Overseas companies need to understand overseas markets from multiple dimensions, including products, users, and businesses.
Editor’s note: This article is excerpted from “A Guide to Entrepreneurship in Southeast Asia”, produced by ZhenFund, co-produced by Golden Gate Ventures, and Zhong Wei ( Founding Partner of ATM Capital < span>).
In recent years, the rapid development of the Internet economy in Southeast Asia, the huge demographic dividend, and the inherent advantages of emerging markets have made it a hot spot for domestic companies to develop overseas. However, in the cross-cultural context, it is very easy to simply transfer Chinese experience It is difficult to meet the needs of local users. Overseas companies need to understand overseas markets from multiple dimensions such as products, users, and business.
To develop overseas To B market, the key is to persist
Chinese companies doing B2B business overseas will initially have a relatively long exploration phase. In the early stages of market expansion, you need to establish relationships with local companies, gain trust, and have the opportunity to participate in business and expand scale. This is a gradual process. It is important to be determined, patient, believe in the direction you choose, and stick to it.
Huawei began to deploy internationalization in 1996. It was recognized from the beginning that it was a marathon. At that time, customers did not believe that Chinese companies could engage in technology products. After hard expansion, the first order was sold in 1998. Just a few screws, the contract is worth dozens of dollars. In 2007, Huawei entered the Turkish market, but due to the long history of cooperation between European countries and US technology companies, it is difficult to find a suitable entry point. Zhong Wei represented the company in Turkey from 2007 to 2012. In the first two years, there was almost no business income. Ankara and Istanbul both signed their first orders in 2008. However, during this period, the company has always insisted on investing, investing hundreds of people on-site support during peak periods, because Huawei is more interested in long-term enterprise development and will not give up because of short-term losses or slow progress.
This persistence depends to a large extent on Huawei’s product attributes and industry characteristics: First, B2B business usually takes a long time to establish a trust relationship. Second, the demand for products is fixed, and Huawei ’s overseas business started as Operators provide telecommunications equipment. According to 3-5 operators in each country, the major global customers are about 500. In the end, the product needs are the same. Each country must call, surf the Internet, and do billing. The need for an international standard has been formed. In this case, there is no big problem of product compatibility.
Huawei ’s overseas market expansion is like climbing a mountain on a very certain road. Its own products are strong, and determination and endurance are the keys to breakthroughs.
Looking at the world, looking at the local
In contrast, Internet companies go to sea very differently. User needs vary widely across countries, soBefore going overseas, companies need to fully understand the overseas market, including local user needs, human resources, investment environment, legal systems, humanities and religions, etc., to avoid asymmetry of information as much as possible, from technology to content, it is related to local culture and consumption People are used to fusion.
Alibaba’s UC Browser has achieved milestone success in Indonesia. In the two years from 2014 to 2016, the number of monthly active users of UC browser increased from several million to tens of millions, occupying more than 50% of the Indonesian market share, far exceeding its competitors. Zhong Wei joined UC in 2014 and became the general manager of UC Indonesia. In 2015, UC based its Southeast Asia headquarters in Jakarta.
Image source: ucweb.com
UC can occupy a dominant market position in Indonesia, thanks to UC’s localization improvements in product design, traffic acquisition, advertising distribution, including website distribution.
Product design should be centered on the local user experience
“Faster, more memory-saving, better-looking interface” is what most users think of the UC browser. UC cuts in from as many angles as possible and continuously optimizes the website to bring the best experience to users.
More memory savings:
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At that time, Indonesian users mainly used low-end smartphones with very small memory. The UC browser occupied much less memory space than Chrome, which better adapted to Indonesia. This low-memory machine operating environment has become the choice of more local users.
Faster:
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In Indonesia, most local users visit US websites. UC browsers set up a dedicated cache server based on user habits. Relying on server transfer acceleration, users will be redirected via dedicated lines when they visit the website. At the same time, UC will recompress the pictures. Resolution, saving traffic and speeding up.
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UC browser has built-in de-advertising function, which will automatically block a large number of pop-up ads on the Internet. Due to the way ads pop up on different websitesDifferent, the browser kernel will be optimized according to the commonly used local websites, so that the content is presented in the best way, which improves the user experience;
More content and more friendly experience:
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Indonesia skipped the PC era and went directly to the mobile Internet era, so UC organized the desktop version of the website into a mobile version to make the interface more friendly to mobile phone users. When testing products, UC will also use locally popular Phone models are tested to achieve the effect closest to local users;
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The UC browser was upgraded to a “content distribution platform” in 2016. Through big data, it integrates local news organizations and self-media content resources to provide Indonesian users with “thousands of people” push information. Internet users have played a role in popularizing the Internet. UC’s globalization strategy can be summarized with “Global + Local”, that is, it not only looks at the world and uses world-class standards to make products, but also looks at the local and serves users in a grounded manner. The product is the basis for obtaining traffic. UC is able to catch the “pain points” of the market, and the retention is greatly improved.
