Last month I talked about how, with my business, I often meet companies with a success story in Italy but struggling to replicate this model in other countries: The Business Idea. I tried to explain this situation by using Richard Normann’s Business Idea model: the product and the organization were modelled on the Italian market and do not work as well if they are used – as is – in other markets. A few days ago, however, I happened to meet an italian company in the furniture components industry with the completely opposite problem but which, once again, confirms the accuracy of this model in reading the stark reality.
This company has had Germany as its main market for many years with turnover in this country around 90%. However, besides this important market, the company has had difficulty in building a strong position in other markets – including Italy. It must be said that a little bit of this is the result of the business choice: Italians in this sector often do not reward the price vs quality ratio that is chosen by the company, preferring to rely on the area’s craftsmen. However, management told me that they had recently had a visit from a potential customer from the Veneto region and he seemed interested in their semi-finished product. After a few weeks, however, having failed to contact them back, they called him and found out that he had been impressed with the product, but he hadn’t liked the approach used by the company’s Key Account Manager: You asked us a lot of questions!
The company’s salesman explained to me that he had, in fact, used the same approach he uses in meetings with their German customers: in the beginning the most important thing is to understand the customer and his needs in order to offer the best solution. Obviously, however, this overly-German approach was not appreciated by the prospective Italian client who had felt as though he was being interrogated.
The fact once again highlights how cultural aspects are important when approaching a new market. In this specific case, our Key Account Manager’s experience was formed on the German market which has very different characteristics from the Italian one. Very often, German clients have a high technical preparation and they literally split the hairs 4 ways when it comes to product knowledge. Ergo, it is necessary to be well prepared. Furthermore, their communicative style highly favors frankness and straightforwardness as opposed to diplomacy. For anyone not German, this way of doing things is mistaken for rudeness.
I have no doubt that the company has marked this down as a learning experience and that our Italian-German Key Account Manager will have a different approach with the Veneto-area prospect next time. But the fact once again highlights how it is necessary to adjust your aim on organization and, very often also, on the product as well, when facing a new market.