It’s a pretty dark out there.
The economy has tanked, people aren’t buying and employees are treading on eggshells fearing they’ll be next on the dole line.
Time to dig the foxhole deeper and wait for the economic shrapnel to whizz by, right?
Fact is other smaller companies are eying your market share and thinking that you’ve gone into hibernation waiting for the new economic spring.
I work in Asia-Pacific and it’s here that the next breed of up-and-coming companies will come from to steal market share from today’s incumbents. Many of these companies are extremely successful in their home markets, where they have honed manufacturing and supply chain management into sharp, competitive weapons.
Their weakness is in marketing and understanding cultural, societal & business nuances outside of their core market.
I remember one large Asian IT company trying to engage in channel development and marketing in Australia — unsuccessfully (with similar results and experiences replicated in the US and Europe). Their experience in engaging with third parties and stimulating demand through that channel was rudimentary to say the least. It took a while for them to understand that the the channel itself did not generate demand for itself and that it was the task of the vendor to aggressively brand its products and services for end-user awareness, consideration and hopefully purchase.
They also failed to connect the dots when it came to understanding that because they were foreign, they had no brand equity and their local positioning and messaging was highly undifferentiated in a more highly competitive, open market.
So the company defaulted to winning business on price. After a few years, it realized that it could not sustain its offshore business profitably and that domestic sales were propping up overseas expansion efforts that could not pay for themselves.
No HBR study needed here: the company was on a fast track to a major crash and burn.
So it changed tack: it decided to outsource marketing and communications to Western companies that could help it overcome these challenges and it started to re-engineer its business operations as well as marketing.
It’s now starting to expand more aggressively as a result — despite the economic downturn. And guess what, it’s expanding in Europe, the Middle East, Africa and Latin America and then the US last of all. But it’s taking share from US and EU companies in those other geographies, taking significant bites.
With the global credit crunch, US and EU companies have dug their foxholes deeper, but in the meantime they are being surrounded by smaller, more agile, higher efficiency Asian companies.
If you want to take a look at the planet’s next IT powerhouses, a quick scan through the Deloitte Asian Fast 500 is an illuminating read (http://www.deloitte.com/dtt/article/0,1002,cid%253D239357,00.html).
So the message here is that now is not the time to shut up shop, now is the time to reinvigorate your brand, your products, messages and positioning because you’ll be ready to take on all challengers when the market swings back into the black.