It's rare to find an exporter that sells the exact same product or service in their international markets in the exact same way they do in Australia. Here's how to customise your exports to suit your destination markets for better sales.Every exporter knows they need to heed cultural differences to succeed overseas. Even exporting to New Zealand, often thought very similar to Australia, requires a cultural understanding of the market and business environment there, for example with regard to its Maori heritage. The worst thing you could do is assume that the market is similar, and blunder your way in. So whether you're looking to alter your product or service to make it more suitable in an overseas destination, change your marketing to better communicate with potential customers in a specific country, or learn more about doing business to avoid etiquette mistakes, customisation is the name of the game. "The key to successful entry into an international market is not only knowing when to compromise and adapt, but knowing when to stand firm," says Amit Mehta, consultant at DC Strategy. He says many businesses underestimate the power of local culture in its ability to make or break its global ascent. Mehta uses an 80/20 rule whereby 80 percent of the business-containing the core values of the company-must remain untouched, whereas "the remaining 20 percent should be adjusted to capitalise on the unique facets of the local market". One example he uses is fast food chain McDonald's, which conquered non-beef-eating nation India, despite its fame as a beef hamburger restaurant. McDonald's realised that selling beef hamburgers was not its core business, it was actually "the systems, processes, marketing campaigns and vibrant fit-outs" that made the business work, says Mehta. The chain happily changed the menu to suit the local palate, offering the Maharaja Mac, a chicken-based version of the 'two all-beef patties' Big Mac. "McDonald's has taken every element that makes the business successful and adjusted the offer such that the core of the brand is not lost, but the nuances of the local market are catered for," explains Mehta.
Set the standard
Quality standards and other regulations that may apply to your business, products or services could be a cause for customisation. Some markets may even use these standards and regulations as an unofficial trade barrier, so be aware that paperwork could be difficult and the bureaucracy process a hindrance. One poignant example of how regulations could affect your business is the recent Russian ban on kangaroo meat. Earlier this year, Russian supervisory body Rosselkhoznadzor had "concerns of bacterial contamination" according to spokesperson Alexei Alexsenko. "We had quite a few shipments of kangaroo meat infected with [E. coli] bacteria, which is absolutely prohibited by Russian law and regulations." The ban came into effect on August 1 and-since 70 percent of roo meat exports went to Russia-brought the industry to its knees. Could the industry have avoided its fate? Perhaps if the harvesting of roo meat were more systemised to ensure the supply was free of E. coli, the sector would still be selling to Russia. Services may also need customisation to suit a country's standards and regulations. There are licensing requirements that apply to legal practitioners in each jurisdiction, for example, that may restrict either where they practise or how they practise. Lawyers may need to undergo a conversion test, or may need to work alongside a practitioner who has qualifications from that jurisdiction to operate their practice.
Mind your language
Linguistic customisation is often the most obvious change you may need to make, which could include translating everything from ingredient lists to place of origin tags, instructions to marketing material. Even in English-speaking countries you may be obliged to provide translations: for example in Canada, even if you are not selling to the French-speaking province of Quebec, you must have written material in both English and French. Even if you have no legal obligation to translate material, it may make good market sense. In southern parts of the USA, for instance, having material in Latin American Spanish as well as American English may extend your market because of the region's large Hispanic population. The other thing to watch is the dialect of language you use. In the example given, I cited Latin American-Spanish, which differs from European Spanish, and also American English, which differs from Australian English. Awareness of these differences will prevent translation mistakes and marketing gaffes. One interesting case was Mitsubishi, which had to rename its Pajero for Spanish-speaking regions because it meant 'masturbating man'. It was instead marketed as the Montero.
Every exporter should question whether their product or service is culturally fit for the destination market. While the subject of cultural differences could fill several books, one example of how you may have to alter your offering comes from Boost Juice, which learnt to put seating in their Asian stores because "customers weren't used to walking around with a drink," says Jacinta Caithness, CEO of Boost International. Culture may also affect the product itself; the Australian wine industry, for example, is keen on doing more to educate potential consumers in places like China and India where wine is not part of their beverage heritage. Understanding the cultural assumptions of colour could also help sales-in China, red is auspicious, white is funereal-and taking advantage of a country's customs could also assist your business there. For example, a recent report by the Rural Industries Research and Development Corporation showed that Australia's tea harvest coincides with the New Year tradition in Asia of giving gifts such as green tea, presenting an opportunity for us. Marketing according to the culture of the destination country is also very important. You need look no further than Tourism Australia's controversial 'Where the bloody hell are you?' campaign, which came under the scrutiny of many advertising watchdogs worldwide due to use of the word 'bloody': acceptable in Australia, but perhaps offensive in other cultures.
