Initiated by Kotler Marketing Group, this episode of the Spillover—Corporate Breakthroughs Under the Wave of Globalization series focuses on: From History to the Future: Certainties and Uncertainties in the Globalization of Chinese Enterprises. 

Amid the wave of globalization and the robust growth of China's economy, Chinese enterprises encounter both opportunities and challenges in their global expansion. Integrating the spillover of corporate capabilities within the framework of new quality productivity, Kotler Marketing Group has launched a new online program dedicated to the globalization of Chinese enterprises. It brings together Kotler consulting experts, professionals from various sectors, entrepreneurs, and founders of emerging brands for in-depth dialogues. Together, they explore pathways for Chinese enterprises to survive and thrive during global transformations, uncover cutting-edge trends, and decode the principles for success in the new era of globalization. Through extensive practical case studies, the program offers actionable guidance for overseas market expansion, helping Chinese enterprises transform their strengths into sustainable competitive advantages to succeed in global competition.

The globalization of Chinese enterprises is expected to be one of the certain trends of the future. Currently, the advantages and resilience of Chinese enterprises in supply chains are hardly challengeable. The U.S. shift toward deglobalization is overly radical, leaving the global market perplexed. In this context, seeking certainty becomes the top priority. For instance, when foreign buyers face uncertain tariffs, even if they consider international suppliers, they are still highly likely to ultimately choose Chinese enterprises.

In the future era of Globalization 2.0, Chinese enterprises need to focus on building four localizations: supply chain localization, brand localization, team and shareholder structure localization, and mindset localization—covering compliance, lobbying, public relations, government relations, and other comprehensive aspects of localization. This presents both a significant challenge and a rare opportunity for Chinese enterprises. This field is still under exploration by many, and the difficulties are not insurmountable. Countries like Japan have accumulated substantial mature experience during the previous wave of globalization, which we can learn from. As long as Chinese enterprises perform slightly better than their domestic counterparts, they can reap substantial dividends.

I believe there is a window of opportunity within the next six months. Due to the overly radical policies of Trump, numerous issues have emerged between the U.S. and its traditional allies. Under these circumstances, driven by practical interests, these allies will seek cooperation with China. Even if they have differences and conflicts with China in terms of values and markets, as long as China can counterbalance the U.S. to some extent, they will gain a more favorable position in negotiations with the U.S.  

From a tariff perspective, in the past, under the WTO's unified market agreement, countries enjoyed multilateral equal treatment. However, today, at the level of trade agreements, globalization has taken on a new form—a "mosaic" pattern composed of multiple multilateral free trade zones. Within each "mosaic," tariffs are low, and free trade is implemented; but at the boundaries between "mosaics," there are extremely high tariffs and non-tariff barriers, such as geopolitical conflicts and various special regulations (e.g., ESP-related provisions). The world today resembles a mosaic, and when enterprises engage in international business, they face higher compliance costs and more complex laws and regulations than before. This "mosaic" globalization has brought profound changes to the pathways for enterprises, especially Chinese enterprises, going global.

In the era of Globalization 2.0, a low-globalization mosaic pattern, a new model may emerge: relying on Chinese supply chains or Chinese technology, manufacturing in Southeast Asia, and selling products to global markets, forming a division of labor pattern based on the greater Chinese Confucian cultural circle. This division of labor requires Chinese enterprises to master the ability to build supply chains in Southeast Asian countries, including local production management, iterative optimization, and cross-cultural talent management. Only then can they effectively address tariff issues in global deployment and establish a multi-chain, flexible global supply system, which is crucial. For Chinese enterprises going global, Asian countries are highly significant. They serve as a testing ground for product quality, a training base for teams and organizations, and a watchtower for understanding global trends. For example, establishing a company in Singapore can function as an important product iteration center, talent recruitment hub, and intelligence center. Additionally, Asian countries also serve as value-added production bases. These four roles make Southeast Asia, as neighboring countries of China, extremely valuable to Chinese enterprises and even China as a whole.

We cannot view the international market as a unified whole because the scope of "international" is too broad. When discussing the international market, we must return to specific regions, often referred to as the "Go-Re-Lo" model: "Go" for global, "re" for regional, and "lo" for local. All successful marketing strategies begin with respect for and deep insight into the local market. It is essential to deeply integrate into the local lifestyle. Therefore, I recommend that the bosses or core leaders of Chinese enterprises going global should visit the local areas and engage with the original users—the most core target consumer groups there. There is only one principle for succeeding in a market: respect the local market, go deep into the local area, and conduct in-depth insights into the original users and the most valuable groups. Do not rely solely on secondary data or superficial, generic research reports. What is truly needed is to visit the field in person.