In China, imitation is typical not accidental, revealing the inability of Chinese business to develop their own brands that stems from a number of factors:
A get rich quickly mentality. After suffering for many decades from the failures of communism, some Chinese people have been trying to improve their standard of living, but they have yet to grasp the meaning of modern capitalism: a system of wealth creation within certain social norms, including respect for other people’s property.
The belief that intellectual property is a social good. Coming of a communist rule, where many commodities belong to society, and therefore, could be shared among all society members, some Chinese people believe that intellectual property, including brand names can just be shared for free.
Weak enforcement of property rights. Intellectual property receives little protection in China, especially when it comes to prosecuting and punishing violators–though Starbucks and CocaColla have won brand infringement cases in Chinese courts.
A supply side approach to entrepreneurship. In western countries, developing a new brand is a form of demand side entrepreneurship that begins and ends with the consumer; it involves a great deal of consumer research and engagement that require the commitment of great deal of human and non-human resources—and that’s what makes western brands so successful. In China, brand development is a form of supply side entrepreneurship that begins with supply, with abundant labor and financing, but little market research and consumer involvement—and that’s why Chinese brands flip.
The bottom line: China’s widespread imitation of western brands reflect a number of cultural and institutional factors that constrain the development of domestic brands.