It is quite clear that this is going to be Asia's century. The opening of China, the rise of India and the resurgence of Asia make the region the most vibrant business playing ground in the world. There is a slow but steady shift in the Asian business mindset. Gone are the days when low cost and manufacturing prowess alone served as the only competitive advantages for the Asian companies. The Asian corporations must realize the importance of moving up the value chain.

One of the main ways to achieve that would be to create strong brands. This will not only serve as the main competitive advantage for these companies, but also enhance shareholder value in the medium and long-term. This is easier said than done, given the dominant Asian business mindset of trading and sales.

A substantial part of shareholder value of successful companies derives from their ability to successfully manage and leverage their most important intangible assets: their brands' equity. In turn, Asian companies will have to realize that branding must be led by the boardroom and corporate management. It is too important to be left to the marketing function alone. Brand management is a dynamic and continuous process which requires attention and involvement from the senior leadership. This requires the marketing function to be presented at boardroom and corporate management level.

Contrary to common perceptions in Asia, branding is much more than advertising and marketing communications alone. Nice company logos or modern design identities are not key ingredients for branding - only a tactical face to it. Instead, successful branding is strategic, involves all functions and aspects of a company and must be deeply embedded throughout the entire organization aligned around multiple touch points. This ensures a successful balance between brand promise and brand delivery.

In the future, this requires the Asian marketing function to become more cross-functional, to manage and measure their results through multiple marketing metrics, and work in teams to play an important part of brand building.

As more and more global and local companies enter the market in all possible categories, there will be an intense competition and an over-capacity in the market place. This will exert immense pressure on companies to resort to price wars to capture the market on a short-term basis. But Asian boardrooms need to take a strategic look and balance between short- and long-term financial performances. Corporations need to look beyond quarterly results, monthly sales figures and factory turnovers. This will be highly valued by shareholders and financial markets.

Financial resources spent on brand management must be treated as an investment rather than an expense. Boardrooms need to invest in sustainable intangible assets through branding strategies to survive, sustain and grow in the market.

As more Asian countries open their doors to global companies and attract foreign investments, building strong brands becomes not only an important strategy but also a matter of survival for many Asian companies. In the changing market dynamics, being a domestic market leader does not guarantee long-term success as global players entering the domestic markets, can easily challenge the local players with their business might.

A McKinsey study shows that the top ten Asian value creators derive more than 50% of their revenues on an average from outside their home markets. A case in point is India's software giant Wipro Technologies deriving more than 80% of its revenues from non-Indian customers.

Many global brands have established strong relations with local partners, invested heavily to build robust distribution networks, worked in tandem with the local authorities to establish a good working rapport and recruited local people to gain the crucial local "Asian" knowledge. As this levels the ground for local and global brands in terms of local market and customer knowledge, Asian companies will increasingly come under pressure to defend their traditional comparative advantage. This in turn again stresses the need for local Asian companies to invest in building resonating brands with compelling stories if they were to compete with global brands and survive in the market place.

Asian brands like Singapore Airlines, Banyan Tree Hotels & Resorts, HSBC, Samsung and Shiseido have demonstrated that it is possible for Asian companies to build brands on par with those of Western countries. They have also proved the fact that a strong brand will enable companies to sustain through difficult times and sustain their financial robustness.

A branding drive in Asia is progressively emerging and will change the global landscape in the next decades if taken seriously by Asian boardrooms and if managed properly throughout the entire organization.

As the management professor Peter Drucker once said: "Whenever you see a successful business, someone once made a courageous decision".

Asian cultures have always valued the long term aspects in almost any aspect of life. Let this unique strength influence the Asian branding efforts in the years to come. It is up to the Asian boardrooms to take courageous decisions.

Asian Brand Strategy will be published in Mandarin by CEIBS Publishing in July 2009. Professor Philip Kotler has written the foreword to the Chinese version.

The Wall Street Journey Asia has ranked the Top 10 brands in the Philippines:

1. Jollibee Foods
2. Ayala Corporation
3. Ayala Land
4. San Miguel
5. Bank of the Philippines Islands
6. Globe Telcom
7. Banco de Oro Unibank
8. Philippines Long Distance Telephones
9. SM Prime Holdings
10. Metrobank

Source: The Wall Street Journal Asia, June 2009

From an early start in 1992, Banyan Tree Hotels & Resorts has grown into one of Asia's most successful hospitality brands with numerous international awards and accolades from publications like the prestigious Conde Nast Traveler and others.

