Chinese firms find new path toward overseas growth
- By Kunal Sinha
0 Comment(s)
Print
E-mail Shanghai Daily, April 14, 2016
|
|
|
OnePlus launches new Hydrogen OS based on Android 6.0 in Beijing on April 7, 2016. [Liu Zheng/chinadaily.com.cn] |
As China transitions toward becoming a market economy, it is being propelled by the twin engines of innovation and branding. In the recently released WPP BrandZ report on the 100 most valuable Chinese brands, market-driven brands — those owned by entrepreneurial firms — contributed to more than half of the total value of the top 100.
It was found that innovative and unique brands grew eight times faster that their competitors — 29 percent for the most innovative versus three percent for the least innovative. McKinsey has estimated that the innovation opportunities could contribute between 6.5 and 13 trillion yuan (US$1-2 trillion) per year to the Chinese economy by 2025, or roughly 24 percent of total GDP growth.
The exact same business drivers will spur demand for China's value-added products overseas as well.
Manufacturers of household appliances such as TVs and refrigerators dominated the first wave of customer-focused innovation at Chinese companies. What was then a trickle is now turning into a flood, particularly in emerging markets where the value-for-money dimension provides the innovativeness of Chinese products an undeniable edge.
It is in markets such as India, Indonesia and Africa where Chinese brands are marching ahead. In India, Chinese smartphone brands such as Xiaomi, Gionee, Oppo, Lenovo, Huawei, LeEco and Vivo have captured 22 percent of the market, up from 12 percent a year ago, while non-Chinese foreign brands including Apple and Samsung saw their shares decline from 44 percent to 37 percent. WeChat is rapidly gaining ground — with 39 percent of the Asia Pacific region's Internet users using the app, and drawing users away from formidable Facebook.
How have these brands been able to capture the hearts and minds of consumers so quickly? It has been through customer-focused innovation and smart branding.
Go to Forum >>0 Comment(s)