In a successful e-business, companies adopt strategies which help their business gain the capacity to replicate the processes needed for successful management in website globalization. However, it is very often that companies choose to not participate in web globalization, simply because they feel they lack the necessary skills, knowledge, tools, and resources to do so. There are many challenges and strategic decisions needed in the process of web globalization, so the task can seem daunting. Though it takes a lot of time and resources in the initial stage, companies can benefit greatly from investing in web globalization.
What is Web Globalization?
Web globalization is an e-business expansion that successfully addresses all corporate issues involved in launching and regulating websites accessible to users across the globe. It takes into account the design technological processes and strategic decisions that lead development, implementation, and management of international sites.
There are two types of approaches involved in globalization, which are called “standardization” and “localization.” These two strategies each have their own set of benefits, and it is up to the company to decide on what level of standardization vs. localization they want to implement into their website’s content and functionalities.
Standardization vs. Localization
Deciding on the levels of standardization vs. localization you want to use really depends on what type of company you have, and what marketing strategies you use. While each have their own benefits, one size does not fit all, and it is very important that you carefully consider which one is better for your company. Good planning could save you time, money, and resources, as well as protect your company’s reputation.
Standardization is a cost-effective strategy which offers standardized products and services through standardized marketing, to an assumed homogeneous global market. The argument made in favor of this approach is backed by the fact that technology is globally developing at a rapid pace, which many believe is reducing the cultural gap, thus creating a homogeneous “global culture.” On the surface, standardization has several benefits, which include:
- Significant reduction of costs in translation and local adaptation
- Saving time and resources in brand marketing
- Creating one unified brand and worldwide corporate identity, leading to higher global recognition
- Minimizing the need for the coordination, management, and control of local subsidiaries
However, while it may seem that neither the industries nor their products require localization, it’s possible that the marketing strategies may need to be changed in certain aspects–or entirely. While in some cultures your ads may be acceptable, other cultures might find your ads confusing or even offensive. This can potentially pose a risk to the company, costing thousands to make significant last-minute changes or, in more severe cases, recall all of their products entirely.
Translation errors are (usually) on the lighter end of standardization blunders (and often times can be humorous), but it still costs the industry time and financial resources to re-market their brand to fix those errors. Sometimes, even the brand name itself needs to be changed. One famous example is how, when Coca-Cola first entered the Chinese market, they tried to phonetically spell out their brand name so that it could be read the way they had intended, but it turned out to roughly translate to: “bite the wax tadpole.”
I’m sure you can guess why that didn’t sell well…
This was fixed once the brand’s marketing team (after much hard work) came up with a new phonetic spelling that was still close to the brand’s name, while translating to something nicer: “happiness in the mouth.”
Cases such as this further prove that standardization often does not work, and the marketed ads need to be localized (or at least properly translated). In addition, research studies have shown that standardization doesn’t actually affect financial performance (Samiee and Roth, 1992; O’Donnell and Jeong, 2000). Therefore, localization is the widely preferred method in marketing.
Localization (AKA, “adaptation strategy”) is often considered to be the better approach in global marketing, as it takes into account the vast diversity of international markets, and treats people as “cultural beings” whose values and behaviors are shaped by their culture. This method involves understanding local consumer preferences and adapting marketing and business strategies to satisfy needs and wants. It basically takes a more careful and thoughtful approach to marketing across the globe, in order to avoid the problems that standardization often creates.
While localization may seem costly in the initial stage, it has the potential to save a company thousands, and greatly increase profits. Aside from avoiding issues that would call for rebranding or recalling, localization sometimes comes with another perk: “cultural icons.” These entities come to exist in international markets through infusing iconic brands and characters with cultural myths or symbols.
A good example of this would be the “Indianized” Spiderman, who is named Pavitr Prabhakar (phonetic distortion of Peter Parker) and roams around Mumbai (instead of Manhattan). He has become so popular that he has even been integrated into Indian myths and religion.
In this sense, localization can serve as a great opportunity for companies to grow and gain more profits. But what strategies should companies use in localization, and to what degree should localization vs. standardization be implemented? Why does it matter? This is what I’ll cover in the following sections, so you can make the best decision for your company.
