Branding is relational, not transactional. It's about retention, not acquisition. I work with companies and governments to identify and develop the strategies required to build the relationships that ensure ongoing branding success.
I call it data driven branding & it should not be confused with creative driven branding.
I'm also a rugby nut & devoted family man, probably in that order, but don't tell my wife!
Even before the arrival of COVID19, the bottom had fallen out of the freelancer market in Malaysia. Once upon a time, freelancing was seen as the best of both worlds, work to your own routine, don’t have to answer to a dictatorial boss while only taking clients you wanted. Sadly life is rarely so simple and many freelancers have suffered.
A frustrated freelancer described the business to me like this:
Freelance graphic designers get friends asking them to do wedding invites for RM500, 3 days before the wedding. Even though the freelancer knew his friend was getting married, he didn’t ask for the business in case he was rejected. The friend getting married didn’t ask earlier because he’s disorganised or assumed his friend would do it. Plus he’s a guy and leaves everything to the last minute.
The freelancer is happy to get the job but 2 weeks earlier he’d won a RM5,000 job and had been paid RM1,000 but hadn’t started work on it because, well he’s a freelancer and works to his own schedule but the deadline is a week away and he was intending to work 3 days straight to catch up but now he’s got the wedding job so focusses on that because it’s for a friend and he can’t let a friend down and it’s a wedding, so he can’t push the deadline back!
As a result, the RM5,000 job gets put aside but he is too shy to tell the client. As the deadline approaches the client starts calling more and more often. Because he doesn’t know how to speak to clients, apologise and explain a new timeline, he ignores the client’s calls till he’s finished the wedding job which he does. His friend is really happy and pays RM250 and promises the balance later, blaming the wedding costs etc for the delay.
It’s his wedding and he’s a friend so the freelancer has to say no problem. Then he calls the RM5,000 client who ignores his calls because he’s got fed up and has taken the RM5,000 job and given it to someone else. Now desperate he starts looking for work but can’t find any.
He can’t chase the wedding guy because they are friends and it’s too embarrassing to ask friends to pay their debts. Besides, what if he tells other people in the kampung? He’ll never get another wedding job.
Meanwhile the RM5,000 client has found a freelancer willing to do the RM5,000 job for RM3,000 so even after writing off the RM1,000 deposit he paid to the first freelancer, he’s actually saving RM1,000 which should make his boss happy and his boss is more happy when money is saved than when value is created.
However, the freelancer who is doing the RM5,000 job for RM3,000 doesn’t put much effort into the job because he’s only getting 3k and it’s a lot of work and should really cost RM5,000 plus he didn’t get anything in advance because the client is pissed off with the first freelancer but why should he be punished?
I forgot to mention the original freelancer who did the wedding job used the RM1,000 deposit he got for the RM5,000 job for a downpayment on a 50 inch TV from Harvey Norman and desperately needs to make the next payment or suffer the humiliation of his neighbours seeing the TV taken away a month after it was delivered.
So he goes out and gets a RM5,000 job by offering to do it for RM1,000 with 50% up front so he can pay the next instalment on the TV. But after paying off the TV he’s got nothing left and TNB cuts off the power to his house so he can’t work. The client is calling him so he turns off his phone and goes back to his parents.
Meanwhile, all the companies that thought using a freelancer would save them money have seen deadlines and opportunities missed, brand equity reduced, reputation tarnished and large amounts of hair pulled from heads.
Across town in Damansara, a mother of three who markets herself as a social media guru because she’s got 10,000 questionable followers on IG and gets free products for promoting unknown skin care brands, suddenly realises that there’s more to social media than sharing 12 second videos of cats saving babies from falling off motorbikes in the suburbs of Boise, Idaho or ducks doing handstands. But she charged RM1,000 to develop a social media strategy for a government company with impossible to achieve follower targets because organic takes forever and she doesn’t have any budget to promote the posts which is probably a good thing for the rest of us because it’s less crap content clogging up our feeds!
So if you are thinking of becoming a freelancer or hiring one over a consultancy or an agency because they are cheap, think again. Think past cost and think about value. Cheap can often cost far more than moderately expensive. There are some good freelancers out there. But you need to find them. Not all of them are created equal and it can be very dangerous if you choose the wrong one…
This is not a piece about the latest technological advances, gimmicks toys or 5G, 8K, robotics, foldables, AI and other buzz words. It’s about preparing your business to compete in 2020 and beyond!
So what will be the big branding shifts in Malaysia in 2020? Here are ten developments that will help you take your company from innocuous business to sustainable brand:
1) Seismic shift away from using traditional media to create instant sales to relationship branding to ensure long term success: In 2014, in a global attempt to unseat Apple at the head of the consumer electronics table, Samsung spent a heart stopping RM50 billion, yes RM50 billion on marketing with a large chunk of it on advertising. It failed.
For twenty years Proton spent in the region of RM10 – RM25 million annually on traditional creative driven marketing. During that period, Proton’s market share fell from 85% to 16% and it had to be bailed out by the Chinese.
In 2018, Unilever slashed RM1.2 billion dollars from it’s annual marketing budget. The impact on sales? Zero.
And then there’s Malaysia Airlines. In the lead up to the tragic events of 2014, Malaysia Airlines spent over RM1 billion on traditional media telling us about Malaysian Hospitality. In fact it is still using hospitality to sell seats but lost nearly RM800 million in 2018.
Everywhere you look, businesses that have spent hundreds of millions of dollars on a traditional, creative driven approach to marketing are struggling to stay competitive, repeatedly bailed out by the government or have already gone out of business.
In 2020, the old rules of marketing will no longer apply. Replaced instead by relationship branding. Relationship branding focusses the organisation on establishing a personal relationship at every touch point with every customer, all the time.
Based around a business with a deep understanding of the organisations’ abilities (and limitations), relationship branding will seek to build deep, meaningful relationship with prospects and customers by delivering outstanding individual value and memorable experiences at every touch point throughout the customer journey and beyond.
2. Co-creation is the new innovation:Fusionbrand, one of Malaysia’s most established and respected brand consultancies is working with a local fashion house to build a community around it’s best customers. Each customer is encouraged to participate in the design process by voting for designs online.
Designs that ‘win’ will be developed and marketed in the same way as designs developed in house. This simple but effective example of co-creation will help build relationships with prospects and customers while encouraging participation in the success of the brand and at the same time, generate discussions that will be far more effective than traditional advertising.
This more collaborative and transparent approach to branding is nothing new but it’s rarely done properly. Yet ask yourself, if you are in a positive, fulfilling relationship, where your partner treats you as a partner, are you likely to end it? Of course not. In 2020, successful businesses will look to build relationships not sell products.
3. Develop social media strategies to leverage its power, not treat is as a tactical after thought: 2018 was the year Malaysians finally understood the power of the internet and in particular, consumer generated media (CGM) when they used it to peacefully topple an authoritarian government that had ruled for more than 60 years.
