What Differentiates a ‘Global’ Marketing Strategy?
Many companies have a thorough understanding of the marketing tactics used to strategize in their home country, but what happens when the decision is made to pursue business across foreign borders? The development of a successful global marketing strategy involves a series of choices and careful analyses of the local region, which can be simplified into the following steps:
- Identify the market you wish to enter: Conduct thorough research on the potential global marketplaces in which you may choose to expand your product. You will want to forecast the likelihood of successful growth in this market, the long-term sustainability of your product or service in this environment, and the overall potential demand for your business in the area.
- Design your strategy: Once you have identified an international region with suitable demand and promising growth, you can begin to develop your global marketing strategy. This is where the complexity of the global aspect comes into play – your company must do more than enter a foreign market and translate your existing marketing practices into their language. You must develop an in-depth understanding of the culture, values, and preferences of the locale. Depending upon your goals as an organization, and how these cultural nuances align with your existing practices, you may choose some variation of the following 3 global strategies as discussed in Pankaj Ghemawat’s framework.
- Adaptation: A strategy that seeks to adapt to regional preferences, changing some aspects of the business in the process.
- Aggregation: A standardization strategy that finds synergies amongst global markets, allowing for the creation of expansive economies of scale.
- Arbitrage: A cost reduction strategy that aims to optimize each element of the supply chain, often locating different parts in different areas that best utilize the unique economies and offerings of the region.
- Strategy implementation: Once you’ve selected an approach to global marketing strategy that best suits your business’s needs and the preferences in the global market, you are ready not only to begin developing a plan to implement your strategy, but also to analyze its success. I find it important to determine KPIs, or key performance indicators, that will allow you to benchmark the success of your global marketing strategy relative to your projected goals. Through consistent monitoring of consumer responsiveness to your global marketing techniques, you can develop a comprehensive understanding of whether you selected the best global marketing strategy for your needs, as well as if there are any areas that can be improved upon to further propel your company’s international success.
Our Top Picks: Best of Global Marketing Strategies
We’ve rounded up 3 companies that we think have done an outstanding job at creating and implementing unique, effective global marketing strategies. These companies can serve as both references and inspirations when developing your own global marketing strategy.
- Spotify: The Swedish born music streaming platform has reached astronomical success across 17 countries by adopting an out-of-the-box global marketing strategy. They determined what most music streaming consumers had in common regardless of region, which was determined to be a desire to discover new content. In order to deliver this new content to their international markets, they thought beyond the confines of music genres, instead adapting their recommendations to things such as mood and lifestyle. This allows their service to adapt to the unique desires of consumers across various marketplaces, while maintaining one standard service.
- LEGO: The iconic building blocks brand was able to use a global standardization strategy due to their primary, heartfelt belief: “Creativity and building are common to all children.” Originating from Danish origins, LEGO has proven itself to be a global phenomenon loved across cultures. Though overall products essentially remain standard, LEGO did adopt an adaptation strategy in regards to their marketing tactics when they realized that the promotional concepts they employed for their American products – such as free miniature gift packs of blocks included with the purchase of larger sets – were not garnering the same consumer receptiveness across markets.
- McDonald’s: Who isn’t familiar with those famous golden arches? Thanks to McDonald’s widely-implemented global marketing strategy, they’ve developed not only an iconic and instantly recognizable brand, but also a global presence that spans every operating continent in the world. Their strategy focuses heavily on adaptation, with food selections varying to match consumer taste preferences in each region. Even outside of the continental United States, Hawaiian McDondald’s locations feature items such as spam and rice, staples of the local diet. In India, the chain focuses on offering more plant-based selections due to religious dietary restrictions that would prevent many customers from consuming McDonald’s typical range of beef products. Beyond menu items, McDonald’s also has made an effort to adapt the physical appearances of their stores to the surrounding region, for example, the French Champs-Elsysees location pictured above features an ultra-modern, black exterior with sleek minimalist furniture inside to match the high end atmosphere of the surrounding area. This exemplifies the cultural intricacies that must be studied and understood before adopting a global marketing strategy.