Tourism Australia Marketing Campaigns


Australian tourism campaigns have often been in the news, sometimes for good reasons attracting attention, other times questions about the campaigns including the most recent ‘Philausophy‘.

Tourism Australia's latest campaign 'Philausophy' attracts criticism.

Tourism Australia Marketing Campaigns (Image copyright Pexels)

The ‘Philausophy’ campaign is self-indulgent wank, and a crime against Australia

Tourism Australia’s latest ‘Philausophy’ campaign has “desecrated” Australia and is appalling, self-indulgent wank, according to creative director and senior copywriter Mark Farrelly.

November 1, 2019 10:52


What happens when you give a government department $38m dollars of our money? You get a pile of self-indulgent wank that’s an embarrassment to our nation.

You would think after the unmitigated disaster that was ‘Where the bloody hell are you?’, Tourism Australia would have learnt a lesson. But clearly, it did not.

The campaign after that was completely forgettable. Can you remember it? Bet you can’t. It passed like a ship in the night. The only thing memorable about it was the fact its weak, pathetic slogan was grammatically wrong.

There’s nothing like Australia? No people. Australia is a place. A location. It is somewhere, not something.

There’s nowhere like Australia would have made sense. I’m not saying that’s great. But it’s okay.

Rule one of tourism advertising: you are advertising a destination.

So it’s not surprising that when you have a team of people so unable to use even basic English, they are going to come up with something even more appalling than before…

…The campaign after that was completely forgettable. Can you remember it? Bet you can’t. It passed like a ship in the night. The only thing memorable about it was the fact its weak, pathetic slogan was grammatically wrong.

There’s nothing like Australia? No people. Australia is a place. A location. It is somewhere, not something.

There’s nowhere like Australia would have made sense. I’m not saying that’s great. But it’s okay.

Rule one of tourism advertising: you are advertising a destination.

So it’s not surprising that when you have a team of people so unable to use even basic English, they are going to come up with something even more appalling than before.’


What had happened before?


Tourism Australia looks beyond ‘controversial campaign

‘”Where the bloody hell are you?” has gone the way of the “shrimp on the barbie” – into the dustbin of advertising history.

It is two years since the Government unveiled the confrontational slogan to sledge people into coming to Australia, and now it is being dropped.

The $180 million campaign generated much publicity around the world but did not generate any major increase in visitor numbers.

Tourism Australia is also set to review its contracts with advertising agencies as it opens one of the country’s largest advertising accounts to tender.’


What is the issue or challenge round tourism marketing?


The Best Job in the World” & Beyond in a Brave New Marketing World

“Not since Willy Wonka and the golden tickets hidden in chocolate bars, has something come along like this.” Editor, The Sunday Times, United Kingdom

Investing heavily in content but not communication channels to reach prospective tourists, however, Queensland’s ‘Best Job in the World’ did gain attention globally through having travellers create the content.

The challenge was to convey to the rest of the world, in an already saturated global travel market, that surrounding this vibrant living organism was tangible product and a new tourism story for Australia…

….By the end of 2008 the groundwork was laid, the tourism regions and operators along the 2300 kilometre of the Great Barrier Reef had come on board under the “Islands of the Great Barrier Reef” banner, we had agreement from our international travel partners to start including Islands of the Great Barrier Reef product into their packages and marketing collateral had been produced.  Now all we needed was an idea or a “hook” to sell the Islands of the Great Barrier Reef to the world.

Stage two was the big idea itself.  Brisbane-based creative agency SapientNitro was given a brief to devise a campaign to promote the Islands of the Great Barrier Reef.  While several ideas were floated we realised that “The Best Job in the World” was The One; a dream job offering one candidate something priceless, the role of Caretaker of the Islands of the Great Barrier Reef with six months to explore the Islands of the Great Barrier Reef while based in a luxury house on Hamilton Island for a pay cheque of AUD150,000.