Acquisition channels: Combining mobile devices to embrace digital communities
In the beginning, UC exchanged traffic with the local traffic master (webmaster), and converted other website users into UC users at zero cost, realizing two-way benefits. In the later period, UC spawned an international mobile traffic cooperation platform, U League, which directly exchanges and purchases traffic with webmasters through the platform. While establishing a traffic channel, a new commercial model is formed locally. At the same time, UC also cooperates with Chinese mobile phone companies that go abroad to obtain new users through software pre-installation. Through these measures, the overall customer acquisition cost is only half of that of the friend.
Tong Zhongwei emphasizes that the choice of circuit should be before the product. Use your heart to observe the big environment during the preliminary survey: the state of the country’s economy, the changes in user habits and consumption habits, and the stage of technological development. Combined with the team’s own advantages, the probability of project success will be greatly increased.
Local team building
Excellent talents are an important factor in the company’s development of multinational business and one of the biggest challenges. At present, a mixed team is an inevitable choice for making offshore business.
If it is a business that requires landing, you can recruit “locals” in China or overseas students, first train at the domestic company headquarters for a while, and then go to the local office with the Chinese team. In this way, the team has already run in, the division of labor is clear, and the speed will be faster. However, this method is not suitable for too small companies. And crossNUS companies are different. In the early stage of recruitment, startups lacked brand endorsements, which made them less attractive to outstanding talents. Only internal referrals or direct Linkedin attraction can be used.
Comprehensive domestic engineer bonus. For products, data, algorithms and other parts that are not highly dependent on local languages and can be reused quickly, most companies choose to place functional departments in China. The cooperation mode of “big, medium, and small, front desk” is adopted to make more effective use of human resources. For example, some companies have their product and technical teams in Beijing, Guangzhou, and Shenzhen, and then set up specialized teams in the local market to be responsible for business development, operations, marketing, and customer service.
To build a multinational team, we must respect the unique culture and customs of each country, but we cannot ignore everyone’s similarities. Although they have different religions and languages, people have a longing for a better life. They all want to improve their abilities and gain recognition. These aspirations will not vary greatly around the world. Grasping these points and empathizing with local teams is a very effective way to communicate.
In addition, in the Chinese management system, the company’s culture and strategy are often daily preaching, not formal documents. However, when cooperating with Western or Southeast Asian teams, it is necessary to actively communicate this part of the non-written information. This is also an opportunity for both parties to understand each other. Employees will feel more trusted, better informed about the company, and have a sense of true integration. The purpose of management is to improve employees’ sense of identity. Southeast Asia attaches more importance to the interests of teamwork than individual heroism. It is better to complete a goal than to compete with PK.
Southeast Asian Market Outlook
Zhong Wei, who has been cultivating the Southeast Asian market for many years, from the person in charge of overseas business of large companies, to entrepreneurs, to investors, is still surprised and hopeful about the development speed of the Southeast Asian Internet market.
The mobile Internet market in Southeast Asia has changed dramatically over the past 5 years. In 2014, the e-commerce platform Topopedia received a $ 100 million investment from SoftBank, becoming the largest financing case in Southeast Asia at that time, which opened the prelude to the accelerated growth of the entire Southeast Asian market; Grab and Gojek, two transportation trip unicorns, went from zero to over 100 in valuation 100 million US dollars; the development direction of the Internet in China and Southeast Asia may be the same, but the path is definitely different.
So how does a team with a Chinese background perform in Southeast Asia? Shopee has become the largest e-commerce platform in Southeast Asia for a few years. The Southeast Asia version of SF J & T has become the largest express delivery company in Indonesia in just 4 years. At the same time, Huawei, OPPO, MINISO, Advance.AI and other Chinese companies The respective markets in Southeast Asia occupy a leading position. In the top 100 rankings of Indonesian GP, apps developed by the Chinese team accounted for 28%. 17% and 8% of APPs developed in the United States and Indonesia, respectively, and various evidence shows that the Chinese teamHas a strong competitiveness in Southeast Asia.
Although giants have appeared on the track of e-commerce, travel, online media, tourism, etc., there is no absolute leader on the segmented track, such as new consumer, financial technology, education, health, media, etc. In the early stages, there is great development potential. For example, The Asianparents, the largest mother-to-child platform in Southeast Asia, has received a US $ 10 million Series C financing with the participation of Fosun Group and will expand to more markets in Asia and Africa.
Currently, there are more than 300 million Internet users in Southeast Asia. The overall valuation of all new economic companies is 60-70 billion U.S. dollars, which is about the same as the number of Internet users in China in 2009 and the valuation of BAT. China’s Internet listing plus 206 unicorns that are not listed has an overall valuation of more than $ 2 trillion. There are currently 11 unicorn companies in Southeast Asia. I believe that in the next 10 to 15 years, there will be opportunities to produce 30 to 50 unicorn companies.
Edit | Yun 晞 @ 出海
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