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02.07

MAGAZINE FOR DHL CUSTOMERS

Best of the best: All the export award winners!

No-budget marketing, page 19

Innovation 2007: the results of DHL’s innovation survey

Inside the hot house: the growing network of business incubators

Web 2.0 Is the bubble back?


FACE TO FACE

POINTTOPOINT

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Exporting

innovation

AS A RULE, companies in Oceania that export goods and services value innovation. That’s what the results of our innovation survey told us at the end of last year—that even if the government could do more to help companies with less red tape and more funding for research and development, the end result—innovation—is not negotiable. We need it to survive. That’s why we’ve chosen innovation as a theme running through this latest issue of Point to Point. Our cover story this issue, about the second coming of the Internet boom, dissects a fundamental shift in the nature of global business. In the heady days of the first Internet bubble, 10 years ago, plenty of pundits were hailing the utility of some incredible technology. Now, with a boom and bust behind us, we can coolly appraise some of the unique benefits online technology offers us. Plenty of smart—and previously sceptical—people have done so. And as a result, some of the true innovations of the Web are making billionaires all over again, and changing the way we all do business. Elsewhere in the issue, we celebrate the winners of the Export Awards in Australia and New Zealand. DHL is proud to be the major sponsor of the Annual National Export Awards. DHL is committed to facilitating and driving export trade, and encourages individuals and companies to look at the importance of and the possibilities derived from exporting. Companies like Opus in Wellington and ResMed in Sydney are virtually synonymous with innovation. But many of the other winners, as well, have seen their global growth take off as a result of innovation either in products or processes. According to our research and research done by Austrade, exporters tend to

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value education and training more than other businesses, and actively invest in it to a greater extent. And that makes them more courageous. They’re more likely to put new goods and services onto the market. They’re also more willing to try different business practices and management techniques, and (obviously) are more open to discovering and implementing best practice techniques from around the world. In this issue we also take a look at business incubators, and the role they play in helping innovative new companies get off the ground and on the road to success. Partly because of the ubiquity of the Internet, business incubators today are networked globally—creating a world stage for new companies to compete and thrive on. And for those who are already established but looking for innovative ways to broaden your markets, we have a brief run-down of what’s possible with guerrilla marketing—which is essentially low-cost marketing that has been made extraordinarily effective by the global reach of the web. One example, the company Flatout Australia, unintentionally stumbled across a global market just through the creative use of email. The ideas behind guerrilla marketing are simple enough— why don’t you try a campaign yourself and see how effective it is? And in other news, four DHL executives, myself included, spent a bit of our summer holidays on board the yacht DHL doing the Rolex Sydney to Hobart. We came in 8th place overall. Read all about it on page 18.

Gary Edstein SENIOR VICE PRESIDENT, OCEANIA, DHL EXPRESS

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inside

ISSN 1448-4188

8 Cover Story

Is Web 2.0 a new revolution or a new bubble?

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Quick Points Brett Lee teams up with DHL, plus all the news from our world

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Innovation We analyse the results of DHL’s innovation survey

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Business Secrets The wired world of business incubators

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Market Profile Doing business in Detroit

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Freight Expectations All the winners of the Export Awards in Australia and New Zealand

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Exporter Profile The world of luxury yachts

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Trade Guerrilla marketing lessons

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Business Boosters Three clients of DHL who are taking care of business

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Who’s Who Small talk with Elizabeth Heggie

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Special Delivery A winning partnership with Pure Fiji

EDITORIAL DIRECTOR Rob Johnson COMMERCIAL DIRECTOR Mark Brown SUB-EDITOR Stephanie Sword ART DIRECTOR Tim Donnellan CONTRIBUTORS Dominique Antarakis, Rachel Davis, Nicole Azzopardi, Miles Clarke, Mike Parker-Brown, Karen Ramsey, Shelley Dempsey. Cover photo by Stephen Wilkes, Getty Images.

Produced on behalf of DHL by Engage Custom Media ABN 50 115 977 421 Suite 4.08, 22-36 Mountain Street Ultimo NSW 2007 Point To Point material is copyright. Reproduction in whole or in part is not permitted without written permission of the copyright holder.


POINTTOPOINT

QUICK POINTS

The need for speed DHL EXPRESS AND Brett Lee, the Express bowler for the Australian cricket team, have one thing in common: they are both “number one in fast and efficient deliveries.” Lee at his fastest is capable of bowling at 160 km/h, claiming the title of Australia’s fastest bowler. DHL Express and Lee have formed a one-year partnership, which commenced in 2006 and will conclude in 2007. Within the next year, Lee will appear in DHL promotional material and also attend DHL customer and staff events. At the end of November, just before the English team snatched defeat from the jaws of victory in the second test, Lee took time out from his preparations for the test to meet some of his fans at the Adelaide branch of DHL. He mingled with staff of the logistics company and their families, with the Ashes test the favourite topic of conversation. Lee also showed off his bowling skills. DHL organised the visit to reward staff for their hard work.

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QUICK POINTS

POINTTOPOINT

Surf Life Saving New Zealand & DHL In September, Derek Anderson (general manager, DHL Express, New Zealand) and Graeme Cullen (chairman, Surf Life Saving New Zealand) officially signed a contract for a further three-year sponsorship term by DHL. Surf lifeguards patrol at over 70 of New Zealand’s busiest beaches throughout the summer.

Customs changes Australian Customs has made some major amendments to the Customs Tariff Act 1995, which came into force from 1 January 2007. The amendments reflect changes arising from the third review of the World Customs Organization (WCO) International Convention on the Harmonized Commodity Description and Coding System, better known as the Harmonized System (HS). These changes are spread throughout the Customs Tariff affecting 20 per cent of commodity classifications and may have some impact on your business. Goods currently falling within a particular classification may be transferred to other classifications. This may result in differences in duty rates. Duty rates changes only affect a small number of commodities falling within Chapter 44 and 48 of the Tariff. The changes to the Customs Tariff will impact on a number of Customs’ instruments and decisions, including Tariff Concession Orders (TCOs), Tariff Precedents, Tariff Advices (TAs) and Origin Advice Rulings. Some may be revoked and replaced with new reference numbers. As individual circumstances are different, we

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recommend you seek independent advice as to how these changes may affect your business. For more information on these changes, see Australian Customs Service Website (www.customs.gov.au/site/page.cfm?u=5663) or contact your DHL account manager.

DHL leads in TAPA certification Last October, DHL received another strong endorsement in its continuous drive to achieve superior security and service levels. The DHL Express Perth facility set a new benchmark when it was presented with the Technology Asset Protection Association (TAPA) certification by Senator the Hon. Chris Ellison, Minister for Justice and Customs. DHL Express’ Perth facility was awarded the TAPA ‘A’ certification, the highest security standard awarded by TAPA, with a score of 98.6 per cent. The certification is a testimony of DHL’s continuous pursuit of service and security excellence, and will serve to bolster and set new benchmarks for the express and logistics industry in the region. With this latest certification, DHL Express currently has four TAPAcertified facilities in Australia. This highly sought after security accreditation is awarded to facilities that meet the highest security standards for the freight of high-value technology goods. Certification is awarded after successful completion of a rigorous and detailed assessment conducted by independent TAPA-trained and accredited auditors. Recently, DHL Express was awarded a TAPA certification for its international Gateways in Auckland and Wellington. The facilities underwent a rigorous and detailed audit conducted by independent


(Opposite page) DHL will continue its major sponsorship of Surf Life Saving New Zealand (SLNZ) for another three years. The contract was officially signed by Derek Anderson, general manager, DHL Express, New Zealand and Graeme Cullen, chairman, Surf Life Saving New Zealand. DHL provides similar support to Surf Life Saving Australia (SLSA).

