Comments on: From China, a Plan to Topple One of America’s Most Dominant Brands http://www.chinafirstcapital.com/blog/archives/927 The Trends, Opportunities, Deals, Chinese Companies on Path to IPO and Private Equity Investment, from China First Capital Tue, 31 Jan 2012 12:23:54 +0000 hourly 1 http://wordpress.org/?v=3.1.1 By: LongTian http://www.chinafirstcapital.com/blog/archives/927/comment-page-1#comment-392 LongTian Wed, 21 Oct 2009 05:54:40 +0000 http://www.chinafirstcapital.com/blog/?p=927#comment-392 I completely agree with Dan. Brand recognition includes much more than you covered. It involves a sort of relationship with the product and company, and a trust that is built up over many years. Crayola has never violated that trust in any way. It doesn't matter which crayon is cheaper. It doesn't matter which has more colors. Parents buy products that they trust. Why? Because the first thing on their minds when they are buying products for their children isn't price, or color, or even what the child wants. I can tell you that without even doing any market analysis, the number one issue for parents is the safety of their children, and regardless of any one particular factory's safety record, China is currently at the bottom of the global barrel concerning product quality and safety. All of this aside, would you really want to be the ONLY child in your 2nd grade class who DIDN'T have Crayola brand crayons, but instead had Chinese ones? Children will say, "But Mom! Nobody else at school has to use these crappy ones!" That's just the way the child market works. Parents would bet their life savings on brands such as Lego, Fisher Price, etc. because they trust them and believe in their commitments to the safety of children and of product quality, and because they have known them since they were children. I completely agree with Dan. Brand recognition includes much more than you covered. It involves a sort of relationship with the product and company, and a trust that is built up over many years. Crayola has never violated that trust in any way. It doesn’t matter which crayon is cheaper. It doesn’t matter which has more colors. Parents buy products that they trust. Why? Because the first thing on their minds when they are buying products for their children isn’t price, or color, or even what the child wants. I can tell you that without even doing any market analysis, the number one issue for parents is the safety of their children, and regardless of any one particular factory’s safety record, China is currently at the bottom of the global barrel concerning product quality and safety. All of this aside, would you really want to be the ONLY child in your 2nd grade class who DIDN’T have Crayola brand crayons, but instead had Chinese ones? Children will say, “But Mom! Nobody else at school has to use these crappy ones!” That’s just the way the child market works. Parents would bet their life savings on brands such as Lego, Fisher Price, etc. because they trust them and believe in their commitments to the safety of children and of product quality, and because they have known them since they were children.

]]> By: Dan http://www.chinafirstcapital.com/blog/archives/927/comment-page-1#comment-96 Dan Sat, 26 Sep 2009 17:39:04 +0000 http://www.chinafirstcapital.com/blog/?p=927#comment-96 I'm not buying your thesis, at all, and I speak from experience. Unless Wingart crayons have gotten a lot better since my youngest of two kids stopped using crayons (maybe three years ago), they are not nearly as good as Crayola's. They come in crappy boxes, they are dry, they break more easily, they do not sharpen as well, their colors are not nearly as good nor as varied nor as well defined, and they simply do not write as well. And again, unless everything has changed in the last few years, everyone knows this and that is why Crayola dominates. Lastly, you completely ignore that when it comes to young kids and a product like this, parents are going to be wary as hell to buy something that is made in China AND is Chinese. Ask a parent which crayon they want to see their four year old put in their mouth, a Crayola or one from China? We all know the answer to that one. Also, I can still remember a number of crayon recalls from China involving lead. Now I have no idea if any were from this particular company, but if I were a parent standing at a Target with my four year old looking at Crayons, I would pay the extra 10 cents rather than do the research to check up on the safety/lead content of the Chinese brand. And might it not be possible that is what Wal-Mart is thinking as well. No, I do not see Crayola giving up much market share over the next few years. I’m not buying your thesis, at all, and I speak from experience. Unless Wingart crayons have gotten a lot better since my youngest of two kids stopped using crayons (maybe three years ago), they are not nearly as good as Crayola’s. They come in crappy boxes, they are dry, they break more easily, they do not sharpen as well, their colors are not nearly as good nor as varied nor as well defined, and they simply do not write as well. And again, unless everything has changed in the last few years, everyone knows this and that is why Crayola dominates. Lastly, you completely ignore that when it comes to young kids and a product like this, parents are going to be wary as hell to buy something that is made in China AND is Chinese. Ask a parent which crayon they want to see their four year old put in their mouth, a Crayola or one from China? We all know the answer to that one. Also, I can still remember a number of crayon recalls from China involving lead. Now I have no idea if any were from this particular company, but if I were a parent standing at a Target with my four year old looking at Crayons, I would pay the extra 10 cents rather than do the research to check up on the safety/lead content of the Chinese brand. And might it not be possible that is what Wal-Mart is thinking as well.

No, I do not see Crayola giving up much market share over the next few years.

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