Banyan Tree is one of the youngest chains of up-market and privately-held luxury boutique hotels and resorts. By successfully blending its environmental concern with the unique Asian traditions and heritage and the concept of individual luxury villas offering an intimate experience, Banyan Tree has emerged as one of the leaders in the hospitality industry.

Branding has been part of the strategy from the early start, and was born out of a necessity to differentiate a traditional overseas Chinese family business. Banyan Tree wanted to escape being overrun by cheaper competitors from Indonesia and China on the one hand, and to take the focus away from tough pricing on the other.

These have been the typical challenges for many Asian businesses trying to compete in the new environment and building competitive advantages. It proved to be a successful way of breaking away from an Asian commodity business and changed the focus onto higher value-added revenues.

Banyan Tree is founded by Singapore-based Ho Kwon Ping, who named the brand name after a place in Hong Kong where he and his wife spent idyllic days when he was a reporter and editor for an Asian magazine. In 1994, the couple opened the first Banyan Tree resort in Phuket, Thailand.

Given the inevitable turmoil of the volatile hospitality industry, Ho Kwon Ping was convinced from the beginning that a strong focus on branding would give Banyan Tree a sustainable competitive advantage. This was proved right as Banyan Tree withstood the repeated crises of 1997/98, the events of September 11 and the Iraq War.

During the SARS outbreak in Asia in 2003, the company still emerged profitable by achieving average occupancy rates of 65-67%.

The company has based its brand on the two main beliefs of the organization. Banyan Tree resorts would become a 2romantic escape for couples" and Banyan Tree would be an environmentally sensitive and a socially responsible organization.

Branding has started right from the locations of the Banyan Tree resorts and has been consistent through the designs, the facilities offered, and the ambience created in each of the resorts. The resorts offer a unique experience for the visitors by providing them a luxury holiday complete with self-indulging and pampering experiences like the Banyan Tree Spas which offer traditional treatments and fresh ingredients.

The company operates a training academy in Phuket in Thailand where all spa therapists must go through the compulsory 400 hours of training, which is above the industry standard.

Concern for the nature and environment surrounding the resorts has been a trademark of Banyan Tree. Many environmentalists appreciate their efforts to nurture and protect the surroundings of their resorts. True to its belief that environmentally sustainable and socially responsible tourism is compatible with making profits, Banyan Tree has established the Green Imperative Fund to extend financial assistance to environment conservation and community projects.

Brand Communications
Banyan Tree initially resorted to advertising to build awareness in the market, but the advertising budget was soon cut to save costs. In fact, the overall marketing budget of Banyan Tree has been 7% of the total revenue, with 60% allocated for trade and 40% allocated for consumer promotions. The entire brand communications strategy has been based on third party endorsements, word-of-mouth and public relations.

Editorial coverage combined with word-of-mouth recommendations from customers and co-branding activities with strategic partners have since the launch of the company served as the major channels for brand communications. The media coverage has helped build the brand's international awareness and credibility.

The strong belief in branding by Banyan Tree's corporate management has started to pay off, and the Banyan Tree brand equity has enabled new revenue streams for the organization. It has enabled Banyan Tree to come out with a brand extension in the form of Angsana Resorts (launched in 2000), targeted towards young families and at different price points - typically 20-30% lower than Banyan Tree resorts themselves. It also operates stand-alone Angsana Spas.

The latest line extension has been Colours of Angsana, a sister chain of resorts under the Angsana brand, which opened in 2003. The hotels are launched in more remote areas of the world including UNESCO's World Heritage sites.

These measures not only allow Banyan Tree to increase its awareness in new markets and gain international momentum, but also create a strong platform for a portfolio of sub-brands that can be a source of long-term revenue generation.

The future strategy of the Banyan Tree Company is described as "to string a necklace of resorts around the world. It’s not about being everywhere, but having a presence in chosen places. It is not about quantity but building quality jewels that form a chain".

The future challenges
Distinctively Asian versus developing a global image: With plans of expanding beyond Asia, Banyan Tree faces the typical dilemma of any Asian brand to find a balance between being distinctively Asian and developing a more globally-oriented image.

Consequences of brand extensions: This is a challenge which goes to the very foundation of the company - management of the brand and allocation of resources. Though Angsana has a lower price point and is targeted primarily towards family guests, these resorts still have much of the typical Banyan Tree feel. The challenge is to balance two distinct brands and differentiate them without diluting the leading brand Banyan Tree.