(This page, clockwise from left) DHL continues its commitment to charity work by delivering goods to families in Uganda; the Hon. Chris Ellison (center) presents a TAPA certification to Mark Baker (left), state manager, WA, DHL Express and Sean Haran, security manager, Oceania, DHL Express; major amendments to the Customs Tariff Act came into force in January, affecting 20 per cent of commodity classifications.

TAPA-trained and accredited auditors. DHL is the pioneer in terms of TAPA support and compliance. Across the Asia-Pacific region, DHL leads the rest of the logistics industry in both security investment and the number of TAPAcertified facilities. By ensuring that DHL facilities and processes meet and exceed required standards, they have greater control of the shipments and can minimise the time delays that sometimes result from increased border safety measures.

DHL pioneers real-time tracking system New groundbreaking technology known as the Quality Shipment Monitoring System (QSMS) has made DHL the first express and logistics company to offer customers real-time shipment monitoring. With this system, DHL can proactively inform customers and respond instantly to potential shipment delays. Developed and trialled over the past 12 months, QSMS is the only real-time freight monitoring system in use. “In an industry where speed and reliability are paramount to the success of our customers, QSMS provides additional security as DHL can immediately respond to operational problems and alert customers of any shipment delays,” said Gary Edstein, senior vice president, DHL Express, Oceania. The system enables DHL to identify any small problems before they snowball, as issues can be recognised immediately and actions taken to fix the problems. Instead of customers contacting DHL with regards to delayed shipments, DHL will alert customers before they are even aware of an issue. From the moment a shipment is picked up by a courier, DHL can monitor its movements at 17 different checkpoints until it is

delivered. This enables DHL to identify a problem as soon as it occurs and resolve the issue in real time. Australia was the fourth country, following the success of Singapore, Hong Kong and India, to begin using this innovative tracking system. In September, DHL Express established a local Quality Control Centre (QCC) in Auckland. The DHL QCCs are a network of regional and country quality control centres that monitor DHL shipments in the air and on the ground, around the clock. This provision of real-time freight monitoring enables DHL to save customers precious time and money.

A helping hand When a small volunteer group wanted to deliver books to a very empty university library in Laos, they had no trouble raising book donations. What they didn’t count on, however, was the high cost of transporting their heavy cargo to South-East Asia. Fortunately, DHL stepped in with a program that provides support to charities in need. “Charities that successfully raise donations for a good cause are often thwarted by the cost of delivering them to their foreign destination. At DHL, we already have the networks and capabilities in place, so it makes sense that as a good corporate citizen we help where we can,” explained Harlis Malkic, general manager, DHL Express, Australia. This in-kind charity program has seen DHL deliver a broad range of goods, for a wide range of good causes. This has included five pallets of toys to earthquake victims in Java, 11 laptop computers for a school in Afghanistan and 10 boxes of clothes for orphans in Uganda. p

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INNOVATION BUSINESS SECRETS

POINTTOPOINT POINTTOPOINT

Passport to innovation Companies that think ‘outside the box’ are often the first to export their innovations—and the first ones exposed to new visions for economic growth.

INNOVATION AND EXPORT go hand-inhand. According to Austrade’s Tim Harcourt, innovative firms are the ones that are typically exporting in the first place. But furthermore, he said last year, “By choosing to be exposed to the world market those same firms are taking advantage of innovation overseas and bringing it back to Australia.” The sentiment was echoed by Tim Gibson, New Zealand Trade and Enterprise chief executive, following the last DHL Export Barometer: “It is heartening to see that “For exporters, innovation is exporters are realising not just about the next best the economic value of innovation and product. It is also about improving enterprise,” he said. efficiency, cost effectiveness, the But an innovation environmental impact of business survey by DHL at operations and businesses’ the end of last year found that while most relationships with the community.” Australian exporters Gary Edstein, senior vice president, Oceania, DHL Express (91 per cent) believe companies must innovate to survive, they are critical of government support with 78 per cent saying governments should do more to improve incentives (23 per cent), reduce red tape (22 per cent), and increase funding for research and development (22 per cent). “These results show that Australian exporters recognise that innovation is their passport to international success and, as a result, they look to the government to create a legislative framework and develop trading opportunities that will encourage and reward innovation,” said Gary Edstein, senior vice president, Oceania, DHL Express. “They want policies and trade liberalisation

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initiatives that will reduce red tape, improve incentives, increase research and development and open doors to international expansion,” added Edstein. The research also found that Australian exporters are leaders, not followers. Seventyfour per cent of exporters believe it is better to be first to market, than to follow the lead of others and learn from their mistakes. Many exporters hold the opinion that Australia and New Zealand are the most innovative. “Evidence suggests exporters can make productivity gains in terms of scale and specialisation,” said Gibson. “By working smarter, investing in technology and establishing a physical presence offshore, New Zealand businesses are simultaneously fulfilling that maxim and helping to transform our economy.” Exporters see innovation as a key part of improving business operations, with 26 per cent of respondents saying it improves products and services, and 22 per cent saying it increases efficiency. “For exporters, innovation is not just about the next best product. It is also about improving efficiency, cost effectiveness, the environmental impact of business operations and businesses’ relationships with the community,” noted Edstein. “There is no doubt Australians value their role as international innovators and see the young, progressive nature of Australian business to be integral to this.” The same could be said for New Zealand: “This is good news for New Zealand, putting us in a strong competitive position vis-à-vis our international competitors and providing an excellent blueprint for the future of exporting in this country,” said Gibson. p


PHOTOGRAPHY: AUSTRALIAN TECHNOLOGY PARK

POINTTOPOINT

BUSINESS SECRETS

Part of the ATP Innovations ‘ecosystem’ in Redfern, Sydney.

Room to grow Incubators provide companies with an ‘ecosystem’ in which to nurture and expand. Are they also the secret to conquering foreign markets? By Stephanie Sword THERE ARE MANY uncertainties when launching a business, and entrepreneurs often struggle with fear and doubt during the early years of their company. But there is safe harbour: business incubators provide a supportive training ground, furnishing entrepreneurs with the tools to succeed on both foreign and domestic shores. Phil Kemp, Business Innovation and Incubation Australia in Western Australia, says incubators are a crucial starting point for many companies. “Evidence shows that small businesses that start in incubators perform better than those that don’t. They survive longer and create sustainable business for the economy in the long run,” he says. Jonathan Kirkpatrick, Incubators New Zealand, agrees they are powerful economic development tools. “Economic growth requires the attraction of export dollars— from a region or as in New Zealand’s case, from offshore. The spin-offs of this for the economy are new jobs created by successful growing companies, company tax, individual tax, balance of payments and GDP.” In fact, incubators are proving efficient in opening many doors for exporting. “They can provide access to strategic partners already operating in offshore markets,” explains Kirkpatrick. “Some incubators have a particular relationship with partners in particular offshore markets.”

Business incubators also provide entrepreneurs with the advice to translate ideas about a product or service into something commercial and globally marketable. They also offer exposure, linking tenants to a network of IT and managerial advisors, potential customers and other experts crucial to emerging companies. Randy Morris, National Business Incubation Association (NBIA) in Ohio, US, says incubators prepare entrepreneurs for overseas business by filling in key knowledge gaps. “Some incubators offer specialised programs designed to instruct businesses on expanding into the foreign marketplace. These programs also help identify to customers which incubators and companies are well schooled in international dealings.” NBIA’s Soft Landings designation acts

as an ID card to foreign clients, pointing out incubators that are well equipped at handling the needs of companies wishing to do overseas business. These incubators can provide translation services, cultural and language training, as well as help with government regulations, import/export laws, and immigration and visa assistance. The graduation policy for business incubators is usually between two to five years, though tenants typically migrate once commercially viable. Most that do ‘graduate’ are still in business years later. Does this mean incubators are the key to success? “We’re only one tool in the economic toolbox. But we’re certainly reducing failure rates, improving business performance, producing employment and creating viable exports,” Kemp says. p

What’s in a name? Dr Mark Bradley, CEO of ATP Innovations in NSW, says the term ‘business incubators’ is a bit of a misnomer. “We don’t necessarily want to be tagged as an incubator, and our clients don’t want to be referred to as ‘incubatees’.” Bradley says ATP Innovations—and others like them—do more than what the traditional incubator does. “We are what I would call an ‘ecosystem’ or a ‘knowledge-based precinct’. You might even say ‘innovation hub’. We are part of the chain of commercialisation, linking entrepreneurs to government, business experts and clients. We offer ‘one-stop shop’ mentoring, as well as physical facilities, networking exposure and professional development advice.”

