1、Reinforce the brand loyalty by advertising: A local beverage company in China. Jiajie Dong Beijing Normal University, Hongkong Baptist University United International CollegeAbstract:Considering the importance of brand loyalty in marketing communication, this paper uses a case study of a local bever
2、age company in China to document how this local beverage company reinforced the brand loyalty by advertising. In attempting to analyze advertising as an important way to reinforce the brand loyalty in marketing communication, this paper offers research and theory to regarding a local beverage compan
3、y in China, which has reinforced its brand loyalty by advertising. This paper also discussed this in terms of key concepts in advertising theory, in order to provide guidelines on how to reinforce the brand loyalty by advertising in China when a local beverage company attempted to establish a well-k
4、nown local brand of herbal tea all over China. Key words: China, brand positioning, image management, unique selling points, brand loyalty, media channelIntroduction Today as the education level of consumers in China has improved, they will think further about the truth of advertising. Based on this
5、 trend, image management and positioning are becoming the key elements in the process of reinforcing brand loyalty through advertising. This paper documents the reinforcement of brand loyalty in the process of brand management in China, by examing the efforts of a Chinese local beverage company (JDP
6、 Group Corporation). The JDB Group is a Hong Kong-based, large-scale enterprise that focuses its business on the production and sales of specialized beverages. In 1995, the Group launched the first red-canned “Wong Lo Kat”. In 1999, the Group set up its production base as a foreign capital enterpris
7、e in Chang An Town of Dongguan City, which is located in the Guangdong Province of China. In order to tie in with the Chinese nationwide market development strategy, the Group also set up individual production plants in Beijing, Zhejiang, Fujian and Guangzhou.Various beverage products are produced b
8、y the JDB Group, such as the red-canned “Wong Lo Kat” and other tea drinks. “Wong Lo Kat” has more than 170 years of history, and is the one of most traditional and distinguished brands in Chinese history. Within the herbal tea industry, the red-canned “Wong Lo Kat” is also the number one brand, bei
9、ng made from pure Chinese herbs with their unique and effective functions of clearing heat and reducing excessive fire from the body. The JDB Groups distribution network covers more than 30 provinces, cities and autonomous regions in China, with the products are also exported to South-east Asia, Eur
10、ope and America.The JDB Group has expanded rapidly in 1999, and the Group set up “Guangdong JDB Beverage Company Limited” in Chang An Town of Dongguan City, Guangdong Province. In late 2003, the Group invested in the Beijing economic development zone and established “JDB Beverage Company Limited”. I
11、n 2004, “Zhejiang JDB Beverage Company Limited” was established in Shaoxing of the Zhejiang Province. In mid-2005, the Group established “Fujian JDB Beverage Company Limited” in Shishi City of Fujian Province. 1 The data (2007) from AC. Nielsen shows that Wong Lo Kat had the top one sales revenues o
12、f all beverages in China, larger than Coco Coca and Pepsi Coca.Wong Lo Kat(王老吉) is one of the most popular traditional herbal teabrands in China; this paper will indicate how the JDB Group has reinforced the brand loyalty of its products by new positioning and reworking its image throughout advertis
13、ing.Literature ReviewWhat is brand? A brand is defined as “a logo, name, sign symbol, or design, or a combination of these, which is intended to identify the products or services of one seller or group of sellers and differentiate them form those competitors” (Kotler, 1998). What is brand loyalty? B
14、rand loyalty is defined a “consumers consistent preference and/or purchase of the same brand in a specific product or service category”.3What is advertising? Advertising is defined as “paid nonpersonal communication from an identified sponsor using mass media to persuade or influence an audience. Ad
15、vertising is a widely used marketing technigue in which a marketer claims product superiority for its brand over one or more explicitly named or implicitly identified competitors, either on an overall basis or on selected product attributes. Advertising is useful for reinforcing brand loyalty, for t
16、arget market selection and strategies”.4Marketers are usually interested in attracting not just brand users, but more importantly, those who will consistently purchase the companys brand.5What drives brand loyalty? The psychology behind human behavior as it pertains to brand selection can be both ru
17、dimentary and complicated at the same time.(Bill Nissim, 2009)Based on this, a good advertisement as sender and medium can be used to increase the market share, build up the brand image, reinforce the brand loyalty, ect. To better understand the process of how advertising reinforces the brand loyalt
18、y, a basic communications model is important. The five components of this model are sender, message, medium, receiver, and feedback. In our daily life, we are exposed to messages via the radio, television, billboards, Internet, mail, and word-of-mouth (sender/medium). Although these messages are per
19、vasive, we continually screen out or ignore content that has little or no relevance to us. 2All messages are coded patterns and sensations colors, sounds, odors, shapes, etc(message). Those messages deemed recognizable, or a basis for a relationship, are decoded and stored in our memory (receiver).
