Have you ever found yourself gravitating towards a McDonald’s outlet whenever you are in an unfamiliar city or country and unsure of what to eat? You could be thinking that at a McDonald’s there is always a familiar item in the menu such as it’s iconic BigMac, fries and nuggets as well as something local you can try? McDonald strategy of providing menu items that are available across it’s thousands of outlets worldwide and at the same time featuring items that cater to the local tastes is the classic example of the business strategy of “Think Global, Act Local”. This international marketing strategy has made McDonald’s recognizable and relatable in every city or country it sets its foot in.
What is it actually? And why do businesses who are planning to expand internationally need to know and whenever appropriate adopt this strategy?
Definition of Think Global, Act Local Strategy
This international marketing principle encourages companies to have a both a consistent global strategy when selling internationally and at the same time adapting a local approach to the target market. Going back to the McDonald’s example, except for a few exemptions (like India where beef is considered scared), you will always find its iconic products like BigMac, fries and nuggets along with local treats like hamburgers with blue cheese in France or chicken burgers in India with paneer, the Indian cottage cheese. Combo meals are also common in all McDonald’s location and packaging is almost always the same too, making it familiar and recognizable by everyone regardless of the store’s location.
The “think global, act local” strategy is an approach used by nearly every successful international brand. It touches on almost every area of sales and marketing which includes but is not limited to features of the product, its pricing and packaging and the messaging used to convey it to customers. It also touches on the sales channels used. Implemented properly, the strategy guarantees economies of scale in sales and marketing of brands internationally while at staying relevant to the local market.
“Think global, act local” is believed to be originated by Scots town planner and social activist Patrick Geddes. The exact phrase does not appear in Geddes’ 1915 book Cities in Evolution but the idea of a “local character” was clearly evident. The concept of local character applied by Geddes to city planning meant a thorough understanding of the essence and characteristic of the place concerned borne out of sufficient grasp and treatment of its whole environment. Geddes was a pioneer in town planning, but he was also a biologist, sociologist and philanthropist who believed in working with the environment rather than against it.
In present times, town planning is all the more linked to understanding the idea of “think globally, act locally” as companies expanding internationally need to be aware of how global communities are impacted when enter new locations. Global expansions bring urbanization which in turn affects the surrounding environment as well the dynamics of local communities.
Designing and Implementing a “Think Global, Act Local” Strategy
Knowing the Customer
In designing this strategy, the primary consideration is knowing the target market. Start with an understanding of target market and the customers within that target market. Ask the following questions:
- What language do they speak?
- Are there any culturally-sensitive nuances to be taken into consideration in marketing and communicating about the brand locally?
- What aspects of the customers’ lifestyle, work practices and leisure activities will affect the brand?
- What are the local customs and traditions?
- What taboos, inappropriate symbols, imagery, and language should be avoided?
Solicit the support of someone knowledgeable about the local market, someone who knows it intimately and understands the customer’s journey. Knowledge of the local market knowledge is vital – the information is most important input in designing a localization strategy.
Having the Right Team
After a comprehensive knowledge of the target, the next important step is to put the right team in place. Consider representing all skills and functions needed to execute the localization strategy. For example, it is imperative to have someone who speaks the local language and someone who is an expert in the local laws. Communication is key to making a successful localization strategy and this should be reflected in the skill set of the team. Other important consideration is diversity. Team diversity allows for varied and comprehensive views on many aspects of a localization strategy – including communication, product design and marketing.
Communicating the Brand with the Customer in Mind
After understanding the local market and deciding on how to adapt to it (whether by adding new products or adjusting the marketing, etc.), next important step is to formalize the approach through the communication strategy such as branding guidelines. If there are distributors or local partners, define the “rules” clearly around how the brand is to be used. This include the core messaging, use of logos, straplines, and packaging. All of these need to be controlled to prevent an incoherent approach in the marketplace. Put all of these brand guidelines in writing.
We have already mentioned McDonald’s which is often cited as the most successful brand employing the “think global, act local” strategy. Citing more examples on McDonald’s strategy, it has very strict rules on its franchising in new locations that maintains the look and feel, packaging and its messaging. But it is also deeply committed to “localization” in terms of catering to the taste buds of the local community. McDonalds offer rice options in its stores in Asia like the Philippines, fried shrimp in Japan, vegetarian options in India, lobster burgers in Canada and tailors its sauces and desserts according to the local preference.