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COVER STORY

POINTTOPOINT

THE SECOND COMING

After surviving the dot-com crash of 2001, the Internet is back stronger than ever. But is Web 2.0 going to be a bubble all over again? By Kerryn Ramsey

“POWER TO THE people” may have been John Lennon’s mission statement in 1971, but little did he know how much people power would flourish 35 years later. From passionate greenies to corporate moguls, from pimply teens to intrepid pensioners, Internet users are discovering the pleasure, power and profit of the next generation of Internet services, reverentially referred to as Web 2.0. After the dot-com bubble burst in 2001, computer architects huddled together in Silicon Valley to iron out the Internet kinks. By 2003, Web 2.0 became the buzzword after Tim O’Reilly, the tech publisher who now runs the annual Web 2.0 conferences in San Francisco, US, released a Wired article. The US Newsweek jumped on the bandwagon with a “Web 2.0” cover story in April 2006, which was followed by “The Geeks Shall Inherit the Earth” in The Bulletin last October. The number of global Internet users reached one billion last year, so what are the implications for this emerging web trend? While the first boom was all about home pages and corporate spaces, Web 2.0 refers to

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services that let people collaborate and share information online. According to O’Reilly, Web 2.0 is a mishmash of tools and sites, such as YouTube, MySpace, Flickr, Wikipedia and weblogs, which let users share digital assets and link up with other people. The hype spiralled in 2004 when Google was floated and, after its shares actually passed the $500 mark last November, it’s now worth more than any media or technology company except Microsoft. On a roll, Google acquired five per cent of AOL for a mere $1.7 billion (US$1.35 billion), then snapped up the video-sharing site YouTube for $2.2 billion (US$1.65 billion) last year. Google ranked as the third most visited Internet property while YouTube ranked 14th last August. When combined, the two companies had a worldwide reach of 477 million visitors. Last year, Yahoo spent A$95 million for both del.icio.us, which keeps all users’ bookmarks, and the photo-sharing site Flickr, while eBay bought Skype, a program for making free phone and video calls over the net, for $3.29 billion (US$2.6 billion).

Meanwhile, Rupert Murdoch’s News Corp. spent $770 million (US$580 million) for the social networking site, MySpace, and at an investors’ meeting in Sydney last November, the media mogul claimed that it could now be sold for $6 billion. With revenue from its advertising relationship with Google, MySpace is expected to make A$50 million in 2007 and A$300 million in 2009. With the current tech stock boom and new start-ups emerging every nanosecond, the hype conjures up images of the dot-com bubble five years ago. However, there are copious reasons why Web 2.0 will flourish. New and improved “The difference between 1997 and 2007 is that the online companies now make profits and survive on cash flow, rather than just on venture capital,” explains Marc Phillips, managing director of APT Strategies, a Sydney-based research company. “I don’t see a crash occurring because there are not as many initial public offerings for businesses with no business plans.”


FREIGHT EXPECTATIONS

Rupert Murdoch (l), chairman and CEO of News Corp., shakes hands with Japanese Internet giant Softbank president Masayoshi Son in Tokyo late last year. The two companies announced plans to launch a Japanese version of popular US networking 99 website MySpace in a joint venture.

PHOTOGRAPHY: GETTY IMAGES

POINTTOPOINT


COVER STORY

POINTTOPOINT

Web 2.0 has also succeeded because hardware is cheaper, and the underlying software to build web services has been upgraded. According to The Australian, almost 15 million Australians now have Internet access, although only 1.4 million have high-speed access. Employment costs have also dropped because it’s now possible to send work offshore, thanks to an improved outsourcing industry in lower-cost countries. However, Rod Drury, founder of email management software company Aftermail, based in Wellington, New Zealand, says there has been one negative aspect. “Tech became unsexy after the dot-com crash,” he says, “and we now have a shortage of technology graduates.” During the first boom, companies spent

“The Internet is becoming more democratic. We believe you can do it from anywhere. A lot of new businesses don’t need to develop a large physical sales network. The US venture capital model is no longer the only game in town for global success.“ Rod Drury, founder of email management software company Aftermail

massive amounts on TV and radio ads and promotions. Now it’s easier to market a site cheaply via search engines. “Online ads in the US generated US$16 billion in 2006 and will continue growing strongly,” says Brett Morris, general partner of Neo Technology Ventures, a Sydney-based venture capital firm. “Online the most proven revenue model for users is free, i.e., advertising supported,” says Morris. Venture capitalists not only supply money—they supply knowledge and expertise, as well as bringing IT specialists on board. Morris, whose company currently has five start-up companies in its portfolio, receives about 50 proposals every month. “The current environment for technology investing is robust,” he says. “More thought and care is devoted to developing a business model these days, because if you don’t learn from history, then you are bound to repeat it.” Local big shots Apart from the big US Internet players, Australia and New Zealand have also hit the headlines for their impressive buy-outs. In 2005, Fairfax Holding bought the Internet dating site, RSVP, for A$39 million and Stayz, a holiday house booking site, for $A12.7 million. Meanwhile, James Packer’s Publishing

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and Broadcasting Limited (PBL) spent A$33 million on the online recruitment site, Seek. While whiz-kid computer graduates made millions when their start-ups were bought out by large companies in the first boom, more mature players have found success during the net’s second coming. Graeme Wood, a Rockhampton-based entrepreneur, floated his online travel booking site, Wotif, last July. After founding the company in 2000 with about $200,000, Wood made $42 million through his sale of 21 million shares. “The Internet is really an entrepreneur’s dream,” says Wood in ninemsn. “It broke all the rules, so it let people who exploited the Internet also break the rules.” Almost a decade ago, Melbourne brothers Paul and Andrew Bassat, a lawyer and a management consultant, with marketing manager Matthew Rockman, quit their day jobs to start Seek online. In 2003, they sold a quarter of the business to PBL before floating the company, which was soon worth more than $1 billion. Last October, James Packer spent $35.3 million to increase his shareholding from 24.7 per cent to 27.2. While Matthew and Paul are both 39 and Andrew is 41, it’s a 30-year-old New Zealander who made the single biggest digital deal in Australasia last year. Sam Morgan had already scored A$220 million for his third of the New Zealand auction-cum-portalsite, Trade Me, but he then sold it to Fairfax Holdings in March 2006 for A$675 million. While these Australasian-made sites have prospered during the Web 2.0 phase, they follow the more traditional Internet platforms. However, there is a breed of local tech entrepreneurs who have embraced this Web 2.0 phenomenon. One of these is Martin Wells, the 36-year-old CEO of Tangler, a next-generation Internet messaging system who’s already raised more than $1 million in start-up funding from the US and Asia. Another example is Wollongong’s Nik Cubrilovic, 26, who runs his online storage platform, Omnidrive. He has already raised $5 million in venture capital and is now based in California to expand his business. Home turf Despite the proliferation of Australasians heading overseas, Drury reveals that even a Wellington-born businessman is happy to stay put.


