The influence and power of Chinese brands are on the rise globally, according to a new report which found Lenovo is the world’s most powerful Chinese brand.
The electronics and mobile brand topped the BrandZ Top 50 Chinese Global Brand Builders Report, which provides an insight into the growing influence of Chinese brands within international markets.
Lenovo beat out mobile giant Huawei, e-commerce powerhouse Alibaba, rising mobile company Xiaomi and national airline brand Air China, which made up the top five brands.
The report, which is conducted by WPP and Kantar Millward Brown in collaboration with Google, revealed the significant growth in brand power for Chinese brands, particularly in the consumer electronics, e-commerce and mobile gaming categories.
Electronic and technology brands, such as Huawei, mobile accessories company Anker, drone company DJI and mobile brand Oppo, all experienced significant double-digit increases in brand power in this year’s report.
However, it is not just the online and mobile brands driving growth, China’s more traditional sectors such as banking, airlines and oil industries have also increased, which the report credits to the innovation of China’s Belt and Road initiative.
“Chinese brand builders aren’t just concerned with reaching a wider global audience, they are aiming to change customers’ perceptions too,” said Doreen Wang, global head of BrandZ at Kantar Millward Brown.
“Brands that succeed in China’s formidably competitive marketplace are not just out-gunning the competition in terms of innovation, they are deploying an equally powerful weapon – branding.”
Wang said this growing influence of Chinese brands is helping to change consumers’ ideas about the quality and innovation of products that are made in China.
“The key theme of China’s Belt & Road is moving from ‘Made in China’ to ‘Innovated in China’, so China is encouraging companies to build more high-quality innovative brands. We are seeing among global consumers that the perception of Chinese brands as innovative has improved significantly."
According to Wang, more than 21% of global consumers think Chinese brands are innovative while 14% think they are unique.
“While negative perceptions of some Chinese brands may persist among older generations of consumers, there is a shift in attitude among younger generations. Younger consumers are turning to brands such as Lenovo, Alibaba and JD.com because they are united by their love of cool, affordable products and services, regardless of their country of origin.
“The perception is changing from low quality to innovative and creative. We know brand building is a long-term thing and for these brands to really establish credibility it won’t happen overnight, but we are seeing it move in the right direction.
“China is following the examples of Japan and Korean quite a lot. When you think back to 30 or 40 years ago when Hyundai, Toyota and Samsung initially went global, that is an example of what is happening now with China. All of these brands enter the market at the lower end and they build trust and they gradually move up the value chain and that is exactly what brands such as Huawei and Xiaomi are doing in many markets, especially in the western markets.”
However, despite making significant headway, brand awareness remains a significant challenge with many of China’s biggest brands receiving low rankings. Tencent, the entertainment and gaming giant, ranked 31 on the list despite being one of the world’s most valuable brands, due to its low brand awareness outside of China. Internet giant Baidu and e-commerce giant JD.com ranked 37th and 44th, respectively.
The report highlighted building brand awareness, investing in brand building and marketing activity and improving trust and quality perceptions as the major challenges for Chinese brands looking to expand globally.