Home Interviews “Marketing has not been the SMEs’ strongest subject”

Interview with Stefan Hentschel and Klaas Flechsig, Google Deutschland

“Marketing has not been the SMEs’ strongest subject”

According to Google, many German small and medium-sized businesses still haven’t understood the scope of the Internet’s reach. Marketing isn’t exactly the SMEs’ strongest subject either, says Stefan Hentschel, Industry Leader Technology at Google Germany in an interview with International Trade News. For export-oriented companies, Google is offering additional coaching through a new initiative – its “worldwide growth” platform. It is all about seizing opportunities to win additional business via digital sales channels – without turning one’s back on traditional sales routes.

International Trade News: Mr. Hentschel and Mr. Flechsig, in 2014 you launched the initiative “worldwide growth”, specifically targeting German small and medium-sized businesses. You have even promoted it before a high-powered audience at the congress "Day of the World Market Leaders" in Germany. What lies at the heart of this initiative?

Stefan Hentschel: Our initiative “worldwide growth” is primarily aimed at companies with a strong export orientation and which already exploit digital sales channels alongside more traditional sales routes. They already understand that the “digital” medium represents an opportunity for them to expand their business. Secondly, we are also targeting many of the smaller SMEs that are only just starting to build up their export activities.

International Trade News: How do you teach interested SMEs about digital sales channels?

Stefann Hentschel: We talk to company executives and business owners about their company’s potential in export markets. Let us look at the example of a major Swiss supplier of weighing systems that has just begun to “cross-pollinate” its classic sales channels with digital channels. The company management wanted to know their product’s sales potential in an export market like Mexico. With regard to digital sales, the next question was: which phrases and keywords does its potential target audience in Mexico use to search for its products? After determining potential digitally, the classic sales force came into play. For companies generating additional potential in this way, we can offer our considerable expertise regarding digital tools.

International Trade News: Such as the platform “worldwide growth”.

Klaas Flechsig: Exactly. At www.weltweitwachsen.de there is a search tool where the products can be entered. It then determines their sales potential in important export markets.

International Trade News: Are there costs associated with this initiative?

Stefan Hentschel: No, the platform is free. Its first intention is to raise awareness of “digital” opportunities amongst companies. In my experience, many of them have yet to explore their potential in the digital world.

International Trade News: So, a business enters its product on the platform – what immediate success can he then expect?

Stefan Hentschel: The wood carver, Gerd Schmieder and his Black Forest clocks are a good example: a small business finds its home market saturated. He starts wondering whether he can sell his clocks worldwide. After entering the keyword “cuckoo clocks” on our platform, he can determine the export potential for Singapore. In this way, he has succeeded in not only developing a campaign for Singapore, he has also managed to prospect for new business contacts – specifically for new agents to import his cuckoo clocks and sell them on to other customers.

International Trade News: What advantages does the platform “worldwide growth” have for Google?

Stefan Hentschel: First of all, we want to conduct an exercise in “awareness building” amongst small and medium-sized companies.

Klaas Flechsig: With regard to the advantages for Google, it is a long term project. We hope that companies will recognize the huge potential the Internet has to offer in order to add to their company success. When more companies invest in online marketing in the medium term, hopefully they will do that with Google and invest in advertising on our digital channel.

International Trade News: : Do you think that SMEs are already in a position to fulfill the expectations that you have outlined here? The challenges are enormous, starting with the technology and ending with the Google tools that will have to be mastered. You also have to overcome the fears of SMEs of not being fully in control of those digital tools.

Klaas Flechsig: Well, the Internet is a medium that is becoming increasingly important for potential consumers. In order to reach their customers, companies must address the Internet. They cannot ignore it – regardless whether they advertise with Google or with other providers. There are still too many German small and medium-sized companies that are failing to understand this message fully.

