Global Brands in China: Changing Consumer-Brand Relationships (Abstract)

Chinese consumers, as consumers elsewhere, use brands to help define their social identity. To the rising middle class, international brands are not only an indication of quality products but they are also status symbols and an indication of the users’ sophistication. This special brand-consumer relationship has an unexpected negative impact on the general public. Regardless of the quality and appeal of the brand, members of the public who do not like the current brand users would allow their emotions and prejudices to affect their brand perceptions, thus resulting in antibrand sentiments. This concept of disidentification, or brand-hate by an out-group (non-customers), has been documented with empirical evidence (Karlsson and Rodrigues 2015).

In China, the disidentification consumer-brand relationship is most evident in global luxury brands. Although the nouveau-riche or tuhao accounts for just about 30% of luxury users, their outrageous attitudes and showing-off behaviors have spread to affect the perceptions of specific luxury brands (e.g., Louis Vuitton) and the general public’s attitude towards these brands. Further, some of these brands are ridiculed by netizens, who create “ads” for these brands that are widely viralled and joked at. Although the people who dislike these specific luxury brands are nonconsumers of the brands, their perceptions and impacts cannot be ignored to ensure the brands’ long-term viability in this market.

For many fast-moving consumer goods (FMCG), the niche strategy that was originally adopted to enter China many years earlier is no longer effective. Instead, a localization strategy is adopted to appeal to the growing middle class. This strategy when adopted consistently can be so successful that for selected brands such as Olay, even Chinese consumers who prefer to buy local would continue to buy these brands as they thought they were local brands. Thus, global brands are faced with a double-edged sword in China. They could appeal even more strongly to the niche market and strengthen their bond with this segment or they could localize and broaden their appeal to include the growing middle class. Implications on global brands’ communication strategy were discussed.