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Brand-Building Challenges in Overseas Markets for Korean Companies

  • Rajeev Batra
  • Youjae Yi

Abstract

The challenges facing companies from Korea (South Korea, or the Republic of Korea) as they try to build their brands in the West (North America and Western Europe) are very important to Korea, given its export orientation. Korea derived 55 percent of its GNP from exports in 1997, 34 percent of that from exports to the West (North America and Western Europe). This success of the last 10 years (1988-97), in which Korean exports grew by 12 percent a year and GNP by 10 percent a year, is being threatened not only by the current currency and debt crisis, but by the longer-term challenge from countries with even lower cost structures, such as China (Lee 1994). If Korea is to avoid entering into ruinous price wars with these new competitors, and if it is to realize higher margins on its exports, it must have the ability to charge higher prices, by marketing stronger brands. Korean companies have historically focused on an OEM-supplier export strategy, relying on low costs as their competitive advantage, but this needs to change as their relative costs go up. They thus need to learn how to move beyond such an “OEM supplier strategy,” but this will require new skills, because the success requirements for “own brand exporting” are different from those of successful OEM exporting (Lee and Son 1993). (A background note on the Korean economy and exports is attached to this chapter as an Appendix.)

Keywords

Korean Company Brand Equity Private Label Corporate Identity Transitional Economy 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Springer Science+Business Media New York 1999

Authors and Affiliations

  • Rajeev Batra
    • 1
  • Youjae Yi
    • 2
  1. 1.University of MichiganUSA
  2. 2.Seoul National UniversitySouth Korea

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