PHOTOGRAPHY: GETTY IMAGES

Young moguls: the Internet made Google founders Larry Page (left) and Sergey Brin, both in their early 30s, billionaires.

“The Internet is becoming more democratic. We believe you can do it from anywhere,” he declares. “A lot of new businesses don’t need to develop a large physical sales network. The US venture capital model is no longer the only game in town for global success.” Last year, Drury sold Aftermail to US company Quest in a deal that could be worth up to $65 million. Now holding a senior role with Quest, he is also on the Trade Me advisory board and acts as a mentor to IT start-up companies. “Because of Australia’s savings schemes, its investment companies are awash with cash,” he says. “We know this because they have pretty much bought New Zealand over the past year! If Australian tech companies are not attracting investment, they have not proven themselves to the investment industry. “In New Zealand, we have had a number of big tech deals in the past year, so the investment industry is looking for investments, often fuelled by Australian money. It sounds like the industry needs to shout about its successes more to attract the abundant funds based in Australia,” he says. Could a fearless Australian or New Zealander take the challenge to develop a

new version of Google or YouTube? Cameron Reilly, a 36-year-old computer whiz from Melbourne, is on the case. After launching The Podcast Network in 2005, this former Microsoft technology exec soon received more than 250 million listeners each month. “I’m already running a virtual global company,” Reilly told The Bulletin in the cover story, “Who Wants to Be a Millionaire.” He says he’s hoping to have half a million listeners by the end of this year—the same as the top radio station in Australia’s capital cities. Like many local entrepreneurs, he’s headed to the US to scout around for venture funding. “It makes sense to go to the US,” he says. “That’s where 65 per cent of our audience is, and that’s where the action is.” Out of the pod The New Oxford American Dictionary heralded ‘podcasting’ as 2005’s word of the year, explaining it as “a digital recording of a radio broadcast or similar program, made available on the Internet for downloading to a personal audio player.” Podcasting can be an audio aspect of a blog, which usually combines text, images and links. Drury explains that blogs can post

personal profiles and build networks among friends and colleagues with shared interests. “These users have free access, and the sites are funded with advertising revenue,” he explains. “To lure advertisers, young sites typically offer deep discounts that make profitability elusive, and it is unclear when they will be able to push ad rates higher, if ever.” Apart from his business ventures, Drury still finds time to publish his thoughts on the technology sector on his website, www.drury. net.nz and is an active blogger. Drury’s site is not to be confused with The Drudge Report (www.drudgereport.com), one of the world’s first news-based blogs, which was founded in 1998 by journalist Matt “no budget, no bosses, no deadline” Drudge. Drudge found notoriety after reporting that Newsweek had spiked a story about a sexual relationship between Bill Clinton and Monica Lewinsky. His site never lost its credibility, and broke its own traffic record last November, reaching 2.3 million visitors and delivering more than 100 million ad impressions in just one day. The encyclopedia site, Wikipedia, explains that a blog, derived from ‘web log’, is a website where entries are made in journal style and displayed in a reverse chronological order. Only 100 diaries appeared in 1997, but leapt to 20 million by December 2005. Around that time, AOL snapped up the US Weblogs Inc network for $33 million (US$25 million). Recent statistics by Morgan Stanley’s Mary Meeker revealed there are now more than 57 million blogs, and they’re doubling every seven months. “Blogs have moved from an individual tool to an important business communications mechanism,” says Drury. Three Australian bloggers who have found international kudos include Duncan Riley of Bunbury, WA, who sold his business site, The Blog Herald, for a rumoured $100,000 (US$75,000) in late 2005. He then joined with Melbourne’s Darren Rowse, Adelaide’s Shai Coggins and Canada’s Jeremy Wright to run a blog network of 85 sites known as b5media. Venture capitalist Brett Morris says since blogs are cheap to produce and run, they will soon take on new features, such as embedded video stories. “Successful blogs generate significant traffic and some revenues from online advertising. We expect them to be around for as long as the authors can find time to pen them.” p

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PHOTOGRAPHY: STOCK.XCHNG

MARKET PROFILE

POINTTOPOINT

Destination

Detroit

Sweet ride: Australia’s auto export market is moving full speed ahead, making lead way into the lucrative US car market. Watch out, Detroit.

Australasians are taking over Hollywood these days, but businesses from Down Under are also taking a foothold in the toughest car market in the world—Detroit, USA. By Shelley Dempsey THINK DETROIT. THINK cars. Once the global home of the car—famed for producing daring, distinctive models that Ralph Nader termed “dangerous at any speed”—many now fear the old Detroit has lost its way. For decades, the mighty, muscular city that made America great and painted a living picture of the capitalist dream trumpeted headlines of astonishing success. However, in more recent years, Detroit has found itself in the headlines for different reasons—mass sackings, nightmarish losses, and the devastation of its market share to Asian and other rivals. Ford, Daimler-Chrysler and General Motors (GM) are the ‘Big Three’ in Detroit, and for an indication of how times have changed, take a look at recent Ford results. Globally, Ford made a US$2 billion profit in 2005, but lost US$1.55 billion within the US. Prominent Australian businessman Ivan Deveson, who worked for GM for 32 years, half of them in Detroit, and who was head of Australia’s Auto Industry Strategic Action Group in 2005, says he’s “devastated” by events in Detroit, but adds that it means a bigger auto export market for Australians. The US is the biggest export market for

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Australian auto products, which are running at about $6 billion a year and are forecast to reach $10 billion a year by 2010. “Detroit is no longer the power base that it was, as many plants in America are outside Detroit now. So you just don’t go to Detroit to sell today—there are about 16 other plants in America outside Michigan that Australian companies should be pursuing.” In rising to meet challenges and cut costs, Detroit has become leaner and meaner, shifting more production to low-wage nations like Mexico and implementing new policies such as global sourcing, lean manufacturing and the incorporation of more aftermarket accessories into OEM (original equipment manufacturers) design. The good news for low-volume Australian auto exporters is that they slot very neatly into this new picture. Especially since they are now more competitive under the AustraliaUS Free Trade Agreement (AUSFTA), which came into effect on 1 January 2005. Trade in auto parts and accessories between Australia and the US is now tariff-free, and the US has removed the 25 per cent duty on light commercial vehicles and the 2.5 per cent duty on passenger vehicles.

With Japanese and Korean rivals such as Nissan, Hyundai and Toyota now accounting for about one-third of domestic US auto sales—and Thailand even calling itself “the new Detroit”—the Big Three are much more demanding of suppliers. “Engineering and quality requirements have been increasing dramatically in Detroit, much faster than the rest of the US market; they are now much more stringent,” says Geoff Thompson, president of EGR Inc, the US arm of Brisbane’s outstanding export success story EGR. With total turnover estimated at more than about A$150 million a year, EGR supplies auto parts and plastic accessories to big names such as GM, Ford and Toyota in 40 countries worldwide and exports more than 70 per cent of production. Launching exports in 1990 with a staff of 100, it now has around 1,000 globally and is the world’s largest manufacturer of acrylic thermoformed auto products such as headlight guards, fender flares, body kits and hood shields. Now the US is one of the firm’s biggest export markets, but breaking into Detroit was hard. “We established our US operation in 1993, but for the first five years none of the


