Corporate Survival: The New Economic Game
Executive Summary: Survival is the name of the game in this economy. No organization can be fully shielded from the shockwaves of economic turbulence. To thrive in a tough economy, requires a change in mindset. Corporate Survival: The New Economic Game examines the lessons we can all learn from marketing innovators like Apple, BMW Canada, Singapore based Osim International, and Canada's CBL Data Recovery Technologies Inc.
Core Messages:
- Avoid the "Not Invented Here" Syndrome,
- Re-think Your Offer and Re-Invent Yourself
- Shift Your Paradigm
- Move Beyond Conventional Wisdom
Osim International, Luxury mall kiosk, Kuala Lumpur, Malaysia
I discovered Osim International when I first travelled to Asia in 2000. We can learn a lot from its innovative marketing strategies, successes and recent challenges. It's one of my favourite companies and I've been watching its performance ever since. Osim International, Singapore based manufacturer of luxury massage chairs and healthy lifestyle products, is very much a company to watch. This photo was taken on a field trip to one of Osim International's interactive luxury kiosks at a shopping centre in Kuala Lumpur, Malaysia during one of Executive Oasis International's executive team building sessions (Visexecutaries: Seizing Opportunities in our Shifting Corporate Landscape).
People rarely have a neutral reaction to Survivor, the American reality TV show. Love it or hate it, it’s impossible to ignore it. Given our turbulent economic climate, Survivor is a powerful metaphor for what’s going on in the marketplace.
Changing Times … Changing Rules
In the real world, just like on Survivor, no one is immune. Anyone can get “voted off” the island. We have had a number of wake-up calls. There is no need to repeat the names of all of the corporate giants that have tumbled. We read about them daily in the headlines.
Survival is the name of the game in this economy. It’s tough out there so it’s not hard to understand why a show that enacts these dynamics metaphorically would continue to appeal to such a large audience.A Change in Mindset
Truth is there are no magic answers, just some strategies to consider. To survive this economic crunch requires a change in mindset. It involves recognizing that what worked last year may not be the right strategy for tomorrow or even today. It will take the courage to try something different, a lot of support from suppliers, partners, and employees and, a lot of prayer.
Marketing Intelligence
When there is a downturn, marketing is often one of the first areas to be cut. Remember, Eaton’s? This Canadian retail giant, went out of business because its senior management team lost touch with their customers and marketplace trends. To survive this economic crisis, you need regular and accurate data about your customers and your market. Rigorously track demand patterns in your key markets. Scan the horizon and seize opportunities in emerging growth markets.
Ask yourself "What marketing strategies have been most effective in bringing you new business?"
- Focus on those areas.
- Save money by eliminating or scaling back efforts that haven’t been paying off.
We have all learned from the current global economic crisis and the dotcom meltdown a few years ago that we neglect the fundamentals at our own peril.
Identify Potential Sources of new Business
Ask yourself "What new market niches can you target?
- The ethnic market is growing dramatically in North America but you would never know it when you look at most advertising campaigns. Should you be promoting your products and services in Spanish, Arabic, Farsi, or Mandarin?
- The explosion on the Internet has literally opened up a world of opportunities, even for small businesses. The Web 2.0 is hitting in full force. Your company can't afford not to be there. So explore LinkedIn, Twitter, Facebook, and Second Life. Where ever your customers are, you can't afford NOT to be there.
- Go global. If your domestic markets are stagnating, look to areas of the world where there is growth and an increasing demand for your products and services. This is by no means a foolproof strategy without pitfalls.
Osim International's strategy to "go global" by teaming up with US based Brookstone ended up being a significant drain on their bottom line.
- If your traditional marketing strategy is business-to-consumer, ask yourself “In what way can I add value and attract potential corporate clients?”
Founded in 1980, Osim International, a Singapore based company with a stellar track record in product innovation, has traditionally marketed high end massage chairs for the consumer market in Asia. In 2008, Emirates Airlines signed an agreement to purchase Osim massage chairs for all 18 of its dedicated first and business class lounges worldwide.
Avoid the "Not Invented Here" Syndrome
During times of change and turbulence, a narrow focus on practices in one's industry and country will be a barrier to innovation. Search for best practices and innovative practices in other industries and beyond your own borders. Learn from failures and successes, opportunities and challenges. Here is one of our first of many Companies to Watch that we will be exploring.
Company to Watch Osim International in Singapore @Osim_SG
Osim International TV Commercial:
Check out this no-holds barred discussion of company performance and challenges with Rom Sim, Osim International's founder and CEO:By all indications, the company seems to on the way to recovery.