Why Localization Strategies Matter
If my previous examples still haven’t convinced you, let me put further emphasis on why proper localization is so important. First of all, it will save your company thousands–or even millions–of dollars. If your marketing is insensitive towards other cultures and your products reflect this, you could receive backlash and have to recall everything. Even if you didn’t aim your marketing towards this culture in particular, sending insensitive messages about other cultures through blatant stereotyping will only cause you to lose a huge demographic of consumers, meaning losing major profits, and boycotts and protests can ensue. This will not only cause a financial setback, but a permanent setback as your company struggles to repurpose itself and fix its mistakes.
Take Abercrombie and Fitch, for example. In 2002, the company released a new line of tee-shirts with insensitive racist stereotypes, with the intention of it being “humorous.” All of these shirts were specifically Asian stereotypes, and it caused a huge uproar of consumer protests, especially from the Asian-American community. And phrases like “Two Wong’s Can Make it White” or “Get Your Buddha on the Floor” are not at all funny. They are absurd and insensitive. This has left a permanent stain on Abercrombie and Fitch, and if you didn’t know about this incident before, you can now make a clear judgement on whether or not this is a company you should be supporting…
Local insensitivity can also lead to legal and regulatory issues, so think before you put something out there. Or at least get a second opinion from someone from the local culture.
To add another point, while translation errors can be humorous (like in my earlier example), they can also be very offensive and lead to even more problems, if you don’t take care in translating and proofreading your content. A good example of this would be when a Windows XP system was released in Spanish to the Latin American markets. Upon startup, the computer asked users to select their gender: “Not Specified,” “Male,” or “Bitch.”
You also need to consider whether your product will even work in other cultures. While selling bath bombs or soap additives to Americans might be okay, it is certainly not okay to sell in Japanese markets. In Japan, the bathtub is used to soak yourself after cleaning yourself beforehand, because the same bathwater is shared for the other family members to soak in after washing. Thus, additives would be considered unclean.
Also, it would be a good idea to research into what’s popular in different cultures. Take also into consideration that some cultures might see things as taboo, or they might have different superstitions. Advertising generally doesn’t work in a standardized way, because all cultures are inherently different.
What’s Right for My Company?
If I’ve managed to convince you that localization is typically the better way to go than standardization: Good, you’re on the right track. However, not all companies fit into the same glove, and some actually can benefit from standardization. So, how do you figure out which one your company needs more? One simple way is to first determine what extent you want your users to utilize your product or service for their own self-expression. The higher the level of self-expression associated with the product or service, the more localization (price, product, promotion, web, and logistical) will be needed. This will especially be true with cultural customization.
For example, if your company sells products like home décor, automobiles, beauty products, and other travel- or lifestyle-oriented products or services, much more localization will be needed. This compares drastically to companies who sell low self-expression products or services, like B2B companies (business-to-business). If it’s sold directly to the consumer (B2C), you need to have an understanding of their culture and psyche. However, localization levels will differ depending on how much your product appeals to the consumer’s identity and self-image.
If you still need more help on deciding whether your company needs more localization or more standardization, here are four strategies proposed by Bartlet and Ghoshal (1987) and Ghoshal and Nohria (1993) for companies to use in web globalization. Keep in mind that global integration refers to standardization, while demand for local responsiveness refers to localization:
- The Global Strategy is used in industries such as construction and heavy equipment, in which global integration is strong and demand for local responsiveness is minimal.
- The Multinational Strategy is used in industries such as food, beverages, and household goods, in which global integration is minimal and demand for local responsiveness is strong.
- The International Strategy is used in industries such as paper, printing, publishing, and textiles, in which both global integration and demand for local responsiveness are minimal.
- The Transnational Strategy is used in industries such as auto, computers, and pharmaceuticals, in which both global integration and demand for local responsiveness are strong.
In choosing which strategy to use, consider your products/services, your industry’s environment, and your company’s culture. In today’s most competitive markets, the “transnational strategy” is the most effective strategy, but you should think of your values, goals, and mission. Which one sounds the most like your company, and how much are you willing to commit to localization?