Detroit-based companies were interested in even really looking at us. They get approached from overseas companies all day, every day. They’re not interested in taking a chance on someone who hasn’t got a proven track record,” says Thompson. “So we established ourselves in the aftermarket first and only then started getting any sort of interest from Detroit.” Now the firm supplies the Big Three, which accounts for about 10 per cent of global turnover. “Our plan is to continue to increase our business in Detroit—which probably holds the greatest potential of anywhere in the world,” says Thompson. “We still only have a very small amount of available business there, so there’s a large amount of room for growth.” EGR currently has a warehouse in California. “We plan to increase our presence in Michigan, mainly for sales, support and engineering functions.” PBR and other Australian firms in Detroit have an advantage in low-volume manufacturing and customising niche products. “Because the market is so small, what Australia considers a good economical run, Detroit considers a short run. It’s something a lot of the US companies won’t consider, because it is short,” says Thompson. The AUSFTA has so far not made a big difference to the bottom line, due to long lead times for auto contracts of up to two years, but is likely to do so on one OEM multimillion-dollar EGR Detroit contract. “The FTA has helped us to become more competitive, and this is probably the most competitive market we deal with anywhere in the world,” says Thompson. “Detroit is really the home town of the automobile industry globally, and they have volumes that are just staggering.” One prominent New Zealander who has made a name for himself in Detroit is Alan Gibbs. Building his first amphibious car in 1995 so he could drive out of the water at his NZ holiday property without a tractor and trailer, in 1996 he took the design for the Gibbs Aquada to Detroit for development. In 1999 the project moved to the UK, and the firm has now won a US Department of Defence contract to test the technology for military purposes. Back in Australia, Sydney’s Revelation Racing Suppliers, which makes body kits and other parts for older Ford Mustangs, is now poised to enter the OEM market for upgrades

DHL in the USA æ In 1969, DHL began life as a service shuttling bills of lading between San Francisco and Honolulu. DHL USA now services 120,000 destinations in more than 220 countries and territories. æ By 2003, DHL was the third-largest express service provider in the US, and in 2004, launched a threeyear, US$1.2 billion investment to expand its US ground delivery network. æ In 2006, the DHL North America Trade Lane intitiative was launched to improve service for US, Canadian and Mexican clients in the US$8.8 billion cross-border express and ground parcel shipping market in North America. æ Canada and Mexico together represent nearly $300 billion a year in export business to the United States, and are the first- and third-largest trading partners for the US, respectively. The US is also the leading trading partner for each country.

to the new Mustangs. Managing director Matthew Pankau says the firm is now making about A$1million a year in US sales, up from a zero base about two years ago. “We have an arrangement in Detroit at the moment where Jorgens, a company we use, has shipped a number of components to us in Australia. Now we will actually supply components to them and have them assembled there and sell directly to the US marketplace.” A return to retro car styling means that Mustangs and other cars from the ‘Retro Muscle Car Era’ of the 1960s and

“Our plan is to continue to increase our business in Detroit—which probably holds the greatest potential of anywhere in the world.” Geoff Thompson, president of EGR Inc

1970s—which were so unpopular with Ralph Nader—are currently very fashionable in the US. Muscle cars were the theme at last year’s Las Vegas car show SEMA. “It’s back to the great American conquest of signature styling,” says Pankau. Other Australian firms that have connections with Detroit include Melbourne’s Air International Thermal, an auto air conditioning and parts specialist which has a facility in Auburn Hills, Michigan, and a number of contracts with GM. JPMorgan took a 65 per cent stake in the $275 million firm in 2004. Then there’s Melbourne brake systems specialist PBR International USA Ltd, which is soon to relocate its facility in Auburn

Hills to a longstanding facility in Knoxville, Tennessee. PBR made up most of the $805 million in revenue earned by parent group Pacifica Group Ltd last year, which is now facing a $272 million takeover by German group Robert Bosch. PBR has contracts with General Motors and has won an award for being one of Ford’s best global suppliers in North America. Meanwhile, the Victorian firm ANCA, which has 330 staff globally and was named Victorian 2006 Exporter of the Year, established their base 20 years ago in Farmington Hills, Michigan, and just last year relocated to a much larger A$4 million facility in Wixom, Michigan. The firm, which makes precision tool grinding machines used by firms such as Dana, American Axle, General Motors, Chrysler and Delphi, turns over A$100 million a year. “Our US market is running at about 40 per cent of our total, and the Detroit area is probably about 15 per cent of the market,” says Linsey Siede, ANCA director and group general manager. One huge change over the years had been the introduction of lean manufacturing processes in the Detroit area. “There have been a lot of changes in the auto industry, especially in Detroit, because of Japanese car companies coming into the States. But we’ve introduced new products such as a stick blade grinder, and that’s put us into new niche markets within the auto industry. We’ve done that by working very closely with a number of key customers,” says Siede. “We’re there to stay in the Michigan facility we actually own, and we have just made a big investment in capital and people in the Detroit area.” p

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PHOTOGRAPHY: AUSTRADE

FREIGHT EXPECTATIONS

POINTTOPOINT

Industry support: (l to r) Brian Movrin (ResMed), the Hon. Warren Truss, MP, Minister for Trade, Greg Lang (ResMed), Gary Edstein (DHL), Peter O’Byrne (Austrade), Paul Eisen (ResMed) and Peter O’Brien (ACCI).

Best of the best

Australia and New Zealand honour their best exporters for 2006 with a bevy of coveted awards. By Dominique Antarakis A WILLINGNESS TO embrace innovation and do what it takes to succeed—and in some cases, a bit of healthy irreverence— characterise the winners of the 2006 Export Awards in Australia and New Zealand. Described as a company that’s “come a long way from its origins,” Opus International Consultants outperformed 18 other finalists to be named the DHL Supreme Exporter of the Year at the 2006 New Zealand Trade and Enterprise (NZTE) Export Awards. Opus also won the Services Exporter of the Year Award. Formerly the Ministry of Works and Development, Opus is now New Zealand’s leading engineering, architecture, planning and property management consultancy. Dr Kevin Thompson, Opus chief executive, sees the company’s recognition as “a reflection

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of our hard work over the last few years in building our presence in Australia, Canada and the UK. “Through this strategy we have expanded our revenue in these countries from NZ$12 million to NZ$37 million (on a total revenue of NZ$217 million). We have focussed on the provision of asset management as distinct from asset development, as this is a unique service others are not providing.” Thompson says that with a worldwide shortage of qualified and experienced infrastructure engineers, winning these awards helps to profile Opus as a significant, expanding company, a good place to work, and an employer that values its people. “It also increases our people’s sense of pride in working for a successful company,” he says.

Brian Dewar, general manager of Healtheries of New Zealand Ltd, named Food and Beverage Exporter of the Year, says the company’s export growth strategy revolves around the sale and marketing of branded consumer health food products into Australia and South East Asia. “From my perspective, the benefits of winning an award like this are the sense of pride the international team and the whole company get from being recognised as one of the best in the industry at what they do, as well as promoting the fact that we have won the award to key customers,” Dewar says. He says being part of the awards process is also a great way to learn from what the other successful organisations are doing. phil&teds Most Excellent Buggy Company


Ltd was named Creative Exporter of the Year. Despite a “quirky and somewhat irreverent” profile, the company obviously takes itself seriously enough to grow exports by 173 per cent last year to $17.2 million. phil&teds designs and markets worldleading nursery hardware products. Managing director Campbell Gower took over phil&teds in 1998 when the business was in danger of foundering. As he readily admits, he knew about finance but “bugger all” about engineering, design, marketing, exporting or pricing. Today phil&teds’ core products are established as leaders in the global nursery product industry. About 95 per cent of sales are generated from exports to 25 countries. At the 2006 Australian Export Awards, ResMed took DHL Exporter of the Year for a second time (they previously won in 2002). They also won the Caterpillar/Australian Made Large Advanced Manufacturer Award. Export Finance and Insurance Corporation Services Award winner Ausenco is also a multiple winner, having taken out the same category in 2002 and again in 2004. According to managing director Zimi Meka, the awards are an opportunity to receive formal recognition for successful export activities in front of clients, industry peers and Australian business leaders at a state and national level. “It also boosts staff morale when the company is recognised as a leader in its field,” he says. “The award is proudly displayed in our head office foyer, and creates a sense of pride in everyone’s achievement.” He acknowledged that the application process takes significant time and effort to complete, but doing so provides an opportunity to reflect on corporate objectives, strategies and activities. The Minerals Council of Australia Minerals and Energy Award was won by Rio Tinto Iron Ore for the second year running. Chief executive Sam Walsh says the award “is a fitting finale to Rio Tinto Iron Ore’s 40th anniversary celebrations, and what has been an amazing year of success.” In 2006, the company underwent a $4 billion expansion program in the Pilbara, made their first commercial shipments from the HIsmelt project in Kwinana, and pursued global expansion of its operations in Canada, Brazil, Guinea and India. While the Commonwealth Bank Small to

