Lenovo CEO Yang Yuanqing attends a news conference in Sao Paulo (Nacho Doce/Reuters)
Here's a little thought exercise: Think of a Chinese brand. Any Chinese brand. Go on, I'll wait. Give up? Don't feel too bad: According to a recent poll conducted by HD Trade Services, 94 percent of Americans cannot think of a single brand from the world's second-largest economy.
Strange, isn't it? Japan and South Korea, countries China zoomed past in the GDP-rankings, boast globally-respected brands across a variety of industries. Even Sweden and Finland -- mere minnows in comparison to China -- offer IKEA and Nokia, respectively. Given China's incredible transformation into an economic powerhouse over the past three decades, why doesn't the country have more recognizable brands?
Before we tackle that question, it's worth exploring why having globally recognized brands even matter for a country. As David Wolf, managing director of the Global China Practice at Allison + Partners, a PR consultancy, says, "there are two ways to add value to goods and services in a competitive industry. The first is through innovation, and the second is through branding. When you create a brand, you're creating a distinction that people are willing to pay more for than just by its own virtue. That's added value -- and added revenue -- without much additional cost per unit."
Brands, then, benefit a country's economy with no downside. So why is China struggling in this area? The answer lies at the nexus of history, economics, and culture -- with a bit of geography thrown in.
Let's start with geography first. China, as you've no doubt heard, is very, very big. It's the fourth largest country by land mass in the world and has more people than anyone else. As a result, Chinese companies have a large domestic market to play with, and don't always need to attract overseas markets in order to be profitable. In addition to its size, China's economy -- for one that is still somewhat centrally planned -- is actually highly fragmented, with local provinces and municipalities acting almost as independent economic units. Accordingly, across a broad swathe of industries and markets, there are a lot of small-time players in China, making it difficult for one company to amass the scale necessary to invest in global marketing campaigns.
Secondly, in comparison to countries like Japan and South Korea, state-owned enterprises (SOEs) play a dominant role in the Chinese economy, comprising 35 percent of all business activity and reportedly 43 percent of all profits. China's banks loan money to SOEs on favorable terms, allowing these companies to operate inefficiently and still survive. It's no wonder, then, that they have less need for marketing and branding. Wolf relates a common joke among China business observers: "for most SOEs, 'branding' means getting a new logo, 'marketing' means buying ads on China Central Television, and 'P.R.' stands for 'pay the reporter'"
Indeed, Chinese executives across a variety of industries often don't see the point in investing time and money into building their brands. As Scott Markman, the president of the Monogram Group, a brand consultancy, put it, "building a brand is messy, it takes time, it involves soliciting and following advice from outside counsel, and the vast majority of Chinese managers are deeply suspicious of things in which basic proof of effectiveness is difficult to provide," Wolf adds that few Chinese companies treasure innovation, preferring to follow rather than to lead. "The typical approach is to avoid sticking your neck out first; wait till the other guy does it, and see if his head gets chopped off."
In spite of these roadblocks, there's evidence that Chinese brands are beginning to make an impact in foreign markets. Beijing-based computer manufacturer Lenovo, which made a splash in 2004 by purchasing IBM's PC-unit, is a prime example; the appliance manufacturer Haier is another. While these companies have yet to become household names in the United States and elsewhere, they've embraced marketing and brand-awareness to a degree unusual for a Chinese firm. And -- by experiencing financial success -- they could serve as role models for skittish firms unsure how to approach foreign markets.
Chinese brands still have a long way to go, not least in battling the perception that Chinese-made goods are inexpensive and low-quality. But, as Markman points out, Japanese and Korean firms faced the same perception a few generations ago; even Japan's world-class auto industry once produced cars that were considered inferior by American consumers. It's no less unlikely that, in the not-too-distant future, Chinese goods will enjoy a similar surge in appreciation.
They may soon have to. As wages rise, Chinese goods will become more expensive, and companies will find that they can no longer compete solely on price. As a result, branding will necessarily play a larger role than before simply out of necessity; Chinese companies will have to find a way to distinguish their higher-quality goods in a highly competitive marketplace, and building popular brands is the best way to do that.
