Recommendation Report

To: Mr. Dennis Zhang, Managing Director, Shanghai Golden Wheel Fortune 100 Group

From: Leslie Chu, Communications Manager, Shanghai Golden Wheel Fortune 100 Group

Subject: Recommendations to develop brand awareness and strengthen the effectiveness of promotions for Shanghai Golden Wheel Fortune 100 Group

Date: 21 November 2016

1. Introduction

This report provides recommendations to overcome the branding and naming dilemmas encountered by Shanghai Golden Wheel Fortune 100 Group. The purpose of this report is to suggest actions to increase the brand awareness to a larger audience and to improve the effectiveness of promotions.

Affecting the brand image and the marketing strategies, branding and naming of the company is one of the greatest concerns of the Managing Director. Given that the corporation has a complicated and elusive corporate name stated above and has a total of five brand names at present, namely Flying Duck, Phoenix, White Horse, Fast Flight, and First Eagle, it is considered by the Managing Director that to rename, drop a few brands or unify the name of both the corporation and its products. He called for a second meeting in no time and requested his managerial team members to look into the course of action to be taken.

The recommendation report is undertaken by Leslie Chu, the communications manager at Shanghai Golden Wheel Fortune 100 Group, on 21 November 2016. Intending to access the preference of employees and investigate the reasons behind, researches were done and 100 questionnaires were distributed to staff members over a two-week period.

The report provides an in-depth understanding of the three courses of action above. Due to the two-week timeframe, we were only able to hand out 100 questionnaires. Therefore, the sample size is small that cannot represent all stakeholders.

Taking all the standpoints collected into consideration, the report will come up with conclusions. Recommendations are then given aiming to help overcome the challenges facing by the company. To support our views established, our findings would also be included.

1. Conclusion

Based on the findings below, we reached the following concluding observations on Shanghai Golden Wheel Fortune 100 Group’s branding and naming practices:

1. Shanghai Golden Wheel Fortune 100 Group has five brand names, two of which has a poorer reputation, constituting the purchasing intention of customers and brand image.
2. Shanghai Golden Wheel Fortune 100 Group current practice is of low effectiveness which can be ascribed to having many brands to be promoted.
3. Shanghai Golden Wheel Fortune 100 Group current name is elusive and lengthy.

1. Recommendations

The complicated corporate name and the multi-brand strategies have put the brand awareness and marketing efforts in jeopardy, lowering the reputation and profits of the company, I as the communications manager make the following recommendations:

1. Shanghai Golden Wheel Fortune 100 Group should have a brand transformation. Having only three brands well established, the company should drop two of the brands. The company should unify the name of branches in China by using ‘Phoenix’, which is best known in China.

The company should keep the names, ‘Fast Flight’ and ‘First Eagle’, for brands in Taiwan and Seoul in Korea as they are renowned in the respective zones. ‘Flying Duck’ and ‘White Horse’ should be dropped and their resources should be shifted to the other brands.

1. Shanghai Golden Wheel Fortune 100 Group should create a new corporate name by using “Asiacycles”. Since the current name of the company is too lengthy and hard to remember, ‘Asiacycles’ should be used as it is shorter and distinctive. The first part of the name specifies the origin of the company and the second part of it, which comes from the word ‘bicycle’, is self-explanatory.
2. Shanghai Golden Wheel Fortune 100 Group should not unify the names of the corporation and its products. Consolidating the name would create havoc to the market, the company would be at risk. Therefore, it is not recommended to take such a risky action.

1. Branding and naming practices

For the years of operation, the company has been using an elusive name for its corporation and has a total of five brands for its products. The branding and naming practice is a stumbling block that hinders the development of brand awareness and the effectiveness of promotions, leading to low purchasing intention and weak recognition.

It is supported by the research of Nirmalya Kumar in 2013 that dropping brands is not of high risk^[1]. The research indicates that merging business can help shift customers from one brand to another and extend the equity of the stronger brand to the weaker one. Take the two Swiss banks UBS and SBC for example, they are combined as UBS in 1998 successfully, which shows that merging is appropriate in some cases^[2]. Therefore, it is recommended to take the risk of dropping two of the five brands.

The current branding and naming practice at Shanghai Golden Wheel Fortune 100 Group is of low effectiveness. The survey done revealed that the current name of the corporation is too lengthy and not self explanatory. From the survey report, 90% of the respondents agreed that the corporation’s name should be replaced by ‘Asiacycles’, which they think can better represent the company.

For the question about the branding of the company’s products, ‘Phoenix’, ‘Fast Flight’ and ‘First Eagle’ have been chosen by over 80% of respondents to be kept due to their good reputation while ‘Flying Duck’ and ‘White Horse’, which is generally admitted to have poor reputation and lower product quality by the respondents, should be eliminated. It is also suggested that the resources of the brands should be transferred to the others to help enhance the effectiveness of the brands’ marketing. 

However, for the question about unifying the name for the corporation and its products, 87% of the respondents objected to the view that the action is too risky that may affect the continuity of the company adversely.

(984 words)