Next level of Asian marketing

Chang Dae-ryun is professor of marketing at Yonsei School of Business and currently a visiting professor at Singapore Management University. Martin Roll is a Business & Brand Strategist, and author of Asian Brand Strategy.

By Chang Dae-ryun and Martin Roll

The time has come for more Asian companies to collectively flex their muscle especially in the marketing arena. When we talk about global companies and brands, the “usual suspects” are Coca Cola, Microsoft, Nestle and other household names - in other words, brands from the U.S. and Europe, combined with familiar giants from Japan such as Toyota and Nissan, and the new powerhouses from Korea like Samsung and Hyundai.

We do not, however, refer as much to companies from other Asian countries, even though for many industries this region represents over a half of their markets. China and India, in particular, have more than a billion consumers each, whose purchasing power has increased at incredible rates. But what are the companies or brands from those places? Yes, some people know of Haier, Lenovo, Tata, and Unisys, but still they do not have the brand awareness or the clout that the brands elsewhere can brag about.

Why then is there such an underrepresentation of Asian brands among the global elites? Part of the answer is that this lack of respect has been self-inflicted. Consumers evaluate the value of a product in a subjective and varied way. Companies must therefore communicate the worthiness of its offerings in an integrated and consistent manner. Unfortunately, for many Asian brands, they have focused too much on the technical aspects of the product.

Classic examples of this are Singapore’s Creative and Korea’s iRiver. Both firms preceded Apple’s iPod in the mp3 market. Apple may not have had a technically superior product to these rivals, but its combination of cool designs, cool retail presence, and most importantly, the online iTunes ecosystem ensured greater sustainability of its mp3 brand.

What exacerbated this technical orientation of many Asian companies was the organizational hierarchy, as they were run by executives with finance, accounting, or manufacturing backgrounds. In contrast, marketing personnel were treated like stepchildren and thus they had little say in the major strategic directives of companies.

To develop iconic Asian brands true to their roots and origin, Asian managers, with marketing executives taking charge, will have to become trendsetters to a much larger extent than today. The future perspective for Asian businesses is that, in order to be successful, Asian brands need to capture the spirit of the region, but they also need to lead the way by spreading that spirit.

It is time for Asian boardrooms to have more guts to emphasize what Asia actually has to offer when it comes to brand building.
This new branding philosophy must be steeped in a more acute understanding of old and emerging Asian consumer behavioral patterns. Asia is not a homogenous entity. Even more importantly, Asian countries are more and more traversed by cultural flows permeating the region: cinema, music and fashion trends extend beyond national borders to capture the imagination of millions - the Korea Wave (Hallyu) being a perfect example. Moreover, branding and brands do not operate in a vacuum, but are closely linked to the development of a society, of its people and of its culture.

As such, the identity of a brand is very important. Given this, it would seem very obvious that Asian companies would benefit by maintaining their unique Asian identities when they expand globally. Of course, companies will have to be careful not to generalize this too much. The level to which Asian brands maintain their Asian identities also depends on the type of industry the company belongs to.

In the hospitality industry, Asian players such as The Shangri-La, Banyan Tree Hotels & Resorts and Mandarin Oriental Hotels are brands that have gained immensely by leveraging on the unique Asian service mindset. The same goes for Singapore Airlines which is truly Asian and has successfully become the most admired and profitable airline brand in the world.

Cosmetic brands like Shiseido from Japan, and more recently, Amorepacific from Korea have also attracted consumers all over the world while using Asian brand value propositions and aesthetics. All of these brands demonstrate that “Asian-ness” is not merely a geographic location but a lifestyle concept that now has a global appeal.

On the other hand, consumer electronics is a sector where cutting-edge technology and world-class design are more crucial than the degree of Asian origin and culture of the company. As such, companies such as Sony, Samsung and LG have emphasized the tangible technological dimensions of the brand more than the cultural aspects of being Asian companies. But moving forward, these brands will also have to leverage their Asian origins to instill brand personalities that can truly differentiate them from other global players.

Therefore, companies will have to make a careful examination of the relevance of maintaining the Asian identity of their companies in the context of the industry sector that they are in and then accordingly emphasize its importance.

But the one ingredient, more than any other mentioned above, that engenders strong brands is the mindset of the boardroom and the CEO. Branding is a boardroom discipline and successful brands can be built only when the board, led by the chairman and the CEO, understands, appreciates and commits to treating branding as a strategic discipline and devotes the resources at the company’s disposal to continuously support its brands.

At the same time, shareholders and analysts push companies and boardrooms to deliver on revenue and profit objectives. Therefore, the CEO must ensure that marketing and branding strategies take the center stage and help drive the bottom line.

Asian consumers and Asian managers have for too long not properly valued Asia and its heritage, and they instead tried to emulate everything from the West. Because of its newfound economic might, this Asian inferiority complex is now diminishing. From now on, the challenge for Asia is to be not just buyers but also creators of great global brands.