Closing Enterprise Deals in South Korea

A common misconception many have is that the business processes are fair and transparent. The truth is that Korea is a relationship-oriented country, driven largely by reputation and trusted networks established over time. Most Korean companies would rather team up with an industry partner whom they have worked with and can trust, than with a foreign company of unknown reputation. 

Network Your Way to Success

Relationships are the key to succeeding in South Korea, an example of which is Korea’s family-owned conglomerates. These companies operate in a closed ecosystem so they rely on their own vendors such as IT providers, wherever possible.The best deals in Korea are oftentimes the ones that marry both organisational and personal interests. 

Hence, for a foreign company, it can prove difficult to break into the market without having any connections. Invest time into researching the business ecosystem in your industry. Find out who the key players are and their relationships with one another. This should give you clues on which company to go after. For instance, if a company has historically worked only with local companies from a particular family, you may not be as successful in cracking a deal with them as you would be with a relatively less entrenched new player. Choose wisely. 

If you don’t have any relationships with the company previously, you have to find the right person in the company to close the deal. This can be tough if you don’t have the sufficient network. Forge relationships with industry insiders who can give you that information. This could look like working with a local Korean company with the right connections who can partner with you and help bridge the gap.  

Establish Your Reputation

Koreans are very conservative, so it can be hard to win your clients over if you don’t have a solid reputation in the country. Make sure your PR team has reached out to local publications beforehand, and has secured articles or features in reputable media outlets. Another way to gain exposure is through partnering with communities in your client’s industry. These could be relevant industry bodies or forums, where you could get involved in relevant events for instance. Make sure your clients have heard (good things) about you before your first meeting.

Brush Up on Your Korean

Another misconception is that Korean clients prefer to close enterprise deals in English, which simply isn’t true. Korean clients feel uncomfortable at best, and threatened at worst when faced with the prospect of working with a partner who doesn’t speak the language. The finance and public sectors for instance, communicate almost entirely in Korean. If you’re not bent on picking up the language, work with an interpreter you trust to make sure your words are not being lost in translation. 

Avoid Risky and Costly Solutions

The last misconception is that your solution has to be completely novel and disruptive. Where anywhere else in the world, your innovative solutions might have garnered interest or applause from potential clients, Koreans are fairly risk-averse. Your clients would feel more assured if they knew that your “innovative” product or service was proven to be successful. If your solution is out of the box, make sure you’re walking into the meeting armed with success stories. Otherwise, consider approaching the C-level leaders who might be more open to taking risks and experimenting with something new, because securing the buy-in at the working level is going to be a real challenge. 

In terms of pricing, Koreans will often choose for the less expensive option unless the benefits are significantly high for choosing otherwise. The hierarchical nature of the corporate world means that an employee would need to justify these decisions to their superiors, and would prefer not to go through the hassle of explaining why they went for the costlier alternative. Do your research and make sure your product/service is priced competitively. 

There’s no hard-and-fast rule regarding which stakeholder you should approach first as each company is different. But usually, in my experience, we try to suss out what the company’s real requirements are by speaking with executives on the working level first. As these are the individuals who are carrying out day-to-day tasks, they will provide you the best understanding of what the company’s challenges are, and what strategic gaps you could fill.

Thereafter, figure out what the hierarchy in your client’s company is. In most cases, it is not sufficient to engage one stakeholder, especially if he or she does not hold the final decision-making lever. Adopt a targeted approach. Identify the key stakeholders at each step of the sales process and reach out to them.

Follow-up in-person wherever possible. Ask questions on how to refine your proposal. Understand what the requirements of each stakeholder are. Reviewing proposals can take a long time, especially in regulation-heavy sectors, so take it as a golden opportunity to build trust with the various stakeholders.

Strive to meet the C-suite leaders of a company at an early stage. This is because it takes time to build relationships with the key decision makers. The C-suite leaders are also thinking big picture and will have different requirements from employees on the ground as they’re steering the company vision and direction. Speaking with them will give you a sense of the larger goals of the organisation, which will help you craft an air-tight proposal.

But how do you even reach out to these senior leaders? One way of doing so is through your network. Ask a trusted point-of-contact in the company to link you up with their senior leaders. Usually, he or she will agree to help if you’ve proven to be respectful and have added value. It also depends on how close you’re with the person and their temperament as well. If your point-of-contact is sociable and outgoing, then your chances of getting him or her to broach the subject with the C-suite level will naturally be higher.

Another way to engage them is by stepping back and getting your bosses to do the talking. You’ll find that it is much easier to secure that first meeting with a C-suite leader in a Korean company if the person reaching out to them matches their seniority. This is also a form of respect in face-sensitive Korea.

1 Establish Relationships

Understand your clients’ personal interests first before convincing them to work with you. Work with local partners who have established networks, and make sure your company’s reputation and achievements have been highlighted in the media. This will go a long way in cementing trust and thus boosts the chances of closing the deal. 

2 Understand Your Competition

Don’t try to explain why your higher pricing is a good thing. Korean companies tend to avoid the costlier option, so do your research and make sure your product or service is delivering great value at prices your clients won’t be able to say no to. 

3 Be Risk-Averse

Don’t reinvent the wheel by proposing a completely new, revolutionary solution. Go for a tried and tested idea. Otherwise, make sure you are prepared with several success stories that will reassure your Korean clients that your solution will guarantee the results they want to see.