The IMC link to entrepreneurship around the globe

By Susan Monahan

Every year, many students relocate from China to Evanston to attend the Medill IMC graduate program. They are in a unique position to apply their foundations in this emerging market culture to the IMC approach. One student has already shared this perspective with the world and received much-deserved notoriety.

Xiaojun Ni, IMC class of 2010, was honored at the 40^th Annual St. Gallen Symposium in Switzerland this May. It is publicized as “the world’s leading platform for dialogue on key issues in management, the entrepreneurial environment and the interfaces between business, politics and civil society.” Xiaojun was recognized for a white paper she submitted for the event.

VIMC: Xiaojun, please tell us about the white paper that gained you access to the stage.

It’s titled “Free Entrepreneurship in China.” I cast my attention to small and medium enterprises (SMEs) in China, who epitomize entrepreneurship and are the pillar of the Chinese economy. But their development is hindered by lack of capital, rigid regulation, an ambiguous legal system and cultural and social stereotypes. So I propose to facilitate the growth of SMEs through financial, political and managerial measures.

VIMC: What inspired you to write about entrepreneurship in China?

Entrepreneurship is vital to the Chinese economy. SMEs in China (most of which are in the private sector) compose 99% all the businesses. They contribute 60% of the GDP, absorb 75% of the suburban workforce and 90% of the migrant rural workers, and create 70% of the new jobs each year. It's like Chris Anderson's "Long Tail" theory: the vast sea of small beats the large. However, entrepreneurs face challenges in China, and I want to explore solutions to help them.

VIMC: Can you share with us some solutions you offer?

Yes! In short, I talked about introducing multiple and flexible financial channels, reforming policies and removing legal barriers, managing with innovation, shifting to high value-added industries, enhancing education and technology, and provoking a pro-entrepreneurship culture in society.

VIMC: What knowledge from your classes at IMC did you apply to your analysis?

When I made suggestions on "managing with innovation," I used examples of IMC in practice. One involved a Chinese girl, who posts make-up tutorial videos on Tudou.com (like China's YouTube). She became very popular. Gradually she discovered women had trouble choosing make-up brushes – they were either too expensive or low quality. So she found a manufacturer in Guangdong and launched her own brand of brushes. This is a typical "outside-in“ approach - discovering market opportunities and catering to unmet needs of consumers.

VIMC: You were honored at a reception with students of economics and business from around the globe. How did their marketing philosophies differ from the core principles of IMC?

Although the symposium focused on entrepreneurship, new companies, and brilliant ideas -- they revolve around a unifying theme: they are customer-focused and data-driven!

Christian von Koenigsegg, founder of Swedish car brand Koenigsegg, shared with me that he focuses on a niche market and only makes less than 20 cars a year. Each car is tailored to the customer's specific requirements.

Rakuten, a Japanese e-commerce company (similar to Ebay), flourished with a sellers- to-buyers model, but took its business a step beyond by analyzing the Rakuten “super database:" segmenting users and cross-selling Rakuten e-banking, mobile, etc. It has the largest market share in Japan across all these sectors.

No matter the size or industry, companies are always finding a way to understand consumers first and then act, if it's a one-on-one relationship (that's easier) or mass market (that requires statistical and computing science).

VIMC: what are your plans for the future?

I’m open to going anywhere, and to positions other than (traditional) marketing, to gain broader business exposure. In the future, I might start my own business after being inspired by the forum.

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Susan Monahan is a blogger at Vitamin IMC and a student in the Integrated Marketing Communications graduate program at Northwestern University's Medill School. She can be reached at SusanMonahan2010@u.northwestern.edu.

Amazon Steps on Its Own Tail

Amazon.com is a prime example of using the Long Tail theory as a business model. Amazon sells a lot of unique products to niche markets instead of focusing on selling a few popular products to the masses. However, recently the company stepped on its (long) tail when books categorized as "adult material" (including LGBT themed books) were removed from sales rankings and search results. Whether an unfortunate decision or accidental 'glitch,' Amazon's blunder incited outrage that spread like wildfire across the internet.

While Amazon is icing its tail, marketers should take this as a lesson learned and as a reminder to never underestimate the power of the consumer. Consumer communities and social media can escalate an issue before you've even had time to blink. Prevent situations like this by listening to your customers and being proactive. If they are taking time to report issues to you directly, these issues should be investigated and addressed quickly to prevent discontentment. Slow action and sub-par responses infuriate customers. In Amazon's case, one blogger encountered the issue as early as February and posted a timeline of his effort to get the issue resolved.

You can't always expect customers to come to you with issues. Therefore, you must be proactive and monitor Web chatter about your company. Consumers are more forgiving to companies that are trustworthy and authentic. If you uncover an issue and can't fix it immediately, be honest and open with customers and let them know what you're doing to control the situation.

What are your ideas and best practices handling issues and complaints in a social media world?

--Marina Molenda