20、A successful convergence between sender and receiver will result in some type of response to a brands compelling message (feedback). 2 But how to organize or plan a good advertisement? There are many steps to do it, but doing research is the basic foundation. Consumer motivation and behaviour can be
21、 understood through research. From the research, marketers and analysists will identify the target market and consumer segmentation. After that, the advertisement can aim at the target consumers precisely. A firms marketing activities are always aimed at a particular segment of the population-its ta
22、rget market. Likewise, advertising is aimed at a particular group called the target audience. Most of the advertising we see today in the mass media falls under the broad category of consumer advertising. So advertising professionals must understand how people act and think-and why they buy what the
23、y buy. 6The typical research process consistent of eight steps: 1、selecting a problem 2、reviewing existing research and theory (when relevant) 3、developing hypotheses or research questions 4、determining an appropriate methodology or research design 5、collecting relevant data 6、analyzing and interpre
24、t the result 7、presenting the result in an appropriate form, and 8、replicating the study (when necessary) 10To identify target consumers from research and analysis, first step is to do a marketing pre-test. With this process, researchers must collect the demographic data and point-of-sales in order
25、to be helpful for the further analysis. Also, researchers need to do the qualitative research, such as field observations and focus groups. All these research methods are valuable to develop hypotheses or research questions. After the pre-test process, researchers need to identify the best consumer
26、segments, create the top target groups. And develop detailed lifestyle and behavior profiles from the pre-test data. From the website of AC. Nielsen, analysists classify their customers according to their shared demographic, lifestyle and behavioral traits with consumer segmentation. Considering tha
27、t the memory of human being is short-term sometimes, successfully reaching the target consumers is not equal to reinforce the brand loyalty from target consumers. Since the target groups and consumer segments are identified, the analysists plan of a creative strategy to fulfill the hierarchical need
28、s of the target consumers. In Maslows Hierarchy of Needs theory, all the desire or needs of human being can be divided into five parts: biological and physiological needs such as food, water, air safety needs such as social norms, laws, protection belongingness and love needs, family, affection, rel
29、ationships, work group, esteem needs, such as reputation,status, achievement, responsibility self-actualization, such as personal fulfilment and growth. Advertising is “paid nonpersonal communication from an identified sponsor using mass media to persuade or influence an audience.4 In the process of
30、 an advertising campaign, a good advertisement must let the target audiences feel that the production can fulfill their needs. After conducting the advertising campaign, the analysists and marketers need to do post-tests. As a post-test can check the reliability and availability of the campaign. Aft
31、er checking the reliability and availability, the marketers can keep pushing the advertising campaign because all the data shows that it can reinforce the brand loyalty totally. With the data from the post-tests, the analysists and marketers can correct the wrong brand positioning statement, and rec
32、reate the campaign. Within the process of repositioning campaign, to target the new segmentation is most important. Research methods IntroductionThe case study method is another common qualitative research technique. Simply put, a case study uses as many data sources as possible to systematically in
33、vestigate individuals, groups, organization, or events. 11This paper attempts to analyse three critical factors. They are identify customer segementation based the data from the marketing research, brand image and positioning management by using the segmentation data, reinforce brand loyalty by adve
34、rtising during the brand image management process. A case study approach has been used in this research. In this paper, the study has established a framework for achieving brand loyalty:identifying the best target customers by using quantitative research Deducing the lifestyle of those customers seg
35、mentation by qualitative research recreate the brand image and positioning based on the information from qualitative research deploying the media strategies to promote the brand image or positioning and reinforce the brand loyalty.Case studyThis paper focuses on the Wong Lo Kat(王老吉) as a case study.
