When entering the Chinese market, even very successful fashion companies can encounter serious difficulties. A brand’s name can especially pose problems for the Chinese who can have difficulties in pronouncing the name. Elizabeth Paton has some great tips for ‘hot’ brands to ensure the Chinese consumer is just as enthusiastic about a brand as the rest of the world!
Analysts at Exane BNP Paribas recently came up with a new way of assessing brands – by their ‘temperature’!
In a blog post on the website of the Financial Times, Paton says that in order to judge brands by hotness, the researchers reviewed elements companies cannot control directly. According to Paton, these ‘hot’ or ‘not’ variables are influenced by marketing efforts, and even then only remorely.
Exane BNP Paribas compared the marketing spends of hot and cold brands and the impact of these expenditures on spontaneous global marketing, editorial coverage and the possible improvement of brand recognition by consumers.
After the research, the analysts concluded the following: for ‘heating’ brands, key metrics all improve at the same time. Moreover, if the temperature increases, so will the full price sell-through in wholesale, which can lead to a higher brand profitability and sales development. Consequently, when a brand is ‘cooling,’ the key metrics of the company will all decline simultaneously.
After reading this, Paton wondered what variables could prevent fashion marketers from having success on a certain (new) market.
She believes a brand’s name could be one of the biggest hurdles to take. As an example, she gives the New York brand Altuzarra. This brand is on the rise in China, but Paton says the Chinese have a hard time pronouncing the brand’s name.
Paton has four tips for ‘heating’ brands that want to enter China’s prospering market:
1. Use logos
As logos are universal, Paton says, many brands use them for they marketing in China. Louis Vuitton and Dolce&Gabbana, for example, are both known under their initials in the country. Fame isn’t the only factor that increases sale, however: even though both brands are among the best known brands in China, sales for the companies are decreasing in China. According to Paton, this shows that balancing ubiquity an exclusivity is very difficult.
2. Teach the consumer
Paton believes consumers should be educated on how to pronounce the name of a brand correctly. Western products are often seen as status symbols, and the Chinese consumer doesn’t want to look like a fool when he is shopping in Europe and asks for a certain item. Paton says that European brands could of course hire Mandarin-speaking employers to prevent this, but that selling a bag to a consumer that is hesitant to pronounce the bag’s name is a little more challenging.
3. Change the brand name
Some brands have chosen to alter their name for the Chinese market. Paton says that Unilever and P&G are two good examples, but that there are downsides to doing this. It undermines a brand’s consistency, after all, which is especially problematic for the luxury market in which consumers travel the world to purchase certain items.
4. Transition the brand into a localized alphabet
If a brand converts its name into the Chinese alphabet, the brand must decide whether it wants to translate its name or its meaning. According to Paton, this is a tough choice. Translating the name could result in ‘white noise’ for the consumer, while translating the meaning could lead to a loss of the original brand associations. Many companies go for the first option, Paton says, and educate the consumer later on. She believes this is a very logical decision, as the luxury sector in China has been growing extremely hard in the last 3-5 years.