The unprecedented integration of the global markets has fostered a transnational community of like-minded professionals who talk in one universal language. Some call it Marketinguese, the language of successful marketers that everyone can use and employ. It speaks of megatrends, micro segmentation, and brand personality. It certainly makes for easy analysis and communication—seemingly nothing gets lost in translation. But, as scores of companies have found out, Marketing 101 may not travel so well when taken to Asia.
Take Google for example, which is often described as an underdog in this region. In Japan, it recently gained ground against frontrunner Yahoo, but only after it relaxed many of its long-standing marketing policies such as not allowing branding ads. Wal-Mart’s warehouse retailing strategy failed to appeal to Korean consumers who wanted to buy in smaller units and more comfortable settings even if that meant higher than “everyday low prices.” Christie’s attempted sale of two looted Chinese relics set off a public relations nightmare that hurt the auction house’s reputation in a market where collective sentiments sometimes override those of individuals.
These missteps provide good lessons not only to global companies already in Asia, but also to those planning to enter in the future.
What are the caveats that marketers need to keep in mind when doing business in Asia? Here are some suggestions:
1. Avoid the marketing-template mentality.
Managers are accustomed to think in terms of standard operational procedures. Marketing is no exception—we are trained to make annual plans, track marketing metrics, and inspect key demographics. It can be tempting to just download the templates and fill in the data. Such an approach may be less effective in Asia because many markets are turbulent, evolving, and as we saw with Wal-Mart, defy easy categorization. We therefore need to rethink and be flexible in our many units of analysis so that they better fit the market conditions of Asia.
2. Don’t ignore the “YO” Factor. Think of Asian countries as both Young & Old.
Many companies focus too much on Asia being very young or very old. The truth is that it is both. Yes, we are young as modern economies (Japan excluded), but we also have some of the oldest cultures on earth. Both forces operate and interact to influence consumer behavior. For example, Starbucks became a hit not only for its new coffeehouse concept but perhaps more so because of Asians’ age-old need to socialize. Marketing success in Asia hinges on how global companies properly balance the ”YO” mix and how well they push the right hot buttons to the market.
3. Try to tap the communal mindset.
In Asia, as compared with the west, there is still a greater sense of community that can influence consumer behavior. This is very evident in the internet domain where portals dutifully inform users the most popular topics that others are searching. In Korea, leader Naver provides a Q&A feature, Knowledge iN, that openly sources from its layman users answers to detailed and sometimes offbeat questions. Those supplying good replies can achieve “Sun God” status. People can also check a user-generated database of over 70 million queries including many on shopping. For foreign companies, this kind of information can be useful in gauging common interests and potential lightning rods in the local markets.
4. Accumulate marketing memory.
Many global companies rotate their top personnel from one country to another. For marketing, the consequences can be dire as valuable local marketing knowledge is lost. Moreover, local relationships, a key Asian asset, are also wasted, which can be critical in B2B markets or in managing marketing intermediaries. Global companies must therefore build an infrastructure that can store such vital marketing information or create continuity at the top marketing positions.
5. Get in the trenches and be more local than the locals.
Many multinational firms competing in Asia often trumpet the “we’re more global” message, but it rings hollow when homegrown firms like Samsung are now an even greater global presence. Waiting in the wings are other potential Asian giants like Lenovo, Haier, and Tata. Global firms therefore need to find another game-changer. Ironically one such strategy could be to out-localize the locals. Many luxury brands, prized in Asia mostly for their global appeal, are now appreciated for their local sensibilities. As Asian markets mature and become more demanding, consumers’ loyalties will lie with brands that best deliver superior value — regardless of who does it. This is a message that Asian companies must also heed both abroad and at home.
I have merely scratched the surface of the many marketing issues faced by global companies in Asia. For several decades to come, this region will emerge as the primary growth market for the world. Reflecting this new economic reality, what else do you think global companies can do to be better positioned in Asia?
Dae Ryun Chang is Professor of Business at Yonsei School of Business in Seoul, Korea. He has taught and given industry talks around the globe on advertising, branding, sponsorship, and digital marketing.
This article was first published on www.hbr.org (http://blogs.hbr.org/cs/2010/02/in_asia_marketing-101-doesnt-work.html) on February 5, 2010.
© 2010 Harvard Business Publishing