Brand­ing key to boost­ing Tai­wan’s ail­ing econ­omy

The China Post - - COMMENTARY -

The Tai­wan ho­tel in­dus­try is boom­ing; more so than any­where else in the world, and many in the in­dus­try ex­pect the good times to keep rolling for a few years to come. Ac­cord­ing to the Tourism Bureau, Tai­wan reg­is­tered the sec­ond-high­est in­crease in for­eign tourist ar­rivals in the world in the first half of 2014. This strong growth trans­lated into over 9.91 mil­lion vis­i­tors last year, up from slightly more than 8 mil­lion in 2013. The fun­da­men­tals in the tourism sec­tor are in­deed solid. In 2014, Tai­wan’s tourism rev­enues rose to NT$437 bil­lion com­pared with NT$187.1 bil­lion in 2008. Now that Tai­wan has set the goal of wel­com­ing more than 10 mil­lion vis­i­tors this year, it is time for tourism au­thor­i­ties to fo­cus on up­grad­ing the qual­ity of the tourism ex­pe­ri­ence.

Grow­ing de­mand in the face of the soar­ing sup­ply of new five-star ho­tel rooms around the coun­try, how­ever, has set the stage for con­di­tional room rate in­creases and there­fore profit growth. In or­der to in­crease their com­pet­i­tive­ness, luxury ho­tels would be well-ad­vised to in­vest in their brand­ing strat­egy to bet­ter es­tab­lish their prod­ucts and foster brand aware­ness that will grow and ma­ture when the mar­ket­place be­comes sat­u­rated. Brand­ing is es­pe­cially cru­cial for prod­ucts and ser­vices sold in emerg­ing mar­kets be­cause it helps you stand out from your com­peti­tors as well as to po­si­tion your­self as a ref­er­ence “name” in the minds of your prospects and cus­tomers. If you want to cap­ture a more sig­nif­i­cant mar­ket share, such brand aware­ness will also help re­in­force your “brand eq­uity” — the amount of money cus­tomers are will­ing to pay just be­cause it’s your brand — over com­peti­tors. In ad­di­tion to gen­er­at­ing aware­ness and rev­enue, brand eq­uity will fur­ther make your com­pany more valu­able over the long term.

The same is true with most lo­cal man­u­fac­tur­ers who need to de­velop unique Tai­wanese de­sign aes­thetics in or­der to stand against com­peti­tors. Af­ter suc­cess­fully designing for sev­eral in­ter­na­tional brands, sev­eral small and medium-sized en­ter­prises (SMEs) have launched their own brands fea­tur­ing the lo­cal cul­ture, in­clud­ing art, drama, mu­sic and more. Such im­por­tant ini­tia­tives are con­sis­tent with the “Brand­ing Tai­wan” pro­gram of the Bureau of For­eign Trade (BOFT, ) that aims to turn Tai­wanese man­u­fac­tur­ers into brands in their own right, and we must con­tinue to en­cour­age them. Only if such for­ward-think­ing man­u­fac­tur­ing firms con­tinue to de­velop their brands, can Tai­wan’s ail­ing econ­omy fully re­cover and more com­pa­nies fur­ther cap­i­tal­ize on their man­u­fac­tur­ing ex­pe­ri­ence and tech­no­log­i­cal ex­per­tise.

The BOFT’s brand­ing strat­egy has sev­eral im­por­tant ini­tia­tives. The first is to help lo­cal SMEs set up ven­ture cap­i­tal funds for do­mes­tic brands that have mar­ket po­ten­tial but are not yet float­ing on the stock mar­ket. The sec­ond is to cre­ate a fa­vor­able en­vi­ron­ment for brand devel­op­ment, in­clud­ing the open­ing of the Brand­ing Tai­wan’s web­site, which pro­vides in­for­ma­tion on brand­ing and brand devel­op­ment. The BOFT also re­searches brand­ing poli­cies and of­fers loans to man­u­fac­tur­ers who want to ex­pand but have in­suf­fi­cient cap­i­tal to do so. The third mea­sure aims to con­duct brand value sur­veys of Tai­wan’s in­ter­na­tional brands in or­der to pro­vide lo­cal com­pa­nies with an ac­cu­rate and stan­dard­ized ref­er­ence by which to eval­u­ate their own brands and their com­pet­i­tive­ness against other “big names” in the in­dus­try. The fourth mea­sure is to pro­vide brand man­age­ment ed­u­ca­tion by run­ning classes for busi­ness­peo­ple across var­i­ous sec­tors. Last but not least, the BOFT aims to fur­ther raise the in­ter­na­tional im­age of Tai­wanese prod­ucts and brands by en­cour­ag­ing the par­tic­i­pa­tion in the an­nual Tai­wan Ex­cel­lence Awards through which Tai­wan’s brands are rec­og­nized for their re­search and devel­op­ment, de­sign, qual­ity and mar­ket­ing. The BOFT also rep­re­sents Tai­wanese prod­ucts at var­i­ous trade fairs world­wide to this ex­tent. Tai­wanese brands have a promis­ing fu­ture across the Tai­wan Strait, as well as the Euro­pean and North Amer­i­can mar­kets. De­vel­op­ing coun­tries like In­dia and In­done­sia also of­fer Tai­wan two mas­sive mar­kets with very high de­mand for high-tech, high-qual­ity prod­ucts. With the help of suc­cess­ful brand­ing strate­gies, Tai­wan can surely shrug off its rep­u­ta­tion as a sub­con­trac­tor and be­come a world player in its own right.

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