In 2019 Malaysians experimented further by repeatedly challenging the newly elected government while flexing their muscle on numerous issues such as the economy, education, immigration, transportation and taxes.
The taxi industry, utilities providers and other monopolies incurred the wrath of the increasingly confident Malaysian consumer. They and many others are under increasing pressure to perform and will come under further pressure throughout the year.
One Malaysian property developer saw its reputation practically destroyed because of the power of social media and more importantly, its inability to represent its brand effectively online in a crisis.
This provides an outstanding opportunity for businesses that understand social media and how to develop a strategy to leverage its power. To do so, firms will need to be more genuine, authentic, accessible, transparent and human. One way to do this is by creating and managing online communities where customers interact with each other, often to the detriment of the brand. Attributes that don’t come easy to Malaysian CEOs but they really don’t have a choice.
The irony is that such transparency and collaborative approach is beneficial to the brand. The Ogilvy Loyalty Index found that such customers are worth six times the value of a “typical” customer while a McKinsey study found that these customers accounted for two-thirds of online sales.
4. Enhanced customer connectivity: With consumers increasingly choosing to shut out the more than 5,000 messages they receive every day, companies must accept that they need to look for more innovative ways to engage with and stay connected to customers if they are to stay ahead of the competition in 2020 and beyond.
The good news is that consumers are more willing than ever to share information and this, coupled with the increasing affordability of tools that provide better capabilities for segmented messaging mean there is no longer the ‘no budget la’ excuse for not integrating technology into any brand strategy.
Moreover, advances in geolocation collection and activity-tracking, mean that companies can provide personalised, custom content and offerings as well as anticipate needs and potentially prevent potential issues at a fraction of the cost of even 5 years ago.
A word of warning though. Enhanced connectivity means more interactions so personnel need to know how to represent the company and what tone of voice to use. Marketing automation and chatbots are not a solution on their own. It’s how you use them that matters.
5. Social branding: Increasingly, companies will understand that brands have social as well as economic value. This is a lesson that companies such as the Body Shop, Patagonia and Ben & Jerry’s have long recognized. Think #MeToo, Black Lives Matter and Movember for examples.
In 2020, companies will increase sponsorships of a wider variety of social movements. Sights like RankABrand are sharing information on how sustainable brands are. Expect Malaysian companies to pay greater attention to corporate governance, recognizing the strong effect that transgressions can have on their brands.
6. Product placement will not go away: As advertising becomes less effective, better enforcement of the PDPA act, do-not-call lists and more robust spam filters, companies will have to work smarter to get their products in front of consumers. Look for an expanded emphasis this year on product placement, not only in TV and movies but also in songs.
7. Blogs will get the recognition they deserve in 2020: Blogs are hardly new but they aren’t used properly in Malaysia or rather they weren’t up until 2018 when they helped bring down the government. An online tool powerful enough to help influence and change the voting habits of Malaysians while making obscure Swedish gamers international superstars and multi millionaires will be used extensively in 2020 to move product.
While there are many bloggers in Malaysia, not many of them are consistent. In 2020, we’ll see blogs begin their rise as a cost effective tool for internal and external community relationship builders.
Smart brands will recognise the power of good blogs such as syedoutsidethebox, Bangsarbabe and of course this one! The power of Blogs to fuel word-of-mouth, which accounts for 30-50% of all brand switching will be truly recognised.
8. Training and upskilling: 2020 will be a tough year economically, making competition even more intense. Moreover, international brands are now targetting Malaysia making it harder to find talent willing to join Malaysian businesses.
This means Malaysian companies will have to invest more in their personnel, treating them as an investment not a cost.
9. Brand audits will become fashionable: In 2020 smart companies will invest in hard hitting brand audits that identify what is right (and wrong) with the brand and provide a benchmark for future strategies.
Understanding where is the brand today, providing a clear vision and mission as well as making sure everyone within the organisation understands what is the brand, its values, what is its purpose and what their role is in delivering memorable experiences will be the key to moving from price driven businesses to brands so expect to hear a lot of talk in 2020 about brand audits [LINK].
10. Fast-forward to the end of 2020: Keep an eye on immersive communications. Talked about since 2005 or so, immersive communications has struggled to cut through the noise, mainly because businesses don’t want to make the investment, preferring instead to try and shout louder than everyone else because everyone else is shouting.
Branding is often not about new stuff, it’s about doing the fundamentals better than anyone else. Get that right, while delivering on promises made and you’ll see your brand succeed where others fail in 2020.
If you’d like to learn how to make your business a brand, contact us today
The Skytrax awards are based on the responses of 21 million participants from 100 nationalities. It is touted as the largest annual airline passenger satisfaction survey in the world.
I have a number of issues with satisfaction surveys, the primary one being that they don’t really provide any actionable insights. J.D. Power, a research company carries out an annual satisfaction survey of US airlines and their 2019 survey shows travellers are more satisfied than ever with airlines.
Yet high levels of satisfaction don’t translate into increased profitability as airline stocks underperform most markets, mainly because as capacity continues to grow, prices continue to fall.
And many of those surveyed probably travel once a year in economy. Business class passengers’ account for only 5.4% of international travel, yet are responsible for 30% of airline revenues. On some flights business class passengers account for 75% of profits.
Little wonder then that Malaysia airlines, Qatar Airways and Emirates are going all out to attract premium class passengers as we head into the lucrative end of the year holiday season. But which one of them flying to the UK deserves your hard earned money?
We compare the business class offerings of these three of the main carriers.
Online airline booking experience
If you want an easy to navigate, seamless experience with an online booking engine that is clear and transparent with an intuitive interface then Emirates clinches this important part of the process as all the information is clearly laid out, allowing you to make changes without too much effort or repetition.
The Qatar Airways sites is easy to navigate although the font is a bit small. They lose a point for the outrageous ‘no show’ penalties while Malaysia Airlines loses a point for the limited number of flights offered but wins it back for being the only one to offer direct flights, shaving at least 3 hours off the journey time. Emirates 4. Qatar 3. Malaysia 4.
Check in at Kuala Lumpur International Airport
There’s nothing to choose between the three, which is a massive lost opportunity for MAS because KLIA is its home airport and should be used to really make a powerful first impression.
Check in staff for all three carriers also need to be trained to have more enthusiasm for their jobs and be constantly reminded they represent the brand at the start of the relationship with passengers.
It may be a process for them but it isn’t for the brand or the customer. It’s a key touch point in the relationship building process and shouldn’t be underestimated, especially by Malaysia Airlines. Emirates 3. Qatar 3. Malaysia 2.
Emirates, Qatar Airways & MAS lounges at KLIA
All three lounges are on the ‘mezzanine’ level at KLIA and are all harder to find than they should be, especially the Plaza premium lounge. This is not unique to KLIA as most airports appear to hide their lounges.
