Worldwide communication for Asian multinationals:PR’s next big thing?

The 2014 ICCO Global Summit at New Delhi Bob Pickard

Times have changed in Asia !

Old perceptions are being replaced

By modern new realities…by compelling new realities

There is no country called ‘Asia’

It is not a ‘country of regions’ like the US It is also not really a region of countries It’s more like a division of diverse

regions ‘Asia-Pacific’ as a reporting convenience

for multinationals, a waning regional umbrella concept

The way quite a few Chinese marketers seem to think, China = Asia (similar to some US attitudes about the Americas)

2010 2015 2020 2030 2040 20500

50

100

150

200

USA

China

Japan

Germany

UK

Brazil

India

Russia

Indonesia

(tri

llion c

urr

ent

US

D)

Source: Citibank Global Economic Review

Consider the sheer scale of Asia’s rise

Composition of nominal GDP

26%

8%

25%6%

6%

29%

16%

8%

13%

7%11%

45%

10%

8%

8%

6%

19%

49%

North America

Latin America

Western Europe

Eastern Europe

ME / Africa

Asia Pacific

2010

2030

2050

Source: Citibank Global Economic Review

The balance of power is shifting fast

Map of the global economy

Map of the global PR industry

“I skate to where the puck is going to be, not where it has been.”

- Wayne Gretzky

Why Asia now?

PR for Asia-Pacific companies

As famous as this fellow?

Is it as big as the factories in China ?

As big as those Chinese factories?

As old as Ayers Rock?

As easy as the Tokyo subway?

As entrepreneurial as the Indians?

Is it as fast as the bullet train?

As fast as the bullet train?

As ‘cheap’ as this currency?

It’s all about ‘face’

Do Asians see the same ‘face’ as Westerners?

Chemical

Materials

Constuction

Banking

Consumer Durables

Transportation

Capital Goods

Technology Equipment

Trading

36%

37%

39%

42%

47%

52%

53%

55%

83%

34%of the world’s top 2000 companies are now headquartered in Asia

Source: Forbes Global 2000 list

188 of the FORTUNE 500 list are now companies from Asia-Pacific

PR clients of the future

Now 95 from China

Japan still has 57 India has 8

Key PR questions being asked

What is corporate communication? Where does it ‘fit’ in the marketing mix? How much money should we spend on it? Do we communicate differently globally

compared to domestically? Who should be in charge of it internally? Who else is doing it and what can we follow

or imitate from their ‘case study’ experience?

How do we tangibly measure its effectiveness?

How many of China’s 95 are famous?

What about Huawei?

Famous from fears

What about Alibaba?

Famous from fortune

Getting started with going global

Many Asian companies are completely unknown outside of the region and will find it challenging to compete in countries where ‘mind share’ will help them achieve market share

In many cases, their corporate communications efforts have been so ‘local’ in orientation, they are simply not yet equipped with the tools they will need to build an image – or the defences required to defend their reputation

As these companies gain traction internationally, they can count on being attacked by entrenched competitors, who in many cases may enjoy commanding positions supported by the most advanced communications capabilities available today

Meanwhile, in many Asian companies, corporate communication is an underdeveloped and poorly understood low-status function

Even before then, Asia companies will be up against generic negative stereotypes that are commonplace in many markets…

Unfairly exploitative; interested in ‘extracting’ from host markets rather than ‘contributing’ benefits to communities

Commoditized ‘quantity’ players who compete on price rather than on quality

Hierarchical ‘machines’ with top-down command and communications Nationalistic and conquering in mentality towards other countries Unsophisticated when it comes to corporate social responsibility Agents of PRC state power and potentially a security risk Environmentally ‘toxic’ with pollution problems likely Untrustworthy in keeping commercial agreements Flagrant abusers of intellectual property Culturally and ethnically homogenous Harsh employers with HR problems Lacking in transparency Ethically suspect

The ‘national’ challenges for Chinese multinationals

The opportunities for Asian companies

Those are all kinds of characteristics that may be unfairly assumed to be true of an Asian company overseas before it even gets started with its communications

While such may seem to be daunting obstacles, fundamentally they represent tremendous opportunities for Asian companies who have the ‘power to surprise’ with positive behaviour that will directly contradict these negative preconceptions

Get famous for good stuff first

Indeed, it is the contrast between the negative perceptions in theory about Asian companies and their positive performance in reality that will build the best image

The key test outside of Asia is making sure that when people hear about a new Asian company for the first time, they do and think things favourable to the company in direct consequence

It is critically important that Asian companies become well known internationally for the positive things they stand for in the first place, rather than become famous first through negative mistakes…

…like what happened to Foxconn

Asia is driving the rise of PR on mobile social media

Social media is all over Asia

Asian companies were slow to engage

Asia

Global

40%

80%

Source: Global data from Burson-Marsteller Global Fortune 100 Social Media Checkup 2010Asia data from Burson-Marsteller Asia-Pacific Social Media Study 2010

Percentage of companies with at least one branded social media channel

Source: Global data from Burson-Marsteller Global Fortune 100 Social Media Checkup 2011Asia data from Burson-Marsteller Asia-Pacific Social Media Study 2011

Percentage of companies with at least one branded social media channel

Asia

Global

80%

84%

40%

81%

2010 2011

Not any more!

Asian corporates playing catch-up on owned media platforms

Asian apology PR prowess?

The digital opportunity for Asia

1800s

1980s

2000s

The rise of America

The rise of the ‘Four Tigers’

The rise of Japan

2010s The rise of China

The rise of Britain

1900s

2020s The rise of ?

Communicate ‘the golden circle’

How some Western companies failed to communicate in Asia

Being seen to ‘take’ and not ‘give’ Engaging the wrong people to communicate Lack of respect for local culture and language Failure to listen to their stakeholder communities Misreading the tastes and preferences of the market Lack of effort to build relationships through earning trust ‘Bulldozing’ of ‘global’ marketing from the home country Double-standards in how they treat customers and employees Thinking they can get away with putting boundaries around

markets in a digital world where ‘local’ can become ‘global’

Asian companies should avoid making the same mistakes!

Bob PickardChairman, Asia-PacificThe Huntsworth Group

www.bobpickard.com@BobPickard

The 2014 ICCO Global Summit at New Delhi Bob Pickard