- Many new Chinese brands proactively position their products as domestic premium products, some of them invoking imagery of Chinese history, culture and national identity.
- Combined with sophisticated use of digital marketing and social media as well as increasing quality while keeping lower prices than foreign competitors, new Chinese brands hit the taste especially of younger Chinese consumers.
- The success of the “National Tide” is based on rising cultural self-confidence, pride in the increasing quality of “Made in China”, as well as explicit promotion of national sentiments by government and media. This is combined with increasing disposable income and consumption capacity among China’s growing middle class.
- Nationally oriented consumer behavior means increasing challenges for foreign brands to keep their position on the Chinese market. Localized branding will become highly important for foreign companies, especially in consumer goods, who want to defend their market share in China.
- However: Many of the emerging Chinese brands are still at an early stage, struggling to generate profits given high investments in marketing and sales. Foreign brands thus still have opportunities to find the right strategic responses to the “National Tide”.
Sinolytics is a European consulting and analysis company that focuses entirely on China. It advises European companies on their strategic orientation and concrete business activities in China.