Export or die!

The title of this piece refers to the catch-cry of the British Motor Industry some 65 years ago. Back at the end of WWII, the UK’s motor vehicle manufacturers put a serious effort into exporting their products, globally, especially to the Americas, Australasia and elsewhere in order to re-start the country’s economy, almost destroyed by the then-recent conflict.

I believe the Export or die philosophy is relevant today, especially for SME-level businesses in the USA, where the nation’s economy needs some serious action to get things going again and people back into jobs.

At the start of this decade, during the economic downturn that occurred after the dot-com boom went bust, I wrote an article in a small, Northwestern US business newspaper about how much of the world wanted to ‘buy American’, and the difficulties they faced trying to do so. This desire for US goods is still there today; why?

• ‘Made in USA’ still offers a perceived guarantee of perceived consistent quality and reliability in many global markets;
• Because of the huge domestic market and the ability to make things in large volumes, US-manufactured goods are often surprisingly competitive, internationally. This is especially true for niche manufacturers. In fact, these companies might find that they’ve got global markets they didn’t even know about just waiting to buy their goods and services!
• As a global trend-setter, products and services from the USA often have an in-built prestige about them. Many consumers in other lands love to be seen with the latest and greatest – best of all, it doesn’t have to be made in Asia. Many American-made goods from smaller-sized enterprises could and should be perceived as being just as desirable as the latest offerings from the multinationals;
• Add to that, the Internet offers global access to American goods and services like never before.

So if that’s the case, then why aren’t more SME-level American companies getting into international markets? My observations are that:

• American SMEs have little understanding of the global marketplace, the downside of its having such a large local economy;
• A lack of belief that a small business can compete, internationally. I can’t recall how many times American businesspeople are shocked when I tell them about how New Zealand, a nation of SMEs, competes globally without subsidies. In fact, my adopted homeland’s plastics moulding industry is competitive, internationally; it’s therefore safe to say that its US-based counterpart would be equally so;
• American SMEs seem to have a fear of the unknown when it comes to exports;
• While the US Department of Commerce and other agencies have sone pretty good export programmes, I believe that SME-level exporting is still very much a low-profile activity for these organizations;
• The American banking system is archaic by world standards when it comes to handling international transactions. I remember the Letter of Credit for an export order for a Middle East client having to go through THREE different US banks for the transaction to be completed, as only one of these institutions was set-up for international business! Compare that with my ability at the time to go to the local branch of any of the banks I dealt with in NZ to do a foreign exchange transaction…

Many business media commentators in the USA have said that it’s the SMEs that will create the jobs that will help pull the country out of the nation’s worst recession in living memory. However to grow businesses, they’ll need customers, and those may not be found within the local economy. This is why I suggest that Federal, State and Local Governments should begin promoting export development far more proactively than it has done in the past, especially in the fast-growing economies of Latin America and Asia.

It’s all there for the taking, there are export development programmes, all kinds of advice and assistance available for exporters, and an infrastructure of US Embassies and Consulates in place around the world ready to help – all it needs is American small business owners to believe it’s possible for them to succeed in a global economy.

(c)2010 visavant, all rights reserved

Why is the essence of marketing so hard to understand?

In the more than three decades I’ve been involved in marketing, either as a hands-on marketer, a marketing consultant or as a trainer of the topic, it amazes me how many businesspeople get the concept completely wrong – what I usually get from other marketers, in effect, is promotion, which is an activity of the overall marketing process, but not marketing in itself.

It’s even scarier to think how many of the respondents hold MBA degrees in Marketing! What were they being taught at university? Frankly, I’m afraid to find out the answer…

Rather than dealing with an academic description of what marketing is (google Stanton’s definition, if you really, really need one), I wanted to talk about the essence of marketing, which involves one or both of the following four-letter words, repeatable in all company:

• NEED
• WANT

It amazes me how many marketers seem to ignore these two simple words. Unless one understands what the core need or want of a target market, how can one satisfy that need or want with the appropriate product or service? To whittle Stanton’s definition down to the basics, marketing is about getting paid for offering a product or service that satisfies a client’s needs and/or wants. Without understanding this, marketers are, for all intents and purposes, product pushers, and nothing more.

