Creating a Chinese brand

Customers shop at the Xiushui Street market. [file]

Xiushui Street or Silk Market, is a must-go shopping destination for foreign tourists in Beijing. And it is in the process to shaking off an image of paradise for counterfeit brand products, as China strengthens its efforts to better protect intellectual property rights.

The market, though not very big or high-end, is so famous among visitors that it was branded as a tourist destination eponymous to the Great Wall and the Forbidden City according to tourist guidebooks.

And it is expecting to embrace a business boom as hundreds of thousands of tourists will flock to Beijing to watch the Olympic Games.

Abigail Alvarado from Ecuador is one of the market's many customers wandering around between the bustling aisles flanked by stalls. "I bought chopsticks, slippers made of silk, and some handicrafts," she said, carrying several bags in hand. "I haven't looked at the clothes yet."

Alvarado is just one of nearly 50,000 customers at Xiushui every day, of whom 80 percent are foreigners, according Wang Zili, general manager of the market.

Chinese vice premier Wang Qishan noted Xiushui Street as an example of China's progress in IPR protection in an interview with The Wall Street Journal in mid-June, during his staying in the United States for the fourth China-US Strategic Economic Dialogue.

Better known as the Silk Market among foreigners, the shopping center has shifted its marketing strategy from just selling fake brands to promoting Chinese culture and lifestyle.

"On every Beijing-bound international flight there are Xiushui Street customers," said Wang, in his office on the top floor of the six-storey building adjacent to Beijing's booming central business area.

According to Wang, Xiushui has a three-decade history in accordance with China's opening up and policy change towards free market economy, but it was not until 1995 that large numbers of fake products began to dominate this market. It suffered a setback when China started to fight hard against IPR infringement in recent years.

In early 2005, the old market, which was in fact stalls in makeshift buildings, was torn down and reconstructed to a brand new store with improved facilities. The upgrade helped increase business as it attracted many traditional Chinese brands to open chain stores in there, including clothes, shoes, and drug stores with centuries of history.

However, management only started to take IPR protection seriously from April 2006 when five international manufacturers sued vendors in Xiushui for selling replicas of their products. The lawsuit ended up with the court ruling that the vendors and the market must pay 20,000 yuan in compensation to each of the five brands.

"That ruling accelerated our efforts in fighting against counterfeiting," said Wang, who is an MBA graduate. Meanwhile, he believed that getting rid of counterfeits and piracy from China would need long and continuous efforts.

"There used to be 100 percent fake brand products in Xiushui before the renovation, but now we have a lot of genuine producers especially traditional Chinese brands," he said.

According to an online survey conducted by the market, silk articles tops foreign tourists' shopping list of buying souvenirs in China, followed by pearls and handicrafts. "So we now have two stories selling pearls and jewelry, and we have the largest Chinese tailor shop."

Besides these popular goods, Xiushui has a group of foreign language-speaking salespeople to serve customers from all over the world, so there is no language barrier in any of the shops. After training, nearly every shop assistant can speak fluent English to shoppers, and customers will meet no difficulty shopping if they speak any of the eight major foreign languages in the market.

For many customers, being in Xiushui is not just about shopping.

"Bargaining is so much fun!" exclaimed Amna and Fatina Pirzada from Pakistan, who enjoyed slashing prices. "When there was a difference in prices, they [shopkeepers] would give a smile. People are very friendly here."

Bargaining is the rule at many markets in Beijing, and this convention is a must in Xiushui.

"Every aisle in Xiushui is like a hutong in old Beijing, so people come to this market as if they are taking a trip to know Chinese culture," Wang said.

Earlier this year, Xiushui Street publicized its first self-owned brand, the Xiushui Market, selling shirts, tea leaves, ties, chinaware and other articles under the trademark.