Achieving these changes will be a challenge. But it shouldn't come as a big surprise if, in 10 years, a few Chinese brands are as familiar to Americans as Samsung, Toyota, and Mitsubishi are today.
It happened gradually—and until the U.S. figures out how to treat the problem, it will only get worse.
It’s 2020, four years from now. The campaign is under way to succeed the president, who is retiring after a single wretched term. Voters are angrier than ever—at politicians, at compromisers, at the establishment. Congress and the White House seem incapable of working together on anything, even when their interests align. With lawmaking at a standstill, the president’s use of executive orders and regulatory discretion has reached a level that Congress views as dictatorial—not that Congress can do anything about it, except file lawsuits that the divided Supreme Court, its three vacancies unfilled, has been unable to resolve.
On Capitol Hill, Speaker Paul Ryan resigned after proving unable to pass a budget, or much else. The House burned through two more speakers and one “acting” speaker, a job invented following four speakerless months. The Senate, meanwhile, is tied in knots by wannabe presidents and aspiring talk-show hosts, who use the chamber as a social-media platform to build their brands by obstructing—well, everything. The Defense Department is among hundreds of agencies that have not been reauthorized, the government has shut down three times, and, yes, it finally happened: The United States briefly defaulted on the national debt, precipitating a market collapse and an economic downturn. No one wanted that outcome, but no one was able to prevent it.
Learning how to bond with my daughter, who found comfort in the familiarity of being alone, has come through understanding reactive attachment disorder.
My hands hover over the computer keyboard. They are trembling. I hold down the shift key and type the words with intention, saying each letter aloud: “R-e-a-c-t-i-v-e A-t-t-a-c-h-m-e-n-t D-i-s-o-r-d-e-r.” The words “reactive attachment disorder” are memory beads I gather into a pile and attempt to string along on a necklace.
I think back to when Judith, my neighbor who is a psychiatrist, offhandedly threw out the term the first time she met Julia. We were talking about babies who start their lives in orphanages, and she mentioned the disorder. She wasn't suggesting that my daughter Julia showed any signs, but she’d said it was a well-known problem with children who’d been adopted from Romanian orphanages in the '80s and '90s. I remember nodding my head and thinking, Shut up, Judith. We got Julia young. It shouldn't be an issue.
Unexpected discoveries in the quest to cure an extraordinary skeletal condition show how medically relevant rare diseases can be.
When Jeannie Peeper was born in 1958, there was only one thing amiss: her big toes were short and crooked. Doctors fitted her with toe braces and sent her home. Two months later, a bulbous swelling appeared on the back of Peeper’s head. Her parents didn’t know why: she hadn’t hit her head on the side of her crib; she didn’t have an infected scratch. After a few days, the swelling vanished as quickly as it had arrived.
When Peeper’s mother noticed that the baby couldn’t open her mouth as wide as her sisters and brothers, she took her to the first of various doctors, seeking an explanation for her seemingly random assortment of symptoms. Peeper was 4 when the Mayo Clinic confirmed a diagnosis: she had a disorder known as fibrodysplasia ossificans progressiva (FOP).
The results of the referendum are, in theory, not legally binding.
Lest we think the Euroskepticism displayed this week by British voters is new, let me present a scene from the BBC’s Yes, Minister, a comedy about the U.K. civil service’s relationship with a minister. The series ran from 1980 to ’84 (and, yes, it was funny), at a time when the European Union was a mere glint in its founders’ eyes.
The Europe being referred to in the scene is the European Economic Community (EEC), an eventually 12-member bloc established in the mid-1950s, to bring about greater economic integration among its members.
In many ways, the seeds of the U.K.’s Thursday referendum on its membership in the European Union were sown soon after the country joined the now-defunct EEC in 1973. Then, as now, the ruling Conservative Party and opposition Labour, along with the rest of the country, were deeply divided over the issue. In the run-up to the general election the following year, Labour promised in its manifesto to put the U.K.’s EEC membership to a public referendum. Labour eventually came to power and Parliament passed the Referendum Act in 1975, fulfilling that campaign promise. The vote was held on June 5, 1975, and the result was what the political establishment had hoped for: an overwhelming 67 percent of voters supported the country’s EEC membership.
The city is riding high after the NBA final. But with the GOP convention looming, residents are bracing for disappointment.
