This may fall into the beating-a-dead-horse category, but this morning I picked up my latest issue of The Economist to find Samsung touted as the poster child of brand value in the digital age. Not one of those top US brands that PPI bragged about (see my posting yesterday) but the upstart from Asia.
Samsung was once best known for making things like cheap microwave ovens. In the past few years it has transformed itself into one of the "coolest" brands around, and is successfully selling stylish flat-screen TVs, digital cameras and mobile phones. After a record-breaking year, it is poised to overtake Motorola as the world's second-biggest maker of mobile phones. And it is snapping at the heels of Japan's Sony for leadership in the consumer-electronics business.
This would have seemed inconceivable a decade ago. But Samsung has proved that a combination of clever brand-building and well-designed, innovative products can work miracles. In such a competitive market, a brand without good products will quickly fade. But the real surprise is that the opposite is also true. The market is crowded with firms with a few snazzy products, but weak brands. To thrive and grow on the scale Samsung has achieved requires a strong brand, as well as innovative products.
In all fairness I must mention that the Economist also gives a tip of the hat to a US brand: Apple. But the point remains, strong brands alone are not enough to guarantee economic success. Yesterday's second-string brand may become today's powerhouse. And today's health of a nation's inventory of brands is no indicator of tomorrow's prosperity.
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