Companies with strong brand equity may be able to capitalize on it by extending the brand into other product areas or consumer segments.
Brands that adopt a uniform strategy across China risk ignoring prominent differences in its regional markets. To further build trust, companies selling VMS or OTC products should seek to leverage credible and unbiased sources of information—such as expert endorsements or pharmacies near hospitals, both of which are widely respected.
And industry players have ramped up consumer education efforts, are working to improve product quality and distribution logistics, and are making certified pharmacists available for real-time consultations.
The prevailing belief is that health foods should be fresh, natural, and organic.
The government has imposed stricter requirements for online vendors. Ask yourself the following questions: In which product categories does my company have an advantage in scale, brand strength, product efficacy, or expertise?
Chinese consumers in small cities have high health and wellness aspirations and some distinct characteristics.
For instance, TCM is more popular among consumers in large cities than among those in small ones. See Exhibit 4.
Another challenge is the fight against counterfeit products. Choose your battlefields wisely.