Consumer Discretionary

<p>Imagining Brands in International markets vis-&agrave;-vis domestic is like imagining a&nbsp;fight between an MMA fighter and a Heavy Weight Boxer.&nbsp;While they are competent in their respective fields; both would stand utterly compromised if they were to fight under each other&rsquo;s rules!</p><div class="getty embed image"><div>The biggest challenge that a brand faces in the International arena is in knowing that it may not be a BRAND in that market! It may not have the same equity or consumer demographic that it enjoyed in its home market. So, HUMILITY should replace HUBRIS the moment your product leaves domestic waters. <strong>You are no longer the CHAMPION. You become the CHALLENGER!</strong></div></div><p>There&rsquo;s a reason why Walmart struggled in Japan, Brazil, and Germany despite all their money and global sourcing prowess. GM could not make a dent in the Indian car market despite repeated efforts. And eBay was beaten in its own game by Alibaba in China.</p><p>In my opinion, there are 3 key ingredients for building brands outside your domestic market:</p><p><strong>SKILL:</strong> T-20 players don&rsquo;t always perform well in test matches. Allrounders are good to have but can&rsquo;t always replace specialists in a team. You got to choose horses for courses (both in terms of products as well as human capital) when you want to venture outside your domestic market. Build a team that truly understands international business dynamics &amp; can deal with ambiguity.&nbsp;</p><figure class="wp-block-image size-large"><img class="wp-image-561" src="https://thepragmatistin.files.wordpress.com/2020/09/photo-by-jess-vide-from-pexels.jpg?w=819" sizes="(max-width: 819px) 100vw, 819px" srcset="https://thepragmatistin.files.wordpress.com/2020/09/photo-by-jess-vide-from-pexels.jpg?w=819 819w, https://thepragmatistin.files.wordpress.com/2020/09/photo-by-jess-vide-from-pexels.jpg?w=1638 1638w, https://thepragmatistin.files.wordpress.com/2020/09/photo-by-jess-vide-from-pexels.jpg?w=120 120w, https://thepragmatistin.files.wordpress.com/2020/09/photo-by-jess-vide-from-pexels.jpg?w=240 240w, https://thepragmatistin.files.wordpress.com/2020/09/photo-by-jess-vide-from-pexels.jpg?w=768 768w" alt="" data-attachment-id="561" data-permalink="https://pragmatism101.com/photo-by-jess-vide-from-pexels/" data-orig-file="https://thepragmatistin.files.wordpress.com/2020/09/photo-by-jess-vide-from-pexels.jpg" data-orig-size="3600,4500" data-comments-opened="1" data-image-meta="{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;,&quot;orientation&quot;:&quot;0&quot;}" data-image-title="photo-by-jess-vide-from-pexels" data-image-description="" data-image-caption="" data-medium-file="https://thepragmatistin.files.wordpress.com/2020/09/photo-by-jess-vide-from-pexels.jpg?w=240" data-large-file="https://thepragmatistin.files.wordpress.com/2020/09/photo-by-jess-vide-from-pexels.jpg?w=819" /></figure><p>Japanese make beautiful matcha. That doesn&rsquo;t mean that it will sell like hot cakes in India (which is one of the largest tea-drinking markets). And to understand this nuance, you need people who are well versed with designing RTM for international markets.&nbsp;</p><p><strong>GRIT:</strong> International business is inherently subject to risks! Currency risk, regulatory risk, tariffs or something like COVID-19 can deal a killer blow to your market plans.</p><p>You require a truly resilient mindset and an entrepreneurial team to tackle such headwinds without losing the sight of the endgame. Companies quickly lose their way once they digress from their central mission. Never try to rationalize your failure or change of premise.</p><p>Try to be the solutions guy. Even a layman can tell you what is the problem statement? Art and skill is in finding and implementing the solution. Remember, it takes a lot to get the flywheel in motion, but once it does &ndash; the momentum carries it forward.</p><figure class="wp-block-image size-large"><img class="wp-image-563" src="https://thepragmatistin.files.wordpress.com/2020/09/photo-by-shotpot-from-pexels.jpg?w=683" sizes="(max-width: 683px) 100vw, 683px" srcset="https://thepragmatistin.files.wordpress.com/2020/09/photo-by-shotpot-from-pexels.jpg?w=683 683w, https://thepragmatistin.files.wordpress.com/2020/09/photo-by-shotpot-from-pexels.jpg?w=1366 1366w, https://thepragmatistin.files.wordpress.com/2020/09/photo-by-shotpot-from-pexels.jpg?w=100 100w, https://thepragmatistin.files.wordpress.com/2020/09/photo-by-shotpot-from-pexels.jpg?w=200 200w, https://thepragmatistin.files.wordpress.com/2020/09/photo-by-shotpot-from-pexels.jpg?w=768 768w" alt="" data-attachment-id="563" data-permalink="https://pragmatism101.com/photo-by-shotpot-from-pexels/" data-orig-file="https://thepragmatistin.files.wordpress.com/2020/09/photo-by-shotpot-from-pexels.jpg" data-orig-size="5195,7792" data-comments-opened="1" data-image-meta="{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;,&quot;orientation&quot;:&quot;0&quot;}" data-image-title="photo-by-shotpot-from-pexels" data-image-description="" data-image-caption="" data-medium-file="https://thepragmatistin.files.wordpress.com/2020/09/photo-by-shotpot-from-pexels.jpg?w=200" data-large-file="https://thepragmatistin.files.wordpress.com/2020/09/photo-by-shotpot-from-pexels.jpg?w=683" /></figure><p>If you are one of those who hate looking at red ink in your books for a few years, please don&rsquo;t enter International markets. People who puke at the first sight of blood don&rsquo;t make for good surgeons.