Noah Maffit, a former EVP and general manager of Live Nation and others like him are sounding a wakeup call for American digital marketers. He says those who aren’t actively developing their international online markets are missing their best opportunity to do so before it’s too late.
Maffit told an audience of some of North America’s largest retailers that while there are many risks to taking your business online to other nations, the risk of not going global, or of waiting too long to make the move, almost certainly will be greater.
Clicks Travel in Both Directions
Chinese manufacturers are going online to target U.S. markets directly, in addition to producing goods for U.S. companies to sell. Alibaba’s new Western-focused online retail store, 11mainstreet.com, could help Chinese manufacturers bypass American retailers, for example, and sell directly to U.S. consumers. Although Alibaba’s Jack Ma told the Wall Street Journal that he is “more interested in bringing America to China,” Ma would no doubt be happy to do both. Plus he’d be happy to challenge Amazon on its home turf and take market share from eBay in the U.S., just as he did in China.
Among the Chinese technology companies already targeting global markets are Huawei Technology Co. and Xiaomi Inc. (smartphone makers) and Lenovo Group, Ltd. (phones and computers). Taiwan’s PC manufacturers Acer Inc. and Asustek Computer Inc. (widely know as Asus) are also major global players.
Three online services that are blocked by China’s Great Firewall—Google, Facebook and Twitter—have set up shop in Hong Kong in part to sell advertising to Chinese companies going global. Even state-owned businesses, such as Air China and the People’s Daily newspaper have Twitter accounts, as reported by Ad Age’s Angela Doland and Mark Bergen.
Here’s Charlie Hollander, CEO of Gemstone King, on China’s move to compete in America: “More manufacturers are going to sell their products directly in the U.S,” he warns, and U.S. companies need to be prepared.
In addition to using Alibaba’s Western-oriented platform, Hollander says Chinese brands will soon be competing in the West through American online outlets such as eBay, Amazon and Wal-Mart. “E-bay, for example, is building a warehouse in Los Angeles for Chinese manufacturers to make it easier for them to sell products directly to U.S. consumers,” he says. “Those non-branded items that were sold by U.S. resellers are going to be sold by the manufacturers themselves.”
Maffit and Hollander are among a growing number of ecommerce experts who say you need to take the battle to the home turf of emerging competitors—before they start arriving on your doorstep.
“The best defense for your domestic market is to go after the international markets that are starting to target your market,” says Kent Allen, principal at The Research Trust and co-founder of the Global E-Commerce Forum.
Abundant opportunity is there for those who dare to go after their share of this global-mobile-social and hyper-local market. And while there is danger of missing your target, the greater danger awaits those who think they can just stay home.
When you have home field advantage in what may be the world’s best online (and offline) market, it can seem prudent to stay focused on the U.S. market. But if you want to grow where the growth markets are, if you want to develop your overseas marketing competence before the competition brings the battle to your door, then it’s time to get serious about global digital marketing.
Even if you don’t look anywhere else, you probably should be considering China. It has already overtaken the U.S. as the world’s biggest ecommerce market and—by weight of population alone—China has more room to grow than any other market. The time is here for more American businesses to think as hard about selling to China as buying from China. Beyond China, in the digital world even smaller international markets may offer more opportunity for growth than you had imagined.
But What about the Dangers?
There are bound to be problems when you go beyond the market you know best. For Americans, whose home market happens to be the world’s easiest market to do business in, those dangers can seem all the more daunting.
As Maffit points out, senior managers are very much aware of the dangers. He says that to get board approval for your global marketing plans, you have to go well beyond showing them the great opportunities you’ve found. “You need to show them that you know the risks and have addressed how to overcome them.”
The majority of U.S. marketers new to foreign ventures seem to choose to start with close-to-home markets (especially Canada) where it may be easier to do business. They also gravitate to Anglophone or English-speaking markets where English use is high and the language barrier is lower. But the one really big market that no marketer today can afford to ignore is China.
China tops the list for digital marketers in just about any industry you can name. Global SEO and digital marketing practitioners of every stripe tell me they are targeting China’s consumers, and that more American organizations should at least be thinking about China.
There are more than a billion reasons why the huge Chinese population has overtaken the U.S. in so many consumer market sectors. The online Chinese market is so large and growing so fast that even smaller U.S. organizations—including those that currently don’t do foreign business—need to consider China now. From education to travel to retail, the Chinese consumer is taking the market lead around the world.
Donald Dunnington is an author of “Digital Marketing for The New World” and member of the Advisory Board for the launch of Oban Digital in the United States.