Localization Case Study of Top 5 Brands: Challenges & Strategies
We are living in a world of free markets, high consumerism, and globalization. It is a great time for businesses to explore new markets and spread their roots around the globe. The internet has literally transformed the world for good. It has not just changed how we communicate with each other and do jobs but has also altered how businesses operate. Big companies are constantly pushing the envelope and trying their luck in the international market to reach more customers.
Localization is the main force behind the global success of companies like Coca-Cola, Nike, and McDonald’s. It’s about creating brand relevance to the international audience to make them feel more connected with your products and services. When it comes to localization, it is not just translating your content, there are a lot of other things that need to be considered to make your brand blend with the international cultures.
Businesses that want to thrive in global markets should develop a robust localization strategy based on the preferences of audiences in that market. Localization is about creating experiences for locals to make one’s brand stand out from the rest of the competition. There are many companies that are doing localization quite well and making a good fortune globally. In this article, we’ll analyze the businesses and localization strategies of some dominant brands. Below are mentioned case studies of some major brands that can be an inspiration for businesses who want to target international markets.
Top Brands with Best Localization Strategies
1. Coca Cola
Founded in 1886, Coca-Cola is an international beverage company operating in more than 200 countries. In America, it is the most famous soft drink, which has almost become part of pop culture. Coca-Cola has been facing criticism for the higher sugar content in the beverages and the use of plastic bottles increasing landfills. However, the company is constantly innovating its product, be it improving its bottle design or reducing the sugar content in its drinks.
When Coca-Cola introduced its black soft drink, its flavor was unlike any other conventional soft drink or juice. The biggest challenge for the company was getting people in international markets to accept the taste of Coca-Cola. Whenever this company made a move to a new market, it faced major backlash concerning health damages caused by the beverage. Environmental activists keep raising issues regarding plastic trash which leads to water pollution and landfills.
Launching their business in the Chinese market was perhaps the biggest milestone for the company because of the rigid culture and politics. Thriving in the international markets where people are becoming aware of sustainable lifestyles is still a challenge for a company.
Every day, almost 2 million bottles of Coca-Cola are sold. It is one of the very first brands that managed to capture the global market. The major unique selling point of a company, when it comes to marketing, is that rather than promoting their brand as a soft drink, they sell it as happiness in bottles. They trigger the emotions of people by linking their product with emotions like passion, creativity, vitality, etc. You might have noticed that the company never really talks about the amazing Coke flavor in the ads, or why it is better than other beverages, it’s always about feeling happy, and content.
Translation also plays a major role in brand localization. The company has written its brand name in the local languages of the countries. It creates a sense of belonging for the customers towards the brand. As a part of Coca-Cola’s localization strategy, a few years back, the company printed the famous first names of that region on the bottles, in their local language. In China, you would see images of famous characters printed on the bottles increasing the chances of people buying the product. Such localization efforts have helped the Coca-Cola brand bypass the cultural barriers keeping its brand voice consistent across all regions.
Today Netflix is the number one media streaming platform globally. The company was founded in 1997 as a DVD rental business. The customers would order the DVD online and get it through the mail. It didn’t take the company long to realize that they needed to transform their business model that would enhance their customers’ convenience. After 3 years of their initial launch, they shifted their business model from rental DVDs to monthly subscriptions. In 2007, Netflix introduced media streaming and on-demand videos.
Netflix was never an overnight success; it took the company decades to reach the point where they are today. When it comes to international expansion, the major challenge for the company was to create more relevant content that would make its brand resonate with international markets. The company beat the local competitors who are already creating regional content. Moreover, the competitors are offering that content at relatively lower prices.
As not everyone can understand English, language was one of the major barriers to the company’s global expansion. Pricing was another challenge, and the company needed a flexible pricing structure that was suitable for all markets. Moreover, the infrastructure was also an issue because not every region has a good speed of internet. In third-world countries, the lack of internet penetration can affect the international growth of the company.
To understand the cultural and language demands of people from around the globe, Netflix started providing subtitles and dubbing in the local language. It helped the company enhance the international audience’s accessibility to diversified stories. To cope up with the public demands from around the world, the company started producing non-English content, in the native languages of the audiences.
They translated the content to the native languages and provided the dubbing and subtitles for the content was the first thing Netflix offered to enter the global markets. The Netflix localization strategy of the country was not just limited to translations, but the UI design and the Netflix home screen interfaces are also different for every region. Based on the cultural preferences and interests of natives, the company has designed totally diversified online user experiences. Netflix also adopted pseudo localization to make the content localizing process easier for the localization team.
