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- 1 Is everything you thought you knew about marketing a global business wrong?
Are you a small business owner? Do you hope to take your business beyond your country’s borders? If the answer to those two questions was yes, keep reading this article to learn what you need to know about marketing a global business. Some of the topics covered might surprise you.
Is everything you thought you knew about marketing a global business wrong?
In a word, likely.
I taught international marketing over a substantial portion of my career at several different universities and researched small businesses around the globe. Much of what the textbooks teach about marketing a global business is flat out wrong or, at best, insufficient to guide small businesses intent on expanding their markets outside their home countries.
Here are some of the top things you likely didn’t know about globalization.
1. You’re already marketing a global business
You might find it surprising that your business is already global, without any sustained marketing effort or intention to operate a multi-national business. Take a look at evidence from Google Analytics for this site. You likely notice that the US, which is where my business operates, accounts for the highest percentage of visits. You’ll also notice that over 70% of the traffic comes from outside the US and that several countries even perform better on KPI metrics such as session duration and goal achievement, both of which factor into my profits as well as improve my ranking in Google Search. For instance, both Kenya and South Africa produce a higher conversion rate than any country except the US.
And, such accidental globalization doesn’t just work for internet-based businesses. I did some research in Spain a few years ago and encountered a small baker (who, BTW, produced some amazing pastries and ice creams) who discovered to his amazement that he got orders from other countries when tourists chose to satisfy their craving for the pastries after returning home.
Strategic planning looks remarkably the same
Strategic planning is something you do as a matter of course anyway, as it helps an organization achieve its objectives and goals by efficiently using resources, setting objectives, monitoring KPIs, and changing a firm’s trajectory according to its environment and goals. Here, we look at how you should approach marketing a global firm.
Is there a market for your product overseas?
When you stereotype the people in different countries, you often fail to accurately assess the market potential for your products. For instance, in the midst of a global pandemic, demand for US apparel and several other categories increased by over 100% in global markets, including Israel. Other surprises I learned through my years of teaching international marketing include:
- Lingerie in the Middle East. It turns out wearing restrictive clothing makes women want something sexy underneath.
- Taco Bell in Latin America, when the street tacos are cheap and tasty. When asked, LatinX report they want familiar food that’s different than what they get at home.
By the same token, products you’d think of as winners in global markets often fail. Anything requiring refrigeration has a hard time in some surprising locations as folks prefer to buy fresh every day rather than purchasing food during a weekly shopping trip.
Hence, you must consider the demand for your goods and services in the global market using data rather than guesses. The last thing you want to do is to spend a significant proportion of your annual budget on marketing a global business if there is no demand for growth. Do not fall into the trap of assuming that just because your product does well in your current market or environment that it naturally translates to another culture. For example, a bikini store won’t work in most Muslim countries due to attitudes toward appropriate dress. Careful planning based on information, research, and local insights help reduce the risk of a costly failure.
Structuring your business model
Once you determine a sufficient demand exists, among the first steps is finding a shop lot for rent that meets your needs and offers room to grow.
In many countries, structural, cultural, and legal differences require using a local business partner with intimate knowledge of local customs. For instance, when McDonald’s expanded into Moscow, developing local sources of supply proved challenging with the nature of farming and manufacturing in the country. They worked hard to build partnerships before opening their first store.
When the hamburger first appeared in Asia, locals worked to explain how to eat a sandwich, something totally unknown in Eastern culture.
Meet customer expectations
Once you know if there is a demand in a new region for your company, you need to conduct more research into the new area’s consumer habits. Chinese shoppers, for example, tend to shop at home locally, so Walmart struggled when they opened stores near industrial areas. Other places prefer online shopping and having products delivered to their door, while many European countries have a browsing market culture.
In some countries, such as Spain, consumers shop specialty stores for items, rather than huge grocery stores with hundreds of items. They even have two different bakeries, one for bread (panaderia), the other for sweets. In some countries, people expect to purchase small quantities of staples like flour and sugar from barrels while in others they buy pre-packaged products in standard sizes.
Create a flexible plan
Spend some time designing a strategy that is different from the one you use in your local business sector to compete with diverse markets in other countries. Bear in mind that every nation-and every state in some countries, such as the United States -has its own rules and regulations in all aspects, such as economic, legal, and political, so you must draw up your plans based on the particular regulations of the region.
Embrace the mantra of globalization, “think global, act local.”
You must also ensure that your strategy looks not just at penetrating the market, but also at establishing yourself as a market leader in that new region. You can’t rest on your laurels once you have your foot in the door and hope that the business establishes itself. You must constantly review your marketing plan, refresh your website with new content, and not only work to attract new customers but also to maintain existing customers.
If your products do not suit the behavior and needs of your intended customers, the quality of them, and the strength of your marketing strategy is irrelevant. It has to make sense to them, and to your business.
The nature of the global business environment guarantees that no matter how hard we work to create a stable and healthy organisation, our organisation will continue to experience dramatic changes far beyond our control. Margaret J. Wheatley.
Setting up a business is difficult, and growing it is even more so, especially on an international scale. You must do everything well to achieve success, which means careful planning based on data. You need a great product or service, a great team, and relevance to your customers to break into the global market.