A new brand order is emerging in China. Brands made in China are taking on a new meaning at the global level. It’s the symptom of a crucial change: the achievement of a new stage of maturity where Chinese companies stand for the sophistication of their services as a way to differentiate from their piers.
In just one year, the Chinese Internet service provider Tencent has seen its Brand value increase by a stunning 97%, to become the world’s fastest growing Brand, ahead of Facebook, according to the latest edition of the report BrandZ top 100 Most valuable Global Brands. With a brand value of 280 billion USD, Tencent becomes China’s first Brand and beats the state-owned mobile network operator, China Mobile.
Doreen Wang, head of client solutions at Millward Brown, the consultancy firm behind the annual report, explains that Tencent owes its swift rise to the company’s decision to put the consumer at the heart of its business model, creating products based on the consumer’s habits.
“Tencent is very very focused on innovation, optimizing innovation to the ultimate level. So maybe Tencent’s WeChat is a similar product as Twitter. However, it is providing a much more innovative solution than either Twitter or Facebook”, says Wang.
Internet is the sector that best describes this change. Initially launched similar products than their Western counterparts. The microblogging service Weibo, with 280 million users in China, was baptized as the Chinese clone of Twitter. A label it’s still carrying despite having evolved into a different product. Baidu, with its search services and mobile applications, was nicknamed the Chinese Google; or WeChat (WeiXin) known as the Chinese What’s App developed by Tencent. These companies began their journey by being the Chinese version of something. But they are now offering very different products and innovative services, which are massively welcomed by the eager Chinese netizens.
“When we look at the future, and we are seeing probably next year, the ranking will be experiencing a dramatic change because of Alibaba and JD.com and Jumei and all these big companies’ IPOs. And that probably will change the order significantly”, explains Wang from Millward Brown.
The New York Stock Exchange is the best witness to this rising influence of Chinese Internet brands. By Mid-April, Weibo made its debut on Nasdaq. One month later it was followed by the e-commerce giant Jindong Mall (JD.com), which registered the biggest IPO by a Chinese company, rising 1.8 billion USD. Likewise, within the following weeks, Alibaba, the world’s biggest e-commerce platform (with 800 million registered users) is expected to beat Jindong mall as the company completes the biggest IPO of a Chinese company.
Large Chinese Tech companies are also reaching the Mecca of Silicon Valley. Baidu has recently opened an R&D centre in the U.S. to upgrade its technology and the quality of its services.
“Baidu Research and its labs will bring together top-flight Chinese, American, and global research talent to advance Baidu’s technological leadership,” said Jing Wang, Baidu’s senior vice president, in an official statement.
Andrew Ng, Artificial Intelligence guru and former head of Google Brain, will lead the ambitious project of Baidu and will coordinate the labs of San Francisco and Beijing.
Baidu is not the first Chinese company hunting for talent outside its borders. Last October, Google’s former Vice-President, Hugo Barra, joined the popular Chinese Smartphone manufacturer Xiaomi as the new director of international business development. Such strategic recruits demonstrate the growing competitiveness of Chinese Internet companies and its ability to destabilize the global Brand order.