We can do better selling New Zealand overseas

Marketing guru Seth Godin showcased Ibex as an example of what a good website should look like in his blog today.
Ibex is a Vermont, USA-based company that sells outdoor clothing. Their long sleeve tops for men average about USD100 each. Not exactly cheap, but not over-the-top expensive either. Seth Godin outlines five things that make Ibex successful online:

  • They sell a product you can’t buy at the local store. This is easily overlooked and critically important. Because it’s unique, it’s worth seeking out and talking about. Just because you built a site doesn’t mean I care. At all. But if you build a product I love, I’ll help you.
  • They understand that online pictures are free. Unlike a print catalog, extra pictures don’t cost much. Make them big. Let me see the nubbiness or the zipper or the way you make things.
  • They use smart copy (but not too much).
  • They are obsessed with permission. Once you sign up, you’ll get really good coupons and discounts by email. Not too often, but often enough that my guess is that they make most of their sales this way. 25% discount on a product just like a product you love–just before Valentine’s day? Sign me up.
  • They aren’t afraid to post reviews. Even critical ones.

No doubt with the advent of online commerce anyone can sell anything online. As you go through the list, it’s apparent this is not rocket science. But it’s a wonder how few businesses get the basics right. This got me thinking about the missed potential for New Zealand firms. New Zealand is blessed with some of the most amazing natural resources in the world, superior products including honey, wool, seafood, dairy etc.

Almost all of the Ibex products I came across use the same raw ingredient: New Zealand merino wool.

A woolies zip t-neck (USD72) uses 18.5 micron New Zealand Merino lightweight rib; 150 g/m2. Not sure what the raw cost is, but probably not more than USD2 given the low price of raw processed wool. So basically of the USD72

retail price, maybe USD2 accrues to New Zealand wool producers and processors COMBINED, or 3% of the retail price.

OK, this may not be surprising to some people who already understand that it doesn’t matter if you have the best product in the world; if you can’t sell then you’re finished. However, my bet is the average New Zealander probably doesn’t realise the extent to which we’re “giving away” business. Coming back to the official website of New Zealand merino wool, the organisation tasked with marketing New Zealand merino wool globally.   The homepage is not particularly impressive, and people clicking on the “customer gateway” (curious terminology-

maybe they asked the resident IT geek to write this) get this “under construction” message. I don’t get these messages. If you don’t have a website, just wait until you have one. Why put up an “under construction” message?

Seeing this is the top site that appears on Google whenever anyone searches for “NZ merino wool” I’m not sure it’s a good look for foreign visitors researching NZ merino wool.

The 1992 Arthur D Little (American management consultancy) report quoted on the “About Us” page says:

New Zealand merino is unequivocally the best in the world and needs to be taken to the market in a manner which is distinctly different from the rest of the clip.

Sounds good. Hope there has been some progress in the 19 years since that report was published.

Posted via email from Euroasia

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Value creation key to prosperity

No one is surprised that Kiwis are heading across the ditch at a rate of 100 a day in March alone when news filter back that the average after-tax income in Australia is 34% higher than in New Zealand. If New Zealand ranks as the second easiest place on the planet to do business why are we less prosperous than most of the OECD, coming in at 21st out of 30 countries on GDP/capita?

It’s certainly “easy” to do business in this country. Anyone can start up a company within a matter of hours, apparently one of the fastest places you can do so in the world.

However, just because it’s “easier” to do business doesn’t mean that our firms are necessarily more prosperous. Quite the contrary. Our firms are unusually small (over 90% of firms employ less than 10 staff), compared with under 50% for USA and Korea for example. In the highly significant export sector (where we derive most of our wealth), only 4% of our firms export, and 80% of our the total $ value exported is generated by 1.5% of exporters (Source: David Irving, Icehouse presentation Apr 08) .

The reason Kiwis don’t get paid more is simply because we’re not productive enough. New Zealand is in the business of producing pretty low value goods and services. We are easily lulled into a sense of superiority because we are one of the world’s largest exporters of dairy products.

It’s a matter of demand and supply. It’s not just our dairy products that are in demand, but our talent too. As we have seen from the prices of butter and milk in our local supermarkets, we are by no way insulated by global forces, regardless of how many cows we have in New Zealand. In a global market, organisations compete for talent by paying more. Over time, the best resources move to the highest bidder.

New Zealand is a great place to live. No doubt about that. That’s why most of us are still here. We can and should still talk about what the government and the rest of us can do to make New Zealand more competitive.

Personally I would like to see more people create value by growing their businesses, employing more staff, and selling higher value products/services. Hopefully if enough people do that, Kiwis get paid more, and fewer would have to move to Aust/UK for more money.

I had the chance to visit a high tech company last week and spend some time with the owner (as part of a leadership training programme I’m attending). It was absolutely amazing to see how they managed to grow from nothing to a “mini-multinational”. I’m now pretty inspired to make a difference!

I’m pretty happy that at Euroasia we help people connect with foreign cultures, and a fair few of our clients have extensive contact with people from overseas. They build relationships that help with international trade and New Zealand’s global competitiveness.  order viagra no prescription I have a feeling that in 5 years, we’ll see a lot more people providing cross cultural training and consulting services. And when you google “cross cultural training” you will find more than the handful of providers you see there now.

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