OSIM International 2009 Performance
Osim International Corporate Profile and Vision:
Ask yourself "What are my competitors doing and should I be forging a strategic alliance with them?
One of the contributing factors to the problems in the telco industry is that too many companies have been focusing on the same narrow market niche creating an over supply in the market. At least, 6 years ago I wrote about the fact that the real estate market was setting itself up for a similar problem by building too many luxury condos for the upscale market. Meltdowns in the real estate market from Manhattan to Dubai have shown that, if you’re all chasing after the same customers, there is bound to be a problem. Sometimes it is possible to bundle your services in new ways to serve a larger customer. I know in speaking with some of the firms I perceived as competition, I discovered that we really were offering different services. Two were specializing in strictly recreational events for teams while Executive Oasis International focuses on professionally facilitated business team building simulations and retreats that may or may not include recreational components. Another perceived competitor specializes in 2 hour to half day simulations and has no interest in the 2 - 3 day simulations and retreats that we offer. There were lots of opportunities for cross-referrals. I would never have discovered this without speaking with competitors.
Re-think Your Offer and Re-Invent Yourself
Pinpoint your core areas of expertise and do some brainstorming to identify other ways in which you can use and apply it to create new services and products.
Company to Watch: CBL Data Recovery Technologies Inc.
Founded in 1993, CBL Data Recovery Technologies Inc. used to re-furbish and repair hard drives. A drop in the price of hard drives resulted in reduced demand for his services. CEO re-thought the company’s core offering applied the company’s expertise to data retrieval from damaged hard drives or hard drives that have crashed.
In 2000, the company generated a profit of over $1,227,000 and was ranked by Profit Magazine as the 89th fastest growing company in Canada. The company has experienced steady growth worldwide since then. It now has worldwide labs in Asia, Australia, Europe, South America, and the Caribbean.
If your core market is declining or competitive pressures are eroding your bottom line, search for new opportunities.
Company to Watch: Apple
Under the leadership of Steve Jobs, Apple is the ultimate example of a company that has re-invented itself and experienced expolsive growth in a brand new market. With the MAC, Apple had a product with a high level of consumer appeal. Microsoft out foxed Apple by marketing their computers and operating systems to IT professionals and decision makers within the corporate arena. I can still remember when as a Management Development Specialist, I was practically kicking and screaming when my MAC was taken away from me. In fact, due to my protests, our department and Marketing were among the last 2 to convert to Windows NT. Apple became a niche player in the PC market catering to media and high end design houses. Apple was down but definitely not out. Under the leadership of Steve Jobs, Apple moved beyond the Mac and exploded onto the scene with the iPod and ITunes and revolutionized the music industry. It will be interesting to watch the growth of the iPhone and iTablet.
You can trace Apple's evolution through this series of Articles.
- Where "Think Different" Is Taking Apple (2003)
- As iPod sales growth matures, Apple looks to position company for future growth (2007)
- 2009 in review: Apple's rollercoaster year (2009)
- Harvard Business Review names Apple's Steve Jobs as Best Performing CEO in the world. (2009)
Shift Your Paradigm and Move Beyond Conventional Wisdom
According to conventional wisdom, companies that offer luxury procucts and services should never discount their prices as this will erode brand equity in the mind of the consumer. Is this always true? Think again.
Company to Watch: BMW Canada
BMW Canada had its BEST October ever in 2008 when the North American automobile industry was on the verge of collapse. In October, 2009, it surpassed THOSE results. year-to-date sales for 2009 are up 2%. Why? Instead of following the conventional wisdom that providers of luxury goods should never cut their prices, they reduced prices on some models and invested in glossy spreads in Canadian consumer magazines. Luxury became affordable and a BMW became accesible to some consumers for whom this premium brand had been just out of reach.
- BMW Canada reduces prices on 2009 models
- BMW Canada sets October sales record
- Interview: BMW Canada's Franz Jung New man at the helm
It's a Different Ball Game
In a turbulent marketplace, all bets are off. It's a different ball game. The old rules don’t necessarily apply and there is a need to re-think the way things are “supposed to work” according to the experts. If a particular strategy is supposed to work but it's no longer working, then it's time to change a losing game. This usually isn’t easy to do, but it’s worth it.
To give your team an opportunity to explore more corporate survival strategies, why not let us bring our oasis to you:Photo Credit: Executive Oasis International