Medium Manufacturer Award winner, men’s sport and leisurewear designer aussieBum, is not quite in the same league as Rio Tinto, it is certainly a big fish in its own pond. Principals Sean Ashby and Guyon Holland say they are “living the dream to be independent and present our gear in a way that gets noticed.” “Being recognized in your own country for export excellence is a great honour and

highly respected amongst those I work with,” says Ashby. “It is an excellent time to thank companies who have assisted in achieving this excellence and also to provide future suppliers your company’s standing in the export community,” he says. “Given we principally export we are not known locally. Having an award like this gives relevance to our business in a local capacity.” p New Zealand’s Creative Exporter of the Year, phil&ted’s Most Excellent Buggy Company Ltd.

And the winners are... 2006 New Zealand Trade and Enterprise Export Awards – winners DHL Supreme Exporter of the Year, Services Exporter of the Year Opus International Consultants, Wellington Agritechnology, Life Sciences and Biotechnology Exporter of the Year Comvita Ltd, Bay of Plenty Creative Exporter of the Year phil&teds Most Excellent Buggy Company Ltd, Wellington Food and Beverage Exporter of the Year Healtheries of New Zealand Ltd, Auckland Information, Communications and Technology Exporter of the Year Provenco Group, Auckland Specialised Manufacturing Exporter of the Year Skellerup Industries Ltd, Canterbury Wood Building and Interiors Exporter of the Year Pacific Forest Products Ltd, Auckland

2006 Australian Export Awards – winners 2006 DHL Exporter of the Year ResMed ACCI Agribusiness Award Botanical Food Company Pty Ltd

Austrade Arts, Entertainment and Design Award Rising Sun Pictures Microsoft Education Award Box Hill Institute AusIndustry Emerging Exporter Award Aconex Ernst and Young Information and Communication Technology Award Mincom Limited Caterpillar/Australian Made Large Advanced Manufacturer Award ResMed Minerals Council of Australia Minerals and Energy Award Rio Tinto Iron Ore Australian Business Limited Regional Exporter Award Barrier Reef Pools Export Finance and Insurance Corporation Services Award Ausenco Commonwealth Bank Small to Medium Manufacturer Award aussieBum CPA Australia Small to Micro Business Award Wild Child WA Pty Ltd Accor Sports, Events and Tourism Award Victoria Racing Club

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EXPORTER PROFILE

POINTTOPOINT

Liquid assets Yachting is no longer just a reflection on the lifestyles of the rich and famous. Countries are finding it a powerful economic tool to earn export revenue and to gain international exposure on a very profitable body of water. By Miles Clarke OCEAN RACING HAS been described as akin to wrapping yourself in barbed wire under an icy shower while tearing up $100 notes, but there’s no doubt the leisure boating market— under sail or power—is big business. Major yacht races such as the iconic Sydney to Hobart race and the Fastnet in the United Kingdom draw huge audiences, and the sponsors of the fastest lean, hightech racing machines enjoy massive media coverage should they perform at their best. The business of boating is enormous, and in a small country like New Zealand, the benefits of two America’s Cup campaigns were significant as much as nation-building events as for the revenue from having freespending yachting syndicates in Auckland harbour for several years. An America’s Cup economic impact study over the 2000-2003 period had a net

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additional spending of NZ$523 million in the New Zealand economy, of which $450 million was in the Auckland region alone. The Cup-related expenditure had a substantial effect on employment, sustaining the equivalent of 9,360 full-time years of employment at the national level. The America’s Cup also generated international awareness of New Zealand as a tourism destination and a place to do business, especially in the marine sector where a significant industry in the manufacture of super-yachts continues to assist New Zealand’s export sector. This is a globally competitive niche market where vessels cost in the tens of millions of dollars. One Auckland boat builder with a stake in this potentially lucrative market is Peter White Robinson, whose Fitzroy Yachts Ltd operates almost exclusively in the export

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PHOTOGRAPHY: STOCKEXPERT

The world of yachting offers big benefits to countries like New Zealand and Australia, which enjoy additional exposure and increased revenue in the wake of high-profile boating events.

market. His vessels cost in the region of €1215 million (approx. A$20-25 million). “Aside from the only commercial vessel we have built, which was for a New Zealand client, then all our vessels have been built for export. “We entered the business when Peter Blake won the Americas Cup in San Diego in 1996, believing this would bring a lot of attention to the New Zealand boat building industry, and it did. “The defence in New Zealand maintained this focus with many clients, suppliers, designers and journalists spending many months here. The loss of the Cup has reduced the New Zealand brand and has seen the industry need to invest more in travelling offshore now for the contacts that would otherwise have happened here.” Fitzroy Yachts has a team of 165 and is currently building its ninth vessel, with each

boat requiring over 200,000 man hours to complete, giving the company the ability to deliver one vessel around every 10 months. The company started with a small team in 1996, and it wasn’t until January 2000 that the first boat was delivered. The full turnaround (including design) for the completion of a Fitzroy vessel is 22 months. “Apart from our team having a strong background in sailing and building boats, we have grown out of our associated company, Fitzroy Engineering Group Ltd, and have a major emphasis on planning, project management and quality,” says Peter White-Robinson. “We deliver an excellent vessel on time, and our labour rates are also significantly less than our European or United States competitors. “Our experience is that the market is presently more active than we have ever seen.

This may of course be that we have now created a reputation through the vessels we have launched. “At this time Europe is our main market. Distance to market is an issue. We need to attend several shows in Europe each year and maintain good contact with the designers, who often are the first point of contact with a client.” In late October 2006, the team at Lloyd Stevenson in Auckland had the satisfaction of seeing their latest 52 ft (the old measure still applies in the yachting world) sleek racer Wired take line honours for a keelboat in the HSBC Coastal Classic, New Zealand’s premier offshore race that attracts over 250 competitors. This was Wired’s second race and came just eight days after her launch. The Lloyd Stevenson boat yard produces three to four power or sail boats a year,

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EXPORTER PROFILE

POINTTOPOINT

mostly in the $1-5 million range, with the boats taking on average some nine months to construct. According to Tracey Stevenson, there’s been significant rationalisation in the boat building business since the heady days of the America’s Cup. They’ve had to become nimble and flexible in their pursuit of the export market. “We won a major contract with the Disney Corporation to build a number of rafts for the new Hong Kong Disneyland. It was a most interesting project, though it was like working for NASA with the amount of paperwork the job generated.” She says the company’s success is related in part to the commitment in supporting the vessel and its owner post-build. “We maintain contact with many of our clients and go out to assist them wherever they might be in the world. The whole team feels they own a piece of the vessel once it’s launched, and this is clearly appreciated by our clients. We believe building relationships is every bit as important as the vessels we produce. And it seems to work for us, as we get any number of repeat orders and referrals from our customers.” Word of mouth is the best marketing any boat builder can hope for, especially if it’s coming from names like Norman, Fox, Lowy, Rivkin and Packer. David Warren of David Warren Yachts has been building sailing boats and motor yachts since the 1960s. He has sold out to the Shipworks Group but remains with the company, which has relocated from the NSW Central Coast to the Brisbane River. Business couldn’t be better right now, with some $25 million in domestic sales in two months being matched by the same amount in export business, albeit over a 12-month period. His vessels start around $6 million, with blue sky being the upper limit. “Most of my customers know one another and use their boats to entertain and network, so the vessels tend to be a strong marketing presence in themselves.” Export sales are made in USD and Euros, with interest and exchange rates currently keeping the Warren yachts competitive. “We offer value for money and have a client base that ensures we seldom tender for projects,” says Warren. Warren says the major boat shows in centres such as Fort Lauderdale, Miami and

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“Let’s have our staff meeting here”: In addition to racing, this DHLsponsored yacht is used for staff training and teamwork exercises.

