Market Forces Affect Categories Unevenly
The small 1.6 percent decline in overall brand value for the 2013 BrandZ™ Top 50 Most Valuable Chinese Brands unevenly affected the 15 product categories tracked in the study, with large gainers offsetting some of the categories that declined.
Only three categories rose in overall brand value—technology (+35 percent), baijiu, the traditional Chinese liquor (+19 percent) and beer (+17 percent). Arranging the categories that declined in value according to the size of the decline, they divide like this:
- Decline of 0 percent to 10 percent: insurance, food and dairy, financial institutions, health care, wine and telecom providers.
- Decline of 11 percent to 22 percent: oil and gas, home appliances, apparel and airlines.
- Decline of 30 percent or more: retail and e-commerce, but the financial performance of a limited number of brands drove this steep decline in the generally robust e-commerce category.
Among the many trends that produced these results are the slowdown of China's economic growth; intense competition from both Chinese and international brands; and shifting product preferences in an evolving consumer society.
These general trends were manifested in category-specific ways. The intensity of competition, for example, was particularly evident in retail and e-commerce as shoppers sought deals on electronics both in physical stores and online. Changing product preferences in an evolving consumer society impacted the beer category, as beer drinkers moved to premium, and apparel as consumers expressed desire for less casual, smarter clothing.