While the caretaker’s duties, cleaning the pool, feeding the fish and collecting the mail, were tongue-in-cheek, for the campaign to work, it needed to be a real job…..

….Then on a cold January morning they opened up the newspaper or turned on the television and were hit by a ray of Queensland sunshine; an advertisement for “the best job in the world” with the initial criteria of “anyone can apply”.  The application process simply asked people from around the world to submit a one minute video of themselves telling Tourism Queensland why they deserved the best job in the world….

….On 6 May 2009, Ben Southall, a 34-year-old British charity events organiser, was announced as the successful candidate for “the best job in the world”.  In the first 24 hours of his announcement as the successful candidate, Ben undertook more than 100 media interviews and featured in news stories around the globe.

Two months later on 1 July 2009, Ben started his role as the Caretaker for the Islands of the Great Barrier Reef.  During his stint he visited almost 100 Queensland destinations, fielded more than 450 media interviews and posted more than 60 blogs of 75,000 words, 2,000 photographs, 47 video diaries and more than 1,000 tweets….

….The estimated publicity value of the campaign topped AUD430 million and penetrated almost every country on earth.  Not bad for an investment of around AUD4 million over the three-year life of the campaign.’


Ongoing issue of direct communication with prospective tourists


Campaign fantastic but let down by one oversight by QLD Tourism, no direct channel via their global web presence to contact or make an enquiry in one’s own language, locally.  However, this is where Tourism Australia has been quietly creating a global web presence and physically through local travel and related representatives trained as ‘Aussie Specialists’ with resources made available online via ‘Aussie Specialists Club’.

As important, mostly ignored, are the significant digital marketing resource created by Aussie Specialists developing their own web presence targeting geographic, cultural and linguistic regions.


Most related web searches would find the relevant Tourism Australia website then finding travel planning and an Aussie Specialist travel agent would only be three clicks away; digital marketing 101.

For more blogs and articles about digital marketing and marketing strategy click through.






Brand Trust – Social Media – Digital Marketing – Personal Customer Data

How can trust in brands be developed and maintained in an age of digital marketing, speed, mistrust and social media?

This article first appeared in The Australian on 15th February 2019, then via KPMG NewsRoom.

There are issues in trust round politics and marketing.

Brand Trust in Digital Times (Image copyright Pexels)

Brand power in the age of declining trust

Edelman’s annual Trust Barometer report in 2017 carried a headline “Trust is in crisis around the world”. A KPMG report last year found that “trust has declined in almost every major economy and many developing ones”. In a CNN interview recently, Salesforce’s founder and CEO Marc Benioff argued that “companies that are struggling today are struggling because of a crisis with trust”.

There seems no end to the brands, organisations and leaders that have lost the public’s trust. There has been a royal commission into our banks, multiple questions over Facebook’s use of personal data, cheating cricketers, fake news, church leaders charged, and political parties bickering among themselves.

It is hard to believe that some brands and organisations have turned a blind eye to building trust with customers over the past decade. Trust is the basis of all relationships, gained slowly like drops of rain but lost in buckets. It is fundamental to business, symbolised in a handshake and eye-to-eye contact. ……These brands meet the “trust” checklist in the KPMG report – standing for something more than profit; demonstrably acting in the customers’ best interest; doing what you say you will; keeping customers informed; and being competent and likeable.

There is no doubt that brand trust is more complex in a digital world, where social media and data personalisation have enabled brands to act as if they are talking to you in person. Combine that with the exponential growth of individuals’ data that can be captured; digital marketplaces; smartphones; voice technology such as Google Home and Alexa; and the algorithms and deep learning of artificial intelligence, and there are far more opportunities to get brand trust wrong. This is especially so when trust is measured at lightning speed and some decisions around brands are being made by machines acting like humans.

