Unlike previous years, the economic downturn caused brands’ competitiveness to fall slightly this year, according to a recent annual report released by the Korea Productivity Center.

The 2013 National Brand Competitiveness Index, which saw its 10th anniversary this year, found that of the 56 industries it surveyed ― from over 100,000 consumers nationwide ― only 15 industries improved their scores, causing the overall average to drop 0.4 percentage point from last year.

Out of a total of 197 brands, even top brands were unvaried or showed minimal growth, while brands in the lower ranks were more noticeably affected by the economic slowdown.

Also, following last year’s trend, the gap between the top two brands in each sector continues to widen, both in the product and service industries.

Despite the general lapse, industry leaders in products sectors such as tablet PCs, air conditioners, apartments, mid-size cars and kimchi refrigerators, and in the services sector like department stores, multiplex movie theaters and television home-shopping, managed to keep their heads above water by displaying yet another year of relatively high brand competitiveness.

According to the report, in the manufacturing sector, Avante and Sonata from Hyundai Motor, along with Raemian and Whisen, have ranked first for the past 10 years. Raemian is Samsung C&T Corp.’s brand for apartments and Whisen is LG Electronics’ air conditioner brand.

Within the services department, Lotte Department Store, Samsung Life Insurance, Samsung Fire & Marine Insurance, Kookmin Bank, Samsung Securities, Olleh Internet and others are also worth noting for their continuous success.

Of the surveyed 197 brands, Hyundai Motor’s midsize Grandeur sedan, Nongshim’s Shin Ramen instant noodles and SPC Group’s bakery franchise Paris Baguette topped the list. KPC officials said the upsurge of the Paris Baguette brand was one of the most striking features in the survey.

Another meaningful characteristic of the 2013 NBCI is that although many industries may continue to lead for long periods of time, it is harder for a specific brand to do the same.

For instance, within the kimchi refrigerator industry, the long-dominant company Dimchae was pushed down to second place. As for the beer industry, Cass claimed its new status as the No. 1 brand for beer. Likewise in the services sector, CU rose to top position within the convenience store category, higher than its previous name Family Mart, which had peaked at No. 2.

This observation shows that within a highly competitive environment, regardless of the advantages leading brands may have ― such as being able to utilize more effective marketing strategies and consumers’ tendency in times of a poor economy to take fewer risks and stick with well-known brands ― consumer preference, and thus rankings, can still shift.

The index also shows that brand competitiveness and consumer purchasing intention go hand in hand: Industries with high brand competitiveness show that the competitiveness directly impacts consumers’ brand consideration and therefore consumer behavior.

One area of exception is beer, water and milk because despite a low brand competitiveness, consumer willingness to purchase is still high due to the fact that they are low-priced goods and also basic goods.

Bidets and water purifiers again this year showed low scores in both brand awareness and willingness to buy because they are based on rental services ― an expected result, but the industries will need to differentiate their marketing strategies to fit their needs in order to optimize their competitiveness in the future.

On the other hand, tablet PCs, which only joined the index last year, retained the highest brand competitiveness and consumer response mainly as tablet PCs fit well with the rising consumer demand for “smart” products.

Compared to other electronic devices and appliances, the tablet PC industry is a highly competitive market. In addition, because most brands share similar functions, tablet PC makers must appeal through more aggressive marketing techniques to maintain the edge with their products.

In times of prolonged economic slowdown such as now when consumer spending significantly shrinks, business productivity is reduced, resulting in marketing and investment capital losses. Companies, therefore, will find it more effective to focus on expanding their marketing activities for maintaining consumer loyalty rather than reaching out to new consumers, the KPC said.

By Kim Joo-hyun (jhk@heraldcorp.com)