As more brands look to ‘premiumise’ their offerings into the competitive Chinese market, there is a keener focus on provenance and credence. Chinese consumers will pay the highest price premium for brands from nations they trust. Beyond quality there is a growing awareness of the wider social and environmental factors that imbue a brand’s origin. Brands are missing out when they do not communicate clearly their credence attributes.
Credence is inherent in origin brands where country attributes are recognised, differentiated and highly valued. There is a reciprocal interdependence between country image and brand image with a strong correlation between origin brand and purchase choice (reputation). Nation brand awareness is increasingly influenced by Chinese offshore tourism experiences.
Reputation is everything and nation brands can be sullied by carelessness, and spillover from negative behaviour by its corporate brands and government. In a socially connected world China is a village.
Country of origin is a distinctive resource for fostering perception, preference and appeal. Origin can be actively filtered out of the distribution channel by unbranded products, and by gatekeepers (such as brokers, importers, distributors and buyers in the supply chain), thereby losing specific credence attributes. Every exporter must have a commitment to sustain and monitor the quality, authenticity, integrity and performance their own brand; premiumisation demands it.
There is significant consumer premium for quality brands that incorporate both experience and credence attributes. At the heart of this is origin identification, or branding, to build a relationship with the consumer at point of purchase (omnichannel). Fundamental to communicating an origin message is:
- Visual. Origin clearly delineated in product labelling and packaging.
- Traceability. Search back to the “farm-gate” or manufacturer.
- Channels. Web and digital platforms (eg. QR codes, barcodes, social).
- Transparency. A purposeful brand story.
- Education. Collateral and campaigns to align and promote nation and credence attributes (eg. clean-green, fair trade, environmental stewardship, comfort/health benefits) into the supply chain and with consumers.
Industry Case Studies
Alaskan, New Zealand and Norwegian seafood can attain the highest price with consumers. Chinese consumers were willing to pay almost 95% more for the exact same seafood product from Alaska over the equivalent Chinese branded or sourced offering. Norwegian seafood has the largest “franchise” in terms of country of origin in premium seafood in China. A higher proportion of consumers stated that they would definitely buy the seafood product tested if it came from Norway. This is reflective of the success that Norwegian salmon has achieved in the Chinese market. Consumers are very familiar with Norwegian salmon and the country has a very strong reputation a source of premium seafood (DDMA research 2015).