Editor's Note: In recent years, with the popularity of Korean dramas, the domestic pursuit of Korean dramas has reached a climax. As a result, there have been bursts of "Korean Wave", from the hot sale of Korean goods to the hard-to-find flight to Jeju Island, from the "Dae Jang Geum" in crowded alleys to the endless kimchi, it can be seen that the prosperity of "Korean Wave" is dazzling. And all this is worth thinking about: what is the root cause of Korean cultural and economic revival? Take our theme direct selling as an example. South Korea, in a tiny place, has created a glorious history of ranking seventh in the world direct selling industry. So, what is the experience of the rapid development of Korean direct selling industry?
At the beginning of July, 2006, at the meeting of Xiaotangshan Direct Media Alliance in Beijing, the author had the honor to interview Mr. Yongjia Zhao, a well-known Korean direct selling expert. Through talking with Mr. Zhao, the author can get a glimpse of the whole Korean direct selling market, and at the same time, from Mr. Zhao's interpretation of the development history of Korean direct selling, find out some experiences that are worth learning from the direct selling industry in China, with a view to helping the direct selling industry in China, which is still in a confused period. The following is a conversation between the author (hereinafter referred to as "Pen") and Mr. (hereinafter referred to as "Zhao"):
Pen: Teacher Zhao, you have worked hard in the Korean direct selling industry for more than ten years. Could you please introduce the development history of direct selling in Korea?
Zhao: Like the direct selling industry in China, the direct selling industry in South Korea has gone through a tortuous development process: the period of budding chaos. In 1970s and 1990s, South Korea's direct selling industry was in a period of budding chaos. Since 1970s, a group of Koreans have learned irregular business methods in Japan and started improper pyramid schemes after returning to Korea. This model presents a lot of dark sides to the society, and also leaves a dirty side to the development of the industry. At the same time, these negative things have also influenced the 80s and 90s since the early 1970s, casting a shadow on the psychology of ordinary people, so the whole society and people have a very poor impression of direct selling. During the normal operation, the normal direct selling operation only starts from 1990.
With the entry of foreign-funded enterprises such as Amway, Sunrider and Ruxin, the Korean direct selling industry really started. At the same time, a group of Korean experts and professors also went abroad to study and study advanced direct selling experience, and guided the development of direct selling industry in Korea after returning home, which played an important role in promoting the normalization of direct selling.
During the period of legislative standardization, after 1995, the Korean government legislated on direct selling, and the Korean direct selling industry entered the period of standardization.
After legislation, the government resolutely cracked down on illegal pyramid schemes and supported the development of formal direct selling enterprises. Since then, South Korea's direct selling industry has soared. At that time, direct selling was a cause for people to realize their dreams of success, so many people were still keen on operating without methods and systems. However, during this period, the development of direct selling is not smooth sailing, and it has been hovering between good and bad. For ordinary people, it is difficult to tell good from bad. Many times, good as bad, bad as good.
Falling into the trough, the industry reached its peak at 1997, but it was hit hard and fell into the trough.
The bosses of traditional enterprises joined forces with propaganda agencies to carry out destructive propaganda on direct selling. They tell people through newspapers, television and radio that direct selling is a bad industry, called pyramid selling, and it is an offline business. The products of direct selling companies are all products that have not been formally tested. This devastating blow made 80% people stop direct selling. Negative news spread quickly and spread all over the country. Under these destructive propaganda, the direct selling industry has gone through a difficult course for two years, and the rest of the people have begun to learn from foreign advanced standardized direct selling experience.
During the period of rapid development, after two years of cooling-off, starting from 1999, South Korea's direct selling industry recovered and entered a period of rapid development.
With the influx of large international companies and the rise of local Korean direct selling enterprises, the Korean direct selling market has a high growth rate of 100% every year, and its total output value once occupied the seventh place in the world.
Turning development period, after 2002, South Korea's direct selling industry entered a turning development period.
