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How do you Position Premium Brands in China?

By The Silk Initiative

It’s key to remember that commodities can be turned into Chinese luxury products with the right brand positioning. With consumer suspicion of domestic goods still high, food products and raw commodities, such as sweet snacks and milk, that put an emphasis on quality are able to command a premium price on the market in China.

In order to better position their products as luxury items, many companies are relying on clever advertisements and packaging designs to appeal to consumers. Yili Dairy, for example, uses red and gold — colors traditionally associated with wealth and good fortune in China — to bring a grand feel to its products on the shelves and on subway billboards. The milk in Yili’s ads also appears in an elegant carafe and wine glasses, drawing another association with China’s luxury wine market.

This approach is quite common in China. Our research has found, for instance, that many companies use the color gold on their packaging to make their products appear more upmarket and luxurious. The traditional ‘yellow-gold’ that’s popular in China is also morphing into a more sophisticated high-end gold. These golden elements can be found in swirls, ribbons, sparkles and glitter that really light up supermarket shelves. We’re also seeing the likes of matte and tin being used in similar ways in packaging and advertisements to make products stand out as more upmarket and thus of better quality.

Though successful in reaching consumers, this approach has experienced some backlash of late among those who believe Chinese consumers are being bombarded with glistening shelves with little differentiation between products.

Perhaps in light of this, other brands are trying to connect with luxury consumers in another way, by playing up their authenticity. These days, it’s not unusual in high-end supermarkets to see products like coffee or organic food items being displayed in woolen bags or pouches to drive home the idea they came straight from the farm. That said, market giants such as Mondelez still cover their shelves in their trademark blue and white ‘glossy’ style, which consumers recognize immediately. The key here is to know exactly what your brand stands for and how it fits into the Chinese market and then to optimize your packaging accordingly.

Product shots are also more important than ever, with a range of devices being used to add extra dynamism to packaging to make it pop on the shelf. Food packaging in China is bursting with cookie crumbs, splashes of milk, drips of chocolate, as well as all manner of spoons, swirls and steam. Consumers in China are particularly drawn to packaging with excitement and energy.

That said, we’ve learnt it’s also important to remain true to your heritage. Chinese consumers are after the best products and they’ll buy into your brand narrative if you give them a chance. Don’t be shy to use elements such as flags, logos, and other imagery to really spell out where your product originates. The key here when positioning a premium good is to leverage your existing brand equity back home and really bring it to life on a Chinese shelf using semiotics and language that Chinese consumers are looking for and can understand.

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