South Korean consumers are now increasingly opting for local brands due to their more Korea-centric value proposition and domestic marketing muscle. How would this affect foreign invested in the South Korean market? Spire Research and Consulting was invited to share its thoughts on ZDNet.
Korean tech consumers are increasingly favoring their own local brands – brands which are perceived to be better able to meet the needs and tastes of Korean customers as compared to their global competitors. Dr Justin Lee, Managing Director of Spire Research and Consulting (Korea), attributed the success of these local brands to their sound understanding of the local market’s needs and their ability to relate to Korean consumers.
Whilst most global firms did not adopt a customized approach tailored to the local market and used a ‘one size fits all’ approach, Korean companies were better at quickly picking up what consumers wanted and providing it. A typical example would be the bundling of both desktop and regular chargers offered to Samsung customers; an option which foreign providers Motorola and HTC had yet to feature. With their intense brand building and advertising efforts, coupled with their ability to work with other players in the market, such as telcos, Internet sites and retailers, Korean brands Samsung and LG are now dominating the local IT market.
Successful global firms like Yahoo, Motorola Mobility and HTC had recently exited the country in line with efforts to streamline operations and restructure. However, some firms, such as Apple and Canon, continue to stay in Korea and maintain a decent share.
It is vital that global firms foster a better understanding of Korean consumers’ needs, tastes and trends by investing in thorough research and development.