How do brands with leading products upgrade?

World
Europe

02:39

What do the world’s biggest fast food brand McDonald’s and China’s best-selling hand lotion brand Maxam share in common? Well, both brands have leading products that may be better-known than the brand itself.

Big Mac is the “celebrity product” of McDonald’s. Last year, over 1.3 billion Big Macs were sold – that was 41 Big Macs per second. Maxam is known primarily as a supplier of hand lotion products for which sales expanded by 130 percent in the first quarter this year.

However, both companies know that if they want to stay competitive in China, it is not enough to have just a leading product – they will have to upgrade.

McDonald's determination to build on its core product can be seen in its auxiliary marketing strategy. The Mac coin it issued earlier this month has gone viral – crowds lined up for the coin which is worth one Big Mac.

People queue for MacCoin in Shenzhen, August 6, 2018./ VCG Photo

“Even though the Big Mac has been a hit for a long time, we still develop new things out of it. We launched the Grand Big Mac and Junior Big Mac in China this April,” CEO of McDonald’s China Zhang Jiayin explains.

As for Maxam, the company has varied its products to keep in line with consumer tastes. Li Chenkun, senior manager of Maxam, said that the company is going to partner with candy brand White Rabbit to develop a milk candy-flavored lipstick in the second half of the year.

“A survey we did last year showed that consumers have various hand-care needs depending on circumstances. For example, when doing chores like dish washing and clothes washing, consumers' hands can easily be damaged by chemicals. So we came up with the idea of ‘care as needed’ last year,” said Li.

Their strategies have worked well. McDonald's most recent report shows 12 consecutive quarters of sales growth and Maxam has become the strongest revenue contributor to its parent company Jahwa.

An industry watcher concludes that if a brand wants to upgrade itself based on a “celebrity product”, it has to offer more than just a different name or packaging. Quality is what comes first.

“I think the combination is everything, but the core is whether you have really good product and develop global market strategy to push that to the consumers. Nowadays, you have many ways to do that. I think the chance for product is that, if it's good, it's going to spread much quicker compared to the old days,” commented Clement Yip, Experience Center Partner of PwC Chinese Mainland & Hong Kong.