The popular energy drink that is widely recognizable worldwide for its iconic red bull logo against a backdrop of white and blue, changed its colors when entering the Chinese market for the first time. Opting to set the red bull against gold backdrop, it catered to the Chinese symbolisms of red for good luck and gold for wealth happiness.
Another very recognizable brand globally, Starbucks adapt the designs of their stores according to local traditions and customs. In Japan for example, their stores are minimalist in design evoking the Japanese tea houses and traditions surrounding drinking tea. In India, Starbucks offer chai latte, an obvious local favorite on top of their signature blends. For their deli, beef and other meat-based food are also not offered in India.
KFC’s localization strategy includes adapting its stores to the look and preference of its locations. It initiated a five-year plan to overhaul the designs of its stores in the UK to cater more to the British aesthetics. In India, it is offering vegetarian options in addition to its staple fried chicken menu. In its recent advertising campaigns, KFC updated its use of the iconic Colonel Sanders image and likeness – opting to “localized” by adapting it to each country’s taste. KFC France for example, had a “cool and funky” and notably in “great shape” Colonel Sanders in its advertisement, alluding to the French love for healthy eating.
This well-recognized brand drank by millions the world over is also not immune to “localization”. Among its portfolio of drink products is the sport drink Aquarius, which was developed in Japan to cater to the health-conscious Japanese and compete with local sport drink Pocari Sweat. Today Aquarius is marketed in Latin America, other parts of Asia and Europe, where there is demand for such health drinks. At one time Coca-Cola has over two hundred products under its portfolio including Sprite, Innocent juice drink, Dasani, Smartwater, etc. – all catering to changing local preferences as well as global trends towards healthy drinks.
The global brand that develops and manufactures those “check-marked” shoes, clothing apparel and accessories has always been regarded as an all-American brand. In spite of its global reach, you cannot virtually distinguish Nike products from one country to another, until recently when they introduced a line of “Nike Pro Hijab” , performance hijab for Muslim women to use when they engage in sports. Although not without controversy and a lot of polarizing opinions, the move demonstrated Nike’s foray into “localization” and as well as underscoring its messaging of sports being available to everyone regardless of gender or religion.
The strategy of “think global, act local” is not only applicable when expanding internationally. A “think local, act global” example of this kind is Walmart. Walmart has around 4,000 stores in the US – with the size of the US market, Walmart is effectively using this strategy by going inherently local in every store location it opens. Its advertising caters to local tastes. Its store real estate strategy adapts according to the needs of the location – opting for smaller stores for urban areas (as opposed to its well-known mega-stores) and customizing special offers in locations near students on college campuses.
Browse Netflix and it will come as no surprise how they have applied this strategy really efficiently. Global hits are available to all subscribers regardless of location but with each country, there is a catalogue of shows, tv series and films that cater specifically to that country or region. Netflix France will have a different top 10 show compared to Netflix US. Netflix endeavors to provide content in the local language a well prevent showing of content that may be offensive or culturally sensitive to a country or region.
The Global Brands Not Really Using “Think Global, Act Local”
There is obviously no one-size-fits-all strategy for expanding globally. Although the “think global, act local” has been cited as one of the most important strategies for brands to expand globally, there are lot of globally successful brands which do not use this strategy. Luxury brands in haute couture like Chanel, Hermes, Prada, Gucci have well-developed international activities that they treat the world as one big market and sell the same products everywhere with little or no variations between locations. The same is true for other products and brands catering to the luxury sector like high-end liquor such as champagne from brands like Veuve Clicquot and Dom Pérignon. These brands may add a “local flavor” into their global activities through carefully planned and targeted marketing campaigns that sway the local sentiments. Luxury haute couture houses are known to advertise via special events tailored to the local flavor, using design elements incorporating the local culture and traditions.
Another example of a brand that has an extensive and unified global strategy are smart phone brands like Apple and Samsung. Both sell the same products anywhere in the world. It also takes painstaking care in communicating its product positioning and messaging in almost exactly the same way in every country it sells its products. This global strategy extends is true for other consumer electronic brands such as those offering headphones, computer, and gaming accessories.
The Bottom Line: Being in the Customer’s Shoes
Expanding to new markets even if it just to another city can be challenging. Imagine doing that internationally where customers have different languages, customs, and traditions, buying habits and perceptions plus the laws and regulations could also be very different. In the same way that the focus is on customers for the domestic market, the bottom line for international expansion should also be knowing and understanding the customers in each market. Knowing the local cultures and traditions and tailoring the products and marketing strategy respecting them goes a long way towards succeeding in a new market.
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