Smooth sailing

D

HL’s sponsorship of the sleek 60 ft maxi-yacht bearing its name is much more than simply having the company colours afloat on Sydney’s harbour. The sponsorship of this vessel, which won the gruelling Whitbread Round the World Race in 1997-1998, has been used to great effect over the past three years, according to Gary Edstein, senior vice president, Oceania, DHL Express. “We’ve had great value from our sponsorship, and the teamwork that yachting requires certainly matches our corporate goals. Our business is all about people working towards a common objective, and we use the days out on the harbour for training and teamwork purposes. “We also take our clients out, and invariably if they’re a little lukewarm about

the idea by the time we tie up they’re absolutely thrilled with the experience of sailing on Sydney Harbour on such a highperformance vessel.” Edstein also observes that yachting tends to attract corporate decision-makers, with the yacht providing ongoing DHL branding throughout the year and especially in the summer. Edstein was one of four DHL executives who undertook the gruelling Rolex Sydney to Hobart Yacht Race, which commenced on Boxing Day on Sydney Harbour. It was his first ocean race, though he had spent considerable time honing his skills in warm-up races. “Our participation in the Sydney to Hobart Yacht Race has put DHL amongst some of the leading corporate names in the region and will help build our brand in a key area.”

“We offer value for money and have a client base that ensures we seldom tender for projects.”David Warren, David Warren Yachts Monaco are essential for the boatbuilder who needs to keep up with the trends in an ever evolving and dynamic market. The great thing about the marine services industry is that there’s always work to be done on objects that are in a state of decline from the forces of nature from the moment they are launched. Nick Saull heads Brin Wilson Boat Builders Ltd at Gulf Harbour Marina at the end of Whangaparaoa Peninsula in

Auckland’s Hauraki Gulf. The company has been building boats for nearly half a century, but these days they have their time cut out in maintenance and insurance repairs. There are some 1,000 yachts permanently moored at Gulf Harbour, and Saull’s team of 20 have the business mostly to themselves. “We look after many of the overseas boats that call in during their voyages and have worked on some of the super-yachts from time to time.” p


POINTTOPOINT

TRADE

The power of the screen: Your product could become an international success from a simple viral email campaign.

Viral marketing

Need to promote your business but don’t have a huge marketing budget? There’s a solution that is cost effective and extremely contagious. By Mike Parker-Brown

FIRST APPEARING ON our desktops and notepad screens in the late 1990s, and invariably passed on by friends and colleagues looking to share an online laugh, ‘viral marketing’ campaigns continue to prove highly successful. We’ve all seen them. Everyone knows Carlton United Breweries’ ‘Flash Beer’ and ‘Big Beer’ campaigns, both of which appeared online months before they made it to our TV screens. Honda achieved huge awareness with the release of a very clever clip showing a long line of car components all working together in falling domino style to ‘launch’ the company’s latest model. New Zealand vodka manufacturer 42 Below has also used the concept to boost its international awareness and sales with a very funny series of online campaigns. Viral marketing refers to the idea that people receiving interesting and entertaining online content will—just like the flu—pass it on to other people. The content is based around a brand looking to build awareness of a product or service through video clips, PowerPoint displays, text and even interactive games.

The beauty of viral marketing lies in the fact that just about anyone, irrespective of company size, product or budget, can use it as an extremely cost-effective means of getting their message across. Underlining the cost element, Brisbanebased The Little Bali Hotel & Resort Company (LBHRC) spent just under AUD$3,000 to launch an online tourism revival campaign for Bali spearheaded by its tongue-in-cheek ‘Where the Bali hell are you?’ clip. According to LBHRC co-founder Brett Morgan, most of the money was spent on flying two mates and their video camera to Bali and setting up a website. The result, a not too subtle take on Tourism Australia’s controversial multi-million dollar ‘Where the bloody hell are you?’ campaign, attracted an estimated 160,000 visitors in 25 countries within days of its 2 November 2006 online release. Simon Coley, 42 Below director of marketing, said cost had played a major factor in the company going down the viral route, the company’s ‘Story of 42’ and ‘Gay’ campaigns still listed as two of the funniest ever seen. “We brainstormed a concept, tested it on

the staff and our friends, and quickly realised viral marketing was very much the way to go,” he said. “Since then we’ve used the concept to target specific market groups, including the gay community where we have a strong following.” Viral marketing has also played a role in Sydney-based toy bear manufacturer Flatout Australia achieving export success. Prue Trollope, who founded the company with sister Sarah Novati in 2002, said that success was perhaps somewhat inadvertent. “It all started when we decided to send a bear to (US actress) Sarah Jessica-Parker, who sent us a beautiful note basically raving about her bear,” Trollope says. “We were obviously delighted with her response and emailed the letter to a few friends, and they in turn emailed it on and the word spread from there.” Trollope said the viral concept was ideal for a small company without the time or resources to mount a major marketing campaign. “We couldn’t have done something like this five years ago, but using the web to spread the word has really worked for us and will definitely play a critical part in what we do as we approach other markets,” she said. p

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BUSINESS BOOSTERS

POINTTOPOINT

Taking care of business Three DHL clients explain how their business flourished. By Rachel Davis

Fiji’s islands are an idyllic getaway, but for Mick Cornish, managing director of Communication Technologies (Comtech), they’re his workplace. Based in Suva, Comtech provides communications packages for corporations and government agencies across the islands. The key to their success is the marriage of leading-edge technology with oldfashioned service, advice and reliability. Comtech installs and maintains its communications equipment— often in remote locations. The constant travel hasn’t taken its toll on Cornish, who has a clear vision for his company: “We would like to be appreciated as people who do a good job with recognised equipment, provide solid after sales service and honest technical advice.” Travel and deadlines in a tropical climate are not always compatible, which is why Cornish places such importance on the weather reports from DHL. “The information about good or bad weather allows us to give our clients an accurate deadline.” Comtech has built its reputation on setting deadlines, which they consistently meet, rain or shine. Fiji’s islands are small communities, and trust lost is not easily regained. Cornish is always mindful of this and feels DHL understands this need. “DHL organises our overseas pickups, and Fiji’s general manager often visits our office. He is very approachable and willing to fit in to the local business culture, plus our contact person really cares about our time frames.” Comtech’s continued success depends on meeting tight deadlines, and with DHL, Cornish feels they have a business partner for the future. p