While the direct selling market is growing rapidly, it also pays the price of "serious disorder" in the development of the direct selling industry. Social disputes and complaints emerge in an endless stream, and even the direct selling industry is ridiculed as an industry that "hurts consumers", forcing the Korean government to take major actions to amend the law. The purpose of this revision is to protect the interests of consumers and improve the system of direct selling companies. The most important system is the "consumer compensation insurance system", that is, the fund is submitted through the "mutual aid association" of the industry, and once there are victims, the fund will compensate. In order to ensure the effective implementation of this system, the Korean government has made it mandatory for direct selling enterprises to join the industry "mutual aid association", otherwise they are not allowed to operate. Since June 5438+February 2002, under the supervision of the Fair Trade Commission, two mutual aid associations have been established, namely "MLM Federation" and "Direct Selling Mutual Aid Association". As soon as the Mutual Aid Association was established, powerful direct selling companies joined in one after another. By the end of April, 2003, 65,438+004 companies had joined the Mutual Aid Association and 84 companies had joined the MLM Federation.
Smooth transition period: Since 2003, Korean direct selling industry has entered a smooth transition period.
Due to the economic downturn, the turnover of direct selling began to decline, and the number of companies withdrawing from the direct selling market increased significantly. The remaining companies either changed their faces or deepened their transformation. During this period, in addition to improving the management level, we also made the determination to reform in product development, customer service and incentive system, which saved the industry image and consumer confidence and laid the foundation for the long-term development of the direct selling industry. During this period, Korean local direct selling enterprises began to surpass foreign-funded enterprises, so the market share of Korean local direct selling enterprises has now surpassed foreign-funded enterprises.
Pen: Looking at the development history of Korean direct selling, it is quite similar to China direct selling, and they have not got rid of the tortuous development law. What do you think is the reason?
Zhao: As a special marketing method, direct selling has its inherent operating rules first, and is not necessarily affected by the region. Although it presents different forms because of the different economic and cultural characteristics of each region, it is more * * * in operation. For South Korea, direct selling is also an "exotic product", and its positive and negative effects are also exposed in the process of taking root in South Korea.
Pen: What are the outstanding features of direct selling supervision in Korea?
Zhao: 1995, South Korea formulated quite strict management regulations on the direct selling industry. The "Direct Selling Law" makes clear and specific provisions on the management of direct selling. For example, the restricted products must be daily necessities that are repeatedly consumed (such as household appliances). , direct selling is not allowed). At the same time, it is clearly stipulated that direct selling enterprises are not allowed to sell high-priced products, and the upper limit of product sales price is set at10.5 million won, which is about10.2 million yuan.
Pen: What is the impact of legislation on the development of direct selling in Korea? Has the social recognition and social status of Korean direct selling practitioners improved after legislation? What is the difference between the development trend of the market and the change of competition form?
Zhao: Personally, I don't think this influence is great, because the development of Korean direct selling industry is more influenced by the market. For those engaged in direct selling, legislation has been affirmed on behalf of this industry, which proves that this marketing method is not illegal. But for ordinary people, the impact is not great, because many ordinary people don't know the legislation of direct selling, and ordinary people don't care. It's just that the people in direct selling are "noisy", which is also the difference between Korean direct selling and direct selling in China and other countries. Of course, legislation has cracked down on illegal pyramid schemes, which is conducive to the standardized development of markets and formal enterprises, and also provides a good environment for fair and orderly market competition.
Pen: Which foreign and local enterprises have better brand images in the development of direct selling in Korea?
Zhao: This needs to be looked at in stages. Before 2000, foreign direct selling enterprises occupied a large market in Korea. The companies that performed well in this period mainly included Amway, Ruxin and Sunrider. In the past three or four years, Korean local enterprises have risen rapidly, with four or five enterprises surpassing Amway, and at present, more and more domestic enterprises are surpassing foreign direct selling companies.
Pen: What are the main factors that Korean local enterprises can surpass foreign direct selling companies?
Zhao: 1. They have set clear goals, and at the same time, they have established their determination to catch up with foreign enterprises. 2. Although these enterprises are small in scale, they all have many years' experience in direct selling operation, and they all have professional level. Because of their small scale, these enterprises learn and adapt quickly. They study the excellent characteristics of foreign direct selling companies, quickly accept and use these advantages, and try their best to surpass foreign companies and speed up and shorten the distance with them. They study what customers really need every day, grasp their consumption psychology and meet their needs.
