Market leaders most resilient in economic slump, followers further lag

Korea Productivity Center releases 2012 National Brand Competitiveness Index, ranking 212 brands


Amid an economic slowdown here and abroad, last year’s top brands continued to lead this year, while their followers found it more difficult to catch up with market leaders, a recent brand competitiveness report found.

The state-run Korea Productivity Center recently released its annual 2012 National Brand Competitiveness Index after surveying more than 110,000 consumers nationwide on 212 brands across 59 industries.

According to the report, tablet PCs, plastic containers, milk and kimchi refrigerators showed higher brand competitiveness among product categories. In service sectors, online shopping malls, department stores, hospitals and multiplex movie theaters earned higher points.

One characteristic of this year’s survey was the rise of service sectors while the brand competitiveness of individual products remained almost the same compared to 2011.

Last year, companies boosted efforts to promote their tech devices like smartphones, smart TVs and tablet PCs while “smart idea” started to be applied to other home appliances such as refrigerators, air conditioners and laptops.

Even though people’s needs for high-tech products continued this year, companies are currently struggling to meet higher expectations amid increased consumer knowledge, and offer diverse content that supports new devices more effectively.

The report also said that tech firms seem to have failed to differentiate themselves from others as they could not introduce unique products on their own amid a proliferation of smart devices with similar functions.

On the other hand, service sectors took a meaningful leap when it came to elevating their brand competitiveness this year, with all but four industries seeing a higher brand awareness among respondents.

The report said service sectors have carried out more diverse marketing activities. They especially focused on better communicating with customers through social media such as Facebook and Twitter and other online and mobile marketing tools.

For instance, multiplex movie theaters succeeded in transforming from a simple movie theater into a cultural facility that offers diverse entertainment experiences, including the world’s first “5-D” theaters.

The survey also found that almost all of last year’s best-selling brands continued to maintain their top positions across their industry categories. At the same time, the gap the top two brands widened slightly compared to 2011.

The report said leading companies may have made more of an effort to maintain their status. It would have been easier for them to carry out marketing activities based on their strong brand competitiveness.

The prolonged economic slowdown globally is also considered to have affected consumers, causing them to choose well-established brands rather than take risks with new or less competitive ones.

The report said it remains to be seen how long the trend will continue as companies have begun promoting their products more effectively at cheaper costs thanks to the advanced mobile environment and diverse social network services.

Brand and consumer choice

Korea Productivity Center, the non-profit organization affiliated with the Ministry of Knowledge Economy, also found that higher brand competitiveness was more likely to be connected to consumption across all industries.

With bidets, for instance, consumers gave low points both in their brand awareness and willingness to buy because the local bidet market is based on rental services, not on direct purchase by consumers.

Another result was that people are not as brand-loyal when purchasing essential items for living.

Laptops earned the lowest points in consumers’ willingness to buy, largely affected by the introduction of alternative devices like tablet PC and smartphone.

Even though some electronics makers launched lighter and smarter laptops dubbed “ultrabooks,” they could not attract as much attention from consumers as expected.

Meanwhile, the tablet PC, which was included in the brand index survey for the first time this year, received the highest points both in brand competitiveness and consumers’ willingness to purchase due to the fierce competition among brands within the growing market.

As the item still is in its early development stages, companies are competing to launch active marketing activities to attract consumers, raising their brand awareness and purchasing willingness in general.

By Lee Ji-yoon (jylee@heraldcorp.com)