Whether introducing a new product or a digital category to a country for the first time, all expanding businesses have one thing in common – they have only one chance to get it right.
If you miss the mark, your brand’s reputation may be so tarnished that you might not be able to enter that country again for years, if at all.
Airbnb is still struggling to gain a strong foothold in China after a series of missteps there, recently launching a new rebranding campaign in the country to try to win over market share from its main Chinese competitor, Tujia.
Despite challenges, globalization offers a prime opportunity to scale budding, entrepreneurial enterprises, and it can be done successfully with five key considerations.
1. Respect the country's cultural values
When McDonald's entered India in the 1990s, its signature Big Mac could not be on the menu in a nation where almost half of the citizens are vegetarian, and the cow is revered as sacred. To be successful, McDonald's needed to localize its menu to suit Indian tastes and cultural values. They responded by creating an entirely new menu, and their success is a prime example of how even the largest of companies can turn an obstacle into opportunity.
2. Develop meaningful partnerships
When DocuSign looked to enter the Japanese marketplace with a goal of eliminating the need for paper, the company recognized the national importance of the Hanko, a personalized seal or stamp, dating back centuries. DocuSign's platform is built for digital signatures, whereas the Japanese have used physical stamps as signatures for centuries, as a symbol of personal honour and identity. To win over the Japanese market, DocuSign partnered with Shachihata to develop the e-Hanko -– a customized digital stamp integrated into DocuSign’s Digital Transaction Management (DTM) platform. The partnership with Shachihata not only helped DocuSign become the trusted standard in Japan, but it also expanded Shachihata’s product offerings, helping to ensure that the 92-year-old brand stays relevant in an increasingly digital world.
3. Leverage creditability from your home market
You likely won't be able to win over an entire global conglomeration in one deal. Think locally first, and aim to win over the entities of multi-national corporations operating in your home country. Loyal customers at home can help open doors abroad. Once your regional customer base is solidly in place, tap into your customers' counterparts in other countries. When a decision maker in another country is considering purchasing your product for their particular division, an endorsement from their foreign colleagues can go a long way. This has been a classic strategy in the technology business and executed by Silicon Valley-titans such as Google, Salesforce, Intel, Dell, Microsoft as well as non-US based giants like SAP, Samsung, NTT.
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4. Position the product as strategically relevant
If a new product or category presents a strategically relevant solution to a national problem, the government will have a vested interest in its success and help to pave the way for new or revised regulations, as well as introductions to government agencies and the private sector.
For example, U.S.-based Aegerion Pharmaceuticals Inc. set up its Japanese subsidiary in 2013 hoping to deliver its proprietary drug Lomitapide to Japanese patients suffering from the rare disease Homozygous Familial Hypercholesterolemia (HoFH). Throughout the process of bringing the drug to market, the company received support from Japan's Pharmaceuticals and Medical Devices Agency, the Ministry of Health, Labour and Welfare, and the Japanese External Trade Organization (JETRO), which provided Aegerion with temporary office space, free of charge.
Another example from Japan: as a result of the 4th Industrial Revolution, accelerating the digital transformation has become a national imperative. With the need to care for a rapidly aging population, the Japanese government is also seeking solutions to increase the productivity of office workers, and reduce paperwork. (Japan has the second-largest amount of paper per capita in the world). Factory work is largely automated already, leaving traditional office work as one of the remaining areas where efficiencies can be gained. After much collaboration, the Japanese government now views DTM as a strategic catalyst for its digital transformation.
5. Remember that while business is global, trust is local
Thanks to technological advances that were outside the realm of imagination even a few decades ago, today’s world is more connected than ever, erasing borders, homogenizing cultures and globalizing business. But that does not change the fact that trust is built on a local level, and meaningful relationships are the basis of all business.
Startups and expanding companies shouldn’t approach new international markets with a one-size-fits-all approach and a drive-by mentality. They should carefully craft strategic plans – customized to each market – that integrate cultural considerations, deep partnerships, credible references, solutions-oriented tactics, and, most of all, trusted business relationships. After all, you only get one chance to make a first impression.