A Study of Cultural Barriers in Establishing Brand Names in China

736 Words Mar 17th, 2008 3 Pages
A Study of Cultural Barriers in Establishing Brand Names in China

The interest on cross-cultural marketing is becoming increasingly important due to global trade, with a growing focus on the Chinese market. The purpose of the study was to report the problems and issues encountered by a large Australian beer company trying to sell a product in China. The study examines brand establishment, loyalty and longevity in a different cultural setting. It also identifies marketing differences between the Australian and Chinese cultures. Identifying some of these trends may assist other multinational companies to establish and sustain products in a foreign market, particularly in China.

Foster is the largest beverage multinational company in
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In the past, Chinese consumers were unable to choose products that they wanted or needed. It was the choice of the government to decide which products were offered to the public based on economic strategy. Therefore, when international merchandise became available, personal experience did not play a role in making a decision. The main goal for the marketing group was then to educate the consumers in order to establish the brand name and loyalty. The development of the brand name helps to create product association and identity. It is difficult to achieve brand name and loyalty without understanding the cultural differences.

A brand is a name or symbol that identifies the product of the seller and differentiates them from their competitors. Foreign brands previously had an advantage in penetrating the Chinese market because they represent modern merchandise and a status of being in touch with modern trends. This advantage is normally the opposite when companies try to market into a new culture. Nevertheless, they must create the brand image quickly in the minds of the consumers to remain successful. Additionally, it is increasingly difficult to sustain a brand image in today’s China, and a growing number of international brands makes it even more difficult. Foster beer must also compete against local Chinese breweries that sell their product cheaper than bottled water.

Brand preference among Chinese consumers is different than those of Australian cultures.

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