There was a lot of talk in 2017 about a "post-globalized" world. A world where a steady rise in political protectionism and nationalism poses a threat to ongoing business growth and favors the "local" over the "global." It's caused concern among many businesses that are now more fearful than ever about how and where to make their next move. After all, in a "post-globalized" world, how does a big brand grow local relevance yet keep a global perspective? And how can a smaller business successfully expand to new markets?
The truth is we're not seeing the death of globalization at all--we're seeing its renaissance. It's time to move beyond the fear of so-called post-globalization and start thinking about "smart globalization" instead: recognizing the opportunities for business growth that lie at the place where "global" and "local" business strategies meet.
All business today is global--and that's not going to change any time soon. Thanks to technology and the internet, consumers around the world have access to the same ideas, meanings and values, which translate into global consumer trends, demands and aspirations.
This presents businesses with enormous opportunities for global growth if they can spot the lucrative parallels in consumer habits that arise in different markets. The challenge is then understanding the significant cultural nuances and regional differences and parallels between these markets.
Understanding this interplay between "global" and "local" will allow big brands to boost their local appeal while staying global, and smaller brands to scale up in the markets that make the most strategic sense.
Here are our five pointers to help get you started:
1. Pick the right market: bigger isn't always best.
King, the Swedish games company behind "Candy Crush" chose to launch its "Pet Rescue Saga" game in South Korea, one of the biggest markets for digital gaming at the time. Despite the game having been a huge success in Europe, it flopped in South Korea because of subtle cultural differences around keeping pets. For example, the game featured less traditional pets, like pigs, which seemed to have less sentimental attachment for Korea consumers than European ones.
When it comes to picking the right markets to prioritize, it doesn't have to be the biggest market, it has to be the most relevant. Instead of focusing on the biggest market, King might have done better to focus on the markets where the very essence of the game had most local resonance.
For Skyscanner, we looked into 10 of their key target growth markets to understand how people perceived the brand and used the service. We discovered certain markets were already primed for rapid growth while others, despite their size, weren't digitally or culturally ready enough to adopt the brand. Local relevance must always be factored into to any global roll-out plan.
2. Compare unexpected markets.
We're used to dividing up the world into regional markets, like EMEA, APAC, LATAM, and so on. But grouping markets like this can lead to missed opportunities. The impact of globalization means that similarities can arise between completely unexpected countries. Often countries that share a similar economic history have more in common than countries within the same geographic region, even if they're on opposite sides of the world.
We recently discovered similarities in consumer habits between Brazil and China in the way people choose which children's products to buy, like push-chairs and car seats, and what marketing they respond to the most. Instead of assuming that other countries within a region will respond to a product in the same way, discovering synergies between unexpected markets can have a huge impact on the success of business growth. It's about understanding the impact globalization has had on consumer habits, how these differ at a local level, then creating a strategy that draws on both.
3. Be an insider and an outsider.
In South Korea, new mothers stay at home for the first 100 days after giving birth. In China, the grandparents move in with new parents for at least the first 3 years after they have children. In some European countries parents won't wash their child's hair if they have a cold.
These types of cultural norms could make or break certain product launches if brands don't know about them. But they're so engrained within certain cultures that native insiders wouldn't even think to tell you about them in research conducted on the ground. It's not enough to tap local insider knowledge alone. You have to view it through the lens of an outsider too.
We work with a network of cultural guides around the world in 64 different countries. Their regional expertise and native understanding of specific markets combined with our global overview and understanding of the macro context helps us better understand the interplay between local and global insights. This is crucial to successful business growth.
4. Develop a micro and macro perspective.
No consumer trend is isolated. Broader triggers will always be influencing individuals, behaviors and attitudes on a "micro," local level. At the same time, local insights will have a certain relevance at a wider social, "macro" level. The exciting, and most valuable, part is spotting the opportunities in how the two interact.
Google arguably missed out on the rise of the internet in China because it didn't tailor its product enough to how Chinese consumers were using the internet and instead were seen as a less relevant, foreign entity. Instead local competitors, like Baidu, who understood local consumers' behavior around online social and entertainment services, thrived.
Now with its sights set on the growing Indian market, Google recently unveiled a new version of its Android operating system and apps, such as YouTube, specifically designed for low-end smartphones in India. This combines Google's global, "macro" perspective with an understanding of local, "micro" consumer needs to ensure the best chance of success.
We helped Uber in a similar way last year by finding out why its new digital platform to sign-up new drivers wasn't working in their target growth market of Egypt. We discovered some barriers to entry around the use, social value and cultural meaning of the English language, internet usage and trust in digital platforms that were specific to Egypt. These "micro" insights were used to fine-tune Uber's service locally but also incorporated into the work of other teams at a regional, global, "macro" level--such as looking at the UX of the website and app--to help growth in other markets.
5. Understand local and cultural nuances and know when to adapt to them.
Reaching local consumers in the most relevant way possible is key when brands have plateaued in an existing market and want to sell more, or when they want to have the best chances of success in a new market.
The Parintins Folklore Festival is one of Brazil's largest annual festivals. It sees two local teams, blue and red, compete in re-telling folk stories in vibrant carnival-style dancing, singing and parade floats. The festival is so popular, and the competition so fierce, that the main sponsor, Coca-Cola, produces both red and blue colored cans for the event to broaden their appeal and ensure supporters of both teams buy its products.
Meanwhile, every Christmas period, 3.6 million Japanese families dine out at KFC in what has become the country's most popular festive tradition. It all stems from a 1970s ad campaign, "Kentucky For Christmas," which gave the Japanese market a ready-made Christmas tradition where previously there was void. Despite the overnight success, KFC still adapted its meal bundles to suit the market by including special cake, which had been an established part of Christmas in Japan since before KFCs entered the country.
For big and small brands alike, the challenge is how far to go in adapting the original idea and product in order to appeal to a new consumer base. Whatever decisions you make in 2018 about how to grow your business, ensure you make them with an awareness of both the global and local implications top of mind.