Keep innovating and avoid copycats: The market is crowded with many entrants running similar branded resorts in the upper-end. Particularly in Asia Pacific, where Banyan Tree has its stronghold and traditional base, new entrants are facing only small barriers-of-entry other than huge capital requirements and availability of good locations.

Fiji Water is one of the newer examples which testify that competent branding can elevate even the simplest commodity to a celebrity status. In a category dominated by France's Evian, Coca Cola's Dasani and Pepsi Co's Aquafina, Fiji Water has come to occupy the fourth place within the short span of 10 years and has grown its sales rapidly.

By following non-traditional methods of marketing, a very distinct positioning, and a high end pricing level against competitors, Fiji Water has been able to establish strong brand equity amongst the top tier market segment including celebrities, Hollywood stars and the best restaurants of New York and California.

Fiji's Background
Fiji Water, the company that owns the Fiji Water brand, was founded in 1988 in Basalt, Colorado by Gilmour, a businessman with interests in hotels, real estate and gold mining.

The Fiji Water brand came into life in the early 1990s when David Gilmour secured a 99 year deal with the Fijian government to tap the aquifer discovered by government contracted geologists and market the water under the Fiji Water brand name. Fiji Water has extensively made use of product placements in leading Hollywood movies, high profile events and exclusive restaurants to include the brand in the elite community.

Branding Philosophy
One may say all water tastes the same. This means branding in this category is not product focused, but story focused. The company, which tells a better story and backs it up with credible facts, thereby creating an exciting myth, wins the day. Fiji Water seems to have understood this underlying truth extremely well. The Fiji Water brand is built on three pillars: creating an exciting myth, precision marketing (including personal relationships and product placements) and a controlled distribution strategy.

As the physical attributes of the product cannot be differentiated in itself, Fiji Water has resorted to creating a very powerful story around the product coming from a 332-island nation in the South Pacific. This physical inaccessibility has provided Fiji Water to create the story of this water being extracted from a virgin ecosystem far from acid rain, herbicides, pesticides and other pollutants, and that is filtered naturally for years through layers of silica, basalt and sandstone, as is communicated through its packaging.

This story provided customers with something unique to sit up and take notice of. The story was backed by the credible fact, that Fiji is an unexploited land full of tropical forest surrounded by coral reefs, unpolluted by the modern world’s necessary evils and was protected by nature as it were. This created a very strong myth about the brand amongst the customers.

The myth creation was backed by precision brand marketing. Fiji Water did not resort to the usual mass media advertising for its product launch. It formulated a two-pronged strategy:

1. Building personal relationships with the chefs of leading restaurants, resorts and spas to promote the buy-in of the brand
2. Placing the product in leading Hollywood movies and other high-profile events to attract attention and to create buzz

Gilmour used his contacts in the hotel industry to pitch his product to the top-end hotels, resorts and restaurants. By coming out with an award-winning slippery silver bottle design, Fiji water has been able to replace Evian in many of the top-end restaurants.

Fiji Water has resorted to product placement as a major channel of promotion and brand building. By hiring Creative Entertainment Services, a Hollywood marketing consulting firm, Fiji has been able to fit in Fiji Water bottles in scripts of many major Hollywood movies. Fiji Water has also sponsored many local events such as golf tournaments, sailing regattas, and musical events.

Another important aspect of Fiji Water's branding philosophy has been its controlled distribution strategy. In line with its positioning of a high-end product, Fiji Water has ensured that it is available at the best hotels, resorts and spas used by the leading stars and managed to get chef's recommendations.

Future Challenges
The biggest challenge for Fiji Water going ahead would be to sustain this level of interest in its brand. The problem of basing the brand heavily on such a myth is that it does not create any barriers for any new entrants to come up with some other equally exciting myth.

Given the low level of involvement of customers in selecting water, customers would be willing to try out newer and more exciting brands as and when they come up. In this regard, Fiji Water should focus on formulating a strong customer loyalty and retention drive in the light of impending competition.

Though Fiji Water has managed to get Forbes include it in a list of things "worth every penny", it would indeed require much more than a strong story to carry it through in the future.

The Chief Marketing Officer (CMO) has become one of the more commonly talked about corporate designations in recent years. Given the tremendous marketing potential offered by the new media and proliferation of distribution channels, companies have begun to realize the huge potential of marketing in guiding corporate level strategies and substantially contributing to the financial bottom line.

