Sail the 7Cs to Create an International Business

Edited Version: Delivered by Patrick Tully (Fusion Learning) & Dermott Dowling (Creatovate) @ Mondelez

International Asia Pacific Innovation Centre, Ringwood

Wed 13th Nov 2013

Introducing patrick tullyPatrick leads fusion learnings Asia Pacific team. His branding and

international marketing career has spanned over 20 years. He

started his client-side career at Diageo, working on brands as

diverse as Gleneagles and Guinness and then moved into the

wonderful world of whisky as Global Brands Director on Malts.

After 10 years client side, Patrick spent 6 years as a Managing

Partner in a brand consultancy specialising in innovation and

strategy working across a broad range of categories for a diverse

set of clients including: American Express, Bacardi Martini, Mars,

Cadbury, Nestle and A-B InBev amongst others. Patrick joined

fusion learning seven years ago to help extend the business into

Asia Pacific and has since built up a team in Sydney that works

with a very broad range of global and local organisations from

Heinz to Henkel and from Bulla to Beiersdorf. The team have

helped delivered capability and consultancy programmes to help

businesses unlock the potential of their brands by unlocking the

potential of the people that look after them

Introducing Dermott @

Dermott Dowling is founding Director @Creatovate Innovation & International Business Consultancy.Dermott has over 16 years experience building international brands and businesses in Asia Pacific with time spent building brands at world leading multinationals including Fonterra, Foster’s and Lion Dairy & Drinks.Dermott believes the only sustainable business growth is organic, driven by innovation and international business development.Lecturing and tutoring International Business @Swinburne University in addition to helping clients grow, Dermott works with a diverse range of clients from fast growing multinationals to independent family owned businesses.

Innovation & International Business Consultant

Opportunity

Canvas

1) Challenge

create focus

2) Countrycreate

context

3) Categoryidentify codes

4) Competitionfind white

space

5) Consumerknow your

target

6) Customercater to your key partner

7) Competencies

know your strengths

1st C: Challenge: create focus and alignment

■ The purpose of the challenge statement is to help us set course for the journey ahead

■ In essence the challenge must act as our compass – providing direction without forcing a path on us

■ Ultimately the challenge statement set’s out the end in mind, what are you specifically trying to achieve?

■ It helps provide us with a clear purpose around which to focus our data and information search and around which to align the entire organisation

■ An impactful challenge must be prioritised, provocative and precise – hence we have a very clear structure that helps us achieve this….

2nd C: Country – Where to 1st? 2nd? 3rd?

■ Market Opportunity: Vol / Val / Consumption per capita / CAGR

■ Open to Trade: Vol / Val / Imports / $/Kg/L

■ Open to Austrade: Vol / Val / A$Kg/L Aus exports to market

■ Sociodemographics: Population / Gross/Disposable Income / Capita / Food expenditure $

■ Dispersion – Power of Buyers/Suppliers, Top 5 share of mkt

■ Barriers to Entry: Import tariffs, VAT, Product registrations, Labelling, Behind the border trade barriers

■ Start by creating a strategy with “Where” front and centre …use objective measures like a Market Opportunity Index© to take bias out of your strategic choices on “where to go” first

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Key Criteria Sub Segment 0 4 7 10 1 3 7 11 4 10 2 5 8 6 9

Market Volume mKg 0-50 51-100 101-499 >500 10 0 10 4 4 4 0 7 7 7 7Market Value US$m <50 51-200 201-500 500+ 10 4 10 4 4 4 4 10 7 10 7US$/Kg Total Market <$2 $2-3 $3-4 $4+ 0 4 0 4 4 4 10 10 4 4 0Consumption/capita Kg cup <0.1 0.1-0.5 0.5-1 1+ 10 7 4 0 4 0 4 10 4 7 7Cup Yogurt CAGR (Growth)% Value US$ <1% 1-5% 6-10% 10+% 10 4 10 10 7 4 4 4 4 7 10Share of Cup / Total (drinking) yogurt % <10% 11-45% 46-90% 90+% 4 4 10 0 0 0 4 4 0 4 7Volume of Imports MT <500MT 501-5,000 5001-10000 10000+ 4 7 0 0 4 10 7 0 0 0 0Value of Imports US$m <$1m $1-10m $11-20m $20m+ 4 7 0 0 4 7 10 0 4 4 0Value of Imports USD/Kg <$1 $1.01-$3 $3.01-$5 $7+ 7 7 0 4 4 0 4 10 4 7 0Volume of Aus Exports MT <100 100-500 500-1000 1000+ 4 7 0 0 4 0 10 4 0 4 0Value of Aus Exports A$m <$500K $501K-$2m $2-$5m $5m + 7 7 0 0 4 0 10 0 0 0 0$/Kg of Aus Exports <$3 $3-4 $4.01-5 $5 + 10 7 0 4 4 4 4 4 4 4 4Population (m) <10 11-50 51-200 200+ 10 0 10 10 4 7 0 7 4 7 7Gross Income/capita US$ <$1K $1-5K $6-29K $30K+ 4 10 4 4 7 4 10 7 7 4 4Disposable Income/capita US$ <$1K $1-5K $6-20K $20K+ 4 10 4 4 7 4 10 7 7 4 0Food expenditure/capita US$ <$500 $501-1K $1-2K $2K+ 4 10 0 4 7 4 7 7 7 4 0Power of Buyers (Supermarket Top 5 concentration)

