Transcript Marketing the Nation

Marketing the Nation
• Philip Kotler, Ph.D.
• Kellogg School of
Management
• Northwestern University
• CEO Forum
• Bangkok, Thailand
• October 18, 2001
Strategy Development
• Situation Analysis
– SWOT
• Objectives
• Strategies
• Implementation
Situation Analysis:
Past Policies
• Thailand’s annual growth was 8% between
1991 and July 1997 when the currency
collapsed.
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1960s: Import substitution
1970s: Export promotion
1980s: Foreign direct investment
1990s: Trade liberalization
2000s: ???
Situation Analysis:
Strategy Dilemma
• Past growth was based on factor input growth, not
productivity (Paul Krugman)
• Problem with factor-driven growth: China and
IndoChina will be cheaper.
• The nutcracker dilemma: Thailand is caught in the
middle between low cost-based competitors (China) and
high value based competitors (Italy, Japan).
– Low cost based country: stagnation, unemployment, shortage of
hard currency, second class economic power.
– High value adding country: develops sophisticated industries
with differentiation and niche potential.
Situation Analysis:
Thailand’s Strengths
• Good natural resources
• Low labor costs
• Large internal market
• Democratic government, politically stable, safe
haven (Switzerland)
• Good access for reaching other markets in
Southeast Asia, China and India
Situation Analysis:
Thailand’s Weaknesses
• Bad bank loans
• Credit crunch
• Bankruptcies
• Weak capital inflow
• Unemployment
Objectives
• First, get out of the crisis.
• Second, improve international
competitiveness.
Objective One:
Escaping from the Crisis
• Fighting Unemployment
– Many Thais may come back to Thailand from the Middle East
– Many unemployed Thais will go to villages
– Undergraduates should stay in school one extra year to pick up
more skills
– Unemployed MBAs introduced to program for entrepreneurs
– Slow down company downsizing through consulting and
subsidies.
– Start large scale government work projects
• Get banks on a sound footing. Thailand Assets
Management Corporation.
• Companies need to revise their product mix, segment
mix, customer mix, and marketing mix.
Objective Two: Improving
International Competitiveness
• Thailand needs to improve productivity, innovation,
and marketing.
• Examples of specific objectives:
– Among top five trading countries in Asia,
– Occupy eight niches in world markets.
– Achieve three global brands.
– In top ten more favored countries to invest in.
– In top ten tourist destinations.
– In top ten with high quality of life.
– In top ten with social and political stability.
Strategies
• Choose the industries to develop.
• Improve the financial system.
• Facilitate entrepreneurship.
• Support small and medium scale enterprises.
• Help villages and cities develop place
marketing.
• Consider import substitution.
Strategies:
Industries to Develop
• Tourism
– Green tourism, quality tourism, Japanese weddings, Second
Phuket, Long stays for retired people, “Be My Guest” program
• Promote Thai food restaurants around the world.
• Promote entertainment industry in Thailand.
• Build auto industry; make Thailand, “Detroit of the East.”
• Build natural foods industry.
• Apply biotechnology to agriculture.
• Some industries have to be extended (Thai foods); some
strengthened (tourism, entertainment); and some started (Biotech)
• Two types of companies:
– Physical based companies (speed, quality, delivery)
– Knowledge based companies (design, differentiation, branding,
high value add)
Strategies:
Encourage Entrepreneurship
• Ministry of Entrepreneur Development. One
stop service and lending and training.
• Micro-lending
• Drucker’s suggestion
Strategies: Support Small and
Medium Scale Enterprises
• SMEs that feed into LSEs.
• SMEs that feed into international markets.
• SMEs that feed into local markets.
Strategies: Build Places
• Places need to develop place marketing plans.
• One product, one village: already 4,000
products. Marketing needed.
• A few products will end up in international
market (Thailand Plaza); some in regional
market; many in domestic market; most in
local market.
Strategies:
Import Substitution
• Machinery (raise tariff)
• Grow flowers and fruit here that were
imported
• Grow quality beef
Implementation
• Role of government
• Office of Opportunity Development
Implementation:
Government’s Role
• Government should be the driver. Guided
capitalism.
• Build infrastructure.
• Improve credit availability.
• Build public service information.
• Deregulate, privatize, where appropriate.
• Lower tariffs on luxury products.
• Reduce bureaucracy
Implementation:
Opportunity Development
• September 11 creates new opportunities for
Thailand. Every sector must develop a list of
opportunities.
• Needed: Opportunity Development Salesforce
– Don’t wait for industry and investors to
come here. Go and market to them.
Conclusion
• Thailand is better situated that neighboring
countries that went hi-tech.
• Thailand must position itself as a safe neutral
haven in a troubled world.
• Government must apply business and
marketing thinking to support recovery and
competitiveness.
• Thailand must extend and strengthen present
industries and build new ones that have high
value-added, knowledge-added content.
• Thailand needs to apply marketing skills in
order to turn ideas into results.