The development model of multiple brands in the ceramic industry is inevitable under the background of diversification

Release time: 2024-03-20

The Chinese ceramic industry does not have international or national brands, only industry and regional brands. But how many brands are there in the ceramic industry? Even the associations at all levels in the ceramic industry are unclear. In ceramic production areas such as Foshan, Chaozhou, Jinjiang, Gao'an, Zibo, and Jiajiang, as well as major building material stores in domestic cities, ceramic brand advertisements are overwhelming. In Foshan, slightly larger enterprises have two or three or more brands, and multi brand strategy has become the most common brand strategy model in the ceramic industry at present.

The so-called multi brand strategy refers to a strategic plan in which an enterprise, after reaching a certain level of development, uses a well-known brand it has created to extend and develop multiple well-known brands, and multiple brands are independent and related to each other, rather than completely unrelated and disconnected from each other. The commonly referred to multi brand strategy is a strategy in the Chinese ceramic industry, which involves a single enterprise, the same production base, and bricks of the same type and quality. Because they cannot be digested, an additional brand is launched to digest them.

Ceramic companies launch new brands on the basis of existing ones and take a multi brand approach, with the aim of solving the rapidly growing production capacity of enterprises. Unlike the home appliance industry, the ceramic industry can have many different distributors in the same region. In general, ceramic enterprises have only one agent in a region. However, agents have limited capabilities and funds, and cannot fully solve the sales problem of the enterprise in the local area. However, in order to protect the interests of distributors, they cannot find other distributors. In the end, in order to further seize market share, the company launched one or even more brands to occupy the local market.

Background of multi brand launch

The emergence of the "multi brand model" in the ceramic industry is due to the fact that enterprise production capacity exceeds sales capacity. From the more than 30 year history of the development of the ceramic industry, ceramic products have gone through a development process from a seller's market to a buyer's market, from oversupply to oversupply. After the reform and opening up in 1978, with the development of the national economy, China's ceramic industry has also made significant progress. However, at that time, ceramic products were still a high-end and durable consumer product, mostly used in national large-scale key projects and some public buildings. Ordinary consumers were unable to afford wall and floor tile products. Central leaders have also visited and inspected enterprises in Foshan multiple times. "Foshan Ceramics" is known to the people of the whole country by riding the spring breeze of reform and opening up, and owners from all over the country come to Foshan to buy ceramics. Before the early 1980s, China's ceramic market was a seller's market, with product supply exceeding demand.

The late 1990s to the early 21st century was a period of rapid development in the Chinese ceramic industry, which can be summarized as rapid progress. With the sharp increase in production, the construction ceramic market has rapidly shifted from a shortage economy to an excess economy, and ceramic enterprises have begun to experience unsold products. A single brand is unable to meet the needs of market expansion. It is precisely this background that has nurtured the multi brand strategic model of the ceramic industry.

Characteristics of Multi brand Model Operation

The ceramic industry has experienced a 12 year development process since the emergence of a multi brand operation model in 1999. The multi brand strategic model has the following three characteristics:

1、 Big, including large production capacity and scale of enterprises. From the enterprises that have already applied multi brand operation models in the industry, it can be seen that the successful multi brand routes are mostly carried out by large enterprises. Even small businesses will not choose a multi brand strategy.

2、 Unable to capture the high-end market. This is a fact that multi brand operating enterprises have to admit. Ceramic enterprises, including Xinmingzhu and Xinzhongyuan, have the characteristic of difficulty in occupying the high-end market. From the perspective of market share and sales volume, New Zhongyuan Ceramics of New Zhongyuan Group and Crown Pearl Ceramics under New Mingzhu Group are not inferior to brands such as Dongpeng Ceramics, Nobel Ceramics, and Marco Polo Ceramics. However, in terms of brand influence and reputation, there is still a certain gap. Industry insiders analyze that this is precisely the result of restrictions on multiple brands.

3、 Successful multi brand enterprises are all one product, one team, and one product, one exhibition hall. New Mingzhu Group has brands such as Guanzhu, Samite, Monte Carlo, Glacier, and Louis Modern. New Zhongyuan Group has brands such as New Zhongyuan, New Nanyue, New Yue, and Langgao, all of which have independent and mature marketing teams and independent product display centers. After years of development, the original intention of implementing a multi brand strategy in enterprises has undergone subtle changes. In general, single brand enterprises embark on the path of multi brand with the aim of digesting the expanding production capacity. But at present, many companies are not just increasing their brand capacity to digest, but to improve their product lines and use them to occupy markets in different fields.