When flying Qatar and Emirates I took the early morning flights that left around 0200hrs. Qatar doesn’t have its own lounge at KLIA so uses the Plaza Premium lounge. Which is anything but premium.
From an experiential branding perspective, this is a massive fail on the part of Qatar Airways. I don’t know why they haven’t invested in their own lounges, not just at KLIA but at other airports around the world.
Emirates lounge is small and intimate with a limited but superior range of hot and cold foods and beverages including premium non vintage champagnes. The lighting is calm and the environment relaxing. Staff are attentive and knowledgeable.
Understandably the MAS lounge is the largest but it wasn’t the most impressive. The first thing that hits you is the smell. It’s the unmistakable smell of Malaysian food.
It reminded me of walking into a food court. Nothing wrong with that perhaps but the Emirates lounge in Dubai doesn’t smell of Mandi while the Qatar Airways lounge at Doha don’t smell of Machbus.
While some business class lounges around the world are creating daylight boosting zones, ‘Hue lighting’ rooms and amber or blue lighting throughout, The Malaysia Airlines lounge at KLIA was rather dull and uninspiring. Emirates 4. Qatar 1. Malaysia 2.
Lounge to gate experience at KLIA
Walking from all the lounges to the respective gates should be straight forward but it isn’t due to a lack of effective way finding. While this isn’t the fault of the carriers, they should be able to influence the airport operator. Walking out of the Malaysia Airlines lounge, there is no sign directing you where to go or even how to get down to the ground floor.
The main security checks for all flights are at the departure gates. I think this is unique to KLIA and absolutely bonkers. At Dubai, Doha and Heathrow, by this stage it’s just a passport check.
So as a business class passenger on the national airline you queue with everyone else. This should be at an earlier stage of the journey where there are fast track lanes for business class passengers.
National carriers need to leverage every opportunity they can and home advantage is supposed to work for them, not against them. Malaysia Airlines really needs to get on top of this by working with stakeholders such as Malaysia Airports to create a memorable experience, for the right reasons. Malaysia Airlines loses another point here because KLIA is its home airport. Emirates 3. Qatar 3. Malaysia 2.
Business class environment on MAS, Qatar and Emirates
My Emirates flight was a Boing 777 while the Qatar flight was an Airbus A330 and the MAS flight an Airbus A350. So not exactly ‘apples to apples’ but close enough.
Emirates business class is bling central. It’s shiny, bright with huge TV screens and thousands of movies, TV shows, games, flight information and more. It’s world class and has won numerous awards.
The Qatar cabin is less ostentatious and a little more refined with equally impressive TVs and movies, TV shows, games and flight information. It’s also won many awards especially with Skytrax.
The Malaysian Airlines cabin is functional. It’s more Toyota than the Porsche of the others. The TV is smaller, of poorer quality and there are less new movies. Overall entertainment options are significantly less than the others.
I’m not comparing seats because that would only make sense if I compared exactly the same seat on each aircraft.
Wifi is free on Emirates and Qatar and costs US$2 – US$25 on MAS, depending on the package. Bearing in mind the quality of Wifi on flights is still patchy, charging business class passengers is not a good idea and MAS would be better offering it free. Emirates 4. Qatar 4. Malaysia 2.
Comparing inflight service on MAS with Qatar Airways & Emirates
I’ll focus on key experiential points here and not do a food review! The mix of passengers on all the carriers was essentially the same – Westerners, Arabs, Malaysians and a mix of others so they need to cater to all tastes.
Order a pre meal drink on Emirates or Qatar and it’s served together with a variety of warmed premium nuts in a bowl.
On MAS the nuts are the same as economy class and are served in the bag. Another bag of nut mix is also served the contents of which was a serious disappointment.
On Emirates and Qatar, every pre dinner drink order was a personal event and served by a ‘waiter’. I saw a number of passengers order cocktails, champagne and other drinks and the glassware is elegant and the whole experience is similar to a 5 star hotel cocktail bar.
The pre dinner experience on MAS is functional. It isn’t bad, it’s just not in the same league as the competition but it is competing with them for the same passengers so it really needs to be.
While the food is comparable, MAS really lets itself down with the way it serves the food. Emirates and Qatar prepare meals in the galley and serve them individually, MAS pushes the food trolley along the aisle, like in economy.
I was sitting in the back row so had to put up with the trolley clanking every time it went over a ‘lip’ on the floor next to me.
Oh, and on the MAS drinks trolley were some heavily flavoured and hugely sweet ‘juice drinks’ popular in Malaysia and other parts of SE Asia but not really anywhere else.
Watching MAS cabin crew peel back the seal on one of those containers didn’t make me feel like I was in an exclusive cabin. Pedantic perhaps but paying attention to these little things is what differentiates great brands from the rest.
MAS did deliver the main course personally so I didn’t have to put up with the trolley!
MAS losses a point over its coffee. The world loves good coffee. Arabs have been drinking coffee since the 15th century. Europeans have had a coffee culture for 400 years. There are 700 Starbucks stores in South East Asia, 140 of them in Malaysia. 75% of Australians drink fresh coffee every day.
Order a coffee on Emirates and you’ll receive a freshly brewed mug of Ethiopia’s finest beans. Same on Qatar, on MAS it’s Nescafe. Now I know Malaysians like Nescafe but the typical international business traveller from the East or West is more likely to enjoy a freshly brewed cup of java.
At the end of the meal on MAS, out came that bloody trolley again. And this time there was a rubbish bag on top and as the steward cleared plates, he emptied left over food and rubbish into the bag. Sorry but that’s simply not good enough on business class and another point lost.
All three offer a ‘mattress’. Qatar gets a special mention for providing The White Company pajamas. I didn’t use them but I took them home!
Like I say, it’s not that MAS business class is bad, it’s just that the other carriers have raised the bar when it comes to service. So it’s inevitable passengers will compare experiences. Emirates 4. Qatar 5. Malaysia 2.
Cabin crew attitude on MAS, Emirates & Qatar Airways
Cabin crew are some of the most underrated and under appreciated people in the aviation business. They need a wide variety of skills. They need to be professional yet friendly, polite and caring, have great communication and customer service skills while at the same time an empathetic nature.
They need to be flexible enough to deal with multiple cultures, have high levels of tolerance, be organized, firm and calm while managing multiple activities and all at 38,000 feet!
Little wonder then that cabin crew can make or break an airline brand. And it takes real talent to become good cabin crew. Asians have a natural charm and historically, Asian carriers have led the world in providing memorable experiences and it’s no surprise that Emirates and Qatar hire mostly Asian cabin crew from at least 15 Asian countries.