</p><p><strong>MONEY:</strong>&nbsp;You may have a Virat Kohli in your team but that doesn&rsquo;t mean you send him to bat without pads or gloves. Similarly, never expose your brands in unknown waters if you aren&rsquo;t serious about going the extra mile. And it invariably costs money! Money is the fertilizer that yields the best return for your brand over a period. If you&rsquo;re too scared to invest, you&rsquo;re better off trading. And then don&rsquo;t complain if someone else starts keeping a significant part of the value chain for himself.</p><figure class="wp-block-image size-large"><img class="wp-image-564" src="https://thepragmatistin.files.wordpress.com/2020/09/photo-by-karolina-grabowska-from-pexels-2.jpg?w=683" sizes="(max-width: 683px) 100vw, 683px" srcset="https://thepragmatistin.files.wordpress.com/2020/09/photo-by-karolina-grabowska-from-pexels-2.jpg?w=683 683w, https://thepragmatistin.files.wordpress.com/2020/09/photo-by-karolina-grabowska-from-pexels-2.jpg?w=1366 1366w, https://thepragmatistin.files.wordpress.com/2020/09/photo-by-karolina-grabowska-from-pexels-2.jpg?w=100 100w, https://thepragmatistin.files.wordpress.com/2020/09/photo-by-karolina-grabowska-from-pexels-2.jpg?w=200 200w, https://thepragmatistin.files.wordpress.com/2020/09/photo-by-karolina-grabowska-from-pexels-2.jpg?w=768 768w" alt="" data-attachment-id="564" data-permalink="https://pragmatism101.com/photo-by-karolina-grabowska-from-pexels-2/" data-orig-file="https://thepragmatistin.files.wordpress.com/2020/09/photo-by-karolina-grabowska-from-pexels-2.jpg" data-orig-size="4480,6720" data-comments-opened="1" data-image-meta="{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;,&quot;orientation&quot;:&quot;0&quot;}" data-image-title="photo-by-karolina-grabowska-from-pexels-2" data-image-description="" data-image-caption="" data-medium-file="https://thepragmatistin.files.wordpress.com/2020/09/photo-by-karolina-grabowska-from-pexels-2.jpg?w=200" data-large-file="https://thepragmatistin.files.wordpress.com/2020/09/photo-by-karolina-grabowska-from-pexels-2.jpg?w=683" /></figure><p>Spending money on brand in International markets is an art.</p><p>It is akin to knowing when to get off the roulette table in Las Vegas. Happiest are those who put $ 10-20k and end up making $ 100k or so on. The high rollers don&rsquo;t care, and the misers don&rsquo;t make much of a dent to anyone&rsquo;s fortunes. Investing in brands is just like that. You stake too little &ndash; and the gains would be puny. You put too much &ndash; and you risk losing all.</p><p><strong><u>WHY &amp; HOW of International Expansion?</u></strong></p><p>My personal template remains fairly uncomplicated &ndash;&nbsp;<strong>CHASE THE MONEY!!</strong></p><p>Identify a market/channel/demographic where you can be relevant. It is imperative to treat every market as a distinct animal rather than trying to homogenize your offerings. If you create value, there is always an opportunity. It&rsquo;s better to be a small fish in a big pond than the other way around &ndash; at least you give yourself a chance to grow!</p><p>Good competition will always force you to become better. Not to forget, everybody does like cheering for the underdog.</p><p>The other major fallacy is that most companies are always trying to sell what they make. Rather than making what sells in international markets. That rationale pretty much defeats the holy grail of consumer centricity. Getting your product right wins half the battle!</p><p>Coca-Cola sells more RTD Tea and Coffee in Japan than it sells its signature carbonated beverages. That&rsquo;s because the world&rsquo;s 3rd largest economy demands it. Close to 28% of their population is above 65 years of age and there is general revulsion towards artificial sweeteners. The Japanese love their teas and coffees. By following their consumer, Coca-Cola has managed to reign in the local Japanese soft drinks market ahead of domestic companies like Asahi and Suntory. Among 20 Coca-Cola global brands that bring in $1 billion or more in annual sales, four come from Japan &ndash; Georgia coffee, Aquarius sports drink, I Lohas bottled water, and Ayataka green tea.</p><p>Another critical element of your marketing strategy is to&nbsp;try thinking like a consumer and not like a company employee. Never let biases and subjective opinions clout your thought process. Try being 100% objective when you&rsquo;re trying to sell!&nbsp;Listen to your consumer and let him educate you on his market&rsquo;s dynamics. That way you will never go wrong.</p><p>An American tourist in India may not necessarily find the packaging of popular Indian snacks nor their taste as &ldquo;mainstream&rdquo;. His packaged snacks benchmark is bound to be different from ours. That is because packaging and taste are very subjective. As a marketer, you got to remove your subjectivity from the equation. The idea is not to please everyone &ndash; just those who matter most!</p><p>In my 12 years in International markets, I created a lot of new brands and packaging. Much of my work was considered Radical by my peer group in India. Again, it&rsquo;s important to understand that something radical for India might just be in-vogue in the USA. In the past, I have even unabashedly resorted to online crowdsourcing of my packaging and advertising briefs &ndash; eventually getting the project delivered by freelancers sitting in Amsterdam &amp; Taipei. They can better adapt to local sensitivities.</p><p>There are a lot of things that have been done in industry circles before you. And there will be a lot of things which will happen in the future. No company is ever satisfied with the status quo. Unless you positively challenge the system, nothing new is ever going to happen. Name of the game is innovation. And innovation happens only when someone with tenacity asks the right questions at the right time and is willing to back it up with action.&nbsp;</p>