Data became the hottest brand trust issue last year. The biggest data breach involved the Marriott International hotel chain and had an impact on up to 383 million people on the Starwood booking database. This included more than five million unencrypted passport numbers. Facebook had multiple issues, the most discussed being Cambridge Analytica’s access to Facebook users’ data. This data was used to persuade voters to change their opinions in the last US presidential election.

Consumers started to question the trust they had in these brands: one US survey showed 71 percent of people were worried about how brands collected and used their personal data. …… Marketers also had their doubts after YouTube posted ads that appeared alongside offensive videos, leading to a number of companies and their media agencies withdrawing advertising from YouTube for a period.

In the past five years, some of Australia’s biggest companies have rushed to establish or buy into data businesses that can offer insights into the purchasing behaviour of their customers and also use that information to improve their marketing communications……

Some companies have commercialised this data by selling it to outside organisations that match it with their customer profiles, adding to the knowledge they have on their customers. Some have questioned the ethics of this, even if it is anonymous; others ask who actually owns the data – the individual or the companies?

Trust around data relies on the fundamentals: common sense says that being a friendly and helpful neighbour is better for a long-term relationship than being annoying or remote. The personal customer data a business holds needs to be treated in the same way. In a business environment where consumers have more choice than ever, as well as more transparency and lower barriers to switching brands, boards, CEOs and marketers cannot ignore the need to invest in brand trust.


For more blogs and articles about digital marketing, social media marketing and consumer behaviour click through.


Digital Technology Readiness or Disruption – Australia

Following is a precis of an article from Business Insider Australia based upon presentation by former New Corp Australia Head Mr. Kim Williams about digital technology, disruption, literacy, innovation and opportunities.

KIM WILLIAMS: Why Australia still isn’t ready for the digital era

Digital technology will impact society, organisations, government, business and people.

Ready for Digital Technology Disruption? (Image copyright Pexels)


‘Former News Corp Australia chief executive Kim Williams says Australia “is not managing the change at all well” as digital disruption upends the global economy.

Speaking today at digital disruption conference, Daze of Disruption, Williams, now the commissioner of the Australian Football League, spoke about how companies must understand digital technologies in order to navigate their way through the era successfully.

“The opportunities will be infinitely larger and more interesting… [but] the journey is still in its infancy,” Williams said.

“[New digital technologies] will result in reductions of cost, new-found wonders in efficiencies of operations and a wealth of new possibilities for the quality of life.

“We’re up for a fascinating ride.”


Here are some of his predictions for businesses can expect:


  • Those who don’t innovate will fail.
  • The transfer of power from business to consumers will accelerate.
  • Technology is going to become a genetic extension of our beings.
  • Mobile is the future.
  • A dark age is coming (for those locked out).
  • Life will consist of a series of interconnected, virtual systems.
  • Social media is the key to engaging the next generation.
  • We’re all going to live longer and better.
  • Roads will become redundant.’


Much of the above is already apparent in media, entertainment, education, digital marketing, social networking, e-commerce, business, government and many services.

For more articles and blogs about digital technology related click through.


EU GDPR – Digital Marketing – European Commission – General Data Protection Regulation

What impact will the EU General Data Protection Regulation (GDPR) have upon advertising, media, marketing and social media channels in both the EU and outside?

How important is involvement of IT/web teams, customers, legal, financial, communications and marketing?

EU EC GDPR 2018 description for business and marketing

European Commission GDPR General Data Protection Regulation (image copyright European Commission)

The European Commission GDPR

According to the European Commission:

Fundamental rights

The EU Charter of Fundamental Rights stipulates that EU citizens have the right to protection of their personal data.


The new data protection package adopted in May 2016 aims at making Europe fit for the digital age. More than 90% of Europeans say they want the same data protection rights across the EU and regardless of where their data is processed. (European Commission, 2018)

Scope of the GDPR

From the technology consultancy Trunomi (2018):

‘The EU General Data Protection Regulation (GDPR) replaces the Data Protection Directive 95/46/EC and was designed to harmonize data privacy laws across Europe, to protect and empower all EU citizens data privacy and to reshape the way organizations across the region approach data privacy. The key articles of the GDPR, as well as information on its business impact, can be found throughout this site.

