HAIER - POSITIONING OF AN ASIAN BRAND IN

SOPHISTICATED WESTERN MARKET

 About Haier
 Haier is the world’s 4th largest whitegoods manufacturer
and one of China’s Top 100 IT Companies


 The Haier Group is China’s largest home appliance

brand and one of the world’s leading white goods
home appliance manufacturers.

 Founded in 1984 with headquaters in Qingdao,
Shandong Province, China ;Chairman and CEO: Mr.
Zhang Ruimin

 Manufactures home appliances in over 15,100 different
specifications under 96 categories.


 Haier is the official Home Appliances Sponsor of the

  Employees: Over 50,000 worldwide


 Haier’s global revenue in 2005 reached RMB 103.4

billion
Average annual growth of 68% between 1984 and
2005

 No. of Subsidiaries Over 240 Listed Subsidiaries on the
Hong
Kong Stock Exchange & Shanghai Stock Exchange


 Business Scope: Technology research, Product

development and manufacturing, Trade, Financial
services
Haier today…
400 products each year


60 category of products



Collaboration which gives it

access to 12 technological
research institutes,48
development
centres,10advanced
laboratories,6 design centres

Problems Faced
 Most critical problems facing Asian brands in
recent years is the perception of “cheap &
poor quality”


 Difficult to shift perception



 Haier chose this issue to fight its battles with

the commercial enemy- US where quality
begins at home
Brand Elements
Logo

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 Taglines
‘What the world comes home to’


Brand messages in western

Europe- ‘Haier & Higher’ , ‘Head
held High’, ‘Haier.Believe it’


Latest: Inspired Living


Brand Positioning
Known as having an innovative
personalized & high-quality
product designs & a reliable
after sales service
Positioned itself as an
international leading brand of
chinese origin
Brand evolution:


Motives behind brand
building
Began in mid 1990’s when CEO
Zhang was dissapointed with
Chinese markets:Price
wars,shrinking profits
He felt China’s entry into WTO in
2001 was more a challenge than
opportunity due to competition
from MNC’s,critical anti-dumping
regulations & non-trade barriers
on global markets
Strategic Branding
decisions while going
international
Market first,profits second
Three phases of brand building:
seeding,rooting & harvesting
Difficult things first,easier steps
later
Balanced growth
Observe & digest-imitate-design
them independently

 Focus on quality
Break in with 1 product
Niche marketing
Haier American Trading as a JV

Brand Innovation
Product Mass Customization:
Compact rerigerators in college
dormitory rooms
Sensitive to needs along with
providing aesthetic value.E.g-
Wine cooler
Quick cycle of product
development
Innovation with Brewmaster &
refrigerater with fold-out table
for students
Some Innovative Products
 Wine cellars
 Beer Dispensers
 Beverage centres
 Cellular telephones
 Water dispensers
 Dish Washers
 Refrigerators
 Freezers
 Fans
 Rangehoods
All have good design & space utilization to

create value
Brand distribution
Internationalization strategy
Haier’s position in FDI
overseas
Technology Strategies For Successful
Internationalization

1984 : Acquired From Liebherrcompany of Germany a New

Refrigerator Technology . This Helped Haier to be leading
refrigerator producer in China

Period
 Additional Method
 Operational Area
 -1991
1984 Refrigerators Imported refrigerator
technology from Liebherr
1991-1995 Freezer, Air Merged Qingdao Freezer General
Conditioners & Air Conditioner Plant
1998 Knowledge Sectors Formed Technology cooperations
with many external
organizations
1996 : Became an Exporter of not only its Products but also
Technologies. Used its Improved Technological capabilities &
product diversification to extensively enter into overseas markets
by means of strategic alliances.
“Since 1990 Haier’s Product Successfully entered into Europe, North
America and large number of developed countries”

Cooperative Research Programs: Haier’s cooperative partners includes

Toshiba, Mitsubishi, ESS, Philips, Mets & Lucent. These alliances
provide Haier with information about global trends in technology
development.

R & D spending as a percentage of sales ( 1997 - 2006 )

Company 2002 2003 2004 2005 2006
Haier 4.8 4.3 4.4 6.2 6.2
GE 1.7 1.6 1.6 1.8 1.8
Sony 5.9 6.9 7.0 7.1 6.6
Haier’s most important technology
alliances

Year Partner Cooperative

1994 GK Design Target
Engaged in the
1997 Company
Philips(Japan
(NL) &) cooperative
Produced color
1998 Metz (Germany
C- Mold (USA) ) design
TV -sets of new
Software
products
development
1999 Toshiba (Japan) Produced MRV
2002 Sanyo (Japan) & invertors series
SAMPO (Taiwan) of
R& commercial
D
air- conditioners
 The Technology development institute composed of 11
institute & Labs that aimed to develop leading
technologies for international use in 5-10 years.
 Haier invested RMB 500 million to build up an
academy responsible for developing new products to
be internationally competitive.
 In 2001, the State Economic & Trade Commission of
China & the Evaluation Research Centre of the
Chinese Academy of Science co-evaluated Haier’s
Technology development centre and ranked it first
among 284 state judged enterprise technology
development centres.
Brand Culture
Brand Culture of
Haier………..
Initiation program


It emphasizes team work, safety, and

importance of quality


On factory floor Haier heritage are displayed

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Trip to china
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It attempts to blend the best of east and the
west in employee relations
The Future?????
Future…………
Haier has plants in 13 countries and sells its
products over 160 countries

Haier brand is on TV sets, air conditioners, mobile
phones, pc peripherals, restaurant chain, haier
brothers cartoon……

Goal is to get 10% of US market for standard-
sized refrigerators

Company is learning much from Nike and Dell
If it can survive in the united states and not dilute
its brand equity too much by trying to be all
things to all people, then a global brand will
emerge
Brand Strengths
Product innovation
Speed to market of new products
Passion of its people
Niche market strategy
Strength in low-end appliances
Decentralized sales and marketing
Ability to move the manufacturing plants away
from china
Brand weaknesses
 Country of origin issue

 Consistency of product quality across the markets is
still a bit suspect

 Haier will have to take on the giant brands in mass-
as opposed to niche-product categories

 Loss of focus in US market

 Most design work is still done in china

Brand Architecture
Mainly Corporate branding
Shared branding