In spite of such an understanding, it is startling to note that the average tenure of a CMO is merely 23 months compared to a CFO that typical lasts 4-5 years on average. Further, not many companies have a senior marketing representative in their C-suite. This begs the question - do companies need a CMO or is the role of a CMO a mere hype?

As the business landscape evolves, marketing also evolves into an organization wide strategic discipline. Given marketer's knowledge of the customers, it is imperative that the CEO and the corporate board have a representative of the customer to continually educate them. Additionally, companies need a strategic CMO to benefit from:

Align marketing with the corporate business strategy
Newer technology, powerful channel partners, and empowered customers have made the competition highly intense and marketing a very involved and strategic discipline. Marketing can no longer be confined to the 4P framework. Marketers, with their in-depth knowledge about markets and customers, should act as a major resource for strategy formulation.

In all issues of corporate strategy - what markets to compete in, what segments to target, what entry mode and strategy to adopt, which partners to strategically ally with - marketing offers substantial information. In order to convey these holistic perspectives, it is imperative the marketing is represented by the CMO in the corporate boardroom who can speak to the directors and the CEO in their language.

A classic example is of the iPhone from Apple. Given the tremendously successful iPod and iMac, Apple could have become complacent. But the marketing acumen of the executives recognized the need to constantly excite the customers. Further, they built their growth strategies on satisfying the unmet needs of the customers. Marketing played a crucial role in guiding Apple's corporate strategy.

Connect the corporate boardroom with the customer
As Peter Drucker said, the only two functions of any organization are innovation and marketing. Irrespective how innovative a company is, how committed the employees are, and competent the top management is, unless the company connects with the customer, success will be elusive. The top management should constantly evaluate their strategic decision in the context of customer feedback - what do the customers' value and how can the customers help the company in co-creating value.

CMO plays a crucial role in constantly updating the boardroom and the CEO about latest customer preference, how well the corporate resources are aligned to meet hose evolving customer needs. Companies such as Levis Strauss, Sony, Toyota, Nike and Singapore Airlines are some of the pioneering companies that manage to constantly feel the pulse of their customers. As such, the marketing takes a central role in guiding the corporate strategy by having the top management team and the CEO regularly updated about customers and markets.

Create a customer centric organization
Given the innumerable choices that customers have, ensuring long term customer loyalty and sustainable competitive advantage becomes highly challenging. The difference between the successful companies that achieve those objectives and those who fail is the corporate orientation. Customer oriented companies design and operate every aspect of the company with the customer in mind.

To build a customer centric organization requires a highly concerted effort of all functions within a company along with every employee becoming a customer champion. These issues deal with organizational culture, organizational structure and corporate policies. The CMO can influence the boardroom and the CEO to implement measures that would allow to build a customer centric organization.

Banyan Tree Hotels and Resorts is a classic example that showcases such a customer centric philosophy. The founder has managed to instill a culture that allows constant interaction between marketing and other functions with the company. Such an emphasis has resulted in world class resorts that always manage to delight the customers.

It is evident that CMOs are strategic requirements of any corporate boardroom. But in spite of such a significant role played by the CMO, companies have not completely embraced the concept of a CMO.

Asia has an unprecedented opportunity to elevate marketing to the boardroom level, so that the CMO can take center-stage in shaping and executing the corporate strategy leading to better shareholder returns.

It is quite clear that this is going to be Asia's century. The opening of China, the rise of India and the resurgence of Asia make the region the most vibrant business playing ground in the world. There is a slow but steady shift in the Asian business mindset. Gone are the days when low cost and manufacturing prowess alone served as the only competitive advantages for the Asian companies. The Asian corporations must realize the importance of moving up the value chain.

One of the main ways to achieve that would be to create strong brands. This will not only serve as the main competitive advantage for these companies, but also enhance shareholder value in the medium and long-term. This is easier said than done, given the dominant Asian business mindset of trading and sales.

A substantial part of shareholder value of successful companies derives from their ability to successfully manage and leverage their most important intangible assets: their brands' equity. In turn, Asian companies will have to realize that branding must be led by the boardroom and corporate management. It is too important to be left to the marketing function alone. Brand management is a dynamic and continuous process which requires attention and involvement from the senior leadership. This requires the marketing function to be presented at boardroom and corporate management level.

