“The whole pace of business is moving faster. Globalization is forcing companies to do things in new ways.” -Bill Gates
The world has shrunk. The seven seas are no more capable of keeping people distant. Nor are they able to keep them away from products developed in different lands. So today you can find McDonalds, KFCs, and Starbucks etc. in places other than US, all thanks to globalization. With markets becoming increasingly heterogeneous all brands have to think in a global level if they want to keep their spot in the market. Internet and the media outlets that are globally accessible have made the world comparatively a much smaller place to live in. Yet there is a vast mosaic of values, beliefs, traditions all around the world. It’s very difficult to create global advertisements that are relevant and appeals to the customers all around the world and also reinforces the brand name at the same time. Every country has a different taste be it in the food they eat or the products they use or the kind of thoughts they appreciate. If a brand wants to establish itself across the globe it is important for it to match up with these requirements. Customers don’t feel the connection with the brands if the products are standardized across the globe. We may have entered into an era of globalization but we can’t consider the world to be a single entity and use the same strategies and same prices to sell our products everywhere. A pure global strategy will not work if it does not take the local taste into account. This is where ‘Glocalization’ comes in. The term was first coined in 1980s. It is a concept that says that a product will be more successful if it is customized to match the local taste. It is all about developing and distributing a product globally but fashioning it in such a manner so as to accommodate the consumer of the local market. In short, glocalization is ‘thinking globally, acting locally’.
The reason why glocal marketing works is because customers feel that the brand is trying to get familiar with them and is tailored according to their needs. Such products will generate more interest in the consumer and are bound to sell more. Glocal marketing enables optimization of local and global marketing activities at the same time. When a company delegates more authority over marketing a product to the local players they can fully utilize the local expertise and knowledge of their local managers. In Japan, for example, today around two-third of Coca-cola’s sale is accounted by the local beverage brands.
Let’s see some examples of how companies today have taken up glocal strategies to make their hold stronger in different regions and countries:
McDonald has always been described as the food that is the ‘American way of life’. It is a leader in the fast food industry in terms of its gross income and also the number of outlets. But still the company is bringing changes in its global strategy. It is one company that has followed glocalization full fledgedly to make a notch for itself in all the international markets it has its presence in. It has its restaurants in more than 100 countries and McDonald changes its menu in different countries to suit the local palates. In India, the menu has McVeggies to attract the vegetarian crowd. The hamburgers were removed as cows are believed to be sacred. It introduced Bulgogi burger’ and ‘Kimchi burger- types of hamburgers in Korea, to satisfy the Korean consumers. There’s Ebi Filit-O in Japan (Ebi means shrimp in Japanese), McItaly burger in Italy and kosher Big Mac in Israel. McDonald has not limited its glocal strategies just to its menu. In Japan, it signed Yuri Ebihara, a famous model to promote Ebi Filit-O. In France, it changed its mascot, Ronald McDonald with Asterix the Gaul, a French cartoon character so as to attract French customers there.
Spar, an international retail chain has its presence in more than 35 countries all around the world. Being present in so many countries, this company too follows a glocal strategy, not in its products but in its price. In Germany, it has positioned itself as a low-cost supermarket. But, in United Kingdom and Ireland, Spar provides better service and also store design. In Europe it is positioned as high cost retail store.
Even theme parks have gone the glocalization way. In 2005, when Disneyland opened to visitors in Hongkong, it was not that successful with its revenues and number of visitors. Disney then decided to bring in some changes by catering to the local tastes. It reduced its prices and adapted to local Chinese customs. Even while building the resort it adhered to the rules of feng shui.
Glocalization is not limited to companies that are physically present in foreign lands. For example, Yahoo! practices glocalization too. The portal that Yahoo! markets is viewed worldwide and the company offers different versions of the websites to its users present in different countries. For instance, it has language variations and provides different content in around 25 countries like China, Canada, USA, etc.
When Facebook launched itself, it had a strategy of ‘one-size-fits-all’. But now along the years it has come across the differences in cultures in different countries. Like, in US, having a lot of friends in your friends list is something that is encouraged. But at the same time, in Japan, having more than, say 50, friends is looked down upon and is said to be superficial. As Facebook had not taken into consideration the differences in culture while designing its strategy, it lost a major market- Japan to another social networking brand “Mixi”, which does not show how many friends you have and neither does it have a like button. But Facebook has now set up a team, to focus on the digital cultural challenges. Thus glocalization on the digital platform is also important.
Glocalization is all about finding the proper balance between the global and local levels to get the potential benefits of the product. In this inclusive era, with more and more brands entering into the market at a global level, their glocal approaches will determine how long they survive and how successful they are. Local cultural awareness is the need of the moment for companies who are trying to establish themselves in countries other than their origin. The brands need to be sensitive to the people of their regions else, it might come back to bite the brand. People want to feel a part of the bigger international community and at the same time be in touch with their roots and cultures. A brand that addresses both these needs will be most sought after by the people. Thus glocalization today is the key to success.
[The article has been written by Mamsha Rath. She is presently pursuing her MBA from Xavier Institute of Management, Bhubaneshwar, prior to which she has worked in TCS.][/sociallocker]