Emirates cabin crew lead the field in terms of professionalism. They are attentive and yet unobtrusive. The crew member looking after me introduced herself at the start of the flight and made herself visible without interrupting me. She made me feel special and important.
The service, personalization and ‘nothing is too difficult’ attitude was bang on the money.
There isn’t much to choose from between the Qatar cabin crew and Emirates, perhaps a little more refined but really nothing much in it.
MAS staff were professional and attentive if a little hurried. I felt they wanted to get the meal over with while the others seemed to actually enjoy their work.
When I complained about not being able to have a proper cup of coffee on MAS, the crew member – who was senior and obviously experienced – dealt with me sincerely, sympathetically and professionally. Emirates 5. Qatar 4. Malaysia 4.
Arrival in London
Most airlines seem to be happy to be rid of you the moment you leave the aircraft. However, flying Emirates business class entitles you to a limousine to any destination within about 70 miles of Heathrow or Gatwick.
This limousine option is outstanding value and ensures the last leg of the journey leaves a lasting, positive impression. I’ve lost count of how many times I’ve mentioned this service to people. Neither MAS or Qatar offer a limousine and for some I know it’s a deal breaker. Emirates 3. Qatar 0. Malaysia 0.
The post experience experience
None of the airlines try to build a personal relationship with you. I was travelling Qatar for the first time and yet there was a lack of personalisation in follow up communications. It was my first flight to London on MAS for about 5 years and I had mentioned it on social media but again, no attempt was made to build rapport with me although I was sent an email asking me to complete a questionnaire. Emirates carpet bombs me with numerous emails containing special offers but doesn’t do anything to build rapport with me. This a missed opportunity for all the airlines. Emirates 0. Qatar 0. Malaysia 0.
Malaysia Airlines comes in a distant third and that’s a pity because in the mid 1980s, before The Emirates or Qatar even had their own airlines, three airlines – Singapore Air, Cathay Pacific and Malaysia Airlines – invested heavily in their people to make the experience of flying with them memorable.
It worked and those airlines became the ‘poster boys’ of the commercial aviation business.
MAS began to lose sight of what it is in the 1990s and stumbled along until the twin tragedies of 2014. In the months and years after 2014, costs were slashed and it became nothing more than a low cost carrier masquerading as a national airline.
There is no doubt that it has made significant headway since those dark days but it still has a long way to go. To make the transition, management has to understand they are not selling flights they are selling experiences.
Looking at the MAS staff behave, my gut feeling is they are trying their best but the MAS training is inadequate in the face of such dynamic competition. And how the management react to the recent FAA ruling will be key to the next stage of the carriers evolution.
Splitting Emirates and Qatar isn’t easy. Qatar’s rise as a global carrier of repute has been meteoric and it is winning awards almost every day. Loads out of Kuala Lumpur are impressive but it isn’t investing as heavily in the experience as Emirates and that’s why it came in second.
Emirates is the benchmark for all airlines. The crew really seems to be in touch with the company values and living those values on board. Having said that, I hear there are rumblings of discontent amongst frequent flyers.
Emirates has undoubtedly reached the top but in many ways, that’s the easy part. Staying there and continually improving will be tough, especially if competitors up their game.
Emirates is a clear winner.
If you’d like to know how Fusionbrand can make your business a world class brand, please contact us on +60192233090.
Here’s a cautionary tale about how the innocuous actions of one brand can influence perceptions of another brand as well as cascade into more complicated issues.
At the end of October 2019 I flew into Kuala Lumpur International Airport from Narita, landing at 0500 hrs. On arrival at KLIA, I have 2 options to get to my house, Grab or the KLIA airport limousine service.
I intended to use Grab but when I arrived, I was prompted to take my picture for authentication purposes. As I’ve cracked my screen right over the forward facing camera, this wasn’t an option.
So the only option was the airport limo service. I couldn’t find an app for the service and their website doesn’t list the fares so I needed to use the booths at the airport.
I knew from memory that arriving between midnight and 0600 hours means I incur a 50% surcharge, which is fair enough.
As I walked through customs and reached the Airport Limo counter, it was closed. Fortunately I know there is also a counter at the domestic arrivals but I did wonder what the Japanese families who were on the same flight would do if they intended to take a taxi downtown.
Walking to the domestic arrivals area, I was approached by two illegal taxi operators who offered to take me downtown for RM200, almost double the expected airport limo rate, even after the surcharge.
Of course I told them to get lost but there are numerous stories on the internet of people who have been duped by these unscrupulous operators and I wonder if they approached any first time visitors, would they have paid the inflated price?
As these are not licensed operators, I presume they are not insured.
Anyway, when I got to the domestic taxi counter, I asked why the counter at international arrivals was closed and the young man replied, ‘Not closed, they are asleep.’
Now while I respect his honesty he shouldn’t be saying that. I mean, what sort of message does it send?
Finally, this frustrating and underwhelming brand experience ended with me walking out to the car where the only 2 drivers were talking to each other.
As I got in my car, the driver continued to chat with his friend. He then got in the car and continued chatting. It was all very casual, as if me the customer was more of an irritant than his only source of income.
But it also showcases the lack of appreciation for the customer that is so common in Malaysia.
It’s as if there is an assumption that there will always be an unlimited source of customers. This is especially common with those businesses that are monopolies.
This despite what happened recently to established businesses such as the taxi industry that has been decimated by travel disruptor Grab.
What are the branding lessons to be learned from this simple yet important interaction? The issue here is one of stakeholder communication and brand management.
These brands need to ask themselves why the booth at international arrivals is closed at a time 100s of passengers are landing at KLIA? How often does this happen?
Do staff sleep every night? If yes, what is the direct and indirect impact on revenue and reputation?
Why are the brand front liners so ill prepared for a simple customer question? Have they not been trained properly? What else do they answer so naively?
What can be done to fix the problem? How can staff be trained to present a more professional explanation? In this case, a simple response to such a question could be, “Sorry sir, they are changing shifts and will be back online in 5 minutes.”
There has been a lot of talk about illegal taxi operators at KLIA and how there is a zero tolerance toward them. That doesn’t seem to be the case in reality.
This isn’t just an issue for the KL taxi service, it’s also an issue for the Malaysia nation brand and the airport operator.
If tourists unwittingly use an illegal taxi and they are involved in an accident, incur medical expenses or worse, are killed. Who is accountable? Are the authorities, through lax enforcement, culpable?
Will it take a serious accident causing injury or even death to tourists to make the government do something?
What will be the impact on the brand if there is an accident and it goes viral? What damage will be done and how much and how long will it take to address the negative impact on the brand?
What will be the consequences of such an event on potential visitors or investors in the country? Will they potentially choose an alternative destination or review Malaysia as an investment option?
If illegal taxi operators are allowed to function without fear of prosecution, how does that impact the airport’s relationship with legal operators? If illegal taxi services can operate freely, why should legal operators follow the rules?