Contrary to common perceptions in Asia, branding is much more than advertising and marketing communications alone. Nice company logos or modern design identities are not key ingredients for branding - only a tactical face to it. Instead, successful branding is strategic, involves all functions and aspects of a company and must be deeply embedded throughout the entire organization aligned around multiple touch points. This ensures a successful balance between brand promise and brand delivery.

In the future, this requires the Asian marketing function to become more cross-functional, to manage and measure their results through multiple marketing metrics, and work in teams to play an important part of brand building.

As more and more global and local companies enter the market in all possible categories, there will be an intense competition and an over-capacity in the market place. This will exert immense pressure on companies to resort to price wars to capture the market on a short-term basis. But Asian boardrooms need to take a strategic look and balance between short- and long-term financial performances.

Corporations need to look beyond quarterly results, monthly sales figures and factory turnovers. This will be highly valued by shareholders and financial markets.

Financial resources spent on brand management must be treated as an investment rather than an expense. Boardrooms need to invest in sustainable intangible assets through branding strategies to survive, sustain and grow in the market.

As more Asian countries open their doors to global companies and attract foreign investments, building strong brands becomes not only an important strategy but also a matter of survival for many Asian companies. In the changing market dynamics, being a domestic market leader does not guarantee long-term success as global players entering the domestic markets, can easily challenge the local players with their business might.

A McKinsey study shows that the top ten Asian value creators derive more than 50% of their revenues on an average from outside their home markets. A case in point is India's software giant Wipro Technologies deriving more than 80% of its revenues from non-Indian customers.

Many global brands have established strong relations with local partners, invested heavily to build robust distribution networks, worked in tandem with the local authorities to establish a good working rapport and recruited local people to gain the crucial local "Asian" knowledge. As this levels the ground for local and global brands in terms of local market and customer knowledge, Asian companies will increasingly come under pressure to defend their traditional comparative advantage. This in turn again stresses the need for local Asian companies to invest in building resonating brands with compelling stories if they were to compete with global brands and survive in the market place.

Asian brands like Singapore Airlines, Banyan Tree Hotels & Resorts, HSBC, Samsung and Shiseido have demonstrated that it is possible for Asian companies to build brands on par with those of Western countries. They have also proved the fact that a strong brand will enable companies to sustain through difficult times and sustain their financial robustness.

A branding drive in Asia is progressively emerging and will change the global landscape in the next decades if taken seriously by Asian boardrooms and if managed properly throughout the entire organization.

As the management professor Peter Drucker once said: "Whenever you see a successful business, someone once made a courageous decision". Asian cultures have always valued the long term aspects in almost any aspect of life. Let this unique strength influence the Asian branding efforts in the years to come. It is up to the Asian boardrooms to take courageous decisions.

Asian Brand Strategy will be launched in a 2nd edition in early 2010. We will keep the current structure and content, but everything will be updated. New case stories will be added also.

Some of the current cases and references are:

Accenture, AC Nielsen, Acer, Adidas, Air Sahara, Akai, Alcatel, Apple iPod, Asian Paints, Audiovox, Banyan Tree Resorts, Bausch & Lamb, BMW, Bossini, Cadbury, Chang Beer, Chanel, Cisco, Citibank, Coca-Cola, Creative Technology, Datacraft, De Beers, Disneyland, Esprit, Epson, Etude, Everton, Fiji Water, Gallup, Giordano, Giorgio Armani, Gillette, Gucci, Hang Ten, Harley Davidson, Haier, Hasselblad, Hero Honda, Honda, HSBC, IBM, ICICI Bank, Indian Airlines, Infosys, INSEAD, Kawasaki Bajaj, Lenovo, LG Electronics, L'Oreal, Louis Vuitton, LVMH, Maersk Sealand, McKinsey, McDonald's, Mercedes, Motorola, NASDAQ, Nike, Nirma, Omnicom Group, Oral B, OSIM, Pantech, Pepsi, Prada, P&G, Ralph Lauren, Red Bull, Reliance Group, Rolls-Royce, SAB, Singha Beer, SK II, Shangri-La Hotels, Sony, Shiriro, Starbucks, Star Cruises, Tag Heuer, TCL, Thai Airways, Tiger Airways, Thompson, Toyota, Trung Nguyen, Unilever, Virgin Group, Watson Wyatt, Wipro, Zen Micro and Yue Sai Kan.

Which other cases would you like included? Write us at: contact@asianbrandstrategy.com

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