Asian Mindset Branding Mistakes
The company, Trek 2000 International is hugely successful, with sales of over $75 million last year. The company invented the ThumbDrive. The company, Trek 2000 International is hugely successful, with sales of over $75 million last year. However, two things bugged the CEO of Trek 2000 International. First, few people, even Singaporeans are aware that the ThumbDrive was the brain-child of a Singaporean company. Second, when buying flash drives, people chose those from bigger, more well-known brands over of Trek 2000. This is an excellent example of the power of a brand. When a brand is established, consumers will have more familiarity and trust toward the brand and prefer to buy their products. Similarly, everything else being equal, you would probably prefer to buy something from a place or someone you’re more familiar with compared to the unfamiliar.
But a brand is a lot more than just establishing familiarity. It also offers a lot more benefits for its owner. But this article is not about the virtues of branding. Most SMEs already know branding is important. The question is why don’t we have more successful brands? The Asian Mentality?This branding problem isn’t exclusive to Singapore alone. In general Asia is lagging behind in the branding game compared to our Western counterparts. One of the reasons might our culture and Asian mindset. What Trek 2000 International is experiencing with their brand is similar to what Creative Technology experienced with their MP3 players. They were one of the first to introduce MP3 players to the market. However, most consumers don’t know that and they prefer to buy more established brands.
When Asian SMEs they invent, introduce or start something new and it becomes successful, the revenue usually goes into expanding their production capabilities. The Asian mindset is, “Since this is selling well, I need to increase my production capabilities so I can produce more and sell more”. That mindset might have been useful a few decades ago when production capability was still the name of the game. But things have changed drastically since then. Now, it’s not about production capabilities anymore. It’s about owning mind share or your market’s awareness of your brand. The more mind share you have, the more sales you get, the bigger market share you will have.
In fact, with China and India rising as the production capitals of the world, focusing on production and trying to compete with them is setting yourself up for a tough road ahead. So, take a leaf out of the big brands’ play book. More often than not, they focus on creating stronger brands that will win them more mind share in their market, while they outsource their production or manufacturing to production giants in China or India. By doing so they cut their production costs by outsourcing and reinvest their revenues to branding activities instead.