Although foreign direct selling companies are large in scale, they are also very professional and experienced, which is a competitive advantage. However, these large enterprises are not flexible enough to keep up with the speed of market changes. After years of accumulation and in-depth study of foreign direct selling enterprises, Korean direct selling enterprises finally found their own development model, and in 2003 and 2004, they successively surpassed Amway and other large foreign-funded enterprises.
Pen: You have come into contact with many local direct selling enterprises in China. What do you think these local direct selling enterprises in China need most to surpass foreign-funded enterprises?
Zhao: I think the most important thing is to surpass the confidence and determination of foreign direct selling enterprises. I have contacted many bosses of domestic direct selling enterprises and found that they all have the same problem, that is, they are not confident enough to surpass foreign direct selling enterprises, and think that a big enterprise like Amway has no possibility of surpassing them at all. I talked to them about exceeding the target, and they thought I was joking, so they couldn't set the target of exceeding the foreign-funded enterprise. They have always believed that Amway is the "big brother" and they are willing to be the "little brother".
On the other hand, the bosses of many local enterprises in China have never engaged in direct sales and don't know how to do it. Senior leaders do not learn and understand the essence of direct selling, which will greatly hinder them from making direct selling enterprises bigger and stronger.
Pen: How to treat local direct selling enterprises in China? From your experience in serving these enterprises, what do you think are the biggest problems facing these enterprises?
Zhao: First, the boss's mentality; second, education; third, the senior management team.
Specifically, 1, the direct selling enterprises meet every day to learn and grow, while the bosses and senior management of the direct selling enterprises do not study, study or grow. They don't know how to touch some customers at all. 2 1 century marketers who don't understand customer psychology can't succeed. 3. People who don't know direct selling sit in the position of senior leaders, and control and direct those who know direct selling to do direct selling. In some words of China, it is "the layman commands the expert".
The boss, management and career of direct selling enterprises are an artistic combination. Bosses and management should not only improve the management ability of enterprises, but also pay attention to the changes of large enterprises, so learning is very important for them. In many western countries, enterprises will spend a lot of energy to train senior leaders, improve their quality and broaden their horizons.
And education is to solve the problem of reasonable learning. Business people should not only focus on direct selling, but also learn something other than direct selling. Educators should guide them, what parts and contents they should learn, how to develop and how to grow; Guide all-round learning, about economy, about direct selling, about enterprises, about mentality, etc. , should be within a reasonable learning range.
Pen: From the experience of Korean direct selling development, what is the most valuable experience for China direct selling?
Zhao: The first aspect of education. Without a good education, direct selling cannot survive well. The second is to understand the customer's psychology and narrow the distance with customers. Korean direct selling enterprises that have achieved these two points have survived and achieved good development. As for other aspects, I think they are all similar. It is also noteworthy that marketing, products and systems will gradually become homogeneous in the market competition.
After the conversation, the author was lost in thought: What should we learn from the Korean direct selling industry? How should I learn? Against the background of the great rejuvenation of the Chinese nation and the acceleration of world economic integration today, our direct selling industry and distributors are shouldering an unshirkable historical mission, and the only way to realize this mission is to find a correct position, learn quickly and forge ahead, so that our direct selling industry can be invincible in the face of fierce competitors. When we explore Korean culture, in this unique country with multicultural development, we find our own value orientation so accurately: the combination of "loyalty and filial piety" in Confucian culture and modern education has gradually established a strong national self-esteem, evolved into the collective character and endless spiritual strength of the whole nation, and created the national characteristic of "never compromise until the goal is reached". It is precisely because of this national characteristic and the influence of this culture that South Korea has achieved world-class corporate brands such as Samsung and LG. It is these factors that make Korean local direct selling enterprises surpass foreign-funded enterprises step by step. "National is the world's", which has established national self-esteem and self-confidence. Only by using the will and spirit of our nation to create brilliance and conquer the world can we win the respect of the world. Today, in the face of the increasingly internationalized China market and the direct selling industry in China, how to explore and carry forward our profound and excellent culture over the past 5,000 years and form an invincible force to inspire our national direct selling industry to stand in the world will be a problem that every direct selling enterprise and distributor thinks about. The development experience and lessons of Korean direct selling industry are beneficial to us.