In my work, I constantly ask people about what their companies or organizations offer, and I usually get something about what their company does. What I try to do is get my clients and workshop participants to turn their thinking around and ask themsevels: "What does our product or service do for our customers?”

For example, I recently had coffee with a couple of colleagues, and one of them, an ambitious young insurance agent, said he was having difficulty in working out how to get clients to buy his product range.

The guy is very much client focused, as opposed to being focused on how much commission he makes – in other words, he’s in the business for the long-haul and wants long-term clients; a good thing, in my opinion.

My first question to him was what was he offering his clients. After a few goes at answering the query, he finally said, “I sell comfort.”

“Yes”, I answered, “you’re selling comfort, plus security, and peace of mind.” Just understanding what his offerings did for his clients, emotionally, opened his eyes to how he might be able to approach his customers in the future.

By understanding their needs/wants for ‘comfort’, he could tailor his offerings to meet them, and allow for changes in insurance coverage and investments as his clientele’s future requirements changed. This should build-in the potential to maximise client value at the beginning of the relationship, giving him an advantage over his competitors who are only interested in selling product to make commissions, short-term. It’s sure a heck of a lot easier to sell to a happy customer than constantly troll for new ones, the latter being the usual case in the Insurance Industry, I’m told.

This is why understanding the essence of what one’s products and services offer to fulfil the client’s needs and wants is the key to successful marketing.

In case you’re wondering, how do I define what my businesses do? We’re knowledge merchants, and how that knowledge is sold, its cost and in what form, is based entirely on the specific needs, wants and expectations of a particular client.

Copyright 2010, visavant, all rights reserved

Iran - It's showdown time!

According to the wider general media, the current conflict between Iran's fundamentalists and the country's more moderate groups may, yet again, be coming to a head. As much as many of us outside the region would like to see the Moderates' protest become a catalyst for social and political reform, I believe that the protests planned for the 31st anniversary of the Islamic Revolution will only serve to harden the current regime's hard line.

What saddens me is that all this may have been avoided almost a decade and a half ago, when a more progressive Iranian government wanted to reengage the country with the West, openly admitting that the so-called revolution had not been as successful as originally imagined. The response from many Western countries, most notably the USA, was to reject these overtures out-of-hand. Frankly, I think the American reaction was a completely ignorant position, and was based upon that country's then rather conservative Congress wanting to punish the Iranian government for deposing the Shah in 1979 - it's the same idiotic mindset that's been used against Cuba for almost half a century (my favourite part of the latter is the threat of sanctions against any country that trades with the island state, which would include a number of European and Latin American countries whom the US considers strategic allies!).

Had the West responded positively to Iran's desire to reconnect, this traditional centre of Middle Eastern culture and political power would still be run by more progressive individuals. By forcing it back into isolation, it provided a catalyst for the Fundamentalists' return to power, and all the fun and games the rest of the world is having over Iran's nuclear programme.

One can only hope that the reformists in Iraq will continue their protests in a positive, constructive and peaceful manner and that the regime in Teheran will eventually listen to their concerns. Islam is an inclusive faith that traditionally preaches tolerance and openness, and perhaps those in power in Iran need to remind themselves of that.

FOR SALE: Afghanistan

With reports in the wider media about world leaders offering to pay the Taleban and other opposing groups in Afghanistan to side with the Karzai government, I wonder if those running the war there have finally realised that they cannot overcome these groups by force? If you read the history of the area, you'll understand that everyone, from the likes of Alexander the Great and Genghis Khan through to the Imperial British and the former Soviet Union have tried and failed to subdue the Afghanis.

My concerns are what happens if the Islamists whom we are supposed to be fighting and bringing to justice offer the Taleban more cash for their loyalty than the West is prepared to offer? Are we going to see a bidding war, and how long with such loyalty remain?

...Or perhaps this is merely a way for the US and its allies to extract itself from the place and save face in a publicly palatable manner?