China: Dancing with the Red Dragon

Understanding not just the immediate business, but also the external environment, cultural values and the corresponding consumption context are crucial preconditions for successful marketing and brand development. China has already broken many records: The country has become the leading car market, the biggest steel exporter and the undisputed top supplier of manufactured goods. “Socialism with Chinese characteristics” has transformed the country into the world’s factory and it has given China access to the top ranks of almost every global survey. In addition, China now possesses not only the world’s largest internet population but also the largest mobile phone market, luxury market and it is on its way to become a major force in global R&D. What is important for international brand advertisers is that China is now even the largest English-speaking nation in the World. In this chapter, the major development phases starting from the de-collectivization in the early 1980s are introduced. Today, China is in the middle of the “third wave” of its development where business is about the latest innovations, brand building and connecting with consumers. For China, this means a fundamental shift away from being the cheap assembly line for everybody else’s brands to becoming a creator and marketer of its own. This also implies a “re-branding” of China itself, from cheap manufacturer to innovator. The rise of Chinese champion brands like Lenovo, Huawei, Haier, Alibaba, Baidu, Tencent’s WeChat or mobile phone maker Xiaomi provide ample proof of that. In an environment of rapid transition, traditional values collide with more individualist and career orientated values which creates manifold opportunities for corporations that have built capabilities to understand and utilize such insights.