“Brand Korea: From the Boardroom to the World”
Martin Roll is a world-renowned thought-leader on value creation through brand equity.
Click the button to hear our exclusive interview (40 min. length), or download the mp3 to your computer
Transcript of the interview by KBC’s Tom Tucker
Tom: Hi, and thanks for joining us today for the Korea Business Interview Series produced by KoreaBusinessCentral.com the premier information and networking site for conducting business in Korea. My name is Tom Tucker, and I am the host of today’s interview. Today’s topic is branding.
And joining us to talk about this is our guest Martin Roll, who is the Founder and Principal of the Martin Roll Company. Martin has more than 25 years of experience as a global branding expert, and he is author of the international bestseller Asian Brand Strategy.
Martin has increasingly focused on how Asian brands are developed, and what they need to do to compete successfully on a global scale alongside their North American and European counterparts.
Martin, every year, travels about 500,000 miles on all continents and speaks at more than 100 global top-level conferences, and he’s also a frequent guest lecturer at some of the world’s leading universities and business schools. Martin, it’s great to have you with us today. Thanks for joining us.
Martin: Thank you very much, Tom. I’m glad to be on the show.
Tom: Tell us a little bit about yourself. Tell us about your background, and why branding interests you so much.
Martin: I think the interest comes all the way back because my father is actually a graphic designer back in Scandinavia. I am Danish by origin. I think, kind of the interest for communication, for colors, how the world is shaped, actually came all the way back from my childhood.
It also lead me into advertising, and I did spend most of my career in the international advertising world and the media world before I set up my own consultancy around ten years ago. I think branding is interesting because we are all somehow related to brands in our lives. Brands are shaping personalities; they serve as focal points of our lives, the way we look at things the things we do in life. Brands are really part of everyday life. I think that’s why it’s so powerful to deal with branding.
Tom: Where are you currently located; where are you based?
Martin: I’m based in Singapore.
Tom: Okay. When did you actually start your consulting practice? Are your offices then currently located in Singapore?
Martin: Yeah. I have offices here in Singapore, and I have offices in Copenhagen. But, I would say most of my office activity takes place in many, many different locations, where I spend time with my clients in around 40 countries every year.
So, I must say I am not in Singapore much, but it serves as a fantastic home doing this. I founded it around ten years ago in Singapore. It was kind of based on the interests of the emerging Asian brands, but also based on the assumption that there was so much to do for the Asian firms. So, I felt that Singapore and Asia would be a fantastic home for the company
Tom: So, what are your firm’s specialties? Talk about that a little bit.
Martin: I specialize in helping businesses produce better results through brands, not so much from the visual and communication side. Very often, when you think about branding, people think it’s a logo, it’s a corporate ID, and it’s a set of colors. I don’t really do that; I leave that to the ad world and the media world.
I try to help people form and shape business strategies in order to produce better brands, and what they can do for their businesses. So, it’s very much strategic consulting, but it’s focused on the two platforms of branding and marketing.
Tom: So, specify a little bit more for us the types of activities and projects that you’re involved in right now.
Martin: They could come in many formats. Sometimes, it’s just a one or two hour advisory workshop for a management team somewhere in the world. It might be a company, for example, in the OEM sector that wants to build their own brands instead of just selling OEM products to other firms that are branded.
It can also be much more long-term projects where you look at an already established brand and say, “How can we produce better results here?” in terms of segmentation, brand architecture, global expansion, strategizing, employers, the culture internally in the firm and so forth. So, it really comes out in many, many aspects.
I also advise a lot of CEOs and CMOs in leading organizations around the world. So, a lot of my clients are more on a retainer basis where I would interact with these clients on a regular basis, and help them to achieve better results.
Tom: So, how long have you been involved with branding in Korea? Can you share with us some examples of clients and/or projects in Korea that you’ve done, or maybe that you’re currently involved with?
Martin: I have done business in Korea for around ten years. It took me a few years to get established in Korea as you know, and I think as many foreign firms have realized, it does take time to get a foothold in Korea.