An overview of the main changes under GDPR and how they differ from the previous directive

  • IncreasedTerritorial Scope (extra-territorial applicability)
  • Penalties
  • Consent
  • Data Subject Rights
  • Breach Notification
  • Right to Access
  • Right to be Forgotten
  • Data Portability
  • Privacy by Design
  • Data Protection Officers’


Australian context for the GDPR

From the Office of the Australian Information Commissioner (OAIC 2018):

Key messages

The European Union General Data Protection Regulation (the GDPR) contains new data protection requirements that will apply from 25 May 2018.

Australian businesses of any size may need to comply if they have an establishment in the EU, if they offer goods and services in the EU, or if they monitor the behaviour of individuals in the EU.

The GDPR and the Australian Privacy Act 1988 share many common requirements, including to:

  • implement a privacy by design approach to compliance
  • be able to demonstrate compliance with privacy principles and obligations
  • adopt transparent information handling practices.

There are also some notable differences, including certain rights of individuals (such as the ‘right to be forgotten’) which do not have an equivalent right under the Privacy Act.

Australian businesses should determine whether they need to comply with the GDPR and if so, take steps now to ensure their personal data handling practices comply with the GDPR before commencement.

Issues of non-compliance

However, Hern in The Guardian (2018) when observing large personal data using companies states:

Privacy policies from companies including Facebook, Google and Amazon don’t fully meet the requirements of GDPR, according to the pan-European consumer group BEUC.

An analysis of policies from 14 of the largest internet companies shows they use unclear language, claim “potentially problematic” rights, and provide insufficient information for users to judge what they are agreeing to.

“A little over a month after the GDPR became applicable, many privacy policies may not meet the standard of the law,” said Monique Goyens, BEUC’s director general. “This is very concerning. It is key that enforcement authorities take a close look at this.”

Impact on Email marketing

Email marketing software company MailChimp (2017):

The scope of the GDPR is very broad. The GDPR will affect (1) all organizations established in the EU, and (2) all organizations involved in processing personal data of EU citizens. The latter is the GDPR’s introduction of the principle of “extraterritoriality”; meaning, the GDPR will apply to any organization processing personal data of EU citizens—regardless of where it is established, and regardless of where its processing activities take place. This means the GDPR could apply to any organization anywhere in the world, and all organizations should perform an analysis to determine whether or not they are processing the personal data of EU citizens. The GDPR also applies across all industries and sectors…… relevant to MailChimp…


…..Expansion of scope; definitions of personal and sensitive data; individual rights: EU citizens will have several important new rights under the GDPR, including the right to be forgotten, the right to object, the right to rectification, the right of access, and the right of portability and stricter processing requirements’


However, the most significant issue are the stricter consent requirements:

Stricter consent requirements

Consent is one of the fundamental aspects of the GDPR, and organizations must ensure that consent is obtained in accordance with the GDPR’s strict new requirements. You will need to obtain consent from your subscribers and contacts for every usage of their personal data, unless you can rely on a separate legal basis, such as those found in number 5 below. The surest route to compliance is to obtain explicit consent. Keep in mind that:

1 Consent must be specific to distinct purposes.
2 Silence, pre-ticked boxes or inactivity does not constitute consent; data subjects must
explicitly opt-in to the storage, use and management of their personal data.
3 Separate consent must be obtained for different processing activities, which means
you must be clear about how the data will be used when you obtain consent. (MailChimp 2017).

Consent would appear to be both central to compliance and rights of privacy yet problematic for much existing practice in ‘marketing’.

