Thu, Nov 22, 2001 page18

• Ad guru tells industry to improve global branding

  Ian Batey, founder of Batey Advertising and author of `Asian Branding,' says Taiwan must move beyond its reliance on manufacturing and develop expertise in marketing. Batey sat down with `Taipei Times' staff reporter Annabel Lue to explain why companies must think ahead and develop powerful global brands

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  Taipei Times: You have been in the advertising industry in Asia for several decades. Where is the Asian industry going?

  Ian Batey: Compared with Western countries and Japan, most Asian countries' [brands] are very small. As for Taiwan, it does a huge amount of manufacturing for other international brands and it makes the country's industry invaluable. But why shouldn't Taiwanese manufacturers go to China or India? Taiwan should develop its own brands. The brand owner is the king; the brand owner is the one with the strongest hands. Not only [in] Taiwan but [in] other parts of Asia, we are going to stress this issue and encourage companies to develop powerful global brands.

  

  Ian Batey, founder of Batey Advertising and author of Asian Branding.

  PHOTO: GEORGE TSORNG, TAIPEI TIMES

  Thus, I think the mission of the advertising industry for next 20 years is to have at least 20 powerful Asian brands in the world's top 50 by the year 2020.

  TT: Describe Taiwan's industry and market transformation over the past 50 years?

  Batey: I would like to describe Taiwan as having gone from poorhouse to powerhouse. It means from nowhere -- no one knew of it during World War II -- to becoming one of the world's largest trading economies, ranked between 15th and 18th.

  Clearly in the computer and semiconductor areas Taiwan is doing very well. Everyone knows you are having a tough time at the moment, but don't think in the short term. We have to think five, 10, 20 years ahead.

  Acer is a brand that already has some equity in the world market but let me ask: in the semiconductor area, what strong brands do you have? Nothing. In addition, in the textile and food and beverage industries, Taiwan has no branding at all. Take, for example, the Won Won Group (旺旺). There is a great success story there, but I see no reason why it shouldn't be the greatest food brand in the world.

  TT: Given the economic slowdown, how can a company handle the branding job efficiently?

  Batey: It is a matter of your vision and what you want to be. If you say, "I want to be in the top three brands in the world in a certain category" and that will be your mission in life, that might take you 15 or 20 years. You need to set up some milestones about what you want to achieve along the way. You have to set your strategy, your route map -- and it might take you a year or even two years to map it out. It's like an architectural drawing.

  You will encounter some difficulties like the current slump, and maybe six months or maybe two years later you will come out from it. But with your mission, you will be at the top 20 years later. So, you shouldn't let the short-term situation blur your vision. If you look at the biggest brands in the world, they think much more in terms of mid-term to long-term plans. If you believe in yourself and your mission, you will find ways of handling these problems.

  Confidence is a big thing and I think it's the most important word, especially in the Asian marketing industry in the coming decades.

  TT: As Taiwan enters the WTO, what should local brands do to get involved in the global market?

  Batey: The world has been in some degree stimulated by the force of globalization, and the WTO is opening up the door to free trade. This means Taiwan can get into China or the US more easily.

  But actually, those guys from the West are savvier in marketing and they are going to swamp you, if you let them. If you want, just sit back and let them come in and take over. If you get involved in globalization and free trade, that's the game. It is all there by brands. You have to start accepting the challenge, so that when you say it's a bad time now, you don't have more bad times, because you might be out of business within five years.

  For instance, Taiwan's semiconductor industry. Why can't I refer to it with a brand name such as "Motorola" or something else? However, as a brand owner you should employ more talent and set up manufacturing in India or Africa or whatever place suits you. Just look at the ways used by some of the Western brands, how they do it -- and you take that model and adapt it. Take Coca Cola and Microsoft -- they all have outsourcing and local factories, but the main office is still the one in charge and getting the big bucks.

  TT: How about the competition between Taiwan and China in brand marketing?

  Batey: I believe that within 20 to 25 years China will be the biggest economy in the world, even bigger than the US. India will be the fourth or fifth biggest in the world as well. So in Asia you will see these two extraordinary energies coming out. Taiwan is near them should be inspired and stimulated by them rather than sitting back waiting to collapse. Like in Europe -- Switzerland and Holland still survive very well in this environment. It depends on your creative capabilities in manufacturing, in servicing and in somehow driving the global brand war.

  As you know, any economy is based on the size of the middle-class. It always fuels domestic prosperity and growth and takes things globally. Taiwan has a sizable middle class already but the percentage is much lower in China. However, with China's large population base, the market of people who can afford to buy is still bigger than Taiwan's.

  Therefore, Taiwan should leverage this strength, because it currently has much more expertise than China in terms of marketing and service. All I am saying is that the game is branding and the brand owner is king.

  TT: What industry sectors offer the most potential for Taiwan to develop global brands?

  Batey: Clearly Taiwan has some bases there and information-technology hardware has a very big opportunity. That's natural.

  In other categories, such as textiles, Taiwan has all the infrastructure and manufacturing capability already, but they are just sitting there. Taiwan must take it upon itself to market the brands. They have got to have the courage and confidence to do it. I remember some Taiwanese brands such as a tennis racket called "Kennis" and the "Giant" bike; I don't know what happened to them as they just disappeared.

  As for Acer, I think it has some brand equity already and is quite visionary. To me, when you think of computer hardware providers, Acer is ranked in the top two or three. So, Acer has done a good job of building brand equity.

  TT: In general, what are Taiwan's competitive advantages over other countries in Asia?

  Batey: Taiwan has demonstrated in the last 30 years the transformation from a poor house to powerhouse. Compared with other Asian countries, Taiwan has been far more efficient and far more successful. It is because of the attitude of the Taiwanese -- they have the ability to focus and do a good job.

  However, Taiwan just stays in a manufacturing state. A factory is where you make the products, while a brand is where you take the market. I just want to urge Taiwan to change its mind-set and take the next step to the market.

  The problem is that most Taiwanese companies might say they don't have any experience, but Taiwan has many experienced people in, for instance, the communication services industry. They all work domestically but now they have to go out and compete with other nations. They have to go through the learning curve. But today, because of technology and faster communication tools, it's quite easy to connect domestic experience to the world.
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