36、 According to the information from the official website of Wong Lo Kat, it is the largest beverage (herbal tea) company in China, belonging to the HongKong JDP Group Corporation. The beverage is a kind of functional drink in China. It was established in Qing Dynasty (1830s, A.D.) , and recreated in
37、1938 after Japan-China war ended. The main production of HongKong JDP Group Corporation is Wong Lo Kat (王老吉) herbal tea. Wong Lo Kat herbal tea is a kind of beverage that helps to clear away the accumulated heat in the human body. Also, Wong Lo Kat herbal tea originated from Guangdong, and is a comm
38、only known health drink in the region. Guangdong is situated in Lingnan, which has a typical subtropical climate, and the weather is hot and humid. Under the influence of the climate, improper diet and lack of sleep would easily lead to body heat, which is catching “heatiness”. In order to clear awa
39、y excessive moist and heat in our body, historically Chinese in the region had traditionally used Chinese herbs with the functions of clearing away heatiness and summer-heat, clearing excessive moisture and dissolving toxic substances in the human body, and made these herbs into different types of h
40、erbal tea, and then set up Chinese pharmacists who sold these tea products. The main ingredients of Wong Lo Kat herbal tea are: Holly root, LonghairyAntenoronHerb, Selfheal, Screwtree root. All these ingredients are widely used even today in the traditional Chinese medicine. According to the introdu
41、ction from the electronic cite quotation Wikipedia, herbal tea, can be made with fresh or dried flowers, leaves, seeds or roots, generally by pouring boiling water over the plant parts and letting them steep for a few minutes. Seeds and roots can also be boiled on a stove. The tisane is then straine
42、d, sweetened if so desired, and served. Many companies produce herbal tea bags for such infusions. On the other hand, flavoured teas are prepared by adding other plants to an actual tea (black, oolong, green, yellow, or white tea); for example, the popular Earl Grey tea is black tea with bergamot, j
43、asmine tea is Chinese tea with jasmine flowers, and genmaicha is a Japanese green tea with toasted rice. Before the 1990s, Wong Lo Kat was set as a kind of function beverage in Guangdong Province, but in northern of China, Wong Lo Kat was set as a kind of common beverage, like Pepsi Cola, or Sprite.
44、 In the 1990s, the advertising campaign of Wong Lo Kat focused on the product itself as a common beverage , but did not focus on the concept related to the Chinese traditional. The advertising campaigns targeted the old generation customers at that time, because only the old generation could underst
45、and the concept or insight of function beverage and heatiness. The marketers of Wong Lo Kat at that time attempted to sell Wong Lo Kat as a brand which has long history. Consumer behaviour in ChinaToday, the marketers of Wong Lo Kat have devised a marketing strategy to reposition the traditional her
46、bal tea as a beverage to promote healthiness, as well as to prevent the condition of heatiness. According the homepage of Wong Lo Kat, heatiness is a general term in Chinese medical theory for all diseases that are hot and masculine in nature. Marketers and researchers today note that consumers not
47、only prefer the good taste of drinks, but also prefer than to be healthy. On the marketing pre-test, there are five Chinese eating habits can be easily to infected heatiness. They are: eating hotpot, watching TV for a long periods with evening, eating fried food, barbecue, and sunbathinging.Also, th
48、e data of marketing pre-test from the electronic cite quotation present that there are two best ways to reach the target customers of Wong Lo Kat: Broadcast media Outdoor advertising.Brand repositioning and campaign planningBased on this research, Wong Lo Kat created a new advertising campaign and p
49、laned its media strategy. The first step in Wong Lo Kats media strategy was to reposition the brand. On brand positioning of the advertising campaign, Wong Lo Kat targeted the higher-pricedmarketing segment of functional drinks, and recreated a new core brand value at the same time with concerned of “cure heatiness”.