Our Head of Building Products & Construction, Mark Goldsmith sat down with previous Head of International Marketing for AkzoNobel, Ian Bradshaw. Amongst other topics discussed: researching new markets, ROI of a digital marketing plan and the increase of sustainability issues, here's what Ian had to say:
Mark: Your senior marketing roles whilst at AkzoNobel have largely revolved around the specification, B2B marketplace. During your 12 year tenure, have you seen a big shift in the importance architects etc. put on sustainability issues when specifying products?
Ian: Sustainability has rocketed up the specification agenda in recent years, it is now a vital requirement for the professional specifier. Ten to twelve years ago, sustainability was rarely mentioned and when it was brought up it was only on the occasional, prestigious, part publically funded projects. As more businesses embraced sustainability as a core value, however, the buildings and infrastructure they commissioned began to have a sustainability component. Leading architects then began to build sustainability in at the design stage and this meant that building products companies had to respond by meeting or exceeding sustainability specifications, both in the products themselves, the usage or installation and disposal at the end of life. Basically, in terms of specification, I can’t think of a bigger change over this period than sustainability.
Mark: In this time, how have you seen digital marketing change the way brands are marketed. When interviewing for your team, how much emphasis do you place on them holding more than a passing interest in social media channels?
Ian: The growth of digital has clearly had a significant impact on marketing, though, I do think there is a danger of overstating its impact. The fundamentals of B2B Marketing have not changed, that said, marketing execution has and consequently new, or rather additional, skills are required. Any high-performing team has a blend of complementary skills and of course, it is important that marketing team members have the right skills and experience, including digital skills. More important, however, is that throughout the marketing team there is an intimate understanding of the customer and influencer needs. When activating the brand, whether that be communicating information, making the company’s products and services more easily accessible, demonstrating thought leadership, delivering excellent customer service etc., then digital often has a central role in the marketing mix.
Mark: In your latter role within AkzoNobel, you were tasked with growing fledgeling countries. Specific to building products, which regions do you see as the growth areas over the coming years?
Ian: Economic growth rates (GDP) are a fairly good predictor for building products. Emerging economies, often with growth fuelled by oil and gas, may over-index on construction so they have been attractive and are likely to be so in the future. Market access can be difficult and, as we have seen recently, fluctuations in the oil price can have a devastating effect on growth rates. There is a saying, “you can’t bank percentages” and although, there is good growth to be had in regions like Russia, China, the Middle East and parts of Africa, more mature markets often make up the majority of sales and need to be protected.
Mark: When researching a new region for the company, how do you commence research into their main drivers, competition, buying habits etc?
Ian: When starting out I have found it is best to start with the ‘known’s’ and work out from there. Although the data may be of variable quality, a search of IMF data and other sources provides the key economic and demographic data points. Through market reports or the extrapolation of in-house models, an estimate can then be made as to market size and this can be stress tested in the market using insights from local contacts. Through desk research and local market intelligence, a picture can then be built of the competitive environment and distribution channels.
A picture will soon emerge and an initial assessment can be made as to market size, growth, competitive intensity and any barriers to entry. Specific market research can then be commissioned and market entry approached evaluated.
Mark: How drastically different are the specification and legislative requirements from continent to continent. What are the main barriers to opening up new trading agreements within a country?
Ian: Globalisation has definitely helped here, many of the largest architects practices are in the US, UK or Europe. Regulations often align with the US or Europe, differences tend to be in the detail but may involve understanding local legislation and dealing with the attendant bureaucracy. International terms of trade do vary; there is a need to look at the impact of regulations, tariffs and taxation. In my experience, the biggest barrier to entry is the tariff structure on imports and the biggest factor in a successful market entry is working with the right partner.