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Branding Excellence – The Most Prominent
Driver Of Value For Asian Companies
Contributor -
Martin Roll
A strong brand can simply be characterized by providing a unique brand
promise, and an outstanding brand delivery. When the promise and the
delivery are balanced equally, the brand equity becomes stronger and the
company achieves Branding Excellence. VentureRepublic provides the Branding
Excellence tool (model 1) as a key component in distinguishing between weak
and strong brands and their owners' capabilities of managing their brands
Model 1: Branding Excellence:
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Strong brands have two basic components |
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A. Brand Promise |
B. Brand Delivery |
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Brand Essence
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Brand Identity
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Brand Position
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Attributes, benefits and values
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Organisation and distribution
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Characteristics:
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Brand Promise and Brand Delivery are equally balanced and leveraged
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Uniqueness and differentiation are key drivers
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Consistency across products, markets, organisations and cultures
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Strong brand management systems and processes in place
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Board and top-management are deeply engaged and committed
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Branding Excellence can contribute significant financial value to a
company, but it requires managerial commitment, adequate resources and a
coherent, company-wide brand management program.
Today, businesses and consumers are placing increasing importance on
brands. Brands give us identity, stimulate our senses and enrich our life
experiences. It is a human need to affiliate and surround ourselves with
things we know, trust and aspire to be. Strong brands with unique appeals
championed by passionate leaders are becoming the body and soul of the 21st
century businesses. We believe these strong drivers of business growth are
creating a new type of company with a competitive edge.
Asia is the future global powerhouse driven primarily by China, and this
article examines the importance of branding for Asian companies and how far
they have come at this point of time.
Asia has the platform for building strong brands
Asia is still one of the world's biggest providers of commodities. At the
same time, Asian manufacturers mostly produce for other companies and the
majority of these products are therefore non-branded. In other words, volume
products without personalities, values and distinct faces. The largest part
of the financial value is still captured by the manufacturers' customers
primarily driven by strong marketing and branding programs. What is the
evidence for this? First of all, one should disregard Japan and Korea in
this comparison. They are a different breed and learned to build strong
brands years ago already and have since then mastered this discipline fairly
well. Look at companies like SONY, Toshiba, Toyota, Samsung, LG and Hyundai.
Therefore, there are only a few global brands originating from Asian
companies (excluding Japan and Korea) compared to brands galore within
almost all industries originating from Western companies. The time has come
to change this somewhat historic and outdated trend.
Asia has changed dramatically over the last two decades and now
represents strong product quality, a very well-educated and competent
workforce, powerful financial sources, endless R&D capabilities, a rare
passion for technology & gadgets and a growing infrastructure across the
country. Furthermore, the increasingly changing trade structures, including
the development of free trade agreements throughout the Asian region, or at
least a changing attitude to barriers, and the glooming Chinese powerhouse
are important supplementary factors which positions Asia firmly in the
international arena. India is another forceful power which quickly is
emerging on the scene eager to build brands with international appeal.
Asian companies with international aspirations and forward-looking
shareholders need to move up the value chain through strategic branding. The
brand evolution is taking place in Asia as it took place previously in the
Western world (see model 2 Brand Evolution), but Asian companies are not as
advanced in terms of branding capabilities as their Western counterparts
which is primarily due to the lack of branding talent in the Asian
boardrooms. Most Asian companies are still focusing far too much on product
attributes, but fail to deliver on more emotional aspects of their products
and services.
Model 2: Brand Evolution:
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Involvement and level of knowledge |
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New Asia has finally emerged and Asia needs to take some steps forward
and play a more important role in the global brand battle.
Why leaders must take the lead and be the ultimate brand component of
their corporations to succeed
It needs to be no less than the CEO who embodies the branding efforts and
serves as the company's and thereby the brand's primary advocate and
nurturer. The approach is particularly well suited to companies whose top
executives have a passion and talent for brand strategy, but in tomorrow's
tough environment and in an increasing brand savvy world, all top-executives
must be able to represent and lead the brand. Companies like Sony, Virgin,
Nike, Starbucks, Microsoft, Nokia, Giorgio Armani, Singapore Airlines,
Banyan Tree and Nestle all meet that description.
