Powerhouse Chinese brands lacking in simplicity: Survey

China's most ubiquitous brands, such as WeChat, Alipay and Taobao, fare relatively poorly on a list of the Chinese brands that communicate with the most consistency and clarity. The Global Brand Simplicity Index, released by brand strategy firm Siegel+Gale, puts China's internet giants well behind the top brands (Hilton, 7-11 and RT-Mart), all of which are bricks-and-mortar based. In fact, Alipay, WeChat and Taobao appear in spots 18, 20 and 55, respectively, and have slid further down in the latest ranking as compared with a year earlier.

The reason, according to Johnson Gu, general manager and ECD of Siegel+Gale's Shanghai office, lies in the failure of these brands to execute a consistent message across different touchpoints. The brand scores are based on the simplicity of products and services, consistency in brand experience and communications, as well as the alignment of perceptions between users and non-users.

"When there are conflicting messages, consumers don't know what's real and what's not," Gu said. "They prefer a more straightforward answer, instead of being led in a roundabout way."

Citing a recent example, he referred to a joint campaign from Alipay and 16 other asset-management companies that went viral late last month, thanks to a derisive message that insinuated people only have themselves to blame if they are poor (#年纪越大, 越没有人会原谅你的穷#). Consumers were confused when Ant Financial, the Alibaba affiliate and operator of the mobile payment service, issued a hasty denial of responsibility for the message, followed by a subsequent acknowledgement, he said. 

The online research was carried out in July last year, with a sample of 1,751 respondents in China. The global rankings and country-specifc rankings for China, UK, US, Japan, India, Sweden, Germany and the Middle East were released earlier this year, while the China results were released again locally in August.

Gu pointed out that Alipay has room for improvement in its cluttered messaging and complicated functions, which led to its 10-spot fall compared to the previous year. Alipay and WeChat Pay have a duopoly on the Chinese mobile-payment market, with a 54 percent and 37 percent market share respectively, according to Beijing-based marketing consultancy Analysys International.

Top 10 brands on the Simplicity Index for China.

Speaking on another brand blunder that occured after the survey period, Gu cited Samsung's handling of the Note 7 debacle in China, which initially wasn't included in the device recall. "By having a different response in China compared to other international markets, Samsung caused doubts among Chinese consumers, leaving them to wonder whether the brand was going to help at all," said Gu. The South Korean electronics giant fell 43 spots to 70th place on the rankings.

Consistency reigns

In contrasts, highly ranked brands such as Hilton and Vivo fared significantly better, rising 78 and 72 spots, respectively. 

"Hilton has managed to maintain its excellent service standards in China, something that many international hotel chains fail to do," said Gu. "Consumers find that the chain of communication with the brand is easy and reassuring, whether they are making reservations with the hotel directly or through third-party booking sites." Gu added that the proliferation of third-party sites, especially in the travel sector, presents an issue for brands.

Meanwhile, brands should be incentivised to cut the clutter, since 85 percent of Chinese consumers surveyed said they are willing to pay more for a simpler experience, compared to the global average of 64 percent.

"Vivo has done surprisingly well considering that the brand hadn't made any strong impressions until last year when it went full throttle with its camera and music functions on its integrated campaigns," said Gu. "From its brand ambassador Eddie Peng to its active sponsorhip of sports and entertainment, Vivo presents a very clear and consistent narrative of what its brand is. It makes it easier for consumers to find their connection with the brand." According to the IDC Quarterly Mobile Phone Tracker report, Vivo's market share in Q4 2016 grew 96.4 percent year-over-year in China, while its sister brand Oppo grew 109.2 percent during the same period.

The top 10 brands on the global Brand Simplicity index.

Electronics-centric

Due to the high smartphone penetration rate, Gu said Chinese consumers are particularly demanding of their experience from several sectors, including electronics and internet brands, both of which ranked highly on the industrial rankings that were released along with the simplicity scores.

On the other hand, health and general insurance, which are dominated by local brands, occupied the bottom two spots on the industrial rankings. The calculation of the industry score was based on the industry's overall contribution in simplifying the life experience of consumers as well as its typical communication style. All is not lost for brands that fared poorly on the rankings, Gu said. "When you are doing badly, it also means that there are more opportunities to grow and evolve," he said. "But if you are doing well, it is very hard to have a breakthrough."