Magazine article Management Today

Covering the Uncommon Market

Magazine article Management Today

Covering the Uncommon Market

Article excerpt


Whenever it happens, 1992 is not going to result in a `Single European Market'. Despite the warm glow (whether from anger or otherwise) which people experience at the mention of this date, the huge differences between the 12 countries will remain - during our lifetimes, those of our children and those of their children. The reason is very simple: customers. Rather like leading a horse to water, you can take 320 million Europeans to an economic community, but you cannot force them to drink each other's beverages.

Think of our own `mini-1992', which happened when James VI took on the additional job of being James I. That happened nearly four centuries ago, but the Scottish market is still wildly different from the English or the Welsh... In that case, most of the people in those three countries didn't even speak very dissimilar languages.

Yes, our behaviour patterns and attitudes, and those of other Europeans are converging. Yes, we are buying the same calculators, hamburgers, package holidays and credit cards. And yes, we are actually drinking more of each other's beverages. So 1992 will make it a little easier to bring our goods to each other's countries, but it will do nothing whatever to make customers buy them.

The signatories to the Treaty of Rome (in 1957) believed that the Single European Market would be accomplished (if only between the six countries which were then members of the EEC) by the end of the 1960s. The European Commission believed that for truly free trade between the Six it would be necessary to `harmonise' the regulations covering goods and services and their sale. Mercifully, however, that harmonisation process was very slow. It was slow because each country, quite rightly, thought its own legislation was the best and should not be adulterated. And so, in 1979, nudged by the European Court, the Commission woke up to the existence of the customer.

While customers applaud the choice offered by importing other countries' goods and services, their applause is for the choice rather than for the foreignness of those goods. The customer is at home, and though he may expect a foreign product to be different, he does not expect any less attention to his needs, quirks and foibles from a foreign supplier than he would from a domestic one. So, when you are marketing abroad, whether before or after 1992, it is probably a bad idea to make a song and dance about where the product comes from - unless one is a Scot selling whisky, or a Swiss selling cuckoo clocks.

There are four simple principles which must form the basis of any plan to initiate marketing activities abroad. The first of these is the assumption that marketing operation (including design and formulation of the product) needs to be radically different from what is done in the domestic market, unless there is unmistakable evidence to the contrary.

Second, building a market position in another country requires the same kind of resources, the same amount of effort and roughly the same amount of time as it does to build a similar position in the home market. Agents, distributors, brokers, representatives and joint-venture partners in foreign markets are not magicians. They cannot do what couldn't be done in the home market. What they can do, however, negligently or deliberately, is ruin the long-term prospects of the business. It is impossible to reign over a foreign business in absence.

A third principle to bear in mind is the fact that building a market position abroad does not start with the first sale, but with carefully planned homework. There is nothing which can remove the need for a very intensive intelligence-gathering exercise. The purpose of all that knowledge is not just to reduce risk, but to find out what the options are in the first place.

Finally, anyone who wants to enter a foreign market should be prepared to consider a different positioning of the product from its location in the domestic environment. …

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