The New Zealand Brand needs to work harder in Korea with a targeted approach to gain attention.
- New Zealand Food and Beverage (F&B) is the lead perceived strength and has the authority to claim global leadership in processed dairy, fruit & vegetables and some wines.
- Green technologies are an intuitive fit for New Zealand and shift perceptions into a sophisticated social context.
- Human-centric concepts such as education, e-health, e-learning, medical technologies, Bioscience and 3D/Film all link to a socially advanced welfare system.
- Sectors that are further removed from the core land and people, such as Information and Communication Technologies (ICT) and specialised manufacturing need to work harder to gain credibility.
For Korea, the New Zealand Brand needs to actively tell a linking story, building a premium platform.
- Build a baseline awareness and positioning in Korea, starting with the strength in F&B, positioning New Zealand as ‘premium’ by driving sophisticated niche products and visuals that ‘walk the premium talk’ with executions that are stylish and contemporary but authentic.
- Begin to articulate the New Zealand contemporary business story, leveraging from the ‘premium’ platform. Build cohesive stories around a contemporary, well educated, creative society, using green technology, technologies with a human touch and strong sciences. Proof will be conveyed through the quality of business marketing, digital strategies and business performance.
The brand name ‘New Zealand’ was tested in the research and was positively received as conveying straightforward, clean, natural, pride, and ‘doing things a little differently’.
Perceptions of New Zealand business
There is little change in Korean perceptions of New Zealand businesses since 2008. While the same positive core values predominate, there is a growing impatience that New Zealand is not stepping up to Korean business standards. In the tough competitive environment of Korea, New Zealand business weaknesses seem amplified.
New Zealand businesses are ill prepared in their approach to Korea, often failing at start-up in navigating contracts and relationships. Relationship management is particularly challenging in Korea, where personal relations take precedence over business opportunities and personal ties, such as kinship, schools, birthplaces, etc, override business interest.
- When evaluating a potential new supplier or product, Korean businesses will look first at the impact on any other existing relationships and will default to existing ties, despite better business opportunities with a new supplier or product.
- There are often implicit cultural obligations that underpin the relationship so long term persistence and dedicated ‘courtship’ are required to convey true commitment. Eventually, this creates an obligation to give a new supplier ‘a go’.
- The net effect is a lengthy decision process often over several years, and a complex relationship web where Korean businesses are risk-adverse and reluctant to change. Getting guidance from in-market Korean business people is key.
Contract negation is another cultural hurdle. Unlike the western concept of reaching an ‘agreed price and terms’, Korean businesses view contracts as a starting point, rather than the final stage of a business agreement.
- Active negotiations and new terms or price changes can continue until the very last minute of contract signing and beyond. Koreans recognise the legal implications of contracts, but these are less important than the interpersonal relationship established between the two companies.
Once a relationship is established, there is an expectation that the ‘commitment’ will be actively kept alive with continued social interaction.
- There is an implied obligatory ‘give and take’, so that a Korean business can ‘lean on’ committed business partners when needed e.g. for preferential terms or better pricing.
New Zealand businesses often ignore Korean product and package customisation.
- Korean design aesthetics reflect modern Japanese ‘perfection’ standards, while New Zealand production values can lack international design, are poorly executed, and packaging may be damaged in shipping.
- Products, such as meat cuts, are often in New Zealand formats and not customized to Korean usage or preference. There is a mindset that if it is ‘good enough’ for New Zealand, it is appropriate for the Korea market.
A critical issue is that New Zealand businesses are seen as slow and unresponsive in a market that elevates speediness to a religious status. Koreans seek a response within a day. Korean businesses are losing patience and have easier business options to choose.
Once relationships are established, however, Koreans are quick to see the positive attributes of New Zealand’s honesty and integrity, and pragmatically manage New Zealand’s businesses shortcomings as long as quality prevails.
In the tough Korean environment, a surprising number of New Zealand businesses fall over even after trading has been established. Koreans wonder why New Zealand does not chase business more actively, and attribute this to New Zealand’s lifestyle priorities.
New Zealand business needs to “sharpen up its act” including understanding the long term commitment needed and embracing speed and responsiveness. Critically, New Zealand businesses need to recognise the focus and tenacity needed to survive in the Korean market.
New Zealand products and services need to ‘tell a unique story’.
- For F&B this story is built from premium local or regional ‘handcrafted roots’.
- For ICT the story leverages from the F&B premium base position, highlighting a ‘best in class’, specialist platform ‘in all we do’.