In the future, could those legitimate operators sue Malaysia Airports for loss of income?
What about the reputation of the police, already under fire in Malaysia for numerous issues ranging from drug abuse to mysterious disappearances, corruption and more?
What about the reputation of PDRM, will it be further tarnished by illegal touts operating with impunity at the airport?
If a Minister has stated there will be zero tolerance to illegal taxi touts why are they still operating? What impact will this have on future statements from the Minister, a representative of the government?
Successful branding requires all stakeholders to work together, to understand what is their responsibility to the brand and what is required to deliver a seamless, positive brand experience at every touch point every time.
This simple example of a seemingly innocuous event with one brand has the potential to negatively impact numerous other brands. Every business should look at branding from the same perspective and not in isolation.
It’s potentially complicated but the rewards for all stakeholders are positive and for commercial organisations lead to greater profits.
We’re looking for an accounts executive who doesn’t mind doing a bit of administrative support work. The position is advertised on WOBB, a popular job portal in Malaysia.
Last week we offered the job to an applicant and he accepted. The package meant a 25% increase over his previous salary and working with us meant he didn’t have to commute from KL to Kuantan every day. He seemed happy.
Then at 0625 on the morning of his first day, we received a text from him. Here’s his verbatim message:
Well my friend, we thank you for your apology and we’re sorry such a tragic event happened just when you were supposed to start a job that you feel is a once in a lifetime opportunity.
I appreciate you may be telling the truth although my gut feeling is that you are not. We’ve heard similar, though less dramatic stories before. Just today, we had another no show. She finally answered our messages 5 hours after the appointed time to say she had car trouble yesterday and forgot to inform us she wouldn’t be coming.
We get 100s of applications for nearly all the jobs we advertise. And we go through every one of them. Based on a number of criteria, we shortlist the ones that we want to know more about.
As you can imagine this is a time consuming process and for a small business, time is a premium. We communicate with candidates via text or email and if we’re happy, invite them for an interview and set aside an hour to get to know them.
Of course emergencies happen, cars break down and candidates receive other offers. In such a situation, all any business expects is to be notified. It’s called common courtesy or professionalism.
Now the more forgiving of my colleagues consider you have a special talent to be able to come up with such a creative excuse.
But to me you are unprofessional, immature, disorganized and ignorant. You lack confidence, courage and charisma. I don’t know why you left it so late, perhaps you fear failure or are simply indecisive.
By preferring to create an elaborate tale or distorting the truth rather than informing us of your change of situation, you’ve shown us what sort of person you really are.
I feel sorry for you because you have missed a fabulous opportunity to grow as an individual, to contribute to the growth of your country, feed your family and mature as an individual.
I will be eternally grateful to you because you’ve done Fusionbrand a massive favour by not joining us. You were definitely not a good fit. You’ve also opened the door for someone else to take this opportunity to grow as an individual and contribute to our growth.
To those people reading this who are applying for jobs with any company, be professional, confident and courageous. If you change your plans or decide to decline an offer, simply tell the company that has invited you in for an interview that you have accepted another offer.
It really is that simple. Don’t ignore it and hope it’ll go away. Don’t ignore phone calls and shy away from such ‘confrontation’. You’ll respect yourself for doing so and your reputation will be intact.
You’ll often hear creative teams talk about how beautiful or full of ‘meaning’ their concept logo or brand identity is. That it’s a visual representation of the business and communicates the very essence of the organisation.
They’ll tell you that your brand’s personality is reflected in the logo and that in a social media world the logo is more important than ever and that it must be the trigger to an emotional response and therefore is a key strategic imperative.
Unfortunately, far too many CEOs are seduced into believing every thing they say and many are convinced that a logo or brand identity is a strategic initiative when it’s not, it’s simply one (increasingly insignificant) tactic of many that make up branding.
OK, let’s take a step back for a minute and look at one of the most recognisable logos in the world, Apple. If you Google, ‘what does the Apple logo communicate’ the top result is this page from culture creation.
If you can’t be bothered to click on the link, here’s the description, “In the Bible, Adam and Eve are tempted, by Satan, to taste the fruit from the tree of knowledge.
Eve…gives in to temptation and takes a bite of an apple. Once Adam and Eve had their first taste of knowledge, they knew that they were naked, and they were ashamed. That first bite of the apple represents the fall of man.
The apple symbol – and the Apple computers logo – symbolizes knowledge.”
The article then goes on to introduce us to the Apple as the forbidden fruit, although it could have been a pear for all we know. We learn about the significance of the Apple in Greek mythology and the article closes with:
I don’t believe a word of it even though I’m a big Apple fan. What’s important to me is the fact that Apple makes great products and the experience of dealing with Apple is nearly always memorable, for the right reasons.
I think I speak for the majority of people when I say that I really don’t have the time or the inclination to analyse the meaning of a logo when I’m deciding on which company I want to buy a product from.
And even if I did, it wouldn’t make me keep going back to that company if the product/service etc wasn’t top notch. Especially for a luxury product like Apple.
And if the logo were so important, and so much thought goes into it, then what’s going on with this billboard seen around Kuala Lumpur at the moment? Why does this billboard feature 18 logos?
Are we supposed to analyse every one of these logos to determine what exactly they mean and whether they resonate with us? All done while sitting at a traffic light when we also need to check our WhatsApp, email, missed calls and sports results?
The fact of the matter is that in this day and age, a logo is nothing more than a symbol. It certainly isn’t a brand, strategy or branding. And while symbols may resonate with our inner pagan, it’s only over time and following multiple memorable interactions with the business across numerous touchpoints, does the business gain any meaning at all.
Building that meaning is what we call branding. You can’t manufacture it. You can’t have it. It’s something that builds up over time. And while you can nurture it, you can’t determine it. That requires a clearly defined strategy, an ‘on brand’ workforce, continuous engagement and a helluva lot of luck.
There’s no shortcut to branding. But branding should be what every business is focussed on because it has multiple internal and external benefits including attracting better quality talent, products or services that sell more quickly and at higher prices, better customer relationships that increase more profitable repeat sales, blocked competition and, of course, sustained profitability.
But most CEOs don’t seem to be able to grasp this. Or perhaps they just don’t have the stamina to build a brand. Preferring the campaign over the connection, the creative over the substantial, the superfical and irrelevant metrics such as likes over relationships.
Talking of likes, social media has made the logo even more irrelevant. When businesses could control the message, too many of them lied to consumers about their products or services. Even though the logos were great, consumers became jaded and suspicious and trust was eroded. More on social media later.
Nowadays consumers ignore much of what they see or hear brands tell them. They get their inspiration not from a cool advertising campaign but from the experiences of those they know and/or respect. In 2018, Nielsen reported that 83% of consumers believe recommendations from friends and family over all forms of advertising.”
