How can Kiwi businesses thrive in Asia?
Asia is one of the most dynamic and competitive regions globally, characterized by rapidly evolving consumer trends and a vibrant shopping culture. This region is critical for New Zealand (NZ) businesses, housing three of New Zealand’s top five export markets: China, Japan, and South Korea. The potential for growth in these markets extends far beyond what we can achieve domestically. New Zealand products are often perceived as exotic and foreign, yet safe, ‘clean’, and reliable.
New Zealand’s clean and green image is a significant asset, especially for SMEs in the food and beverage, fashion, and cosmetics sectors. New Zealand food businesses, for example, have successfully leveraged our robust regulatory environment and stringent food safety standards to carve out a niche in Asia. Research has shown that, when it comes to food, Asian customers trust products made in New Zealand far more than products made locally in Asia. So, our high-quality products, combined with a narrative emphasizing boutique, family-owned, and eco-friendly practices, resonate well with many Asian consumers. Highlighting specific regional characteristics, like Gisborne’s sunny climate and premium produce, further enhances our product appeal.
Whilst our ‘clean green’ image is unsurprising to most, we have one other factor, which is often overlooked and taken for granted. That is our ‘soft power’. New Zealand is small, friendly, and egalitarian. We tend to play by the rules both domestically and internationally. We do not wield hard power, are great at building relationships, and often punch above our weight. We are the David in a world of Goliaths. This makes it challenging to view New Zealand or our businesses negatively. In fact, many people in Asia see us as the underdog and want us to succeed.
Recently, as part of the University of Auckland MBA final course, students participated in a one-week overseas study tour. Highlights of this trip included a tour of Alpha Theta HQ (former Pioneer DJ) in Yokohama, the HQ at Mitsui & Co, and CookieTime, and a series of high-profile industry speakers covering diverse and pertinent topics from business mode innovation, business culture and etiquette, growth and doing business in Japan and consumer trends. As part of this final course, our MBA students were also tasked with exploring market opportunities for specific New Zealand firms in Japan in a range of industries, including consumer products, biotech, and financial services. The experience reinforced that the New Zealand brand is well received; however, to excel in Asia, particularly Japan, relationship-building is paramount.
Managers who have forged strong partnerships with selected firms in Japan focus on co-creating valuable product offerings. These relationships are marked by commitment to shared goals and mutual trust. Regular interactions and commitment to shared goals facilitate the exchange of valuable market knowledge and enhance the overall partnership. Companies that succeed typically adhere to several key principles:
- Strategic Location: Choosing the right location can be crucial for business success. For instance, Cookie Time, an iconic New Zealand company, strategically selected Harajuku as its store location. Known for its vibrant teenage culture and diverse fashion trends, Harajuku attracts trendsetters, making it an ideal choice for gaining visibility and popularity among young, trendy Japanese consumers.
- Adaptability: The competitive nature of Asian markets means that trends can shift rapidly. To remain relevant, businesses must be willing to innovate and expand their offerings. Companies that adapt quickly to changing consumer preferences are more likely to thrive.
- Innovation Transfer: Establishing a presence in Asia allows New Zealand firms to bring back local innovations. Companies operating in Asian markets often become stronger, influenced by the region’s spirit of innovation. This cross-pollination of ideas not only benefits New Zealand businesses but also fosters growth and resilience.
Overall, New Zealand’s competitive edge in Asia lies in its unique brand narrative, the strength of its soft power, and its commitment to relationship-building
For busy Asian consumers, New Zealand products offer a unique experience, providing not only a taste of foreign cuisine but also evoking dreams of visiting New Zealand’s stunning landscapes. The “Made in New Zealand” brand narrative, when combined with sustainable production practices, helps SMEs build lasting customer loyalty. Emphasizing authenticity, environmental credentials, and New Zealand’s soft power remains an effective strategy for success in Asia. By focusing on these elements, New Zealand firms can navigate the complexities of Asian markets and unlock new opportunities for growth.
In this big and dynamic region, small can be powerful!
Dr Antje Fiedler is a Senior Lecturer in Management specialising in entrepreneurship and international business. She is also the Associate Director of the New Zealand Asia Institute (NZAI) at the University of Auckland Business School.