Cleveland’s in a weird mood.
My son and I attended the Indians game on Father’s Day, the afternoon before game seven of the NBA Finals—which, in retrospect, now seems like it should be blockbustered simply as The Afternoon Before—when the Cavaliers would take on the Golden State Warriors and bring the city its first major-league sports championship in 52 years.
I am 52 years old. I’ve lived in Northeast Ohio all my life. I know what Cleveland feels like. And it’s not this.
In the ballpark that day, 25,269 of us sat watching a pitcher’s duel, and the place was palpably subdued. The announcer and digitized big-screen signage made no acknowledgement of the city’s excitement over the Cavaliers. There were no chants of “Let’s Go Cavs,” no special seventh-inning-stretch cheer for the Indians’ basketball brothers, who play next door in the Quicken Loans Arena, which in a few weeks will host the Republican National Convention.
The June 23 vote represents a huge popular rebellion against a future in which British people feel increasingly crowded within—and even crowded out of—their own country.
I said goodnight to a gloomy party of Leave-minded Londoners a few minutes after midnight. The paper ballots were still being counted by hand. Only the British overseas territory of Gibraltar had reported final results. Yet the assumption of a Remain victory filled the room—and depressed my hosts. One important journalist had received a detailed briefing earlier that evening of the results of the government’s exit polling: 57 percent for Remain.
The polling industry will be one victim of the Brexit vote. A few days before the vote, I met with a pollster who had departed from the cheap and dirty methods of his peers to perform a much more costly survey for a major financial firm. His results showed a comfortable margin for Remain. Ten days later, anyone who heeded his expensive advice suffered the biggest percentage losses since the 2008 financial crisis.
Shedding pounds is usually a losing battle—research suggests it’s better to just focus on building a healthy lifestyle.
“My own history of yo-yo dieting started when I was 15 and lasted about three decades,” said Sandra Aamodt, a neuroscientist and the author of Why Diets Make Us Fat, on Saturday at Spotlight Health, a conference co-hosted by the Aspen Institute and The Atlantic. “I lost the same 15 pounds pretty much every year during that same period, and gained it back regular as clockwork.”
This is a classic tale—the diet that doesn’t take, the weight loss that comes right back. The most recent, extreme, highly publicized case was that of the study done on contestants from the reality show The Biggest Loser, most of whom, six years after losing 100 to 200 pounds, had gained most of it back, and had significantly slowed metabolisms.
American society increasingly mistakes intelligence for human worth.
As recently as the 1950s, possessing only middling intelligence was not likely to severely limit your life’s trajectory. IQ wasn’t a big factor in whom you married, where you lived, or what others thought of you. The qualifications for a good job, whether on an assembly line or behind a desk, mostly revolved around integrity, work ethic, and a knack for getting along—bosses didn’t routinely expect college degrees, much less ask to see SAT scores. As one account of the era put it, hiring decisions were “based on a candidate having a critical skill or two and on soft factors such as eagerness, appearance, family background, and physical characteristics.”
The 2010s, in contrast, are a terrible time to not be brainy. Those who consider themselves bright openly mock others for being less so. Even in this age of rampant concern over microaggressions and victimization, we maintain open season on the nonsmart. People who’d swerve off a cliff rather than use a pejorative for race, religion, physical appearance, or disability are all too happy to drop the s‑bomb: Indeed, degrading others for being “stupid” has become nearly automatic in all forms of disagreement.
The Republican candidate is deeply unpopular, and his Democratic rival is promoting her own version of American nationalism.
American commentators have spent the weekend pondering the similarities between Britain’s vote to leave the European Union and America’s impending vote on whether to take leave it of its senses by electing Donald Trump. The similarities have been well-rehearsed: The supporters of Brexit—like the supporters of Trump--are older, non-college educated, non-urban, distrustful of elites, xenophobic, and nostalgic. Moreover, many British commentators discounted polls showing that Brexit might win just as many American commentators, myself very much included, discounted polls showing that Trump might win the Republican nomination. Brexit may even result in the installation this fall of a new British prime minister, Boris Johnson, who is entertaining, self-promoting, vaguely racist, doughy, and orange. It’s all too familiar.