Brand innovation in Taiwan

You can't get very far in the blogosphere without running into the concept of brands (the what) and branding (the activities used to build and promote these). There are a zillion different definitions of brand and these are often not very useful -- they tend to define mainly what a brand is rather than what it does. Far better to think of a brand as a dream catalyst: a brand co-creates a dream with us (i.e.,"the consumer"). What's a dream? A dream is a lie that we want to believe -- and, get this, we all dream, despite our bloated delusions of being rational. "Daddy, I want to be an astronaut," doesn't get left behind with childhood.


Here in Taiwan many of the high-profile OEM/ODM firms are having a go at developing their own brands as a way out of the price game and its teeny-weeny margins. Though many firms are attracted to the idea of selling own-branded products, they are finding that moving from OEM/ODM is not as easy as it looks. Many have given up -- retracting back into what they do best: manufacturing complex, mass-produced electronic products in low-wage locations for other firms. Why is the move forward into brands so difficult for these Taiwan-based firms?

- It requires patience. It can take years to get a return on the investment.

- It requires a deep interest in and understanding of country-markets in far away lands.

- It requires an interest in and understanding of other cultures.

- It requires a change in attitude: you can't treat your staff as if they still work in a factory.

- It requires a loyal and commited staff that buy into the brand idea.

- It requires moving directly into the media spotlight -- something many Taiwan-owned businesses prefer not to do.

- A brand requires an authentic story -- not anonymous, behind-the-scenes PR.

- A brand is often linked to a country of origin and this needs to be actively articulated.

- A brand's attractiveness is linked to the attractiveness of that country's culture. Its soft power.

- It requires more than having expensive consulations with "brand consultants" who wouldn't dream of following their own advice.

- It requires moving from servicing 4 or 5 "VIP" customers to delighting hundreds of thousands of customers, who each regard themselves as very important.

- It requires delighting customers post sale: the branding starts AFTER the sale has been made.

Moving from OEM/ODM is a bit like David Beckham waking up one morning and deciding that he wants to become Tiger Woods just because there's more money in it. Fine trick if you can do it but far from easy.

[A great blog on brands is Adliterate.]

Two more innovation types

There are many labels describing the various types of innovation. These tend to take a broad view: Product Innovation and Process Innovation, or narrow view: Channel Innovation, Business Model Innovation, Payment Innovation etc. Here's another two to add to the ever-growing list. These two broad-view types emphasize the firm's attitude to innovation. They also help identify a key driver of innovation activities for each type. [Click to enlarge]



I made the cartoon strip using Stripgenerator.com. You can create some great little cartoon strips with this online tool.

Innovation and entrepreneurship

George Bush, US President, thinks that the reason the French economy is in such bad shape is the fact that the French don't have a word for entrepreneur.

The above joke was used by Carl Schramm, President of the Kauffman Foundation and author of the book Good Capitalism, Bad Capitalism and the Economics of Growth and Prosperity, in this short podcast about the vital role of the entrepreneur in America's and the rest of the world's economy.

Joseph Schumpeter, an economist, wrote extensively about the entrepreneur. He also wrote about the factors that contribute to entrepreneurial behaviour in individuals:

- a desire for personal freedom

- a desire to prove oneself as better than others

- a desire to exercise one's energy and ingenuity (as one Israeli entrepreneur put it: "The real kick is the success not the fruits of success.")

- a desire to form a "transgenerational dynasty" (This suggests that parents are more likely to demonstrate entrepreneurial behaviour)

- a desire to form one's own personal kingdom

- a desire for freedom from the control of others etc.

There's also another one which cannot be ignored:

- no other alternatives (desperation)

America's history of entrepreneurship is bursting with tales of penniless migrants who, through entrepreneurial behaviour, became hugely successful -- and rich.

What is really interesting about the (successful) entrepreneur, though, is the fact that he or she can break out of the social "class" into which he or she was born. There's nothing like free and open markets for a bit of social mobility.