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Kornit Digital readies for next level growth in
PIA spoke with Kornit Digital’s newly-appointed president for Asia Pacific, Ilan Elad, as he navigates his first tasks in his role for regional growth. By Sha Jumari.
In October 2020, Kornit Digital appointed Ilan Elad as the new president for Asia Pacific. Elad takes over the role from Andy Yarrow, who held the position for almost two years. Elad joins Kornit at a critical time as the company is looking to expand its reach in the region.
Currently based in Tokyo, Japan, Elad has experience working and living across continents, including the US, Europe and Asia. In the past 12 years, his specific focus has been on Asia and Oceania. Prior to Kornit, he served Daimler Trucks Asia since 2013, most recently as Vice President of Sales for Africa, SAARC, Oceania. Previously, I was co-Founder and CEO of Vision India, as well as Regional Managing Director NEU with telecommunications company Ciena.
Its a high level view of my background, which is diversified industries, different size companies at different regions. I managed businesses in across Europe, Africa and APAC
“With small to medium-sized companies, there is always that challenge to go from one level to the next. Ronen (CEO of Kornit Digital) was looking at this when he was looking for someone who has a lot of experience in building markets and teams and moving into areas where the company is looking to grow. The seeds has already been planted , and my job is to take those seeds, focus on the growth opportunities and bring Kornit to the next Level in Asia Pacific.”
The E-Commerce Opportunity
“There are opportunities for a company like Kornit right now, and if you look at the sales and the stock price of the company reflected that potential, it has gone up so dramatically. This is because the perfect storm fits into our world,” said Elad.
The e-commerce market is less about holding stock its more about more on supplying what people want. As stores closed doors due to lockdowns, consumers are turning to online for their shopping needs, giving e-commerce a major boost globally.
“E-commerce has now doubled in the past three months not just in the US, but across the world. The e-commerce market is less about holding stock its more about more on supplying what people want. It's the business model where people want to print on demand. It’s not supply and demand anymore; it’s demand and supply,” said Elad.
"COVID has changed our retail purchasing habits. A lot of retailers are moving online. And that’s where we come in. We really need to follow the trends and support the growth for retailers online, because that is where we believe the market is heading in the future with the major players. The
Ilan Elad
focus would be to find the biggest pain points that we can solve and go work with those customers hand in hand,” said Elad.
Targeted approach for Growth in Asia
In terms of evolving the e-commerce markets within the Asia Pacific region, Elad’s first focuses will be with China, followed by Japan, and then Australia and New Zealand. He highlighted that each market will require a different approach. In Japan and Korea, people want higher quality but affordable.
“The top three e-commerce players in China are Alibaba, JD.com and Pinduoduo. Part of the challenges that we’ve had over the years in China is that there are huge differences in quality. The consumer in many cases is willing to accept much lower quality
just because of the price. In China, I can sell a cheap product at a cheap price. In Japan, people want a higher quality rather than affordable, in Korea it’s the same. We have to make sure that we know who our target audience is,” Elad explained.
China is the current largest e-commerce market, with an estimated $672 billion in online sales each year. Amongst the top 10 largest e-commerce market in the world, Japan comes in at number 4, and South Korea at seventh.
Interestingly, Elad added that Kornit Digital has seen movement in Vietnam: “We've started seeing some good traction in Vietnam, so that will be an emerging market. In India, we have a very good partner as well. So those two markets would be the second stage.”
“We have more than a third of the world's population in Asia. We need to adjust our proposition to fit our customer's business model. Our machines are not for the lower end shops, its much more for the industrial
and professional market.
Compared to the United States and Europe, there is no coherent strategy for any one country in our region. China is a totally different country than Japan, Japan is totally different than Australia & New Zealand, and they're both different from Korea. India is a totally different beast,” said Elad.
Within each market, Elad has the task of segmenting and targeting where its strong potential customers are. Kornit machinery is at the higher end of the investment spectrum.
“Our machines are not for the mom and pop shops. It’s much more the industrial, professional space. We are targeting the bigger players who are more industrial with higher capacity, that's where we can add more value. The economies of scales will lower the total cost of ownership for those customers,” Elad continued.
The Pull to a Dynamic Company
Prior to being offered the role, Elad served as a consultant to Kornit Digital. According to Kornit, he was present in supporting several expansion opportunities in the recent months. Not only did he become acquainted with the global business in those months, it gave Kornit the confidence in Elad’s capabilities to offer him the role. For Elad, Kornit was an attractive company due to a few factors.
"Kornit ticket a lot of boxes for me I wanted a dynamic company that was in a new area that was thriving, with high-end technology. Digital printing is something that's growing at a very fast pace. It's a disruptive force,” said Elad.
Kornit’s high-end technology was also a deciding factor: “If you look at the mechanics, there is the machine, and there is the software that runs it. It’s also the chemistry. It’s the ink, and how does that connect to the t-shirt, and how the image comes out at a high quality and resolution.” “And finally, to come into Asia you need to be serious. It’s not like the US. I don’t mean that you don’t need to be serious to go into the US, it’s just that the US is a market for early adopters,” said Elad. “Asia is not – Asia is more complicated. And the region is so diverse, and so big. It takes more time. It costs more to penetrate the market.”
“The CEO convinced me that the company wants to invest heavily in Asia in order to make it successful. I was not looking for a start-up that would struggle and just jump on everything. I was looking for a company that behaves like a start-up, but is mature and has advanced technology that I’m excited and passionate about to grow in the region,” Elad said.
It’s all about the People
When asked to describe his management style, Elad pointed towards the importance of building a successful team first.
“I don't have a recipe of exactly what I do but at the end of the day, it's the people. We can talk about the best technologies, about the most sexy product in the world, about everything else, but the only way to be successful is through the people,” said Elad.
“I would like to create a team and work on trust and good communication. It has to be an inclusive process, so I try to create a lot of diversity in the team. Listen to all the different people and allow them to run with their ideas so that they're successful. Most of the knowledge is not in the headquarters; most of the knowledge are with the people who are meeting customers. We have to listen to them,” Elad continued.
“I think one person can only do so much. And another person you add to the team can only do so much. If you hire the right people, and create for them a sense of belonging, and a sense of purpose, then I think you'll be a very successful company,” said Elad.
Kornit Digital has two main product segments, direct-to-fashion (DTF) and direct-to-garment (DTG). Although still relatively new to the company, Elad already has his favourite machines.
“For DTF, I love the Presto. I think that especially for Asia, it will be a game changer. In India, we have sarees which are fascinating and have amazing colours. Then you go to places like China, where there are beautiful Qipaos. In Japan, we have Kimonos. There’s a lot with fabrics that we can do in Asia.”
The Kornit Presto is a one stop shop, direct-to-fabric digital print system that utilises Kornit’s proprietary single-step print process. It eliminates the need for external process steps and can print on a wide variety of fabrics.
In the DTG segment, Elad picked the Kornit Avalanche Poly Pro, a singlestep process for printing on polyester. First launched in April 2019, it prints directly to polyester and polyester blends. The printer is directly aimed at the sports segment, and the growing athleisure and functional apparel markets.
“I think the Poly Pro is a cool product, because I wear a lot of polyester when I work out, and they’re much more comfortable. I think the fact that now we can print on that and we can play around with the designs and the quality of what comes out makes it a super cool product,” said Elan.
“Those are the two that I connected more with. I’m still new, so I hope I don't hurt anyone with my choices!” he quipped.
