Martin Roll is a world-renowned thought-leader on value creation through brand equity, and the eighth interviewee in our Korea Business Interview Series hosted at KoreaBusinessCentral.com.
Martin Roll is Danish by origin, but currently based out of Singapore. He spent most of his career in international advertising and media before setting up his own consultancy ten years ago. Martin consults in around 40 countries every year, specializing in helping clients produce better results through brands, not in terms of colors and logos, but in forming and shaping business strategies on the two platforms of branding and marketing. Martin’s clients include some of the top 20 Korean corporations.
To listen to the interview, download the .mp3, subscribe on iTunes, read the transcript and/or discuss his interview and this topic with members of Korea Business Central, visit the following discussion link: https://stevenbammel.com/category/archives/kbcforum/topics/korea-business-central-7 [EXPIRED LINK REMOVED: https://stevenbammel.com/category/archives/kbcforum/topics/korea-business-central-7].
(The full list of interviews in the Korea Business Interview Series is help here: http://stevenbammel.com/post/kbc_korea_business_interviews)
Main Points of the Interview:
Topic #1 – About Asian & Korean Brands
- Ten years ago, Asia boasted barely five or ten global brands. However, at that time, the top Korean brands had an appetite for going global.
- The Asian brand leadership model, as outlined in Martin’s book Asian Brand Strategy, is based on the following five principles.
- Asian boardrooms need to change their mindsets and practices so that branding is lead by the CEO and the boardroom.
- Asian consumer patterns are not all that homogeneous and it is necessary to look at Asia as a patchwork of different cultures.
- Asian consumers are becoming increasingly modern.
- Asian companies need to become trendsetters and not just copycats.
- Make sure everyone in the company is empowered around the brand.
- The leading Korean companies all have Chief Marketing Officers now but only 2-3% of the Fortune 500 companies have one, which means marketing for most companies is still tactical, not strategic.
- Singapore Airlines is a leading Asian brand that has been true to their roots and origin by actually delivering the great service they promise. They spend 15-20 working days every year on training everyone within the company. They also invest a lot in new aircraft and technology so that they contribute as much as 20% to the national brand of Singapore.
- Other notable Asian non-Korean brands include HSBC, Samsung, Toyota and ASA (including its two hotel chains Banyan Tree and Mandarin Oriental).
- Samsung is the brand that brought Korea to the world. LG is now pursuing this same journey, but in a different way. Hyundai is the other top Korean corporation in terms of branding.
- Amore Pacific is an interesting Korean brand that is now one of the fastest expanding cosmetics brands in China by representing ten different organically grown brands.
- Korean brands are very good in innovating. Though they have not necessarily been first-movers, they have moved fast and are starting to gain confidence. Design is another area that Asian brands are starting to take notice of.
- Korean brands are a hit because Korea is so technology driven and Korean companies are innovative and spend a lot on R&D. They are quality focused, such that Korean brands are, in many ways, ahead of the rest of the Asia-Pacific region in this aspect.
- It took Western brands 50-100 years to do what Asian brands have done in 10-20 years.
- A strong brand has two components: 1) a strong functional offering and 2) the emotional aspects. Korean brands are stronger in the functional dimensions than they are in the emotional component. This journey of establishing emotional bonds with consumers can take 10-20 years to fully develop.
- As global corporations begin to all sell at the same quality and price levels, branding becomes the only differentiating point available, which makes it more important than ever. People don’t buy functional things but rather buy on the emotional aspects. Asian firms need to bring something to market that is different than others or they won’t create a strong bond with their consumers.
- Asian firms need to be more confident in their own cultures and realize that the global consumer has a huge appetite for Asia and for Asian heritage.
- Asian brands need to follow three methodologies to move beyond local markets: 1) get the strategy right through an orchestrated effort led from the top, 2) make sure they have the time, resources and money budgeted and 3) get the entire corporate culture involved in the effort.
- Korean firms tend to employ mostly Koreans. Even though a lot of very good Korean talent has lived overseas and come back to work in Korea, Korean companies still aren’t achieving a global culture like you can find in Nike, L’Oreal and Procter and Gamble. To become a global company, Korean companies need to mirror the global consumer in their corporate makeup but Korean companies are behind the curve in this trend.
- Success by foreign companies in the Korean market is incredibly difficult, in part because Korean brands are so strong locally. But the Korean market is attractive because of the buying power and consumer interest, which is also influenced by national pride.
- Foreign firms in Korea succeed by being satisfied to remain at number two or three in the market and by taking a long-term perspective. It’s not necessary to localize as much in Korea as in other markets since the foreignness of the brand is often what brought the Western brand to Korea in the first place.
- Foreign companies that have been successful in Korea include Nike, Coca-Cola and Proctor and Gamble. They aren’t taking a leading market share, but they are doing well in terms of branding and financial return.
Topic #2 – Branding the Boardroom
- The company CEO’s emphasis on branding is crucial to successful brand development. You can’t build a brand from the bottom up, particularly in Asia. It is necessary to have a mindset that everything you do within the company is actually cascading around a common brand practice, and a common brand strategy.
- Human resource practices in Asian firms are centered around the functional aspects, and not in really rallying people around the brand and what the company is all about.
- A multi-talented boardroom that represents different cultures and different functions is important in order to make sure it represents the people who are going to move the brand forward in the global marketplace.
- As China works to build its own brands, Korean companies need to work even harder over the next 5-15 years to get out into the global market as soon as possible.
- Martin’s response to Korean executives who ask if global consumers will really like what Korean companies are doing is, “Yes, they will. They love things that come from Korea because you have a fantastic offering; you have great quality, innovation and design. Push it out into the global market!”
Topic #3 – Branding Korea Inc.
- One challenge for Korea in terms of branding the country is that there have been too many stakeholders involved in the effort. So Korean branding efforts are fragmented. Simple strategic systems need to be put in place from the center to bring things together.
- Still, just 10-15 years back, Korea was relatively unknown; but as people come to find out about Korea, they are surprised and interested.
- Key points of advice to Korea for promoting the Korean brand internationally: 1) Korea needs to set up a presidential task force lead by the president, 2) simplify the command structure for the national branding efforts, and 3) simplify and consolidate the message around three to five key messages and then focus on those for the next 5-10 years.
- Martin recommends the following three attributes about Korea on which to build this strategy: 1) Business Korea, 2) Innovative Society, and 3) Tourism
- In terms of tourism, the messages coming out of the various regions of Korea need to be orchestrated under the umbrella of Korea as a nation.