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.]
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.]
Labels: Asian brands, brands in China, definition of innovation, taiwan, Taiwanese brands
posted by Gordon Graham at 8:35 PM
2 Comments:
excellent post! I especially like these two:
"- 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."
I remember how you mentioned the importance of brands, like the ones in Taiwan, to highlight their country of origin. I think Taiwan has a great reputation of making quality electronic goods and hopefully some companies will emerge and harness this "soft power".
Another thing that might cause problems is the ambiguous tag, "Made in Taiwan." In 2007 "Made in Taiwan" usually means "Made in China by Taiwanese Firms." Soft power is even more important for China-based firms: "The Economist" recently cited the following statistic in a recent article on the Asian skills shortage: "A recent report by the Chinese Academy of Social Sciences found that between 1978 and 2006, just over 1m Chinese went to study overseas and some 70% of them did not go back."
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