The yearend euphoria is getting an extended mix this time, with Christmas almost instantaneously flipped into Lunar New Year celebrations, and Ramadan around the corner.
Gloomy reports and geopolitics almost furthest from our minds, as we embrace a renewal of mind and spirit in our typical Malaysian way.
A quarter of the year might pass though before reality of the global economic slowdown that the IMF has predicted gives us a kick in the nuts.
There are positives however which we have stepped into this new year with that could make a notable difference to how the year unfolds for us.
We now have a government entrenched with the mandate of the people, seemingly determined to return us to a more competitive position, though admittedly their roadmap is as guarded as what the final Budget 2023 will eventually be!
Our resilience in bouncing back from the pandemic as fast as we did; inspite of the supply disruptions and contracted export market, deserves mention too. We not only looked within and around the region for new source and markets, but also managed to pick up the slack of global shortages, most notably in the semiconductor and electronic sectors.
While the global pandemic is being referred to as a Black Swan event; without underplaying the magnitude of what we’ve all been through, there have been other similarly ‘unique times’ throughout history that by perspective has made an equally notable impact. Though not identical in nature or scale, these globally impacting ‘events’ offer us a peephole of what might unfold, as there’s often patterns to what follows. It’s in these patterns that the prospective opportunities lie for those who are ready for them.
Discussions into these patterns would go well into the night; possibly deserving a piece of their own, but one oft noticed pattern that we should perhaps pay some immediate attention to is that businesses in the Small & Medium Enterprise (SME) sector, or those that by nature fit the description were first to make brave leaps in such times; be it out of desperation or sheer grit.
From well before the term was coined it can be found that it’s the SME business, because of their agility to adapt or willingness to evolve, that have seen these opportune moments as catalysts for their growth, some becoming established global brands of today.
Amongst those who successfully manoeuvred these times, it is those who seized the moment and invested in brand building and advertising when most established brands of the time chose to take more prudent paths.
Certainly, the enterprising vision of their leaders to see the window of opportunity, being quick to cash in on the discounted media rates and the relatively lower clutter of marketing messaging deserves due credit too.
Another pattern that is quite consistent is that after these periods of upheaval, comes a revolutionary bullish run!
When it will kick in and for how long it will last, would be something the analysts may be more aware of, but what the past has shown us is – the surge will come.
Even in more recent times, this pattern can be noticed in our local context. The biggest influx of new brands coming out of relative oblivion to lead is often during supposedly gloomy periods.
With nearly 40% of our Gross Domestic Product (GDP) contributed by around 1.2 million Micro Small & Medium businesses that make up about 98% of established businesses in the country, this is a sector that can’t be ignored, if not the hope to drive our economy out of this period unscathed!
There are already initiatives in place that are aimed to readying local businesses for ESG requirements of export markets and even public listing, but for these businesses to be really competitive they must position themselves to mean more to the market. This is where branding comes in, and sadly it seems to be where the SMEs are left to their own devices – or to the mercy of self professed gurus and overnight marketing sifus.
SMEs too are more bottom line oriented, and don’t see brand building as more than logos and marketing collateral, and would rather put the money into closing the deals offering discounts instead!
They would not be wrong in saying branding doesn’t give you immediate results though, but discounting ultimately commoditises your products (or services) and leads into a price war. I have spoken about value proposition before so will not dwell on it, suffice to say we should not be drawn into competing on price alone.
With the two largest Free Trade Agreements in play, the ASEAN region will not only offer local brands opportunities in the region, it also opens our market to businesses in the region who may be more competitive in a price war.
Instead, taking a page from the past, do what the entrepreneual businesses of old did. Use this opportunity to build brands, no matter if you are selling ice, offering sanitization services, publishing books or are in the construction business, let the market know what differentiation you bring to the table – establish your brand persona.
The government needs to note this too and provide local businesses with support and encouragement to invest in brand building, as it will be needed to push through the challenges ahead.
For our part the Malaysian Advertisers Association (MAA) sees this as a calling for the term ahead, to reach out to local businesses and affiliate associations representing SME businesses, to offer our assistance and support towards the same. We plan to incorporate a few initiatives specifically for this purpose that will hopefully give local businesses some insights on how to chart their own course.
As an industry too, should our efforts be required in driving a new vision for brand Malaysia; that is future focused and inline with the current global and regional environment, we are ready for the government’s call.
Credit Suisse analysts expect a 4.4 percent growth in the ASEAN-six economies of Indonesia, the Philippines, Singapore, Thailand, Vietnam and Malaysia, for 2023, which puts the regional economic growth above the global average.
Bank Negara Malaysia too has forecast the local economy to expand by 4% – 5% in 2023, according to governor Tan Sri Datuk Nor Shamsiah binti Mohd Yunus.
Though muted for the moment may be the dire premonitions as we take our first steps across the horizon of this new year, let us look forward and be ready to ride the the next wave when it does come, or we will just get washed away in its wake – as the rest of the region rises!
#MalaysianAdvertiserAssociation #MAA #SME #Malaysia #Outlook2023