Stefan Hentschel: Small and medium-sized companies in this country have a special history. In the manufacturing sector, in particular, the product has been the focal point of their activities for decades. That is why marketing has so far not been their strongest subject. Now that resellers of products and services are heavy users of the Internet and that direct sales online can be easily measured, there are now SMEs taking a greater interest in the subject. Add to that the fact that the customer base of our SME customers is getting younger all the time and that these customers tend to research their purchases on the Internet before buying. All companies would therefore be well advised to adapt their sales strategy to changing customer requirements. In recognition of that, we brought our initiative “worldwide growth” to life.

International Trade News: Could an SME say to itself: I’m not going to use Google at all.

Klaas Flechsig: Of course, there a lot who do just that.

Stefan Hentschel: First of all, each company has to establish for itself: What relevance does the Internet have for us? For some, its significance is already very high. For others, the subject will not come to the fore for a few years. That is perfectly understandable.

International Trade News: Let us look at the question of growth potential in the digital age. Can you give us a brief overview?

Stefan Hentschel: The opportunities lie in the ability to approach new target groups or market products via sales channels that previously remained unexploited. That includes mobile telephones. In the Middle East, smart phone penetration is high – it is quite common for sales contacts to be initiated via smart phone. Companies are interested in finding out if they can reach a target group that has previously been overlooked – for the simple reason that their advertising strategy neglected to include smart phones.

International Trade News: What other sales and distribution channels are there?

Stefan Hentschel: There is the opportunity to reach customers via classic Display Advertising. Videos are another possibility. We have noticed that videos are widely used in the B2B segment to present products requiring a great deal of explanation. A lot of companies prefer to look at a dynamic demonstration of a complex product than wade through a lengthy instruction manual. These are all trends that can currently be observed in the market.

International Trade News: How does that change the customer relationship between companies? There is a difference between a travel agent that tailors its customer’s holiday arrangements in person and one that guides its customers through a standardised menu of options in the Internet.

Klaas Flechsig: The travel sector is a good example of how traditional travel agencies are not simply disappearing from the high street just because of the Internet. Customers still want personal service. Instead, there is a migration to researching holiday plans via multiple channels. Often the research into the next holiday destination starts online. However, that is not necessarily where the booking is made. It is more the case that travel agency customers are made aware that there is a travel agency nearby specialising in the country of interest. I can then make an appointment online and book the holiday at the travel agency. However, the process has taken place across many different channels – starting in the Internet.

Stefan Hentschel: If I can apply this concept to SMEs: A manufacturer of rubber seals visits customers to sell rubber seals. However, the company can rethink this arrangement in order to use its sales force more efficiently and say: “A product such as rubber seals can be sold online and the sales force can be used to discuss complex, full service engineering solutions where the need for consultation is greater.” It presents a huge opportunity to distribute easily scalable products via the digital medium and focus the personal sales approach on more complex solutions instead.

International Trade News: Finally, let’s say a few words about data protection. A lot of companies have reacted with concern and skepticism with regard to the safety of their data in light of the NSA scandal. What message do you have for those companies?

Klaas Flechsig: There is of course no such thing as 100% security. However, I don’t believe there is any other company that is as concerned about protecting its clients’ data as Google. We have some of the best software engineers in the world doing nothing else but working to ensure the security of the information contained on our servers. That is why the corporate information uploaded to our servers is safer there then anywhere else.

About Stefan Hentschel:

As Industry Leader Technology, Stefan Hentschl is responsible for looking after the needs of B2B customers with Google Deutschland. Before that, he looked after the financial department as Industry Head Finance and later headed up the marketing strategy for Google mobile solutions as Head Mobile Advertising. Before joining Google, Stefan Hentschel worked in Key Account Management with United Internet Media Deutschland and in Business Development with AOL Deutschland. Before the business graduate took over the project and marketing management of the Business Channel at Gruner + Jahr EMS, he completed a management trainee programme with the publisher Gruner + Jahr.

About Klaas Flechsig:

Klaas Flechsig studied North American studies, German and Politics in Hamburg. After various positions with advertising agencies and PR service providers, he joined Google in 2006 taking over responsibility for advertising customers in the areas of Media and Entertainment. Since 2010, Klaas Flechsig has been press officer for Google Deutschland.

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