After 20 years of bringing American entrepreneurial IT companies to markets across Asia Pacific, I have learned that there are four crucial elements to successful Asia market entry. They are: Market, Offering, Strategy and Team.
The answers to the critical questions for each element will vary across the extremely diverse nations of Asia Pacific including Japan, China, Korea, Philippines, Vietnam, Thailand, Cambodia, Malaysia, Singapore, Indonesia, Bangladesh, India, Nepal, Sri Lanka, Maldives, Pakistan, Australia, and New Zealand.
While each company will have its own unique issues to address, here is a guide to get the ball rolling for an Asia market entry initiative.
Market: The only element beyond your control is the market for your product. Even though you can’t control it, you need to be able to answer each of the following questions for each national market.
* How big is the target market for your offering in Asia?
* Who are the buyers?
* How mature is the market? Will you be pioneers and evangelists or are you coming to the party late?
* Do the customers buy on the same basis and process as similar customers in your home market?
* What is the competitive landscape?
* Who are the major channel companies and which ones would be interested in carrying your product?
* What are the potential revenue opportunities in 6, 12 and 24 months?
Anybody can answer these questions about their home market, but collecting and assessing this information for Asian nations and determining which one(s) to enter first can be very challenging for the uninitiated.
* Is your offering acceptable “as is” or will some functionality, interface, packaging, branding, or pricing modification be necessary?
Again, this is a very basic question to answer for your home market, but it’s quite challenging to collect that information for a region with so many languages, currencies, religions, systems of governments, development status, economies, demographics, infrastructure, types of customers, cultural norms and much more.
Strategy: “Give the People What They Want”
* Who are “your people”
* What do they want?
* How will you get it to them? What go-to-market model is best for that market within that country?
* What elements of your value chain will have to be replicated, modified or rebuilt to serve Asian customers and are your home office people and budgets prepared for the challenge?
Team: Many Asia entry attempts fail because the sales teams mobilize far before the rest of the company is ready to support. You must make sure strategies are aligned and everyone on the home office side is on the bus. You also need to fully answer:
* What team configuration will you need in the region? What support must they get from HQ? Who will do that?
* What skills, relationships and experience must each member of the Asia team have?
* How will you recruit, retain, manage and reward the team? What legal entities and physical environments will you need to support the team?
Overall, I believe team is the most important, and most challenging, element. Success in Asia is not about brilliant strategy or touchdown passes. Success in Asia is about stellar execution – solid blocking and tackling day in and day out.
There’s only one thing on earth that can provide solid execution: people. Specifically, you need people to introduce you to customers and partners; people to present and demonstrate your offering; people to sell; people to support and people to train. Clearly, a start up can’t hire an army of people to do these things across Asia. So, the strategy and business model must be designed such that the army of people materializes off-payroll and can be effectively recruited, enabled, monitored, and rewarded.
The first step to getting all of these elements aligned correctly is to gain consensus for an Asia plan internally. Selling in Asia can be very easy if you first “Sell Asia” within your company. Make sure everyone who will have to contribute to the effort is on the bus and happy about it. The plan should have an elevator pitch conclusion along the lines of ,”We are going to build a business of X size in Asia in Y years and we are going to do it by doing Z things.” You need laser focus on this or you won’t get the support you need from home to be successful in the field in Asia.
About the Author:
Greg Lipper is CEO of Asian Century Solutions (ACS), a Singapore-based company that enables clients to assess, launch and grow their business in 18 countries across Asia Pacific, including Japan, China, India, Indonesia, Singapore, Australia, Philippines, Vietnam and other Asia Pacific markets. ACS helps clients generate revenue – and develop Asia market knowledge, perspectives, and relationships – BEFORE making HR, infrastructure and other long term business investments in Asia.