If all advertising includes a logo and what advertising is saying is believed by only 17% of the population, what is the point of the advertising and, by default, the logo in the advertising?
It’s normally about now that people refer me to big brands like Samsung or Nike. If you use either of these global brands, ask yourself if you would have bought them the first time if everyone you know said the products were crap. Of course you wouldn’t.
Also ask yourself if you would continue to buy them if the products were hard to find, staff in stores were rude and as a result, the experience of buying them was underwhelming. Of course you wouldn’t.
And while we’re at it, I would argue Samsung doesn’t have a logo although the purists will say it’s a logotype but whatever it is it’s not a logo like Nike or Apple but still sold US$40 billion of products in 1Q2019!
20 years ago if you wanted to buy Nike products in Malaysia, you had to find the large wire basket in the corner of Isetan or Metrojaya with a few items of clothing, a couple of pairs of trainers and little else.
If you were lucky enough to find a member of staff, they rarely knew anything about sport and often covered cosmetics and household as well as all the brands in the sports departments.
When Nike decided to take responsibility for the brand in Malaysia, they didn’t create a new logo, instead they took ownership of the experience and now have 10 flagship stores in Kuala Lumpur and at least 6 more across the country.
To make that logo even more irrelevant, consumer lives today revolve around social media. Everything consumers do is influenced by their interactions on social media.
It’s only logical then that social media has to play a pivotal role in your brand strategy. But social media isn’t a passive channel like a TV. It’s interactive and is tailor made for participation not passive acceptance of corporate driven messages. Or your logo or your identity.
The great thing about social media is that it allows businesses to leverage word of mouth and to a wider audience far more quickly than ever before. But this takes time, resources and the right investment and commitment.
Most businesses are too lazy to do it properly. Or perhaps they are seduced by the creative agency sales pitch. As a result they use social media just like another media channel and despite the fact that consumers don’t trust them, still try to tell those consumers what they want them to hear.
They think they can manufacture a brand in the same way as businesses did in the past, often through a cool brand identity and logo.
But for so much better educated consumers who spend so much of their time on social media where content is distributed via titles and headings, screen grabs or personal shares, the logo no longer has a significant role to play in defining the brand.
It doesn’t matter who designed it or what meaning it has, the logo has become irrelevant. In much the same way as DVDs, CDs, audio tapes and many other tools from similar eras.
So if you are looking to rebrand your business and you have invited agencies or consultancies to present to you, I strongly recommend that don’t be dazzled by the creative images or past brand identities because those are not what is going to make your rebrand a success.
Focus instead on their processes and systems to review your brand internally, identify gaps or pinpoint weak spots in your brand experiences. Focus on their approach to collecting and using data.
Their approach to retaining not acquiring customers and how they will communicate with them once they are retained.
Focus on their understanding of the nuances of social media and how they will accelerate your online narrative. Don’t be seduced by how many logos they’ve created for businesses in your sector. Or on the promises about how your new logo will be seen by millions of people daily.
Focus instead on how they are going to spend hours nurturing your brand through every touchpoint every time.
I opened my LinkedIn this morning and had this message in my inbox. Now my trials and tribulations with BMW are well known to anyone who reads my blog on a regular basis.
But in case you are new and interested, you can read an example of why I detest this brand with a passion here.
Let’s go back to that message in my inbox. This is a relatively new channel for brands, especially here in Malaysia where most business owners think a billboard is the height of marketing sophistication.
So why would you use this channel? Well in theory it allows you to get in front of the right kind of people. Ideally, that is people who are interested in your industry and potentially although not in my case obviously, your actual brand and even a particular product.
The idea is to work with LinkedIn to target users who have shown some interest previously in a similar product or even better are perhaps engaged in related communities.
Best of all would be members who are engaged and want to know about the product. I’m none of these but that didn’t stop BMW messaging me.
Look at that message. What does “Athletically muscular and aesthetically uncompromising” juxtaposed with ‘its full-on racing DNA is visible from the get-go” even mean?
In the era of Mad Men this meant something. Today it shows a complete lack of understanding or appreciation of the customer journey.
Hopefully they are being charged per click because in the course of writing this post, I’ve clicked on the call to action many times.
And once I get to the site, I’m bombarded with even more powerful verbs, adverbs, adjectives and prepositions. Uncompromising power. The Perfect Gentleman. Design. WTF? I guess by now I’m supposed to be frothing at the mouth, desperate for the opportunity to own this beast, which incidentally costs more than RM1,000,000.
But perhaps most galling of all is that when I click on the link, I go to the main BMW site. So I’m being targeted as someone with the potential to spend RM1,000,000 on a car, yet now I’m supposed to mix with the hordes of BMW 1 and 3 series wannabe owners.
There should an exclusive, seamless way for me to engage with the dynamic 8 team waiting for someone like me keen to learn more about the 8 series!
But anyway by now, instead of frothing at the mouth, I’m doing what every potential customer does these days. I’m seeking out the opinions of people that matter to me.
And when it comes to buying a car, my first stop is Top Gear. BMW describes the interior of the 8 as “More irresistible with every detail. The elegant ‘CraftedClarity’ (note the nifty use of capitals and joining together of two words) glass application gives the sporty interior an exquisite appearance…It embellishes the insert of the gear selector…The result is an interplay of sporty flair and exclusive design that combines athleticism and grace like never before.”
Obviously as a jaded consumer who has been let down so many times by brands over promising and under delivering, I need to visit the Top Gear site to get a third party unbiased opinion.
Top Gear describes the interior as, “the new TFT- screen instrument cluster is a mess. There’s a big area in the centre that shows navigation diagrams, which can’t be used for anything else if you know where you’re going.” Hardly ‘CraftedClarity’!
Top Gear goes on, “Alongside is a near-unreadable rev-counter. In compensation you get a tach in the HUD when in sports mode. The new climate controls are a bit fiddlier than BMW’s previous efforts too, and the silver buttons are impossible to read when backlit. And while Apple CarPlay-over-Bluetooth is a convenient idea, it was glitchy in the test cars. That’s a nitpicking paragraph, but more nits than you expect.”
It’s a million Ringgit car! You nit pick away lads!
However, Top Gear isn’t done. They end the interior review with, “…The front seats are a good place to be, poly-adjustable and supportive. The back ones aren’t. They’re horribly cramped, for knees and heads. At least the boot is biggish, and folding the useless back seats extends it some more.”
That’s a long way from, “interplay of sporty flair and exclusive design that combines athleticism and grace like never before.”
The Top Gear verdict is seven out of ten and the very underwhelming, “It’s very competent across the board, but not greatly different from the rest of the BMW range.” Hardly a compelling reason to spend RM1,000,000. And that’s before the astronomical insurance, road tax and running costs.
So how can you make sure your brand doesn’t make the same mistakes? Well here’s a few ideas
1) LinkedIn messaging isn’t a tool for creating awareness. Don’t be lazy and treat it as one.