Best Practice Marketing

Meanwhile in Australia Hanson (2018) argues in ‘Mumbrella’ that it’s best practice for both business and customers:

For Australian businesses that want to better serve their customers, the GDPR signals the end of activities that marketers should have abandoned long ago. This means that it’s no longer good enough to buy a mailing list, nor is it appropriate to send cold-call emails or, heaven forbid, actually send spam.

Under the new rules, customers have to explicitly opt-in to getting your communications. In the old days, it was fine to pre-tick boxes on a web form allowing you to send a customer marketing emails. Now you can’t do that. Instead, customers have to give consent to you communicating with them, and that consent needs to be clear, in plain English, as well as informed, specific, unambiguous and revocable.

How to implement GDPR?

What does this mean for marketing in a digital environment or system? According to the Digital Marketing Institute (2018):

Step 1. Get your privacy policy page up to scratch

Step 2. Audit your current databases for opt-in consent

Step 3. Re-opt-in campaigns for current databases

Step 4. Create a process for opt-in consent

Step 5. Get the sales team on board

Step 6. Review third-parties who have access to your databases

Step 7. Have a streamlined process for information requests

Step 8. Prepare for a security breach.


In the short term the direct impact is neither selling nor buying of client email lists, but clear or voluntary consent or opting-in, through organic collection of prospective and existing clients’ details, how?

Using digital marketing techniques for organic inbound SEO search engine optimisation traffic as not just strategy but a living system to attract prospective clients over time. This will ensure compliance and allow prospective clients to opt-in voluntarily for newsletters, follow up etc. with the peace of mind their data will be private and not be shared.

However, organic inbound SEO requires cooperation and input across departments to share inter disciplinary expertise whether strategic management, IT, legal, finance, logistics, marketing, communications and importantly, customers or clients.


Reference List:

Digital Marketing Institute, 2018, ‘Trends & Insights: The Definitive GDPR Checklist for Marketers’, 5 April, viewed 7 July 2018, < >

European Commission, 2018, ‘Data protection in the EU’, viewed 7 July 2018, < >

Hanson, G 2018, GDPR is a great thing for Aussie marketers, Blog, 13 June, viewed 7 July 2018, < >

Hern, A 2018, ‘Privacy policies of tech giants ‘still not GDPR-compliant’’, The Guardian, 5 July, viewed 7 July 2018, < >

MailChimp, 2017, Getting ready for the GDPR, MailChimp Blog, 9 Oct 2017, viewed 7 July 2018, < >

OAIC Office of the Australian Information Commissioner, 2018, ‘Privacy business resource 21: Australian businesses and the EU General Data Protection Regulation’  < > 7 July 2018.

Trunomi, 2018, ‘EU GDPR key changes’, viewed 7 July 2018, < >

Business Simulation Exemplar – Cochlear Hearing Implants

Business Simulation – Competitive Environment

in Taiwan for Cochlear


Cochlear can enter this market fully not just on cost leadership and differentiation, but also help shape the industry in a relatively high income nation, already with an existing presence in the region, though minimal in Taiwan.  Following is, according to Porter’s five forces (Porter,1985), an overview of new competition, product substitution, buyer power, supplier power and existing competition aspects of the competitive environment for Cochlear.


Of the companies or potential competitors previously mentioned, they all could threaten with high levels of capital access, new product development potential, partnerships or acquisitions and close cultural ties with Taiwan, i.e. both the PRC China and Japanese companies.

On the other hand, Australia and Cochlear do have a profile in the region with quite a good product brand for quality, innovation and relationships with broad stakeholders.  This is complemented further by the Taiwan government having a broad biotechnology policy which could create opportunities for in country presence, research, cooperation or joint ventures (Biotech & Pharmaceutical Industries Program Office, 2016).


However, there is direct competition from Chinese private company Nurotron, with the single product the Venus Cochlear Implant System, with R&D in California and manufacturing in China (Nurotron, 2016).  Nurotron recently won one of the largest orders from the Chinese state to provide their budget or lower cost product through a state tender system, in which Cochlear was also competing (Bennett & Giancola, 2015).


