Transcript: Get to know South East Asia
There are three videos in the Anne Lochoff's 'Get to know South East Asia' series. Read the individual video transcripts by clicking below.
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Get to know South East Asia
I love kiwi companies. They are so innovative and they do so much due diligence about their idea. In a way they’re even too hard on themselves to really perfect a good idea; but I’ve never had a problem selling a kiwi idea anywhere in South East Asia because of that due diligence. It's really something to be proud about.
I actually think that because kiwi businesses are really careful about the ideas that they foster, they really are developing niche products; so they really have to be focused on finding those niche segments in Asia, because the niche segments are so big in Asia versus niche segments being really small in New Zealand; and that allows for growth and scale for companies in New Zealand and that’s a massive opportunity.
In New Zealand business is very transactional; you have a product, you offer it and the person says yes or no and gives you money and the transaction is done. But underlying all business in Asia and South East Asia is relationship building; nothing is done unless you have a relationship on the table. I think that is one of the biggest sort of, not really a mistake, but misunderstanding or confusion that potentially happens with New Zealand companies coming up to South East Asia.
I’ll illustrate that for you in terms of coming up to South East Asia. A business relationship would thrive in New Zealand if there were a couple of emails and maybe a coffee every now and again. But in South East Asia there is formal meetings and gatherings face to face and gift giving, but a real intent to do constant face to face.
With mega cities that are beyond 10million you actually need a city strategy, not a country strategy; so as you’re assessing your even regional strategy and you’re landing in a country or a city, is really to actually find out the best ways to understand your end user or consumer and then decide whether you’re going to use a direct model or distribution model. These are some of the biggest things that you’re going to have to decide on and figure out how you’re going to make that decision when you first do a country or city visit.
I’ve been in Singapore and obviously managed a region of Asian, Middle East and Africa for eight years and in that time I’ve learnt so much, but I would probably say the biggest learning is not to regionalise everything; in other words have an approach to South East Asia that is unified; it's just not one big blob, it is many countries with many cities, with multiple cultures, multiple languages, multiple considerations in terms of how you do your business. I guess that seems like a simple realisation but when you get into the region that is something you’ve got to keep reminding yourself about. It's easy to try and find one way that you can cover an entire region because it feels like the easier way, but it just isn’t going to work.
Insights into South East Asia - a big oportunity in Smart Cities
I’d really like to see more New Zealand companies actually thinking about how they repackage themselves as a smart city contributor because of the skills we have in New Zealand. One of the areas and people don’t necessarily think about this but I would like them to, to make the connection, is an agri-tech. Right now the trend is to really understand how urban and rural agriculture intersects so that we can actually feed mega-cities. Mega cities are anything beyond 10million and as soon as you head over that threshold the process of actually feeding and getting food into a city becomes a real problem. So we are in need of a way of actually generating and creating food inside of a city and it is a really new approach to agriculture. The two things that New Zealand does well is tech and agriculture. But it's to actually realise that that fits into a smart city solution and that we have that expertise and legacy and then go out and actually sell this to countries and places that actually need an urban and rural agricultural solution; because we don’t necessarily need it in New Zealand but it's needed elsewhere and we have the expertise.
Really having a look at the role that New Zealand can play within smart cities in the gaps that are not being serviced. If you look around the world Singapore is sort of serving the infrastructure side of smart cities. China and India are really doing it by actually building smart cities from scratch and Silicone Valley is supplying a lot of the sort of technology that we’re seeing in Smart Cities and big corporates like IBM and Cisco are looking at the grids and the infrastructure. You also have Mayor Bloomberg starting C40 so that all the mayors of the world can start talking about climate change and issues within cities. So this trend is global and it's going to actually have a massive impact. One of the other areas that New Zealand can really take their expertise into this trend is in the environmental space. Some of our expertise in managing the environment within a city is fantastic and we really need to look at some of these services and knowledge or leadership that we have that we can apply to smart cities.
The value of e-commerce in South East Asia
NZTE is a fabulous partner when it comes to looking at partnership strategies, channel strategies, distribution strategies, which is crucial for New Zealand companies. But as a considered channel E-commerce really needs to be on your list of considerations. Five years ago that wouldn’t have been the case in South East Asia because the platforms were immature, they weren’t well developed; also from a logistics point of view they weren’t very well supported, but that’s all changed very quickly. You have the likes of [0.39] one of the biggest Japanese E-commerce platforms who have just sold off their country by country strategy and are moving to a regional strategy for South East Asia. That’s a massive move because you haven’t actually been able to service a regional E-commerce strategy in South East Asia at all and now that the big players are moving that way it's key that you actually start looking at that as a strategy for companies coming up from New Zealand.
I constantly advise New Zealand companies to invest in online communities and by that I mean actually if you’re going to be in food and beverage established a foodie blogger network that you can build up and connect with, leverage, talk to and also use as an R&D tool. This is a real investment in marketing where the asset is yours and you don’t actually take a once off approach to marketing where you do a campaign and then you exit out. A network like that or a community as we call it will service you consistently while you’re in market and while you’re out of market. And a lot of companies really prefer to actually run their marketing centralised out of New Zealand and this is one tool that really helps you be able to do that. But it also because bloggers are not just sort of based in one country because they’re readers and the people that get you is much wider, you can also start spreading the word a lot further if you just start setting up those communities and investing in those communities as assets for marketing.
Marketing firstly is sort of silo’d off as a once off activity and something that requires a lot of money; so there’s a perception that it requires a lot of money and that you only do campaigns or promotions. Whereas if you actually sort of look at it as a potential R&D tool that gives you access to your consumers and that you can actually build up these communities over time and do incremental investments into them. It's a far better way of actually approaching marketing.