Market Entry: Part Two, A Special Report For Korean Brands
By Don Southerton, CEO Bridging Culture Worldwide
Localization and understanding the market are key to any successful
overseas' expansion. My consulting work focuses on assisting
Korean brands entering the US market and US brands entering the
Korean market. Last week, I discussed Korean market entry. This
article now addresses Korean brands, both furthering their global
reach and launching for the first time in Western markets.
In a recent Korea Herald article I was quoted saying, "Over the
years I witnessed firsthand cross-cultural issues that surfaced
when Korean companies expanded globally. My role has been to
address these issues, such as trust among the Korean and Western
teams, lack of lines of communication, local employee turnover and
To add to this, I believe that global expansions require Korean
brands to alter many of the practices, which have made them
successful in their own local markets. One example is the model of
dispatching a Korean expat to a new market to launch the brand.
This has its challenges because the expat has limited knowledge of
the local market and few contacts within the business sector.
Equally challenging is hiring a consultancy or firm. While a firm
may have that has high expertise in the local market, more often
than not, these firms have limited understanding of the specific
Korean companies norms, practices, and expectations....
Even when the western staff or company has some experience working
with other Asian or Korean brands, they seldom have insights into
the new company's mindset. In fact, I constantly preach, "No two
Korean firms are alike."
A third path Korean brands take in western expansion is to target
markets in which they feel comfortable, namely local Korean
communities. What seems like a smart strategy actually will require
the brand to again alter most of their western business model
before expanding beyond the Korean diaspora. In fact, little
knowledge will be gained in these early efforts that will translate
to the next phase of the expansion. This includes personal and
staffing. In many cases it will be like starting all over again.
In conclusion, most brands face challenges going global. Success
requires a sound strategy, high awareness of the pitfalls,
flexibility, and some luck. That said, nothing beats experience-not
only in executing a solid market entry strategy but also in
modifying what has worked successfully in past Korean expansions
into new markets and avoiding what does not work.
Recognizing and respecting that each company and brand is unigue, I
would be happy to discuss your needs and potential opportunities.