The ‘Made in Germany’ Champion Brands To my wife, Mercy The ‘Made in Germany’ Champion Brands Nation Branding, Innovation and World Export Leadership UGESH A. JOSEPH First published 2013 by Gower Publishing Published 2016 by Routledge 2 Park Square, Milton Park, Abingdon, Oxon OX14 4RN 711 Third Avenue, New York, NY 10017, USA Routledge is an imprint of the Taylor & Francis Group, an informa business Copyright © Ugesh A. Joseph 2013 Ugesh A. Joseph has asserted his right under the Copyright, Designs and Patents Act, 1988, to be identified as the author of this work. Gower Applied Business Research Our programme provides leaders, practitioners, scholars and researchers with thought provoking, cutting edge books that combine conceptual insights, interdisciplinary rigour and practical relevance in key areas of business and management. All rights reserved. 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Contents Foreword ix Chapter 1 Branding and the ‘Made in Germany’ Brand: A Perspective 1 Chapter 2 From Rubble to an Economic Miracle to a World Export Leader 7 Chapter 3 The Superstars 13 Chapter 4 The Star Brands 53 Chapter 5 The Facilitators and Influencers 131 Chapter 6 The Less-Known Champions 165 Chapter 7 Some Innovative and Emergent Stars 243 Afterword 255 References 259 Index 267 This page has been left blank intentionally Foreword As Europe and the world struggle with the aftermath of the financial crisis, Germany as a nation stands resolute in its growth and export sales to the world. Germany, Europe’s strongest economy, is seen as a pillar of strength and hope for not only the recession afflicted nations of Europe but also for the global economy. While the 1989 reunification rejoined East with West Germany, the two sides could not have been more different economically. Germany has since overcome many challenges on its road to becoming the success story that it is today. The effort the author makes to unravel the apparent mystique of Germany’s success to a global audience is truly commendable. From a multi-dimensional, extensively researched perspective, Ugesh Joseph insightfully gives the reader a sense of the nation and its complex character – from its immediate past to its present-day ‘Champion Brands’ and the nations ‘Facilitators and Influencers’. His studied look at the ‘Made in Germany’ image and how this affects a nation’s positive image, especially its quality image for its products and services, is truly noteworthy. Added to this discussion is his important inclusion of what he calls the ‘Facilitators and Influencers’ to the ‘Made in Germany’ image – a significant, holistic element in the nation-branding discussion. Mr. Joseph professionally selects and classifies around 200 of the best champion brands into relevant and appropriate categories. He then analyses the nation’s strongest products and services in terms of size, reputation and importance. Mr. Joseph illustrates how innovation and a pragmatic business sense have helped these champion brand companies to become some of the world’s leading exporters today. This work is essential reading for all those entrepreneurs, managers, academics, students and researchers, the media, government officials and anyone who is connected with Germany or has an interest in knowing more about the country, its prominent products and services and its influential socio-cultural elements. This book will certainly help the reader to better understand Germany, especially from economic and business perspectives, while giving a sense of its character from a holistic point of view. The author shares useful and insightful information about a nation that has so much to contribute to the world. I wish the book and the author great success that is truly well deserved. Hermann Simon Chairman Simon-Kucher & Partners This page has been left blank intentionally CHAPTER 1 Branding and the ‘Made in Germany’ Brand: A Perspective The image and reputation of countries, like cities and regions of the world, have a process similar to that of companies, products and services. All places have what might be called their brand images. But the process of branding them is still subject to academic and practitioner debate. Today, with the state of globalisation, the world is one huge, diversified market. What this means to each of those countries/places and regions is that they need to compete for their share of consumers, industrial or other, for their products and services. They must compete to attract tourists, investors, entrepreneurs, skilled labour and students. They must vie for their share of international, sporting and cultural events and, finally, they need to get positive attention and respect from the international media, people of other countries and their governments. Before we dwell on the specific case of Germany, it would be worthwhile to go through a couple of definitions with relation to a ‘brand’ and a ‘nation brand’. According to P. Doyle in The Marketing Book, ‘… a successful Brand is a name, symbol, design, or some combination, which identifies the ‘product’ of a particular organisation as having a sustainable differential advantage’. (Doyle) On the other hand, Lynch and Chernatony define brands, ‘... as clusters of functional and emotional values that promise a unique and welcome experience between a buyer and a seller’. (Lynch) While Keith Dinnie, in his book, ‘Nation Branding: Concepts, Issues, Practice’, states that, ‘The Nation Brand is defined as the unique, multi-dimensional blend of elements that provide the nation with culturally grounded differentiation and relevance for all of its target audiences’. (Dinnie) According to O’Shaughnessy and Jackson, ‘The image of a nation is so complex and fluid as to deny the clarity implicit in a term such as brand image; different parts of a nation’s identity come into focus on the international stage at different times, affected by current political events and even the latest movie or news bulletin’. (O’Shaughnessy) Illustrative of this is the case of Germany. After the 2006 Football World Cup celebrations, the internal and external image had markedly changed for the better – in terms of perception by a general audience – to a place that was open to visitors, celebration and enjoyment. The Football World Cup brought out the best in the German psyche and Germans emerged as a fun-loving, friendly people in contrast to the previous stereotype of being 2 The ‘Made in Germany’ Champion Brands serious and humourless. In fact, the event was a pleasant revelation to the Germans themselves, as they embraced the positive vibe. The degree of enthusiasm, tolerance, warmth and openness during the four-week-long football carnival was a surprise to all. Old clichés and stereotypes were dropped and Germany earned a better, more upbeat and fairer image. Even without these events, Germany needs to maintain this positive energy to help maintain its brand equity in the long run, because it is important to remember that a nation is also perceived from the sum of its individuals. Germans, generally, tend to be rational and direct in their communication style and punctual and orderly in their home and work life. For the most part, they are meticulous and long-term planners who value reliability in their business relations. In an annually conducted global survey known as the Nation Brand Index (NBI), Germany scored significantly and was repeatedly ranked higher after the football tournament.