I’ve done quite a few projects over the last ten years, particularly among the top 20 Korean firms. The only challenge I see is that most of my clients are under pretty strict confidentiality agreements, but if I mention the top 10 or 20, I think most of the audience can probably imagine some of the clients and brand names that I’ve been working on.
Tom: Certainly. Let’s talk a little bit about Asian and Korean brands. A major theme of our discussions here at Korea Business Central is on companies doing business in Korea and on the Korea brand going abroad.
In recent years, especially the Korean government, as you may know, has focused on globalizing the Korea Inc. brand, including promotion of Korean foods abroad. Tell us about your book in light of some of these ideas, Asian Brand Strategy. Explore this for us a little bit; why did you write it and what have you learned about Asian brands?
Martin: I think I did write the book originally because I was quite encouraged by the fact that, at least ten years ago, Asia did not have more than maybe five or, say, ten brands on the global table. A few of them came from Japan and a few of them obviously now originated from Korea in terms of the Samsung, the LG, and the Hyundai. So, all in all, Asia had not really produced any brands at that time.
What I realized 8 –10 years ago was that a lot of the Korean firms actually showed a huge appetite for going international and getting into the global scene, and that’s actually what brought me to Korea in the first place.
The book that I wrote, Asian Brand Strategy, has this kind of old world framework, which I refer to as the Asian brand leadership model. It goes around five different very important issues; first of all that the Asian boardrooms, the Korean boardrooms, need to change their mindsets and practices.
I think, until now, marketing has been very much a technical function, but it needs to shift into becoming much more strategic. It has to be lead by the CEO and the boardroom, and that’s something that you rarely see in an Asian organization. That’s something that Korean companies are only now changing.
You also need to look at the consumer patterns in Asia because when you look at Asia, Asia is not really not all that homogeneous. In order to understand how we can bring this brand out, how can it become successful, you really need to look at Asia as part of different cultures that are really penetrating the different markets around. So, it kind of calls for much more detailed, much more sophisticated Asian consumers.
Then you also need to have a certain sense of modernity. I think, for quite a few years, Asia was kind of trapped in the past. There was this kind of oriental perception of Asia, of the old days and old cultures; maybe something very exotic.
I think the way for Asian businesses to be successful at this in the region is they need to look at the region as being very modern. Asian consumers are really yearning for something very, very modern in that aspect.
Then you need to become trendsetters. It was, for many years, that Asian businesses were always copying the Western firms and Western brands; L’Oreal, to Nike, to IBM, and Microsoft. But, they need to become trendsetters for themselves if they want to establish an iconic brand. So, this is very much about innovation, and research and development, design and so forth.
Finally, if we are elevating everything to the boardroom and we are doing all of this, we need to make sure everyone in the company is empowered around the brand, so it’s really become a strategic focus for everyone involved in the operation.
So, somehow, it was a new paradigm and it’s still changing in Asia; many companies haven’t got it right yet. But, if I look at what is happening currently in Korea, I think it’s definitely something that is now taking place at the highest level in many different Korean corporations.
Tom: I think some of the things that you were just describing here not only apply to Korean and Asian companies, but a lot of these rules and concepts I think are pretty much universal.
Martin: Oh, absolutely. It’s still a challenge, even for some of the Western firms. Forget about the Fortune 100 or the Fortune 500; they’re doing a pretty good job here. For example, one of the things I’ve been calling for in Asia is to get a Chief Marketing Officer on the board. If you look at the LG, the Samsung, and the Hyundai, they all have a Chief Marketing Officer.
The fact is only 2 –3 % of the Fortune 500 companies will have a Chief Marketing Officer in the boardroom. That means the marketing for many companies is still very tactical. It’s not really represented in the boardroom suite.
Tom: Not quite C-level yet. I was surprised to hear the percentage that you just quoted. Did you say somewhere that less than 5% of top companies have a Chief Marketing Officer?
Tom: That’s quite surprising.
Martin: It is, and it’s still this struggle that marketing needs to take center stage. Obviously, if you look back at my advertising career that kind of ended ten years ago during the 90s, marketing was very, very tactical and there was this fight for marketers to get better representation at the higher level.