Cochlear can lead on cost, product differentiation and quality without competition in the short and medium term, via their product suite which includes Cochlear Implants – Nucleus 6 System, Baha Bone Conduction Implant and further suite of Cochlear Acoustic Implants.


Due to the uniqueness and differentiation of products, for now, Cochlear has a significant advantage over potential new market entrants and existing providers, if they decided to enter the market, i.e. budget segment in Taiwan, with Cochlear still premium for performance segment.


While Nurotron etc. and Cochlear are competitors, including in China, Cochlear has had a near monopoly on high quality bionic hearing products, translating into continued high prices through most global markets. However, e.g. Nurotron is a clear threat for ‘product substitution’ in the budget market growing organically on population demographics of the Chinese mainland, potentially replicable elsewhere through cross subsidisation, partnership or acquisition (Bloomberg, 2013).


Cochlear may have to monitor over the short medium term signals from potential new market entrants, competitive products or substitutes and large players with access to capital able to undercut the market if and when they enter.  When the market has signalled a move to more competition and maturity, Cochlear will need to consider options to keep costs down, retain sufficient market share and profitability, with continued innovation e.g. joint ventures with local or other competition on budget products?


Ideally Cochlear will compete on differentiation through continued investment in innovation in the short to medium term rather than competing on cost with technically inferior products.


What strategies would you recommend?


If not competing on price or cost in a new market, but through investment in technical innovation according to the five forces (Porter, 1985), both new competition and potential product substitution needs to be monitored by Cochlear’s marketing with existing limited presence e.g. new entrants, potential innovations and market demand.  Further, as experienced in CompXM simulation environment the following elements of buyer power, supplier power and existing competition, can be leveraged at the expense of an incumbent or new entrant like Cochlear.


In short, a large competitor with global presence could potentially enter Taiwan with high performance products, moderate pricing and high customer satisfaction impacting Cochlear’s market share, sales and profitability.  Cochlear also needs to be wary of similar or related threat of product substitution by continuing to invest in innovation, for superior quality products, keeping a ‘step ahead’.


Cochlear will need to be aware of issues discussed previously, with focus upon the value chain (IMA Institute of Management Accountants, 1996), and if competition does emerge, value chain may need to be leveraged further to maintain market share and profitability, with focus upon the product life cycle (Klepper, 1996).  This would include marketing division and Cochlear’s networks remaining informed of Taiwan market, including ongoing feedback from direct and indirect customers, especially the need for improvements based upon customer satisfaction and forecasting of demand.


This also leads onto leveraging production and finance well where the former needs ongoing investment to increase automation and possibly increased plant capacity to lower costs, in a potentially more competitive price environment.  If this is to be achieved sales and profitability need to be maintained; in future outsourcing, joint ventures or purchases could be considered to ameliorate any long term rise in costs that may impact profitability.


There may need to be assumptions made e.g. move towards a mature and stable market with competition in future, medium or long term, however ageing population and longevity could maintain growth (Biotech & Pharmaceutical Industries Program Office, 2016).  Assuming innovation continues, financial focus will become more important, especially keeping costs within bounds that allow profitability and continuing to attract investment.  Cochlear may have to consider contingencies or alternatives if e.g. new competition enters, maturing market with slower growth and downward price pressure, may require production alternatives whether elsewhere or contracting out.


Summary of Strengths and Weaknesses


Cochlear’s strengths are high innovation, strong health medical research with global links, unique products, very good product differentiation, trusted brand, regional and global footprint, with limited presence in Taiwan.  Further importance is human capital, expert personnel with strong ethnic connection to proposed new market, experience of new market entry and higher education or research links.


