Leading consumer brands are faced with low customer loyalty in China, according to a joint study by research firms Bain & Company and Kantar Worldpanel. Results of the study, which covered 40,000 households in mainland China, revealed a high churn rate among consumers, with the top 5 brands in each market segment seeing between 40–80 percent of new customers. Hair care brand Head & Shoulders, for example, saw its customer base expand 3 percent from 2011 to 2012; however, data revealed 45 percent of 2011 buyers did not return in 2012. Market penetration drives repurchase rates and market share, the study revealed.
"Chinese customers' lack of loyalty puts pressure on brands", South China Morning Post, June 11, 2014
Coty Inc. appointed Li & Fung as distributor of some of its brands, including adidas, Rimmel, and Playboy, in China. Marking a change in Coty’s marketing strategy for mass-distribution brands in China, the deal will allow Coty to use Li & Fung’s expansive distribution network in the country, as well as the local distributor’s strengths in the go-to-market business. Coty also announced its plan to stop selling the TJoy brand and instead focus on its leading global brands, which have more potential for growth in the China market. According to the companies, the deal will take effect on July 1, 2014.
"Coty Inc. And Li & Fung Announce A Distribution Agreement In China", PRNewswire, June 03, 2014
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Marketing-Interactive.com, July 25, 2014
WantChinaTimes.com, July 01, 2014
Marketing-Interactive, June 23, 2014
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