By Tim Gingrich

The concept of marketing is as old as the Middle Kingdom.

One of the most famous fixtures of the ancient world, the Silk Road, could be thought of in modern-day terms as a vast supply chain, which Chinese merchants used to bring their wares to market in the West. 

China's new position as the world's second largest economy is a proof that Chinese businesses are meeting the challenges of today's much more complicated global marketplace. Corporate governance, regulation, accounting and finance, human relations, business law and, most importantly, share holders, are matters that merchants never had to worry about on the Silk Road.

The next great domain for Chinese businesses to conquer, the final frontier for the first generation of China's new business leaders, is marketing. 

There are many examples of marketing in China's history. Faded images of qipao-wearing cigarette models from pre-war Shanghai are now elements of nostalgia. The practice of yaohe, hollering slogans to identify the products or services being offered,  can still be heard on the streets of Beijing today.

These ancient advertising jingles may signal the arrival of a person selling candy or sharpening kitchen knives. Most common of all are the boisterous calls of "Wanbao, wanbao," imploring passersby to purchase an evening newspaper.

Among the earliest and most enduring means of marketing from ancient China are the laozihao. The textbook translation is "old trademark," but "venerable brand" makes more sense for the modern-day marketer.

Originating in the Ming Dynasty (1368-1644), the designation was first granted to a handful of stores in the new capital city of Peking.

One of the most famous examples is Quanjude, still Beijing's best-known roast duck restaurant.

The founding of the People's Republic of China in 1949 ushered in a new era of marketing in China. Though not advertising in the traditional sense of selling commercial goods, propaganda became a prominent communication tool during this time.

Beijing still bears the brand names of this period, from the city's revolutionary-themed Worker's Stadium to its main thoroughfare Jianguo Road, which literally means "build the nation." Though primarily political in nature, these too can be considered examples of marketing.

Today, much has changed. Two decades of reform have seen Chinese companies developing into a vital part of the global supply chain and grow to rival international competitors. The next step for China's manufacturing-based companies is to build strong consumer-facing brands that will allow them to take their own products to market. But this move demands that companies embrace new methods of marketing.

Many of today's fast-growing Chinese companies were built by people with business acumen or technical expertise rather than a marketing background.

Until recently, many of these businesses, especially formerly State-owned enterprises, had little competition and therefore little incentive to invest in marketing.

But now that Chinese companies are expanding into the global market and encountering greater competition, it is apparent to local business leaders that a unique and powerful brand is just as important as a quality product.

How can Chinese companies create high-quality brands to be competitive in the global marketplace?

Companies need original branding. There are many shanzhai brands, knock-off trademarks that are suspiciously similar to international competitors. But for long-term success a company needs to be different by communicating the qualities that make its products or services better than the rest.

They also need to get smart about telling their stories. Not just in China but all over the world, companies are finding that traditional advertising is not as influential as it once was. Rather than shouting to passersby as in the past, a more advanced and successful strategy is to target specific audiences through research.

Finally, companies, both Chinese and international, need to recapture the lore of the laozihao. Beijing's venerable brands have survived until today because their reputation was built on people's trust, not just profit. Their most successful marketing strategy was quality.

As companies realign their marketing strategy to meet the goals of today's economy, the ultimate purpose should be to summon the consumer confidence and enduring enthusiasm earned over four centuries by the legendary laozihao.

The author works at an international public relations firm in Beijing. tim@gotoofareast.com