>50% 26-50% 10-25% <10%10 0 10 10 4 7 0 4 4 4 10

Power of Suppliers (Manufacturer Top 5 concentration)

>95% 81-95% 65-80% <65%10 0 10 0 4 0 4 7 4 4 4

Cup Yogurt Brand top 5 % Mkt Share >95% 81-95% 51-80% <50% 10 4 7 0 4 0 4 10 7 4 4Import Tariffs >10% 5-10% 1-5% 0% 4 10 0 10 10 4 10 0 0 10 0VAT% >10% 5-10% 1-5% 0% 0 10 0 4 10 0 4 4 7 4 4

Production Registration

Permit or >12mth

wait time

3-6 mth wait & rego

Rego <3mths

No Rego Normal

Export Docs only

7 10 0 0 10 4 10 4 7 4 4

Labelling Mandatories

Labelled pre

Customs clearance

Labelled on arrival in market

Minimal importer labelling required

Aus labelling ok, no

additions required

4 4 7 0 7 7 7 0 0 4 4

Overall 147 133 96 76 121 78 137 120 92 111 83

Sociodemographic attractiveness

Competitive Intensity (Concentration of top 5)

Scorecard Rating Guidance

Barriers to Entry

Country Market Opportunity Index

Market Opportunity

Open to Trade

Open to Austrade

■ The category landscape is the consumer’s understanding of the group of products or brands with which ours competes and is crucial because: □ Each category has certain product and pack codes that

are expected and challenging these can be disastrous □ The category you target will have a significant impact

on the benefits you communicated and the competitive advantage you choose to leverage.

□ In most markets data is available around the size and growth trajectories for categories – so making choices around category can help you understand the potential for your product today and in the future

□ And finally most categories have clearly defined barriers and drivers. Understanding what these are can provide you with both a clear point of difference and competitive advantage based on either addressing a barrier or amplifying a driver

3rd C: the Category landscape

4th C: to Compete or Collaborate

1. Understanding your external Threats and Weaknesses and internal Strengths and Weaknesses can help you work out where to compete and where to collaborate.□ Threats? (external)□ Opportunities? (external)□ Weaknesses? (your)□ Strengths? (your)

2. Run the ruler over your competition□ Strengths? (their)□ Weaknesses? (their)□ Opportunities? (external)□ Threats? (external)

■ Let’s understand our competition over there more closely…then decide where and when and how to compete or collaborate

5th C: Consumer – the who and the why ■ The first thing we must establish is who do we

believe our offer will appeal. ■ Although this may seem obvious it is all too

often left at the level of unhelpful generalities such as MGBs (Main Grocery Buyers)

■ We have developed a fingerprinting© tool that aims to help develop an improved understanding of our target

■ It achieves this by focussing on the key questions that help us segment our consumer base – see opposite:

■ Having understood who we want to target the challenge is now to dig below the surface of their behaviours to understand the beliefs and attitudes that are driving them – in others words consumer insight

“A profound understanding of consumer beliefs and behaviours that provide inspiring springboards for exciting new brand building

opportunities.”

6th C: Customer – who are they? ■ Listen to the Voice of the Customer early on – what do they need or want from us?

• Prepare a plan for a constructive conversation with your new potential customers (retailers).

• Without an engaged customer (retail partner) supporting your products, you cannot delight consumers

• One of the most important outcomes of your “Voice of Customer” excursions will be making the choice on where to focus your effort and where not to go upon market entry.

■ identifying what we can excel in from a brand, product and technology / manufacturing perspective – what can we do better than anyone else

■ understanding all our tangible and intangible assets can provide platforms for opportunity and competitive advantage □ what can we own □ what do we own □ what do we own exclusively

■ this allows us to play to our strengths and thereby □ reinforces brand or product credibility□ minimises risk □ provides benefit or to RTB for our consumer□ is what made us famous in the first place

7th C: Our Competencies, the what and the why

Opportunity

Canvas

1) Challenge

create focus

2) Countrycreate

context

3) Categoryidentify codes

4) Competitionfind white

space

5) Consumerknow your

target

6) Customercater to your key partner

7) Competencies

know your strengths

Dermott DowlingDirector

T: +61 400 040 195dermott@creatovate.com.au

www.creatovate.com.au

Patrick TullyManaging Director

T: +61 410 867 366patrick@fusionlearning.com

www.fusionlearning.com

Thank-you.