But it also meant marketing was very siloed; that marketing took place in a very tactical function. It was kind of departmental, but it wasn’t something that was cascading throughout the entire organization.
If you’re claiming that you’re delivering the best service, or you have the best design, or you have the best distribution, and it wasn’t really something that was cascading down the organization. That’s why marketing simply has to be elevated to the highest level.
Tom: Which Asian brands do you feel have been very successful?
Martin: I think a company like Singapore Airlines has been very true to the root and their origin. They’re very good in balancing a promise of great service with actually delivering across all the customer touch points.
I think, from the aviation industry Singapore Airlines has done incredibly well. Also, it’s due to the fact that it’s a very, very profitable airline. Another company like HSBC from Hong Kong, one of the top banks today, 20 years ago, it was a small regional trading bank based in Hong Kong, and today is probably one of the top financial powerhouses.
Obviously, you’ve got the Samsung, the LG, and the Hyundai, which I think have been extremely successful as well. You have Toyota from Japan, you got ASA and their two hotel chains; one called Banyan Tree that originated in Singapore and you also have Mandarin Oriental out of Hong Kong. But, I like one or two handfuls of very successful Asian brands which I think have even taught the rest of the world how to do things.
Tom: Talk a little bit more about Singapore Airlines. Tell us their brand and talk about how, at Singapore Airlines, the brand is something that totally permeates the entire organizational culture from top to bottom.
Martin: Singapore Airlines starts with a mindset. The airline was founded back in 1973, and it was simply based on the promise that Singapore had no domestic airspace. So, from the inaugural flight, they were forced to compete with some pretty heavyweight airlines in terms of TWA, British Airways, Lufthansa and so forth.
So, they simply decided to say, it might be that we are small, but we have to focus simply on service. We’re going to deliver the best service in the world, and we’re going to do it through use of the best technology we can get. So, we’re going to source the best aircraft, the best food, the best wine, the best service, and so forth. We’re really going to make sure we are leading edge in terms of technology as well.
That’s a nice statement. It could just act as a very nice strategy. The way the airport has survived is through an incredible way of training people throughout the entire company from top to bottom.
At any given time, Singapore spends around 15 –20 working days yearly on training everyone within the company. And they have some pretty high benchmarking standards in order to make sure that this promise of great service is actually brought to light, so they’re extremely consistent. And they do spend a lot of money on investment in new aircraft, in training, newest technology, bringing things to light and so forth.
So, it’s a company that, from the highest level, from the chairman to the ownership level, which is part of the Singapore government, is taken extremely seriously. I think maybe a result of that, and that’s from my own account, I think Singapore Airlines because they have done so well as they have, I think they have contributed around 20% of the Singapore national brand because Singapore Airlines has simply been a flying face of the nation of Singapore.
Tom: How about some Korean brands who have done as well?
Martin: I think Samsung has done very well. Samsung is probably the brand that brought Korea to the world; it suddenly showed a face of Korea which I think was unknown to most people outside Korea. LG is now pursuing the same journey, but in a different way. You got a company like Hyundai. Those three companies probably serve as the top ones.
But, you also have an interesting company, for example, like Amore Pacific, which is a cosmetics firm and it’s grown from home and they currently are representing ten different organically grown brands, and they are doing extremely well. One of the brands is called Maniche, and that’s now one of the fastest expanding cosmetics brands in China.
So, I think there are quite a few Korean brands that are currently undertaking a journey of getting outside the national market and into the international scene.
Tom: You say LG is taking a different strategy compared to what Samsung has done. Talk about LG a bit.
Martin: LG tried to build up the brand in a different way because Samsung surely was the first mover in the category. They moved into many different areas of technology, and they moved into many geographical areas. Obviously, being the next one on the step, you can’t just copy what Samsung did.
