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Why ASEAN?
Why ASEAN?
Globalization
ICT has allowed wide information access. Goods and services can move cheaper thanks to cheap transportation and ICT. The world is more borderless. In a flat world, competition searches for lowest cost.
Regionalization
Convenience of flows of information, goods, services, and people within the region Relatively similar psychology and national interest within region
Localization
National borders still have economic meaning. National markets exist and are defined by psychology and politics. National economic and political setbacks can threaten globalization.
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Source: Wikipedia.com
Regional Blocs, including East Asia will be prominent Principal blocs will be Europe, East Asia and the Americas. The 21st Century is the Asian Century! Asia will be almost half of the worlds economy by 2020
The formation resembled flying geese, headed by Japan, while the rest of the group followed. Countries toward the front tend to transfer older industries to countries at the back.
Note: Flying Geese is a concept developed by Kaname Akamasu that best describes the economic structure of Asia before the crisis.
Asian Crisis
But the crisis put an end of flying geese.
Source: BBC
Asian Economic Crisis in 1997-1998: The End of Flying Geese, The end of the good old days of the Asian miracle
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SAARC Squadron
ASEAN Squadron
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Strong technology and service industry Relatively efficient capital market Strong private sector and legal framework Younger workforce Growing population Great university system Strong entrepreneurial culture Attracts higher prices Red tape, corruption, tough labor laws and bureaucracy all deter investment Woeful infrastructure Lackluster primary education system Exclusive growth environment to the rich The privatization of key industries has stopped
India
Strengths Weaknesses
Weaknesses
Heavy reliance on low prices Weak financial system Inefficient capital system Slow population growth
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How should ASEAN ride the wave of the rising East (read: Chindia)?
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Threat
ASEAN Integration Individual countries in ASEAN are nothing compared to Chindia
Opportunity
ASEAN is the only region capable of being in the driver seat of the Greater East Asia integration*
* ASEAN is the first to seat ASEAN countries together with China, India, Japan, South Korea, Australia, and New Zealand, as well as Russia (as an observer) in one table during the first East Asia Summit.
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(Observer)
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ASEAN
Neutral Position
ASEAN is not considered a threat to China, India, Japan, South Korea, Australia, and New Zealand
Smooth flow of goods, services, and people under FTA Abundance of natural resources Low labor cost
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Why ASEAN?
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Consumption/Demand
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All barriers to the free flow of goods, services, capital, and skilled labor are removed
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Workable Institutions
It is no longer cost effective for all manufacturing activities to be done in in-house or in a single country MNCs are integrating their manufacturing activities across several locations MNCs are not only seeking large consumer markets but also regional sites where they can establish efficient production networks
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Benefits to MNCs Targeting more sales volume in the ASEAN market Components procurement on an ASEAN-wide basis More product specialization to achieve economies of scale Greater emphasis on profitability using ASEANwide operations
Benefits to Local Companies More export opportunities to ASEAN market ASEAN-wide expansion opportunity for corporate growth strategy Technology and financial support opportunities from MNCs ASEAN-wide pool of talent
A Balanced Approach
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Why ASEAN?
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What is Marketing?
Brand Integrity
Positioning
Being Strategy
Differentiation
Core Tactic
BRAND
Brand
Value Indicator
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S
Explore
1
STRATEGY
TACTIC
T
Engage
Positioning
'BEING' STRATEGY
Differentia tion
'CORE' TACTIC
7 8 9
Process
VALUE 'ENABLER'
Execute
VALUE
(heart-share)
V
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ASEAN
LOCALS
LOCALS
Local Champions
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Positioning
Malaysias largest and most innovative and issuer of niche cards
Brand Integrity
Differentiation
Selection of cards suited to niche segments Early adoption of new card technologies
Brand
BRAND
MBF Cards
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Positioning
The bakeshop with international standards catering to Filipino taste
Brand Integrity
Differentiation
Varieties of Philippines original bakery products and cuisine Understanding of Pinoy values and sentiments
Brand
BRAND
Goldilocks
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Positioning
The convenient gift and souvenir options of hand-made premium cakes, kueh, and cookies
Brand Integrity
Differentiation
High quality hand-made products with attractive and exclusive packaging Convenience for order, delivery, and collection Gift voucher packages
Brand
BRAND
Bengawan Solo
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Positioning
The affordable core essence of energy drink for core generation
Brand Integrity
Differentiation
In sachets, not in bottles Generation Biang (core generation) Large retail distribution networks
Brand
BRAND
Extra Joss
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Positioning
Food houses that combine West and East
Brand Integrity
Differentiation
Extensive Western and Asian (especially Thai) food and coffee menu Wild Wild West name and dcor Large chain of outlets
Brand
BRAND
Black Canyon
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AirAsia of Malaysia
Locals Going Regional
Positioning
ASEAN no-frills and fun low-cost carrier
Brand Integrity
Differentiation
Low-cost structure Fun internal culture
Brand
BRAND
AirAsia
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MNC Type 2 - MNC with Glorecalization Approach: Consistent global value, Coordinated regional strategy, and Customized local tactic (The 3C Formula)
Strategy Tactic Value
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Yamaha Motor
Yamaha Brand and Three Tuning Forks logo The spirit of creating Kando (feelings of deep satisfaction and excitement) as the brand mission Yamaha technology and production
Different product mix for each ASEAN country Different communication approach for each ASEAN country
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Toyota Kijang
Toyota Brand and Three Ovals logo Japan-quality manufacturing Sales, Service, and Spare parts businesses
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Conclusions
ASEAN is a regional bloc of 550 million customers with rich resources. ASEAN is sure to get attention from MNCs and investors both as a source of products and a market for products. ASEAN will bring benefits to the companies in all 10 ASEAN countries because it will lower their costs and provide larger opportunities .
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