Dollars and scents in Asia
Eco-friendly and non-toxic products are gaining traction across Asia, as many countries in the region struggle with food safety and environmental pollution.
Ecostore founder Malcolm Rands says the key to breaking into the Asian market is to understand the diversity of the countries in the region and their customers.
‘‘If you’re not customer-centric you’re yesterday’s business,’’ Rands said.
‘‘You have to go to the final consumer and work backwards from there rather than concentrating on the distributor or business partners.’’
Sales in Asia made up 10 per cent of Ecostore total revenue last year, having grown rapidly from 1 per cent in 2015, Rands said.
The often intimidating and complex market could be cracked only with research and understanding its customers, he said.
‘‘Generally speaking, Chinese consumers trust foreign products more and are particularly paranoid about children’s products.’’
Ecostore launched its baby products in the region first.
Ecostore China market manager Derek Yu said animal testing requirements had been a challenge for exporting to China. As a result, the Peta-approved brand has not been allowed to export through local distributors.
Rands said Ecostore had overcome this hurdle by selling direct to customers online.
‘‘It’s not a bad thing. E-commerce in Asia is much more advanced than it is in New Zealand. Selling online means our customers individually import our products, which we are able to do without animal testing.’’
Apart from China, the other two big Asian markets for Ecostore are South Korea and Japan.
Rands said like China, South Korea was also concerned about safety due to previous concerns over chemical poisoning in the country, trusting foreign ecofriendly, non-toxic products.
In contrast, Japanese customers tend to have strong confidence in local products.
Ecostore also exports to Taiwan, Hong Kong and Singapore.
Rands said the one standard that remained important for customers across all markets was how well a Kiwi business has done back home. ‘‘If you’re a trusted brand, that is outrageously important for them.’’
Rands’ advice to Kiwi SMEs considering branching out to Asia was to recognise the cultural contexts that weave into business.
‘‘Don’t rush with your partners. Generally business isn’t discussed until the second meeting and this is where Westerners go wrong because they go in with the sell in the first five minutes.’’
He said Asian business people tend to favour long-term partnerships and working with people they trust and like.
‘‘Spend plenty of time building relationships because it may last for 20 or 30 years.’’