Choose your platform
Another way you may need to customise your exports is the method by which you market and sell your goods or services. If you do a lot of direct marketing in Australia, you may have to change tactics in China where the concept of marketing 'cold' is uncommon. There, selling succeeds through known networks. Similarly, mail order may be the best way to reach elderly customers in the USA, whereas the same demographic in Japan is quite comfortable buying online. If you do sell online, make sure you understand how your customers access the web. In many countries, your customer could be coming to your site via mobile phone. In that case, features that need high bandwidth, such as Adobe Flash animations, may be off-putting. Consider also whether you're likely to sell more if you use agents or distributors to get your product into a department store versus setting up a standalone operation: having a signature store, for example. Is the market open to new players, or do you need the 'endorsement' of being associated with a well-known brand or medium to be successful?
Costs and benefits
In an interview with Lisa McAuley of the Australian Institute of Export, Fay McGuigan, one of the founders of McGuigan Wines, says the transition from a domestic to an international business came with some costs they had to consider. "Every country had different label requirements. As you can imagine, this dramatically increases your printing costs, but also affects the production chain. You cannot bottle and label the export wine at the same time as managing production for the domestic market," she explains. "This sounds difficult to manage, however if you are determined to succeed, I can assure that you soon work out a system to balance production for both markets." McGuigan had to introduce a process that met both the production requirements to keep the business viable, but also meet the labelling requirements of all the countries to which they exported. Without this system, they would not have been able to enter some markets in a cost effective manner. Any of the customisations you make should thus undergo a cost-benefit analysis. Use DC Strategy's 80/20 rule to determine whether your business model is export ready; if the customisation process involves changing more than 20 percent to enter a particular market, it might not represent a good investment to sell there.
Finally, even if you change nothing of your offering, you will have to tailor the way you do business with potential and existing overseas customers. Researching business etiquette is a good start; understanding everything from how different countries treat time to their notions of hierarchy, what they mean when they say 'yes' to their negotiation styles, will help you customise your direct approach to people and increase your chances of successful relations. There are several books on this subject, including those on doing business in particular countries, as well as free online resources, and courses you can attend to find out more. Don't forget to ask other exporters how they handled their business-to-business dealings in a market, as anecdotal advice could prove invaluable to prevent mistakes. Customisation is a recommended, if not obligatory, part of exporting. Your ability to adapt your products, services, promotional material and/or business to a market could determine your success internationally. Read on for our case study on one business' experience of export customisation
CASE STUDY: Jamaica Blue
Known nationwide for its tasty fare and fine coffee, cafe franchise Jamaica Blue now has footprints in New Zealand and China. Sarah Bolton-Hall is the international project manager at owner Foodco Group. She says as a franchise, Jamaica Blue wanted the same look and feel for China as the Australian and New Zealand cafes, however admits some differences between the Asian and Antipodean versions. Firstly, though the coffee is the same and most of the menu matches, the Chinese offering contains more Australian tastes than the domestic menu. "Things like lamingtons and meat pies aren't things you'll find in our Australian stores, but for our Chinese customers who are looking for a modern western cafe-style food offering, those items are still very much part of their menu," explains Bolton-Hall. And while most Jamaica Blue cafes in Australia are nestled in shopping centres, Foodco had to customise its market pitch to suit the appropriate demographic there, including aiming its pricing at the higher end of the market. Hence, China has more restaurant-style cafes in residential areas and corporate buildings where they are destinations, rather than walk-by eateries. For these locations they've extended the food menu and added evening meals to suit the restaurant style, and have some licenced premises. Other menu changes came down to supply issues: "Particular ingredients, even pre-prepared ingredients like Tandoori paste, aren't available, or we can't get a good quality product in China, so we end up making those from scratch," says Bolton-Hall. This includes its cake range, which in Australia comes from a specialist cake supplier but in China comes from a central Jamaica Blue kitchen. "In China we haven't been able to find a suitable supply that's unique and still really good quality, so we've gone back to scratch recipes." The central kitchen model changes the relationship between the cafes, and distribution lines. "In Australia everything is made within the individual store but in Beijing and Shanghai we've set up central kitchens so the cakes and the large savoury items come out of that central kitchen fresh every day," she describes. Additionally, Jamaica Blue doesn't work on a franchise model in China because it was easier to license the concept and have it run under a company structure. Its licensees provided a lot of context about the Chinese coffee culture, including competition and customer expectations, which helped its entry strategy. Says Bolton-Hall: "Research, and being able to look at what products and supply was available was really important prior to going into the market."