2) Branding is no longer about transactions. It’s about building relationships. Don’t try and sell anything to anyone at the first attempt.
3) Know your target market. How many people in Malaysia are likely to be able to afford or want a BMW 8 series? No more than a handful. There are better ways to reach out to them.
4) Have an integrated brand strategy based on robust brand, market and customer data to make informed tactical decisions. No more of this ‘spray and pray’ approach.
5) Understand the customer journey before making any tactical decisions.
6) If you are selling an exclusive product, make every step of the experience exclusive.
7) Brands can no longer expect consumers to believe what they say and not seek 3rd party confirmation of the claims. The days of flamboyant corporate driven advertising with ‘power words’ are over. Accept it. Be real and human in your content.
8) For an automotive company, the right way to use LinkedIn messages is to create personalized invites for a test drive or invitation to an exclusive and I mean exclusive, event.
9) Don’t use new tools in old ways.
10) Collect and use customer data.
It is inevitable that you will lose customers although preferably not the way I was lost to BMW.
Have a recovery plan for lost customers, especially those lost in an acrimonious way. But once lost, don’t include those customers in your marketing as it may negate your marketing efforts significantly.
But most important of all, branding today is about building relationships, not selling stuff. Use new tools properly to build relationships. The stuff will then sell itself.
Last week we lost a project to build a corporate website to a freelancer who quoted 5% of our figure. How can we compete with that?
On the face of it we can’t. Freelancers are popular because they are cheap. But as I was reminded while discussing this loss, last year we bailed out three companies who had chosen a freelancer and then had to spend a lot more money after he went missing in action.
If you find a good freelancer, he’s worth his or her weight in gold. But they are increasingly hard to find. And if you find a bad one, you could be in a lot of trouble. And not just with your boss.
Freelance web designers tend to create websites. But the goal is not to create a website. The goal is to create a website that compels as many visitors as possible to take action. That may be to fill out a contact form, sign up for a newsletter, buy a subscription and so on.
Because a lot of freelancers have a background in design, the design tends to lead the process and a lot of business owners are seduced by great design even though website design should follow content structure. The design is there to aid the engagement of the content.
The content and referring channels, are what influence search engines and not the design. Have an amazing looking site and lousy content and you might as well not bother.
And of course a good website is linked to tools that allow you to collect data you can use to improve content and engagement. Finally, a good website provides a little more control around the next step in the visitors journey which will be social media.
The 3 projects we salvaged last year eventually cost about the same as we had quoted originally. But after taking into account the business lost during 6 months without a website, cheap becomes expensive.
2 weeks ago we were contacted by a start up who hired a cheap freelancer last November. The site still hasn’t gone live. 5 months is a lifetime for a startup and it’s not just the money wasted on the freelancer. Reputation, credibility and sales have been compromised.
Another entrepreneur we’re helping has lost first mover advantage after hiring a cheap freelancer. In the four months it took him to create a terrible home page with dreadful content and questionable hosting, a competitor has launched a rival business. What has hiring a cheap freelancer cost him? What extra money will he have to invest to recover lost ground?
Many freelancers sell themselves cheap to get the business then try to figure out how to do it. They may be great designers but have lousy project and time management skills. This will negatively impact your business.
Many won’t refuse work, from anyone, ever. And while they may be a web designer, many of them will be asked to develop wedding invitations or websites for friends and friends of friends.
Nothing wrong with that of course except that when they get overloaded they tend to look after their friends and their friends of friends before their top paying customers. That’s illogical but perhaps it’s better to lose face with a stranger than family or friends, even if the stranger is paying 10 times more than the friend and, equally important but often overlooked maybe an influencer.
Freelancer quotes tend to be based on free templates built on WordPress or Wix. WordPress is a great platform with an intuitive CMS but the danger is you’ll have a ‘me too’ website that can look dated very quickly.
A freelancer may design what is easiest for him, not what you the client wants. There’s a good chance they’ll use free stock images and often use the same images for every project.
If a freelancer considers you to be ‘difficult’, they may go MIA mid way through the project. This can be hugely frustrating, especially if the site isn’t live. Talking of the website being live, once it is, what happens when there are updates to plugins?
One corporate site that we built wanted to maintain the site on their own. Then it came time to update a plugin. They made a mistake and the whole site went down. Not good. Luckily we had stressed the importance of daily backups so the damage was limited.
Who and where your website is hosted is very important. While your freelancer may be a great designer, does he understand the hosting process? Does he know the difference between a ‘bad neighbourhood’ and a good one?
Smartphone penetration in Malaysia is above 80% so it may make sense for you to design for mobile first, rather than desktop first. Make sure your freelancer has the necessary skills.
But most important of all is populating the website. Who is developing the content? Often the freelancer will tell you he’ll do it. Don’t let him. Plus you’ll need regular new content to keep the site relevant. Who will create that content and how will it be uploaded?
A lot of planning should go into the development of a corporate website. Whether you are a start up or established business, cheap can often have a high price so think carefully before you hire a ‘cheap’ freelancer.
According to marketing magazine, group CMO of Malaysia Airlines Arved von zur Muehlen lasted 6 months in the role before jumping ‘ship’ and joining a Canadian carrier.
This despite Malaysia Airlines crediting him with being “instrumental in restoring the airline’s position as a leading international carrier and developing its innovative customer-centric services.”
Only yesterday, Group chief executive officer Izham Ismail announced in a bullish interview with Bernama that things were improving at the carrier and the five-year Malaysia Airlines Recovery Plan (MRP) was seeing impressive results across the board.
He said “…customer experience had also improved with market-driven metrics based on the company’s customer survey and net promoter measures showing significant positive gains over the last two financial years.” I don’t quite understand what that means but I do understand that this latest departure and the barrage of abuse the carrier is getting online and on an almost daily basis (See this earlier report with hugely embarrassing videos) suggests things are not so rosy down there in Sepang.
But one thing seems to be for sure. Despite the CEO saying things are really, really good, Malaysia Airlines is a springboard to better positions in more solid Western carriers because Muehlen is about the fourth Western C level executive to bail out in the last couple of years.
This morning, I read with interest Sarawak Deputy Chief Minister Datuk Amar Douglas Uggah’s comments about the price of pepper.
You can read the full article here but the crux of it is that he’s talking about the dramatic price drop and appears upset (rightly so) that the solution offered by the Primary Industries Ministry and the Malaysian Pepper Board (MPB) was to plant more pepper.
He said that he had asked for the Federal government to provide subsidies for pepper farmers but no allocation was included in the Federal budget so the State government would have to provide the bail out instead.
Unfortunately the Minister’s solution isn’t right either. Sure, it may assuage the farmers in the short term but in the long term, the problem will return every time the price drops.
