Asian brands are coming

Just as much as Asians love internal brand names, the region is almost notorious for the lack of home-grown brands. This is going to change argues the Danish branding expert, Martin Roll, in his latest book, which has aroused interest around the world.

Asian companies are behind the curve, but globalisation is forcing them to think strategically about branding, says the branding consultant.
    “His trend will put pressure on Western brands,” he predicts.
    Interestingly Toyota was the only Asian company to crack the top 10 in a global brand survey conducted by Business Week magazine in 2005. Only Honda and Samsung made the top 20 despite Asia having two-thirds of the world’s population and a quarter of its wealth.
    Running his company, Venture Republic, out of Singapore, Roll is taking a special interest in this shortfall. Lately, however, he has mostly been on the road. He spent 200 nights in hotels and travelled over 900.000 kilometres by air during the last year to advice his global client base and provide keynote speaks at leading conferences.
    His intense schedule has been fuelled by interest in his book, Asian Brand Strategy, which examines how Asia builds strong brands. The book is published in English and Korean and is scheduled to be available in Vietnamese within months. At the same time Roll is talking to publishers in China and Japan, and he was recently in Tokyo, where he found time to speak at a meeting organised by the Danish Chamber of Commerce. 
    Japan is interesting, because the country is a trendsetter in Asia for creating brands. The regions biggest economy is famous for names like Sony, Toyota and Shiseido or fashion houses like Issey Miyake. A few years ago Asia’s third biggest economy, South Korea, also started to turn out brands. Roll points to Samsung, which has been able to catch up with Sony in terms of brand equity.
    The Korean electronic giant recently produced and co-marketed a fancy mobile phone together with Bang & Olufsen. A less known brand is the Korean mobile manufacturer, Pantech, which used to be a subcontractor to Motorola. In China Lenovo simply bought IBM’s pc-division to get distribution and soon faded out the American name.
    “North Asia proves that Asians can develop brands. The trend is bound to spread to South East Asia,” predicts Roll, who mentions a few budding examples in his book.
    Banyan Tree Group based in Singapore has developed a string of high-class resorts around the region. Chairman Ho Kwon Ping has focused on high service and tasteful architecture and interior design with a strong focus on preserving the local environment. For instance, all wastewater from his resort is treated and reused.
    Another company with a lot of potential is Jim Thompson Thai Silk Company in Bangkok. An American of the same name united the small silk weavers into a commercial entity. Visiting Cameroon Highlands in Malaysia in 1967 he disappeared without a trace and different reasons have been put forward in numerous media stories. Possibly a former CIA agent he might have had enemies or he was simply eaten by a tiger.
    “These companies have goods stories to tell,” says Roll.
    Due to the relative smaller economies in S.E. Asia there might be a natural emphasis on developing smaller ‘boutique brands’ as the two mentioned above.
    “However, it all depends on the mindset of the board. Are they willing to allocate money to develop a brand,” reflects Roll.
    To illustrate his point Roll mentions Singapore Airlines, which is his absolute favourite airline brand. The airline was established in 1972 after Singapore’s independence from Malaysia. It has focused on quality and technology. Its fleet is continually updated with new aircrafts and the quality of customer service is superb and very consistent. Today the ‘Singapore girl’ is world famous.
    “Interestingly Singapore Airline has no domestic flights, so they were forced to think global,” emphasises Roll.
    More than ever globalisation is forcing South East Asia to develop brands. Many of the big family owned S.E. Asian companies have historically specialised in trading. However, now everybody knows how to subcontract cheaply in developing economies. The margins are squeezed or the middleman is simply overrun.
    From a market point of view the timing is good. Just like everywhere in the world, the Asians will continue to aspire for Western brands. However, Asian people’s confidence and pride in their own cultures has increased dramatically. They now longer fell strange to buy a local brand.
    Roll remembers when he graduated from the business school, INSEAD, in France in 1999.
    “I was the odd man out, because I went for a job in Asia,” smiles Roll and recounts that even all his Asian class mates went for positions in Europe and USA. Asia was not fashionable then.
    “Today people from all over the world come to work in Asia and there is a net inflow of talent,” he points out.
    However, the huge economic development in Asia has made qualified employees scarce.
    “A good brand is an important tool to attract the most talented employees,” says Roll.
    It is no longer only about money. Employees want to know what the company stands for. In this respect the importance of corporate social responsibility will be a very important point, predicts Roll.
    “Ultimately branding is not about advertising. Branding starts in the boardroom,” says Roll.