Aussie’s Freedom Furniture on going native in NZ

First published in New Zealand Herald 14 April 2015

Every week I write about the New Zealand experience of doing business in Australia. This week I thought I’d look at the view from the other side and how an Australian brand adapts in a Kiwi environment.

Having said that, there are two disclaimers. One, is that Freedom Furniture is hardly a newbie on the Kiwi scene having launched 20 years ago. And two, it’s actually one of a number of brands owned by South African parent company Steinhoff International.

Well known and established on both sides of the Tasman, Freedom’s positioning is different across the two markets.

While in Australia the furniture brand tries to maintain exclusivity, in New Zealand it’s working hard to change that perception and appeal to younger buyers who think they can’t afford to buy Freedom pieces (hence, sponsorship of The Block).

Australia’s Freedom is in an increasingly precarious position, prodded from every angle by competitors big and small. Too expensive to be cheap and cheerful like Ikea, Super A-Mart or Fantastic Furniture. Not exclusive enough to stock uber trendy internationals as do Space or Coco Republic. Unable to stake a locally-made position like, say, Jimmy Possum and without the new-brand-in-town advantage of a West Elm / Pottery Barn.

And that’s just the first brands I thought of. There’s a furniture retailer off- and online for every Australian and every taste. It’s a homemaker extravaganza here in Oz.

I think it makes good sense that in New Zealand Freedom would want to downgrade the positioning and appeal to as many customers as possible. As Jeff Karger, Head of Marketing for Steinhoff Asia Pacific (Freedom Furniture NZ and Poco Australia) says, New Zealand doesn’t have the population size to afford being too niche.

However, New Zealand is big enough to warrant a dedicated local approach including buyer, advertising agency and other partnerships.

But it wasn’t always this way. Karger says mistakes were made in the early days with the Australian attitude to New Zealand partly to blame.

“When we first went into New Zealand, we kind of went in saying ‘we’re here to take over and you’re going to do it our way,'” says Karger. “That big brother attitude created some real challenges for us that we’re now turning around.

“Before I came on board, we were literally changing the address of our Australian shipments and sending the same stock into New Zealand. Sure you can learn from Australia, but the market definitely needed its own focus and local knowledge. New Zealand is not another State of Australia and deserves to have its own point of view. There are some incredibly intelligent opportunities and people. It’s another country of equal standing.”

Karger, an Australian, is based in Sydney and travels to New Zealand every three weeks. He says this works for him and doesn’t matter that he’s not permanently based there as the local team add local knowledge.

He tells me there are definitely differences between the two business cultures and qualities that make New Zealand better, such as the openness of communication.

“It’s a terrible term,” he says “but New Zealand has a very open-door policy. The MD is very approachable, everyone we deal with – the printer, the ad agency – there’s not this ridiculous change of command to prove yourself. Even with competitors it does feel a bit like everyone’s in it together.”

Another Kiwi strength that Karger has also picked up on is the Kiwi attitude to trying new things. He says Freedom customers are happy to try new products, and management is keen to support new initiatives. In fact he thinks New Zealand companies are more likely to give something a go if it has never been done before.

For many companies, including Freedom, New Zealand is seen as a great test case for new business ideas. Freedom has an augmented reality app that first launched into New Zealand and then back into Australia. This week the retailer launches the Style by Freedom blog to its Kiwi market and will watch to see what happens and whether it could work in Australia too.

Karger, like others of us who work with both New Zealand and Australian companies, agrees that Kiwis have no reason to be timid in their approach to Australia. He says he’s now a big fan of New Zealand and finds it ridiculous that New Zealanders are intimidated by Australia when they should stand on their own two feet.

“Styles are merging, the market has changed a lot and it’s nice to now see pieces in New Zealand first,” he says. “I know our New Zealand customers really appreciate that too.”

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