Tomorrow's CEO must be a brand champion who approves corporate and
product branding strategies, all brand-stretching decisions and monitors the
presentation of the brand worldwide. The CEO is driven by brand metrics and
fully understands the important and distinguishing components of the
company's brand and brand portfolio. This includes a regular brand valuation
in order to represent the board with the latest cost-benefit analysis of the
brand building strategies and budgets needed to implement future strategies
and plans. A strong CEO has credibility and respect not only because of
business talent and organizational power but also because of the depth of
experience, knowledge, and insight on branding.
Singapore Airlines is one of Asia's strongest and most powerful brands,
and their board and management team spend a significant proportion of their
valuable time on strategic branding as they deeply believe the Singapore
Airlines brand and the embedded icon of the Singapore Girl are major drivers
of financial value for the company. Against a struggling international
airline industry in general, Singapore Airlines recently posted huge profits
and their strong and relentless commitment to branding is a well-known part
of this success.
A suggestion from a visionary CEO with branding talent and experience
should get careful consideration in the Asian boardroom, and it is this
particular aspect which makes successful brands different from commodity
companies and service providers.
Asian boardrooms need to hire branding talent
In the next five years, we will face a rapid changing landscape in Asia
where the opportunities for Asian companies to benefit from international
corporate and product branding efforts will be larger than ever before. The
growing emphasis on international branding will move up the boardroom agenda
and branding will become one of the most prominent drivers of value across
Asia Pacific in the next two decades. Our experience with several clients in
the region along with our close ties with top-management teams across
industries have shown that branding is moving up the boardroom agenda.
Businesses with a sustainable business model and with a visionary and
passionate CEO with branding talent will benefit from the rising
opportunities for taking on the global scene. New entrants in the brand game
can learn from others and become stronger. But having the branding know-how
and marketing technology is no longer adequate. The modern Asian company
leader needs to be a complete player who covers all grounds and has the
vision to follow through and improve. Being a marketing wizard is no longer
enough. One also has to be an excellent business leader and brand marketer
with a truly international edge.
Traditionally, new senior executives among the Asian companies are
recruited from within the ranks of the organisations and they tend to come
primarily from technology and/or financial related career backgrounds and
departments. Much fewer are the talents coming along with in-depth and
high-level marketing and branding backgrounds – and with truly international
backgrounds in brand marketing. Therefore, many companies tend to lack
experienced top-leaders who have spent their entire executive careers in
marketing and branding hence bringing with them the important capabilities
and international experience in the branding field. Unfortunately, this
often tends to disfavour brand marketing in the boardroom and a full
understanding of the importance of branding is not present.
VentureRepublic's experience shows that many CEO's and management teams
in Asia still regard brand marketing as a cost on the P&L statement and not
as an investment which should ideally reside on the balance sheet. A quick
look at the stock exchanges in New York, London and Frankfurt shows that the
market values of most companies are much higher than the pure book value –
part of this excess being the brand value. An asset as important as any
other asset which can be traded upon in various matters, sold and used as
collateral for financing purposes.
Therefore, reconsider the management teams in Asia and take on more
highly skilled people with outstanding capabilities and global experience in
branding strategy and execution, and also talent with preferences for rapid
change, new knowledge and best practices.
All these factors illustrated here are no longer a luxury but a necessity
to win a lucrative position in the global branding battle. Asia has all the
opportunities at hand for building next generation's strong and appealing
brands. But the effort needs to start immediately and with the adequate
resources and attitudes in the Asian board room. Asian culture has always
valued the long-term aspects in almost any matter. Let this unique strength
influence the Asian branding efforts in the years to come. |
