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Heikki Kauppinen: The dream of commercialisation

"Finland has recently witnessed a lively debate over the amount and level of competence in commercialisation in the country, or more precisely, lack thereof. If Finnish companies reign supreme on the Finnish market, why not internationally? What else are we missing other than investments?"

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Finland has recently witnessed a lively debate over the amount and level of competence in commercialisation in the country, or more precisely, lack thereof. The Helsinki School of Economics and some of its stakeholders have set such great store by the issue that they have launched a StratMark project lasting several years with the aim of improving strategic marketing competence in this country.

Sitra’s Food and Nutrition Programme (ERA) has addressed the issue from the very start. When the programme was launched in 2005, Kai Seikku, CEO of HK Ruokatalo Group food manufacturers, stirred up the audience by giving various examples of how much better the Swedes – again – have been at commercialisation. The strategy report launched by ERA in spring 2006 stated that the development of commercialisation competence was one of the most central proposals made in it. From the beginning of this year, the ERA Commercialisation Team began its work, chaired by Bertel Paulig, Chairman of the Board, Paulig Ltd coffee manufacturers. 

Why have we fallen behind the Swedes in this matter?

There are probably many reasons. One might be that Finns are extremely domestic market oriented. This attitude has roots in history.  

For centuries, the Vikings in our neighbouring Nordic countries have set out to seek conquests even in distant countries beyond the seas, all the way to North America. Finns in turn settled for expanding into the nearby regions, Southern Finns going on forays no further than Lapland. In the 20th century, Finland underwent three difficult wars. Food rationing continued long after the Second World War had ended, until the mid-1950s. Many still remember the ration books that were required when shopping for food. Price control continued even longer, for some products until as late as the late 1980s. The prices of key foodstuffs were regulated by the authorities; competition played no real role. 

The importation of foods, particularly agricultural produce, was regulated until Finland joined the EU. In this light it is quite understandable that the Finnish food companies have focused their operations entirely on the domestic markets. Export was mainly to get rid of agricultural surplus – often as a final option. Soviet trade also played a key role, but ran on a wholly different set of rules. 

In terms of marketing, this meant that companies focused on creating strong brands for the domestic market. And they certainly succeeded! According to a trade magazine for marketing and advertising professionals, the most valued brand in Finland was a food brand: Fazer Blue chocolate! The strongest foreign food brand was ranked as low as 30th, and was surpassed by Juhla Mokka (coffee), Valio (dairy products), Vaasan Ruispalat (bread), Elovena (oatmeal) and seven other Finnish brands. 

So if Finnish companies reign supreme on the Finnish market, why not internationally, like the Swedish ones? What else are we missing other than investments?

One explanation is offered by the Danish futures researcher Rolf Jensen. He argues in his book Dream Society that the information society will be followed by the dream society. His thoughts are akin to Maslow’s well-known theory. As well-being increases, consumers will seek increasingly more satisfaction at the emotional level. Sensations and experiences will be a particularly sought-after commodity. Jensen urges marketing professionals to approach markets as being dependent on emotions and develop for each brand a story of its own that will appeal to people’s feelings and values. Naturally, the story should be unique, intriguing and relevant to the brand. 

If a brand intends to succeed internationally, it should tell a story that has universal appeal and relevance. Since the Finnish food industry has only borne the Finnish consumer in mind when developing brands, the stories behind them are targeted at Finns, written from the Finnish perspective and rooted in Finnish culture. When these brands were created, insufficient if any attention was given to the international consumer.
 
A classic case in point is Turun Sinappi mustard. Its story has a solid foundation in Finnish food tradition, alluded to by the image of the medieval Turku Castle on the packaging. Finns intuitively get the patriotic message, they love it, and the product has long been the market leader.  But no Swede will understand the story, let alone the Berlusconis of Italy. 

Although there is obviously much room for improvement in Finnish marketing skills, there are also examples that stand to our credit. In the past few years, the Finnish beverage industry has shown that it can design a brand that is international from the very start. The meat and processed food industry has done its homework and read its Jensens and Maslows: its marketing has been seasoned with a good measure of emotions and ambience. 

The road to better competence in commercialisation is long and rocky. The main thing, however, is that the first important steps on that road have now been taken.
 
Heikki Kauppinen

Theme

Training

Sitra aims to boost the ability of Finnish decision-makers and change-makers to deal jointly with the key social challenges and opportunities of the future. The objective of our training function is to generate new ideas and new solutions. Our activities aim to create learning environments that enable thinking about and developing things together.

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