And with pepper production rising in many countries, the price is likely to remain depressed which means the farmers will require more handouts next year.
This leads to a dependence on the government because farmers will grow used to being bailed out. This is not effective use taxpayer’s hard earned cash and will slow the state growth, let alone build a globally competitive industry or for that matter a self sufficient industry.
Mature economies look to add value to their commodities. So that when the price of the main ingredient fluctuates, they have a buffer. One potentially lucrative way of adding this value is building global brands.
Sarawak Pepper is acknowledged as the best in the world and 90% of Malaysia’s pepper comes from Sarawak yet it is basically sold as Malaysia Pepper. Sarawak pepper still has some existing brand equity but it is rapidly being eroded.
The commodity business is a zero sum game. It’s like the Original Equipment Manufacturing (OEM) business, whereby firms manufacture equipment for other firms who then use their branding skills to sell the product at a premium.
This has proved to be a popular business model in Malaysia but as the country is now finding out the hard way, you can make money in the short term, but in the long term OEM is little more than a commodity business with very low margins and little growth potential.
But the biggest drawback is that there is always a competitor somewhere who can produce the same thing as you at a cheaper price and who can get it to market quicker.
Because the only relationship is a contract based on a cheap price, customers have few qualms about moving to those competing companies or countries offering cheaper deals.
We’re already seeing how Malaysian commodities such as Palm Oil, Rubber, Timber and Pepper, as well as OEM, especially in the electronics sector are finding it ever harder to compete in the face of competition from aggressive challenger economies such as Vietnam, Indonesia and Myanmar.
The time has come to start adding value to the commodity and OEM sectors in Malaysia. Companies in more mature Asian markets, such as Japan and Korea saw the lack of a future in competing on price.
In the late 1990s, when Eric Kim was executive vice president of global marketing at Samsung, he saw the writing on the wall, “We were nobody. We were down at the commodity level.” Samsung understood that they had to make the move from OEM to Original Brand manufacturer (OBM) and make it fast.
Moving from a commodity grower or Original Equipment manufacturer to a grower of ingredients for a global brand or becoming an Original Brand manufacturer (OBM) has huge benefits not only for the company but the country as well.
Today, Korea is admired and Samsung is imprinted on consumer DNA as one of the world’s leading brands. In flat-panel screens, Samsung is the market leader. In smart phones, Samsung sold 300 million units in 2017, compared to Apple’s 200 million.
Huawei, Haier, LG Electronics, BenQ, Lenovo and other firms have accomplished what many Malaysian firms need to do – make the jump from OEM (original equipment manufacturer) to OBM (original brand manufacturer).
The motivations are clear. Brands are more profitable. According to one report, the world’s top 100 consumer goods and retail companies generated sales of US$3.6 trillion recently and profits of US$228 billion.
Meanwhile, the top 100 OEMs in the Asia Pacific region that supplied products to those top 100 companies reported a relatively meagre US$85bil in sales, with total profits of US$4bil in the same year.
Making the move to OBM will also help with Malaysia’s bold attempts to move the country up the value chain to developed status. Other advantages include greater national employment and influence, increased opportunities for strategic alliances and leverage to open new markets.
Compared to the brutally competitive world of OEM, OBMs also have greater control over their destiny. How many Malaysian OEM’s have folded in the last 10 years after a major customer has sought lower costs elsewhere?
What happens to Sarawak’s pepper farmers if the Koreans and Japanese confectionary manufacturers source from Vietnam?
The good news is that thanks to long-established relationships with such major Western brands as Motorola, Dell, Texas Instruments, Ralph Lauren, Airbus, Tommy Hilfiger, Marks & Spencer and many more, Malaysian OEMs have the manufacturing, logistical and quality control potential required to compete in world markets.
But more Malaysian firms have to take the plunge otherwise they will lose out. And the government needs to focus not on bailing out farmers but showing them how to build brands that can conquer the world.
However, making the jump from commodity producer, the global branding dominance or from OEM to OBM is not as simple as spending millions on advertising.
It requires a substantial commitment of time and resources to establish channel relationships and share-of-mind in target markets. And the move is not without risk. Remember when Acer tried to breach the US market but had to withdraw, wasting an investment of almost $10 billion.
Key success factors include:
Change government & corporate thinking: Although Asian consumers are the most brand-conscious in the world, Asian Ministers and business owners devote much more time to advertising and discounting than branding.
Branding is seen as a cost, not an investment, and branding initiatives don’t get much further than billboards, TV commercials and annual sales (4 times a year).
Think long-term: There is no quick fix. It took Samsung five years to move from commodity to brand. Five years is a minimum, although specialty B2B markets may only require three.
Understand branding: Many Asian leaders believe that a new logo, large discounts and heavy advertising is branding. Actually, branding requires the ability to develop emotional and experiential as well as economic relationships with customers.
Ensure execution: Quality is a given. But is the distribution broad enough to support a national branding campaign? Where do consumers call for support? Are staff trained to deal with unhappy customers? How are returns handled?
Commit the resources: Consumer branding doesn’t come cheap. In 2016, Samsung spent US$10 billion on marketing its brand and products to consumers all over the world.
Bertolli, the global Virgin Olive Oil brand regularly spends US$10 million on advertising in the USA where its brand holds a dominant share (37%) of all the olive oil consumed in America and a market worth over US$1 billion. You do the maths.
Start with niche markets: Haier tried to break into the US market using a traditional advertising campaign. After a fortune in advertising driven branding was wasted, they carried out a brand audit as recommended by Fusionbrand.
After the audit, Haier spotted a gap in the hospitality and student markets and started selling small refrigerators to college students and hotels in the US. Now it sells all types of white goods, and in 2017 paid US$5.6 billion for GE Appliances.
Understand targeting and segmentation: The mass market is dead. Now there are as many markets as there are satellite TV channels, ranging from Chinese, Malay, English to Islamic. As a result, one-size-fits-all branding campaigns will not work.
Learn from failure: Honda’s first effort to export motorcycles to the U.S. ended in failure when Americans didn’t like the design. It carried out a brand audit, incorporated the feedback and successfully re-entered the U.S. market.
Invest in design and innovation: Copying existing products is a ‘strategy’ destined to failure as it faces pricing and branding obstacles. We all know how Apple became the biggest company in the world but it didn’t invent the smartphone or for that matter the tablet. But it made them good through innovation and design.
Malaysia is at a monumental cross roads. It has to move from grower and exporter of commodities and from OEM to producer of some of the world’s greatest brands.
The Deputy Chief Minister of Sarawak could save the tax payer a lot of money, make the Sarawak farmers very rich and do his government a big favour. Not by giving hand outs to farmers. But by helping them make Sarawak pepper a global brand.
Marcus Osborne is CEO of Fusionbrand, Asia’s leading data driven brand consultancy headquartered in Kuala Lumpur.