Daniel Drezner has a post up about the troubles that the Chinese brand name is facing at present. (Dan is thinking about China this week) From tires that kill you to dog food that kills your dog, China is getting in the news a lot as the source of lots of shoddy dangerous crap. Drezner suggest that it is a bit odd that China is not moving up the ladder of quality in the same way S. Korea and Japan did, but I am not sure this is so odd.
The image of a China “brand” is of course a metaphor, and in some respects a bad one. China is bigger even than Microsoft and “brand management” is pretty much impossible. Actually, China is really big. One of my professors used to be fond of pointing out that China is big, meaning not just that China is big, but that it is so big that thinking about it creates problems that thinking about, say, France or Canada does not. I was in Taiwan in the late 80’s when the Taiwanese government rolled out the “It’s Made Well in Taiwan” campaign, aimed at changing Taiwan’s image as a producer of cheap crap and also as a haven for patent pirates. This campaign was strongly supported by the Taiwanese corporate elite in part because they wanted to start selling more high-margin goods and also because they had found out that getting a reputation for piracy made foreign firms reluctant to license their really good technology. As the Taiwanese economy was dominated by firms with a fairly common set of interests at this point it was easy to convince them that this campaign was worth supporting. China is different. China has both low-wage companies that make things like bricks and does high-end manufacturing like I-pods. Thus there are producers with very different interests in China, and it is hard to see how Beijing could identify one as “the” China and push it. Of course getting Americans to keep -two- ideas of China in their heads at the same time would be even harder. I feel sorry for China’s brand managers.
I don’t think it’s the fact that there’s low-end goods in the mix. Bricks can be made poorly or they can be made well. Ipods can be made poorly, too: I’ve been told that the electronics which are sold to and by Wal-mart are often second-quality, which is how the manufacturers meet the price pressures while still selling better quality stuff where the margin is worth it.