However, regarding potential weaknesses, there is little previous direct experience of Taiwan, risk of focusing upon costs versus investing in innovation to maintain share price, securing and maintaining intellectual property rights, high expectations after much global and regional success; not forgetting the impact of silo mentality on divisions, plus potential cross cultural issues amongst personnel.  The latter aspect is important, whether R&D, marketing, production, finance or management with predominantly ‘Anglo-Celtic or ‘white Australian’ whilst divisions would no doubt include Australians of Chinese heritage from old Cantonese, through Singaporean, Malaysian and PRC China, plus Taiwanese.


Competitive Strategy through Porter’s Five Forces


For now, and in the short term, Cochlear can develop competitive strategy (Porter, 1985) based upon differentiation through a suite of innovative products being updated or introduced, and presently produced in both Australia and Sweden.  While Cochlear has a dominant global market share, high direct and indirect customer awareness with growth and innovative products, premium pricing should be possible in Taiwan as a middle income nation (Biotech & Pharmaceutical Industries Program Office, 2016).


Due to proximity of Taiwan and nature of the products, production and shipping costs may not be a very significant issue (with high automation levels), but this will probably change in future as Taiwan and other markets mature with more competition thus potentially slower growth (possibly offset by ageing population).  Australia, as happens now, would be the obvious choice for maintaining R&D and production base being same region, time zone, short air freight times and very strong human relationships whether social, research or business.  Further, if needed, Sweden can be a backup for supply, or leveraging contract manufacturing and health medical research expertise in Asia for outsourcing e.g. Singapore, Malaysia or Taiwan itself via subsidiaries or research institutes.


Market research and ongoing market intelligence will be essential for signals and information about actual and potential competitors or new entrants, while organic use of existing relationships and systems should allow monitoring of the situation, both quantitative and qualitative market research.  The importance of good forecasting cannot be ignored as any mismatch between actual and forecast demand can lead to either missed market opportunities or increased costs, especially if forced to outsource.  Conversely excess inventory should be avoided, although excess could be potentially transferred to other regions.  Cochlear’s existing limited presence in Taiwan bionic hearing devices could be leveraged to support ongoing market research and intelligence for expansion.


If and when new competition does emerge a risk would be product substitution, especially in budget sector where lower cost competitors could leverage their advantage, e.g. PRC China, on state tenders and contracts.  This may require more focus upon continuing innovation for premium priced niche products in tandem with cost cutting on budget, or co-operation with potential partners on budget production, whether joint venture or licensing.


With any new competition which generally has a global presence too allowing cross-subsidisation, there may be indirect pressure through buyers having other choices, both budget and performance, with potentially lower prices impacting profitability.  Again Cochlear may need to consider other options whether partnerships, licensing or other production options, to lower costs thus addressing both buyer and other supplier power.


Supplier power of both competitors and Cochlear can be minimised for the former and utilised by the latter.  Simple fact is that Cochlear is continually investing in R&D, innovation and new product releases with high awareness, commensurate reputation for quality, proximity to Taiwan and perception of Australia as a benign or friendly trading partner versus potential competitors or existing competition elsewhere from larger sometimes dominant nations i.e. PRC China, USA and Japan.


Focus upon the Value Chain


The important value chain process includes R&D, marketing, production and finance (IMA, 1996), along with elements of the product life cycle.  Again, these include earlier ease of entry, product choices and product development which then becomes slower with maturity, fewer product or competitor exits, less innovation and more focus upon production costs and retaining market share (Klepper, 1996).


R&D requires retention of strong links and investment into related research: in-house, education institutions and research centres, both Australia and target market(s), continually.  Again, this must include maintenance and leveraging of existing and new human capital through social, research and business links between Australia, Taiwan and region especially via Taiwan’s biotechnology strategy for R&D and investment (Biotech & Pharmaceutical Industries Program Office, 2016).


Marketing focus should be upon matching customer, intermediary and supplier needs, retail, corporate and state, complemented by dynamic, valid and reliable market research with more accurate forecasting. A significant element of marketing between Australia and the region, including Taiwan, are the perceptions of Australia e.g. innovation, quality, trust, proximity, awareness and ‘big face’ i.e. increased value of premium international products versus budget.  Again, Cochlear can use its very limited but existing client presence in Taiwan to ensure valid and reliable market research, especially qualitative for market intelligence.


