How to woo digitally-savvy shoppers28th Nov '17
Millennials are the future – both at home and in the export markets of the Far East – and appealing to them requires businesses to develop a new approach
When it comes to selling to the fast-growing, evolving and diverse range of nations in the Far East, it’s as important to consider the demographics as it is the geography. As Ian Tandy, HSBC’s Head of Global Trade and Receivables Finance, said to the 140 SME business owners at the Cathay Pacific/HSBC Routes to Growth conference: “The ASEAN’s 625m population is strikingly youthful.”
True, the middle-class in the Far East is growing rapidly and has money to spend. But it’s the digitally-savvy ‘millennials’ that pose the greatest challenge to the status quo.
Millennials, defined as those born between 1982 and 2002, are supposed to work, view employment and have career plans that differ significantly from those of previous generations. They also shop differently, having been in the vanguard of the mobile, internet and digital era.
For British businesses looking to trade in China and the other booming Far-Eastern economies, attracting this key group, both as customers and employees, is critical to success.
According to Forbes: “Chinese millennials, numbering more than 400 million, are a force to be reckoned with.” They are “ultra-connected consumers”.
They also need to be treated differently. “We had to throw out the rule book,” revealed Margaret Manning, CEO of Adelphi, a digital design agency. Websites are old hat, she suggested. “You have to use different platforms in different ways and with different modes of address,” she said. “We use WeChat [the Chinese equivalent of WhatsApp] to talk with very senior government clients in a way you would probably speak to your best friend or children. It’s very different.”
“Learn what social media your customers like to be on and use that,” agreed Julie Deane, founder of The Cambridge Satchel Company, a business that exports globally, selling via digital platforms. “In the UK people operate via email; in China it is via social media. I’ve now got lots of customers who are my friends on WeChat. It’s a really effective and cheap way of communicating.”
It’s not just the medium, but the communication channel. The way businesses are structured is also critical.
The approach until now has been based on selling to ‘baby boomers’ (roughly defined as those born between the mid-1940s and mid-1960s), using baby-boomer processes. ‘’Businesses,’’ said William Kim, CEO of the fashion brand AllSaints, ‘’are behind the curve ‘’when it comes to millennials and their ways. Society is outpacing innovation adoption quicker than companies. The world is changing yet business models are not.”
He feels something of a pioneer. “We knew as far back as 2012 that, by 2020, ‘generation next’ [millennials] were going to outnumber the baby boomers in the UK, US and China.”
That meant changing the way the firm linked with both staff and customers, involving adopting a flatter management structure and making changes to sales channels.
AllSaints halved its number of management tiers. “A flatter organisation gives you pace,” said Kim. Innovation comes from how you organise and motivate your teams. It’s all about flexibility and speed of response to changes, and opportunities. The business cycle has become shorter. “These days you can’t work to annual targets; we have to work towards 100-day goals.”
To connect with the millennials, businesses have to digitalise, “taking the analogue out of everything you do in your business,” he added. “Digitalisation is shifting the way the world works and shifting it fast. Businesses need to keep up with the curve if they are to survive. Regardless of sector, if companies adopt innovation, they have great growth potential.”