Founded in 1971, Starbucks is an international coffee restaurant with over 35,000 stores globally. The company is known for its sustainable business operations and choices. Starbucks is working towards social and economic stability by supporting farming communities. The ingredients of the company are ethically sourced, but their coffee and beverage rates are above other competitors. Although they are expensive, they are still known to be the best sustainable coffee makers globally.
Entering into an international marketplace was never easy for Starbucks because of high prices, intense competition, and other economic factors. Moreover, coffee runs in culture. There are many countries that prefer tea over coffee, so it was hard for Starbucks to position its brand as a coffee store. For instance, in the Chinese market, the company faced a major backlash, and they failed to run a successful business because tea was the first preference of locals.
Starbucks might not be able to make a successful business in all regions, but still, it is emerging as a successful international coffee brand. To meet the demands of international customers, the company has designed different menus for all regions. Be it cappuccino, Mocha, or Espresso, there are hundreds of ways you can make coffee. Every region has its own style of drinking coffee, so the company has to adapt its menus to those preferences. The company also emphasizes using local ingredients to promote eco-friendly business operations.
Under its local-focused marketing strategy, Starbucks has designed its stores considering local preferences and put all the elements that would grab the attention of maximum customers. For instance, in Japan, tea is a preferred beverage, but the company manages to do its business here by adapting its store design and overall brand perception to the local culture and social values of people.
Nike is the largest athletic apparel company in the world. It was founded in 1964 as Blue Ribbon Sports, and in 1971 named Nike. The company has positioned itself as a sportswear company. They have also made sports kits, gear, equipment, and uniforms for sports teams internationally.
The high competition for athletic and sports brands in the markets was probably the biggest challenge for Nike. When it comes to launching their brand into international markets, supply chain management was also a hard nut to crack. Importing the products from its Asian factories was slowing down the sales. As the company didn’t own any of its footwear manufacturing, they were highly dependent on contract-based manufacturers. Delays in shipment, and poor quality were dragging down their business. Moreover, the fluctuations in foreign currencies were also a major concern for Nike when it came to globalization. To expand their business to foreign markets, the company has to get away with all of these challenges.
Although the Nike brand is about athletes and sportsmen, they are not just targeting athletes. The company has always marketed its brand to the common people, especially the sports-loving community. Unlike their competitors such as Adidas, the company always focuses on adapting to the preferences of their customers. Keeping the local preferences in mind, the company also makes a shift to clothing trends and fashion. Nike doesn’t change their product to fit into the global markets. Being a sports brand, the barrier of language, culture, and region was not very dominant. So, the localization plan of Nike always revolved around creating a sense of belonging for their potential customers. The company also deals with supply chain distribution by distributing the logistic responsibility to a broad range of manufacturers and suppliers.
Founded in 1952, KFC is one of the world’s largest fast-food restaurant chains. With around 25000 locations internationally, out of which 4,062 stores are in the United States. This brand is valued at around $5.4 billion in 2020. KFC is known for its crispy fried chicken and amazing customer service. This company is successfully running its business in more than 145 countries.
Food traditions and taste preferences are different in every region, and this was a major challenge for the company. To become a global brand, KFC has to meet the expectations of local markets. Secondly, the company has to market its brand effectively to attract local customers. Especially in countries like China, translating the content (ads, slogans, menus, etc.) into their local language was quite a challenge. There are already other competitors in the marketing doing their business quite well, such as McDonald’s and Burger King. Along with maintaining a positive brand image, training their employees for better customer service was also crucial for their global expansion.
First thing first, considering the local taste preferences and regional flavors, KFC modified its menus. For every new region, they designed a new menu, blending their crispy fried chicken with traditional recipes. For instance, in India, around 30% of items on their menu are vegetarian. Similarly, in China, you’ll get the porridge and congee on their menu that no one in the USA even heard of.
To make their brand connect with local customers they have translated their slogans, ads, and menus into the local languages of every region. Especially in countries like China, where people couldn’t understand and read English. They have made some language mistakes down the line though, but now the brand is more conscious about making their translation in-context and culture-friendly. To ensure high customer satisfaction, the company trains its employees for better customer service and creates a higher customer satisfaction rate around the globe.
In a nutshell, you have to push all the right buttons to make your global business expansion successful. Although the international markets are full of opportunities, still the risk of globalization is higher. The case studies mentioned in this article are some great examples of big companies who have made it in the global markets and running successful businesses. So, understanding the sensitivity of global markets, diversified cultures, and preferences of local customers can be very helpful in developing a robust localization strategy.