Sooner or later, successful companies reach a point where they need to scale up their business and enter foreign markets. Southeast Asia, which is currently setting the trends for global economic growth, is particularly attractive in that regard.
This is a huge market, despite having thousands of its own brands. Plus, entering the markets of each individual Asian country is a unique, incomparable experience.
The main mistake most companies make is that the overwhelming majority of them want to operate in other markets, but don’t want to invest real money in doing so. You have to understand that serious investment is a must and that you will have to wait a certain amount of time before you will see a return. But if you do everything right, it will pay for itself. If, however, you set your goals and objectives as “profit right here right now,” failure is a certainty. You will see much better results if you are able to understand that this is long-term, painstaking work, and that attention is being paid to good quality and customer care (always a priority in Asia).
Meanwhile, you need to keep in mind the particular mindset of consumers in this market: a different way of thinking and of doing business. And they don’t like foreign companies, even now. Many Asian countries have closed-off, complicated rules for operation that only allow in residents, at best.
Therefore, you need to have a clear understanding of this market, its trends, and its future prospects, and develop a step-by-step strategy.
First off, it is very important to achieve visibility for your brand: almost no one in Asia wants to work with a European company that doesn’t have a certain level of name recognition. Participating in expos, forums, and conferences can help with that. That’s not to say you should ignore negotiations and one-on-one meetings, but the large-scale events are a good additional tool. You can learn a lot of new things by attending, as well as establish the contacts you need. The audience for trade shows abroad generally consists of private entrepreneurs and potential clients.
Next, you need to choose your country. A variety of factors influence the process of entering the Asian market, including macroeconomics, politics, and personalities. If the high-level political relationship between your two countries is going smoothly, your business won’t run into problems either. Mutual recommendations help a lot. Clients and partners will be more comfortable working with you if they know your company has already had a successful partnership with another country in this region.
Choosing the right country is a very important aspect of entering the region. It’s worth starting wherever the barriers to entry are lower. First, enter the market in a smaller country, test it out, make all the mistakes you can, and only after that try growing your presence in the markets of larger countries.
From the very beginning, your company should have someone responsible for international development, because entering other countries is always accompanied by serious adjustments to adapt to them: studying the local laws, adapting your products and services to match local idiosyncrasies, and so on.
After that you have to research the market you chose very deeply and in great detail. You need to collect a huge mass of data, from cultural aspects to the specifics of distribution, commercial environment, and retail chains already present in the country.
In any case, you need to be objective about your capacity. Sometimes it’s cheaper to contract this kind of research from international research companies that specialize in this sort of thing, since it is quite a challenge to do high-quality research of this kind on your own. Not to mention that it is common to be off the mark when estimating the cost of preparing for market entry.
Another important aspect is the language barrier. When entering the global market, you can more or less divide the world’s countries into two categories:
Many Asian countries, in fact, belong to the second category (China and Japan, for example). And since their markets are quite large, these countries are used to foreigners adapting to them, not the other way around. This means that to attempt to enter the local market you need to, at the very least, localize your product.
Finally, the most straightforward tool is customers who have already purchased your product or service. They are your best promoters, provided that the price matches product’s quality. Here you can often rely on the basic tool of word-of-mouth marketing: someone makes a purchase, tells someone else, they also come and buy it, and the chain reaction begins.
To sum up, having a quality product, localizing it, branding yourself properly, designing and packaging your product according to local standards, and taking a careful, individualized approach to each customer are the foundations of success when entering the Asian market. What you need is a symbiosis of good product, people, and marketing.