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PHOTOGRAPHY: STOCKXPERT

CLEAR COMMUNICATION


ICONIC IMPORTER

BRIGHT LIGHTS

In today’s economic climate of boom and bust, John Brooks Ltd is a beacon of stability. Established in Christchurch in 1964, the business has passed from one generation to another and now comprises three offices in New Zealand, each run by a son of the company’s founding father. Importers of industrial automation products, John Brooks Ltd holds a unique position in the New Zealand marketplace. “We are one of a few companies that can offer a complete package of industrial and electrical components to our clients,” explains Chris Brooks, managing director. Brooks and his two brothers are heavily involved in project management with their clients, from initial requirements and importation right through to the end product at work. The nature of his business has made Brooks a frequent international flyer. “Most of our products are manufactured in USA, China and Europe, and because there is no margin for error, I often have to oversee the initial factory inspections for quality and performance. Our products often come from Australia and are breakdown situations for our customers. That’s often the tricky part—getting the order from there to New Zealand in time,” explains Brooks, who’s company has had a three-year relationship with DHL. “DHL have the ability to get what we need as we need it from Australia, allowing us to carry minimum stock.” Brooks uses DHL’s regional manager in Wellington to help when needed. “If there is a serious level of difficulty, I have found DHL a great resource in getting a project completed to its deadline.” p

An unassuming building in Sydney’s residential inner west is home to one of Australia’s leading manufacturers of lighting solutions. Neoz Lighting, winner of three Australian Design Awards, is a manufacturer with a strong international presence. Formed in 1983, Neoz specialises in cordless lamps and cordless lighting systems. Jonathon Knight, Neoz sales director, explains their unique vision: “Our company strives to design and manufacture quality products that will be beneficial to people and their environment, and with over 10 years experience in cordless lighting, Neoz are seen as the pioneers of high-quality cordless lighting.” Their cordless lighting concept is now used in over 50 countries and can be seen in the Ritz Hotel in London, the Jazz on Lincoln in New York and the Burj Al Arab in Dubai. “Engineered to the highest standard, Neoz rechargeable cordless lamps allow complete freedom and flexibility,” says Knight. He believes design prowess is not enough to explain Neoz’s longevity. “Reliable and dependable service are the cornerstones of any business, and at Neoz we take this seriously. We use DHL because I can tell clients exactly when they will receive their cordless lamps. Whether it’s architects, interior designers or opening nights at restaurants or hotels, this is extremely important to us.” A cornerstone of DHL’s track and trace service is important to Neoz clients. Knight can understand this and says that “being able to track progress of their delivery makes a huge difference to our clients; it gives them peace of mind when dealing with us as they know they’ll receive their lighting when they need it.” p

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PHOTOGRAPH: NICK SCOTT

WHO’S WHO

POINTTOPOINT

Small

talk It’s not always a man’s world. Oceania’s quality control centre manager Elizabeth Heggie is proof positive that monitoring her company’s performance and planning a wedding is all in a day’s work. By Stephanie Sword What’s a typical day like for an operations manager?

The first thing I usually do is to check my emails, going through issues from the night before, such as delayed flights. A lot of my work involves reviewing the reports of what has happened and if there’s anything that needs to be looked into further. The nature of my job is to investigate problems and make sure they don’t reoccur. Who do you have working for you?

I have a number of people working for me, and they’re basically broken into two groups. My day-to-day team monitors flights and shipments in real time. My other group analyses performance, reviews trends and liaises with other countries, among a variety of other things. Are there other female colleagues with positions similar to yours?

Yes, I do have a female colleague in a similar role. She looks after customer operations, interfacing with sales and operations. If the

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Quality control: Oceania counts on Elizabeth Heggie to review and resolve any operational issues.

sales department has a query, she will check to see how we can implement a solution for the customer. Would you encourage more women to enter the field?

I would definitely encourage more women to the industry; it’s entirely suitable for women. It’s a dynamic, challenging and rewarding environment. Although there’s a widely held perception that it’s a male-dominated field, there’s certainly a growing role for women within it. Is your schedule demanding?

Not necessarily. It’s typically a 9-to-5 job. When an urgent issue arises, you may need to be available off hours, but those situations tend to be limited. It’s about having the resources and infrastructure empowered to make decisions at that time. Are there any trends in the industry that are noteworthy?

We use QSMS, which stands for Quality

Shipment Monitoring System. It monitors all international shipments against a complex set of control tables, allowing us to take action for immediate resolution. It also gives proactive notification to customers, providing them with reports about any problems or schedule changes as soon as it happens, which is an industry first. What’s the best part of your job?

It’s the interaction with other countries. We’re a global operation, and I really enjoy having conversations and meetings with colleagues around the world, including Asia-Pacific, New Zealand and the US. You’re engaged to be married. How are your wedding plans coming along?

Just fine. I’m getting married in Sydney on Friday, the 13th of April. I’m not superstitious, so fortunately I’m not concerned about getting married on Friday the 13th. Plus our family will be here for the wedding, which is great. My colleagues—who are already married with children—feel it’s definitely time for me! p


POINTTOPOINT

The island culture of Fiji represents community spirit—the perfect backdrop for the teamwork between DHL and Pure Fiji. By Stephanie Sword

SPECIAL DELIVERY

A beautiful partnership: Pure Fiji produces an array of exotic beauty products and relies on DHL to deliver them around the world.

PHOTOGRAPH: PURE FIJI

Pure partners WHEN YOU THINK of Fiji, what comes to mind? Tropical islands, coral reefs, fragrant flowers, blue-green waters? How about a thriving international airport? It’s true; Fiji’s Nadi Airport is the South Pacific republic’s gateway, serving over a million people yearly. This has come in handy for Gaetane Austin, founder of Pure Fiji, an immensely successful manufacturer of beauty products. And with the company’s longstanding affiliation with DHL, it is now exporting products at a break-neck pace. Austin and her daughter, Andrée, formed Sandollars Fiji Ltd in 1996. Shortly thereafter, they attended an exporters conference with the goal of learning how to expand their business on a global scale. The Austins were open for suggestions, and when they heard a talk given by a DHL representative, the message quickly struck a chord: “We were mesmerised by what we heard. It was clear that DHL could help with the capital outlay, managing inventory and generally assisting us in growing the business,” says Gaetane Austin. “It was just what we needed to hear.” By 2000, after receiving much exposure through word-of-mouth, television, magazines and more than a few highprofile, celebrity fans, Pure Fiji Export was

registered and indeed ready to conquer the world. “By then we realised we should expand and export—it was time to broaden our horizons,” Austin says. Today, an ever-growing number of bath and beauty products, including lotions, fragrances and soaps, are shipped directly to various outlets and customers around the world. Certain exporting obstacles, such as storage and temperature issues, can be a concern with these types of products. Not a problem with DHL, says Austin. “DHL handles the majority of shipments for our company. The advantage of using them is that we don’t have to have refrigerated containments, and it doesn’t matter if your buyer doesn’t have storage facilities—they can order with us more frequently and have it airfreighted on a regular basis.” Considering DHL has been with Pure Fiji since the company’s early days, Austin feels the affiliation transcends the typical business-to-business relationship. “I have both a sentimental and business attachment to DHL. It’s amazing—and surprising—to have this type of relationship with your exporter.” According to Austin, the stable partnership is due largely to DHL’s

Fiji representative, Paul Roper. “He’s a tremendous resource, very helpful and effective,” says Austin. “We can ring him up at any time—even after hours—and know he’ll do whatever it takes to pull everything off. He’s critical to a rapidly expanding business like ours.” Recently, DHL—and Roper in particular—were both key in helping Pure Fiji export a large shipment to Las Vegas, US. “This is typical of the type of service Paul offers us,” Austin explains. “In October, my daughter Andrée went to Caesar’s Palace to conduct a massage show at the Qua Spa. At the same time, we were launching a new range of Pure Fiji products. We had to export numerous items, including brochures and samples. This event was very important to our company, and provided spectacular exposure to Pure Fiji and to Fiji itself. Having the products arrive in tact and on time was very important.” Though the success of Pure Fiji rests squarely on the Austin family, they are quick to say that having a reliable exporter is essential to expansion. “We’re experiencing a lot of growth now, and you can’t do that without having a dependable exporter.” p

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KEEPING STORMS WHERE THEY BELONG. IN TEA CUPS.

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