Jun 07

Success Factors for a Product Launch in Germany

Germany is one of the most lucrative, rewarding and attractive markets to launch new products and services in. The banking crisis’ of recent years have served to strengthen the safety and security of investing in Germany, whose consumer group remains one of the largest and most stable in Europe.

The German market is competitive, relatively conservative and at the same time open to new ideas and experiences. Although many challenges arise when launching a product or service into more sophisticated markets, success often comes down to laying good groundwork, having good ears on the ground and maintaining good communication with consumers.

Once you complete initial market research and obtain good consumer insight, you can begin to think about how to build an awareness of your product or service. Although this can be achieved through traditional forms of marketing and advertising, it is equally important to consider: ‘How can we use social media to obtain feedback on our product or service?’

One way is to engage a local PR team or agency to monitor and analyse traditional and social media relating to your product or service within the German speaking market. Local PR experts can identify any media items that specifically mention your company, clients, suppliers, competitors, related interest groups, and specific topics of interest, such as changing industry regulations. By analysing and responding to current market trends and consumer needs, you can fine tune your campaigns, improve their overall reach and obtain better awareness. For example, the use of social media can enable a company to engage in a conversation with the consumer, allowing you to adapt to their needs as a result of feedback on how they respond to, feel and think about corporate messages and claims. Social media can therefore also give you an insight into what their impressions of various products and services are.

One of the shortcomings of new entrants is to not fully appreciate how consumers in different markets perceive different messages and how negative or positive an impression can be. For example, take a new European airline that didn’t want to be seen as a low-cost carrier. Typically, many markets associate low-cost with poor quality but many companies in Germany offer low-cost products and services without compromising on ‘quality’. In Germany, a low-cost airline has a better image than in most of its European peers. Why you ask? Well, because the industry standards for low-cost airlines are higher than those for no frills airlines. The challenge therefore lies in communicating the right message that matches a consumer’s perception of the product or service. What might work in one country may not work in another.

So, with a check in the box next to ‘awareness, perception and needs’, one also needs to think about maintaining communication. Although this can be achieved through your social media channel of choice (LinkedIn, Facebook etc.), companies make some common mistake here too.

I asked Ingo Harding, the CEO for public link, a PR agency in Berlin, “Is having a social media presence in German really that necessary”? He replied, “Yes it is absolutely necessary and critical to success, especially if you are trying to build up a brand and establish a quality product or service in Germany. German consumers are passionate about the products and services they buy and they like to engage in a conversation with the brand. Additionally, they also need to complain, react and ask for information through simple and easy to use social media channels. Contacting customer service through home pages i.e. ‘contact us’ pages or phoning toll free numbers takes time and isn’t as easy as posting a comment or visiting a Facebook page. The big problem though is that even after new entrants establish German social media channels, they fail to understand that these become the main channels for customer service and often have inadequate resources to deal with the traffic and requests generated by the sites”.

Curious to dispel some typical German stereotypes, I enquired a little further. Do you think there is a bias towards German products in Germany? Does every household have a Siemens washing machine and a BMW in the driveway?

IH: “No absolutely not. The German market is very competitive and demands value for money, so naturally Germans buy products that fit this criteria. Often we see companies or products that don’t fulfill their promise of quality. On the other hand, companies that discover that the competition is weak, their price right, the quality good, and that offer some kind of service advantage are likely to do well.”

Other experts conferred the same, and stated pitfalls that include an unrealistic assessment of market risks, prospects that have no idea of the market and offerings that don’t fit to consumer behaviour. Being too innovative in a conservative market can also be perilous.

Germany is open to new ideas and innovations and enhanced service offerings but consumers expect value for money. If we thought about a four step plan to achieve this it might look something like this:

  1. Needs – Does the consumer need this product or service?

  2. Perception – How is my company, brand, product and service perceived?

  3. Awareness – How aware is my target market that my products exist?

  4. Maintaining communication – How well will I engage them on an ongoing basis?

  5. Achieving loyalty – How happy are my customers and how likely are they to recommend my product to someone else?

These are just a few of the critical success factors to consider when launching a new product or service in Germany.

For further information on launching products and services in Germany visit: http://www.publiclink.de/en/index.php or contact: launch@publiclink.de

Written by Jeremy Hamann – Copyright © 2013 – All Rights Reserved – http://www.berlinbusinessenglish.com


Mar 20

Talking Brands (Medium)

brands

“A Picture is worth a thousands words”Arthur Brisbane, 1911

If a picture is worth a thousands words, then what do some of the most popular German and international brand logos say? What values do they communicate?

Of course, each one of us will have different opinions and feelings about various brands, so I will endeavour to capture a broad range of vocabulary and word partnerships that we use to discuss brands.

Here is a list then of some popular adjectives to describe brands.

What words would you use to describe some of your favourite brands?

Let’s take BMW (Bayerische Motoren Werke AG) as an example. This is one of the more interesting logos from both a design perspective and from the brand’s historical development.

BMW was originally founded in 1917 as an aircraft engine production company.  The logo, which was first used in 1929, has been portrayed as the movement of an aircraft propeller with white blades cutting through a blue sky. It also has the same colours as the state flag for Bavaria, its state of origin.

In my opinion, BMW is a timeless brand that represents a high level of quality and workmanship. Although it is a classic brand, BMW offers cutting edge design and innovation. The cars are very stylish, safe and fun to drive. Some even say sexy. See: The BMW 4 Series Is A Big, Sexy, Beautiful Beast

BMW targets an upmarket or more sophisticated market as its cars are somewhat expensive but very reliable, powerful and safety rich. As a global brand BMW is well-positioned to take advantage of growth in emerging markets such as China and Brazil.



Jan 27

Customer Retention – Part II – Pricing (Advanced)

ID-10061108Pricing your product or service can be one of the most difficult challenges  businesses and independent freelancers face. Too low and you may not be profitable, too high and you risk driving existing customers away or you fail to attract new ones.

In Germany, setting the correct pricing strategy can be fraught with danger . A pet hate of businesses and consumers in Germany is inflation. This has historical roots from the hyperinflation of the Weimar Republic in 1923, through to the late 70’s, 80’s and 90’s when Germany experienced 6-8% consumer price inflation or CPI.

german inflation

A price that is too low could cause doubts by the customer as to the quality of the product or service. Conversely, if the price is high, the product and service better be pretty darn good. Normally, most businesses aim to be somewhere in the middle.

We should also aim to establish more value by reinvesting some of the profit derived from our customers into products, technology or services that clients can benefit from. For example, you could do a YouTube/Facebook viral video featuring some of your customers, run video conferencing sessions, upgrade the website, integrate your calendar (to make scheduling meetings with your clients easier) or develop a deeper conversation with the customer though more insightful and meaningful feedback.

After you have determined your price point, you may also want to think about when to increase your price and by how much. It is always a good idea to inform customers a month or so before you increase your price. This gives them time to prepare and adjust. Even if it’s just a few cents or a €1 increase, you should write a letter or email advising customers of the change. If you establish a routine that your prices go up a little every year or by 10% every 3 years, you should still formally communicate any price increase.

If inflation behaves itself and you’re happy with your price level, you may also want to point out to the customer that there will be no price increase this year, especially if they are used to you increasing your prices a little each year.

Increasing prices can be scary in Germany, but it doesn’t have to be if we follow a few simple rules and clearly communicate how we are adding value and demonstrating the quality of our product and services.

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