Mon, Dec 27, 2004 - Page 11 News List

BenQ Corp thrives on its brand name

BEATING THE BLUES BenQ Corp started building a brand to beat a free-fall in gross margins and in just a few years emerged as an up-and-coming name locally and abroad

By Lisa Wang  /  STAFF REPORTER

Looking at BenQ's bottom line, analysts note that half of an estimated NT$8.23 billion in earnings come from its liquid-crystal-display (LCD) affiliate AU Optronics Corp (友達光電) rather than the core business.

Heavy marketing expenditure, which is seen as the norm for companies to boost brand awareness, is also a concern.

"BenQ skimps on brand marketing. But we also fear that drastic increases in spending could be a burden," said Vincent Chen (陳豊丰), an analyst with CLSA Ltd in Taipei.

BenQ has in the past years spent about 6 percent of its total annual sales to market branded electronics, according to BenQ's Yu. The percentage is well below the 10 percent Samsung spends every year.

"Running a brand is a long-term effort. It is hard to judge now whether BenQ will succeed, but BenQ has already caught the world's attention," Chen said.

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