Germany moves from cars to lifestyle in China

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15 Oct, 2010 Updated Fri 15 Oct 2010 08:09 CEST
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Piggybacking on the reputation for the quality of their country’s cars and machines, German consumer goods brands are feverishly wooing Chinese customers as they try to catch up with their French and Italian rivals in a fast-growing market.

Germany has successfully exported Volkswagen, Audi and BMW cars to China for years, as well as machine tools and chemicals.

Makers of household appliances, furniture and fabrics are now trying to use the "Made in Germany" label cachet to tap into well-heeled Chinese consumers' appetite for products that show off their prosperity.

"The Chinese market for household goods is the largest in the world," said Markus Kepka, head of kitchenware maker Fissler.

But German manufacturers' share of that market stands below one percent, way behind their rivals from France and Italy, who lead the way in luxury and lifestyle products.

Kepka is overseeing the "German Living" fair, which opened in Shanghai on Wednesday in the presence of Berlin's Economy Minister Rainer Brüderle.

Around 30 exhibitors presented crockery, cutlery and decorations to local distributors, promoting a German lifestyle to go with the solid reputation of the country's industrial products.

"High quality, high price - like the cars," said Jeremy Dou, who came to promote Fissler brand products as well as several others the company distributes in China.

China will become the main market for Fissler in two or three years, ahead even of Germany, the firm hopes.

Matthias Menzel, chief executive of Bavarian wooden toy maker Selecta, told AFP he had "held several very concrete discussions with potential buyers" after only two hours of the fair.

"They talked about price straight away," he said. "There I gave them two solid arguments: the 'Made in Germany' tag and respect for the environment and health."

The latter is starting to become more important for Chinese customers who want the best for their children, as they usually have only one due to population-control policies.

The reputation of German industry for quality and reliability acts like "a magnet, a lever" on overseas markets, according to Detlef Braun, who is on the board of Messe Frankfurt, which organised the German Living fair.

Chinese customers have always been fond of brands, which explains the success of luxury labels, particularly those from France.

But now, Kepka says, "it is necessary to show the brand and show that one is making an intelligent purchase at the same time."

For Kepka, this is an opportunity for German products which might be less glamorous than their French and Italian rivals, but are seen as more reliable.

But for the moment, warned Frank Kaltenbach, chief executive of ornament maker AdHoc, "When you look at the size of this fair compared with what one can find in Europe, you see that we are still right at the start."

Like many small- and medium-sized businesses which lack the size to launch themselves independently in China, AdHoc is looking for local partners to distribute its products.

But Kaltenbach is confident the market is there.

"After all, the Chinese are great tea drinkers," he said, casting an eye over his floating tea balls with a silicon handle, the pride of the company.




2010/10/15 08:09

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