The China Casebook

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Brand extension naming strategies: An exploratory study of the impact of brand traits

When a known brand extends into a product category that involves sophisticated and state-of-the-art technology, consumers face uncertainty and perceive a financial risk when considering the extension for purchase. This study explores how the brand's perceived expertise in the extension category and various brand traits (predictability, dependability, and faith) affect that consideration decision and how these interact with particular extension naming strategies (direct versus brand-bridging). Exploratory results from a field study give three insights. First, a consumer's faith in a brand appears to improve the extension consideration independent of what naming strategy is adopted. Second, brands with good predictability seem to benefit only by using a direct naming strategy in the brand extension. Third, a perceived lack of expertise appears to reduce the extension consideration even when a brand-bridging strategy is adopted. A discussion of these insights and their implications is provided

When Good Guanxi Turns Bad

In China, guanxi, or personal connections, can divide the loyalties of the sales and procurement people your company depends on. If you're alert to its potential to cause mischief, you can head off relationships that could work against you

Entering China : an unconventional approach

While EJVs are still necessary in some regulated sectors, and foreign investment is prohibited in still others, there is a growing trend toward a new and possibly much more effective way of doing business in China -- as a WFOE, that is, a wholly foreign-owned enterprise. For all intents and purposes, EJVs and WFOEs are substantially the same in terms of taxation and corporate liability. They also operate under similar foreign exchange rules and comparable import and export regulations for licensing, quotas, and duties. In fact, their only real differences are that WFOEs take less time to establish than EJVs, are not technically required to have a board of directors, and are currently prohibited in some sectors in which EJVs are approved. This paper investigates in some depth the question of whether WFOEs are a realistic alternative to EJVs, using the examples of Johnson and Johnson, and Shanghai Jahwa Corp

To WFOE or not to WFOE, that's the China question : can one go it alone in China?

Equity joint ventures (EJVs) have been the dominant foreign direct investment mode to enter China. With the approval climate improving, the number of wholly foreign-owned enterprises (WFOEs) has been increasing in the last couple of years. This paper investigates in some depth the question of whether WFOEs are a realistic alternative to EJVs. The discussion focuses on strategic, legal, political, as well as operational issues and concerns

Consideration set formation : a rational model and some numerical validation results

The notion of a consideration set describing a subset of brands from which an individual consumer will select or choose has received considerable attention in the recent marketing literature. This paper develops a rational model of the latent consideration set formation process, characterizing it as an information search in a dynamic setting. An individual consumer will holistically evaluate alternative brands as long as the expected outcome of the search justifies the cost. Hence, consideration set generation is viewed as a categorization process with a cost/benefit screening heuristic. In contrast to previous work using the cost/benefit approach, the operationalisation here specifies costs and benefits in the utility domain recognizing various processing phenomena which have been shown to affect information acquisition and computational effort. Given the latent character of the process and its outcome, the validation methodology consists of simulating realistic scenarios and comparing the expansion and contraction of the consideration sets against consumer behavior theory and observation

Commentary on “On Bayesian Estimation of Model Parameters”

No abstract available.