Production needs higher automation required to keep costs down, avoidance of excess inventory, focus upon actual vs potential demand for better forecasting, adaptability and flexibility.  Presently Australian based production, due to products being highly sophisticated digital electronics, is done on campus at Macquarie University Sydney, accessing R&D, expertise and highly skilled operators.  If there are production issues based upon capacity and cost, other Asian subsidiaries could assist with outsourcing via science or research hubs such as Singapore, and Taiwan itself (Ibid.).


Finance strategy would be maintenance of a strong balance sheet helped by global market share and income, ensure financial KPIs are at optimal level and do not decline.  Cochlear has a proven reputation amongst international investment analysts for good management, strategy, increasing sales, profits, share price and dividend growth; with investment in R&D and innovation.  Investment and financing issues for local biotechnology companies has been highlighted in Taiwan which may create a niche for the likes of Cochlear to enter.  While looking to the future capacity and costs, more use could be made of production near or around existing Asian subsidiaries to take advantage of future regional growth, and Africa.


If Cochlear can focus on new market opportunities via these aforementioned strategies and with an added emphasis upon human capital, Taiwan can be both a new and significant long term market for bionic hearing implants.



The CAPSIM Global DNA and Comp-XM business simulations are practical virtual tools for development of inter-dependent company personnel in R&D, marketing, production and finance divisions; in addition to application of scenario planning, strategy and KPI feedback for main regional competitive markets.


In the first simulation Chester in Global DNA was a global niche differentiator for performance products in home market the Americas, in addition to Europe and Asia Pacific; resulting in a leading market position yet without dominating markets.  The simulation allowed focus upon KPIs including profitability, ability to raise capital, asset utilisation, forecasting, inventory management, customer satisfaction and competition; highlighting the inter-play between these and other variables.


Meanwhile the Comp-XM lower growth environment via Andrew’s was similar with two main products Able for budget and Acre for performance with strategy of lowering costs, higher automation, future organic growth, customer satisfaction and increased value.


Both simulations required focus upon customer satisfaction or buying criteria including price, age, ideal position and service life, with at least two products to cover both budget and performance; in addition to incremental changes or updates.  Comp-XM emphasised the need for cost control e.g. increased investment in automation, and addressing customer satisfaction through continued investment in R&D and product updates.


The Comp-XM market environment suggested need for higher specifications for both budget and performance, without increasing prices significantly, and in some cases decreasing prices to maintain or defend market share.  This was confirmed by unexpected events due to competition either entering and dominating market by lower prices, and conversely superior performance or technical specifications.  Final results were mixed due to the latter events, particularly sub-optimal finances, inaccurate forecasting of demand and meeting increased demands of customer satisfaction.


For Cochlear the simulations highlighted need for real world competitive strategy through understanding markets and competition to create profitability.  Importantly meeting or exceeding customer satisfaction requirements is essential through focusing upon and leveraging all divisions in the value chain.  The stress should be upon the product lifecycle exemplified by continued investment in R&D and innovation to keep abreast or ahead of the competition, without needing to even dominate the market to be profitable.


Cochlear can enter or expand significantly the Taiwanese market successfully by strategy addressing all the key elements of perpetual R&D along with marketing and market research, with commensurate adaptability in production, have sound finances to both control costs and attract further investment.  Like simulations are an opportunity to have divisional personnel experiment together on strategy and other divisions, it also suggests the need to have human resource strategies attracting personnel competent in key skills sets, both technical and soft.


  References & Bibliography


Advameg, Inc. (2016) Cochlear Ltd. – Company Profile, Information, Business Description, History, Background Information on Cochlear Ltd. Available from: (Accessed 27/7/16).

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