Monday, January 11, 2010

Push/Pull Marketing to Global Customers

By Rodney Hiel

Over the last few years since the recession began, emerging BRIC (Brazil,Russia, India and China) markets have been the bright spot in global sales growth opportunities for many western companies. With several state and federal government agencies offering a variety of assistance programs to accomplish these goals, business results as published by various business organizations such as the American Chambers of Commere (AMCHAM) in these markets have resonated with American executives and had a "Pull Effect" to either start or expand their international sales during these challenging times in the west (contributing a "Push Effect".)

The AMCHAM office in China produced its annual white paper on the China business environment drawn from a survey of over 7,000 US businesses in China. A few attractive facts from its latest survey of 2008 include:
*74% of businesses found their 2008 Financial Performance to be Profitable or Very Profitable
*87% of businesses found their China Opertions Revenue in 2008 had stayed the same to increased substantially compared to those in 2007
*78% of businesses found their Operating Margins in 2008 remained the same to improved substantially when compared in 2007
*71% of businesses are forecasting 2009 Revenues to remain the same or increase over 50%

These results have generated a significant "Pull Effect" to draw US companies to China. In many cases, selling to these markets has helped them endure these challenging times. But unfortunately, not enough US companies are taking advantage of this opportunity.

In a recent Minneapolis/St. Paul Business Journal article written by Jennifer Niemela, Klobuchar: Small Biz needs helps with exports, "Sen. Amy Klobuchar is calling for expanded resources to help small businesses promote their products overseas." In the article,
Klobuchar (D-Minn) and George LeMieux (R-Fla) members of the Senate Commerce Subcommitte on Comptitiveness, Innovation and Export Promotion are asking that the Department of Commerce issue a report on export promotion that would detail resources currently available to small businesses to help them increase their exporting. "We live in a global economy and our country's small businesses should get the benefits," said Klobuchar in a statement. "Increasing our exports will mean more American business opportunities and that means more jobs and more economic growth."

With lagging sales in the west, and double digit growth in BRIC markets, these government efforts now become a "Push Effect" to drive US businesses into international markets. Some of the local resources currently available to assist in these efforts are the state and federal trade offices and trade associations such as the Midwest Global Trade Association (MGTA), US China Business Connections (UCBC), among others. Like these previous organizations, some local private consulting companies like Asia Business Consulting produce unique and specialized education events to assist in these efforts.

Given the recession, any new markets Minnesota companies can sell to will significantly soften the hard times locally and just as importantly, will lay a strong foundation to grow globally inthe future. There has rarely been a time where there has been such a strong and coordinated Pull and Push Effects happening at the same time. If a business cannot take advantage of these opportunities, this will certainly raise the question, "How long can this company stay in business during this economy?" Contact me with your thoughts.

Rodney Hiel is the Managing Director of Asia Business Consulting, a Minnesota based firm that researches, develops, and tactically executes a proven process to create cost effective strategies for market entry in today's China and Southeast Asia.

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