All successful businesses have one thing in common: they understand their customers well. The more that they’re aware of their customers’ needs and pain points, the more effectively they can offer compelling products or services. This can be done in a variety of ways, from social media listening and handing out surveys to chatting directly with individual customers.
Most brands have to divide their customers into segments because customers don’t always have the same core characteristics. An ambitious business would take this one level higher and branch out to other countries, forming a target market that involves different nationalities, cultures, and preferences. Going global is extremely challenging because businesses fail to understand their customers abroad, and many local thriving businesses have crashed badly when they tried to venture outside. However, scaling internationally has become more possible than ever over the past decades because of technology and globalization
Adapting to Local Culture
The concept of globalization is key for any business to go abroad. It’s a mashup of the words “global” and “local,” meaning achieving success on a global scale by adapting products to local cultures. Before you can even think about marketing, you have to do heavy research and figure out which countries would be the best fit. There’s also timing, local competition, and business model variations to consider, but these two factors are the most important:
Each country or even place has its own culture, which outsiders may find strange or even confusing. For example, social media isn’t too popular in Germany because of the high value placed on privacy, while countries like Brazil and Nepal aren’t as strict with being on time. Cultural differences can make or break your campaign or even your entire brand.
In order to communicate, you have to use the language that your target market understands. Your brand has to be presented in this language, from packaging and advertising to the local version of your website. Aside from the language itself, you should also be aware of slang and common expressions.
The Secret: Talking to Locals
While the technical term is market research, you won’t be able to arrive at reliable data while only sitting in front of your computer. Your company must actually reach out to locals, talk to them, and know their culture firsthand. In fact, a common strategy is to visit the target location as early as during the planning the stage.
Interacting with locals, especially when a different language is involved, is perfectly doable. Take a cue from travelers—join meetup groups, reach out to a possible mentor or influential figure who’s interested in your company, dig into your contacts to see if anyone has a link to that country. To get past the language barrier, you can find a key person to show you around or use translation equipment for more formal settings like meetings.
Success in one location doesn’t guarantee success everywhere, especially if there’s a disconnect with locals from the start. These three mega-companies failed significantly in certain countries:
Groupon offers coupons with discounts for all sorts of items and services, including toys, entertainment, and fashion. Since its launching in 2008, it has amassed around 48 million active users in nearly 15 countries.
But despite being an experienced company, it couldn’t survive in China because it failed to understand the culture. Its marketing was off-mark, and it was overconfident from the start, proclaiming that it would become China’s largest shopping site. Many vendors were extremely put off when it proposed a 50-50 split since they were used to giving partners only 10%. Its high-ranking staff was also made up mostly of foreigners, whose management style didn’t click well with the Chinese employees under them.
BestBuy is known for its huge box stores selling electronics, appliances, and gadgets all over the US. However, some years back, it tried to gain a foothold in the UK—and then backed out within two years. Its original proposal was good, in theory. After all, it had investigated the UK market for years, and it was known for excellent customer service while remaining affordable.
What it didn’t take into account was that the UK’s economic situation had dipped down then. Potential customers in the UK would only buy technology a few times each year because of pricier rent, and they preferred to shop in smaller stores. Notably, Best Buy’s commercials were described as “too American.”
Australians love coffee. 75% drink at least one cup daily, with more than 20,000 coffee shops all over the country. Combine Australia’s strong coffee culture with Starbucks’ impressive track globally, and you have a seemingly perfect match. But the exact opposite happened: Starbucks didn’t thrive at all in Australia.
It turns out that Australians have very high standards for coffee. The country failed to be impressed with Starbucks because the drinks were too sweet and they could find cheaper yet more appealing coffee elsewhere. In the end, Starbucks lost $143 million and closed down more than 60 stores, handing over the rest to Australia’s 7-11 chain operator.
As you can learn from these examples, no company is ever exempted from doing thorough market research. Most of the problems that brought these companies down could have been solved if they’d genuinely connected with locals rather than making assumptions. On the other hand, successful glocalization happens because the company listens and learns from the locals.