Going Global: How to Approach Expansion into Asia

April 22, 2013

Asia is an amazing place for business, but companies from outside the region often consider it mysterious and prohibitive. I find myself discussing Asian business customs and practices with business owners from other regions on an almost daily basis, so I feel like I've become an informal resource when it comes to helping SoftLayer customers better understand and enter the Asian markets. As the general manager for SoftLayer's APAC operations, I thought I'd share a few thoughts about what companies outside of Asia should consider when approaching new business in the region.

Before we get too far into the weeds, it's important to take a step back and understand the Asian culture and how it differs from the business cultures in the West. The Asian market is much more relational than the market in the United States or Europe; significant value is placed on the time you spend in the region building new networks and interacting with other your prospective customers and suppliers. Even for small purchases, businesses in Asia are much more comfortable with face-to-face agreements than they are with phone calls or emails. Many of the executives I speak to about entering Asia argue they don't have time to spend weeks and months in the region, and they make whistle-stop trips in various countries to get a snapshot of what they need to know to make informed decisions. Their businesses often fail at breaching the market because they don't invest the time and resources they need to create the relationships required to succeed. Books, blogs (even this one), consultants and occasional visits aren't nearly as important to your success as investing yourself in the culture. Even if you can't physically travel to your target market for some reason, find ways to plug into the community online and become a resource.

Asia is not homogenous. There are 20 distinct countries and cultures, dozens of languages and hundreds of dialects. There are distinct legal systems, currencies, regulatory frameworks and cultural norms. From a business perspective, that means that what you do to appeal to an audience in Singapore won't be as effective for an audience in Japan ... This is not the United States of Asia nor is there an Asian Union. Having partners in Hong Kong does not get you into China; if you want to access markets in China, you need to build relationships with partners and customers in China. One of the biggest reasons for this in-country presence to understand and avoid a "death by a thousand cuts" situation where minor, seemingly insignificant questions and problems cumulatively prevent a business from successfully entering the market. Take these questions from customers as an example:

  • When I buy from your office in Bangkok, where is the contract jurisdiction?
  • I'm in Hong Kong. Can I pay in Hong Kong Dollars? Who takes the currency risk?
  • Corporate credit cards aren't common in Vietnam. Can I pay for my online purchase in cash?
  • If I sign up for a webinar, is it at a time convenient for me (i.e. repeated for other time zones), or do I have to be at my PC at 3am?
  • If you invite me to a meeting on 12/4, is that April 12th, or December 4th?
  • When I print whitepapers from your website, do I need to resize to a different paper size?

The way you handle currencies, time zones and how you present information are barometers of how approachable your business is for users and businesses in a particular market. Most users won't reach out to you to ask those kinds of questions; they'll just move on to a competitor who answers their questions without them asking. You learn about these sticking points by having people on the ground and talking to potential customers and partners. Since globalization is "flattening" the World Wide Web, the mechanics of hosting a site, application or game in a data center in Singapore are identical to hosting the same content in Dallas. It's easy to make your data locally available and have infrastructure available in your target market, but that's only a start. You need to approach Asian countries as unique opportunities to redefine your business in a way that fits the culture of your potential customers and partners.

In my next blog, I plan to share a few best practices about management, responsiveness and responsibility, positioning, operations and marketing in Asia. These posts are intended to get you thinking about how your business can approach expanding into Asia smartly, and if you have any questions or want any advice about your business in particular, please feel free to email me directly: dwebb@softlayer.com.

-@darylwebb

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