So, I think in order for them to act differently, I think they’re focusing differently in terms of technology offering. Also, the components of the brand; I don’t think they just tried to emulate what Samsung did. They, rightly so, need to find their own journey. That’s what they’re currently working on, and you can see the results of LG over the, particularly, three to five years. They have really gone from a regional international player to a truly global brand, which really has established a footprint in many, many countries worldwide.
Tom: Let’s talk about the competitive advantages that Asian brands and, more specifically, Korean brands have.
Martin: I think one thing that really characterizes Asian brands is actually their ability to innovate. 10 or 15 years ago, most Asian brands were copycats. But, I think they’ve realized there is a lot of talent and there is a lot of knowledge and power in the Asian firms.
I think if you look at some of the Korean firms, they’re very, very good in innovating. It’s also like when Asian firms are getting the strategy right, they might not necessarily be first movers. Obviously, many Asian firms have been late because throughout the last 50 years of industrialization, a lot of that was actually lead by the Western firms, and obviously Japan as an exception in the Asian region.
But, they’re now realizing, “Wait a minute; we can actually do some pretty good stuff here.” The same goes for the Chinese firms; they are now spending a lot of money on research and development.
They are increasingly using design as well. Design, 10 or 15 years ago, hardly existed in Asia, but that’s now becoming another component. I think the last dimension that really characterizes Asian firms is once they got this strategy right, once they set the direction, they are very good implementers. They are very good in execution. So, once they kind of set the focus on, “This is the way we are going to do it,” they are very good in balancing the promise and the delivery side of things.
Tom: How about some of the competitive advantages of the Korean brands?
Martin: I think Korean brands are a hit, first of all, because Korea is so technology driven. I think most of the population has been on the Internet for quite a few years, and they are naturally interested in technology. I think that’s also the reason for the rise of some of the big companies from Korea.
I think one of the key advantages of Korean firms is that they are very innovative, and they are spending a lot of money on research and development. They are also incredibly quality focused. Some of the best products, in terms of quality actually originate from Korea today if you look at the entire Asian region. So, I think that Korean firms, in many, many aspects are quite ahead of the rest of the Asian Pacific scene, at this point in time.
Tom: So, if you had to give some of these large Korean companies a letter grade in terms of branding themselves in Asia, and then maybe branding themselves on a more global scale, such as in North America.
How would you grade, how would you rate the effectiveness, the success, of the large Korean conglomerates at branding themselves and selling those brands throughout Asia and globally?
Martin: I think, currently, they are doing very well. I think they are definitely getting a grade A. They have undertaken a tremendous journey over the last ten tears. We have to realize that all of the Fortune 500 and the so-called Western brands, it took them maybe 50, or some of them 100 years, to establish their footprint globally.
So, I think, somehow, the Korean brands have gotten into the global scene in a very short period of time. We just have to put a note here though because having a strong brand actually has two components.
First of all, you obviously need to have a very strong functional offering, but a brand is also about some of the emotional aspects. I think what the Koreans brands until now have now done very well is they have established a footprint in terms of functional dimensions in terms of design, innovation, quality, pure technology, what goes behind, the security, reliability and so forth.
But, I think still for most of the Korean brands, they are yet to unfold their true emotional component. If you look at a product like iPod, people don’t buy the iPod because of technology; they buy it because they buy into an emotional community of like-minded that actually uses the iPod, and actually adores Apple on a global basis.
We don’t know each other; we just know that people are out there, and I just want to be part of that community. That’s a very strong emotional bond, and I don’t think that Korean brands yet have established those emotional bonds, which is natural because, as I said, it’s a journey and it takes time. It’s almost like a good bottle of wine; it does take 10 – 20 years to mature, and age, and get the full-body flavor of the wine.
Tom: How about some of the up and coming Korean brands that you might know of and what they need to do to be successful?
Martin: I think they need to put the bar a little higher. Some of the upcoming Korean brands are doing very well in Korea, and they have actually started to get into the region. Some of them are lacking the mindset in terms of elevating marketing to the strategic level, and to see marketing as an investment and not a cost on the P&L.
Sometimes, that is lacking, in particular with some of the smaller Korean firms because they don’t really see marketing as something that’s going to take center stage. The late Professor