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What to Centralize, and What to Localize in Building an International Brand

3 Mins read

Over the past few decades, the world has become smaller, providing new opportunities for businesses. Technology has had an enormous impact on the ways we buy and sell, opening up access to broader markets for brands looking for growth. At the same time, tech continues to evolve, as does consumer behavior, meaning brands that stay still risk stagnation or obsolescence far faster than at any other point in history.

Innovation is more than a buzzword these days — it’s a lifeline for any brand aiming to be one of the recognized, dominant global players. The path to global business success is littered with brands that failed to innovate, like Blackberry, which ignored the move to touchscreens, or Kodak, which invented the first film-less digital camera but didn’t see the potential of digital photography. The lesson is clear: Don’t be one of those brands.

How can you predict what’s coming? Don’t just look at what the big guns are doing. That next disruptor could very well be a startup. For example, the skincare cream I’ve used every day for five years is part of a startup, and that startup recently signed a partnership with L’Oreal — the goddess of skincare. When done right, a startup’s products can get noticed by the big cheeses.

On the whole, startups have proved to be more agile than big businesses and therefore better positioned to disrupt the status quo. Startups are also going global earlier in their growth trajectory than ever before simply because they can, and taking advantage of an international market can be especially fruitful.

With this global access, though, comes a dilemma: what to centralize and what to localize. Tapping into multiple markets isn’t easy. It involves making decisions around what should be done where and how that product or service will be perceived by audiences from different cultural backgrounds, speaking different languages. That’s a lot to process.

In an ideal world, a startup would come up with a great product or service, put it out there with some clever marketing and swiftly be rewarded with customer take-up. It seems, though, that taking a one-size-fits-all approach doesn’t work when it comes to brand-building. Centralization can bring advantages, lowering costs and making the most of a company’s best products and marketing ideas, but it can also miss the mark in a less familiar market.

So, what should I keep local, and where should I expand or diversify?

In my work, we balance global efficiency with local effectiveness by first asking the question “Does it affect the customer’s experience with the brand?” If it does, we seek to maximize effectiveness by prioritizing localization. If it doesn’t, we prioritize global efficiency.

It doesn’t have to be an either/or proposition though. Centralization and localization can coexist. There are plenty of examples of manufacturers marketing the same product under different brand names (cocoa crisps in the U.S. are called cocoa pops in Australia); or the same product with a different formula (Mexican Coca-Cola is made with cane sugar, while American Coca-Cola is made with high fructose corn syrup); or creating a product specifically for the local market (in Shanghai, KFC serves Peking duck burgers).

Go global or bust?
Even if you do hit upon a product that is universally accepted, the chances are the marketing message will need to be localized. Examples abound of errors in translation that have led to costly product failures, and there are an equal number of errors in cultural translation.

The biggest issue, then, in building an international brand isn’t whether to go global; it’s how to go global. There’s a delicate balancing act between creating a global brand and being flexible and innovative enough to maintain relevance in each market. Innovation is not a process that ends with a product. As the world changes, so must products and brands. Those that stay ahead of the game and find the intersection between centralization and localization that fits their brand, product and markets will be the big brands of tomorrow.

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