Brands win favour as spending power grows
China Mobile, QQ messaging and Master Kong instant noodles are favourites among mainland consumers, but brand loyalty is being challenged amid rising affluence.
These are the findings of the inaugural twice-a-year China Brand Index survey conducted by brokerage CLSA that will attempt to follow the market opportunities opening up consumer brands in the world's third-largest economy.
Polling 1,500 urban consumers aged 25 to 45 in 15 mainland cities about their top 100 consumer brands, the majority rated China Mobile the No 1 brand, followed by Tencent QQ messaging services and Master Kong instant noodles.
'Brands are rapidly gaining traction with first-generation consumers and the only barrier appears to be how much money they have to spend,' said CLSA head of consumer research Robert Bruce.
'With middle-class earnings on the increase, the next decade presents an incredible opportunity for manufacturers, retailers and investors in the consumer sector.'
The top 100 brands owned by companies listed in Hong Kong, Taiwan and on the mainland are valued at US$233 billion, or 18 per cent of their combined total market capitalisation, the brokerage said.
China Mobile, for example, is the most valuable brand in China, worth US$70 billion, or 41 per cent of the China Brand Index tracking 30 stocks worth US$170 billion.
However, some of the top names in the food and beverage sector are controversial, including Coca-Cola and China Huiyuan Juice Group, whose merger deal fell through earlier this year after Beijing objected. China Mengniu Dairy's milk and yoghurt, among the dairy brands named in the survey, was involved in the melamine tainting scare last year.
Despite a flood of foreign apparel brands, Li Ning and Anta Sports Products are the best-known domestic sportswear and shoe brands.
The most valuable financial firm is China Life Insurance, followed by China Merchants Bank and Industrial and Commercial Bank of China.
The mainland, with 338 million internet users - more than the entire US population - had search engine Baidu, internet content provider Sina and Ctrip.com as the top choices.
Most of those polled said they would be unlikely to switch brands in skincare and cosmetic products, but the wealthiest of the respondents were also the least loyal and could afford to explore new brands.
