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Brands are thinking globally, but acting locally. Localization of marketing campaigns is growing in importance as consumers increasingly look to brands to reflect their interests and values. Efforts are extending beyond marketing campaigns to the products themselves, following a year of supply chain disruption. What trends should marketers keep in mind?

Global Brands Are Aspirational, Local Is Relatable

“Global is aspirational, local is relatable. That is, consumers prefer global when they seek to realize an aspiration,” said Vivek Astvansh, assistant professor of marketing at the Indiana University Kelley School of Business. “Global is less relatable, but less likely to be aspirational. Unfortunately, brands and companies often forget this distinction, using global for relatability and local for aspiration.”

Astvansh shared the example of a brand that enters a new market defined by distinct consumer preferences and cultural values. If the brand wants to position itself for niche consumers who aspire for a global outlook, the brand is better off using a global appeal in terms of pricing, advertising language and content, celebrity endorsers, brand names, and retail channels. Conversely, if the brand wants to infiltrate the laypeople of the market, people must find the brand familiar. Familiarity occurs when the brand name exists in people’s vocabulary, the advertising language and content is everyday material, the endorser is a person-next-door, and the price and retail channels are accessible.

But Astvansh warned of a few caveats with this approach. “First, the aspirational value of global and the relatable value of local apply in business-as-usual situations. In times of adversity, global indicates competence, whereas local signals warmth. Brands are better off staying local when they intend to overcome an adversity. Second, while there is a limit to globalization, is there a limit to localization?”

For example, nuanced yet consequential differences in advertising content that aligns with how people in a region talk can increase the brand’s relatability. But the brand should ensure the benefits exceed the costs of such localization, Astvansh said. “The decision comes down to how narrowly/broadly the brand defines its target consumers and whether the consumers want a brand that sounds, looks, feels, and smells relatable or a brand that facilitates them to fulfill their aspirations.”

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Localization to Give Rise to Multi-Local Firms

Companies will continue to stress localization, giving rise to multi-local firms, according to Forrester analyst Thomas Husson.

“Demand for local products is skyrocketing, and local brands fuel competition,” Husson said. “Consumers increasingly seek brands that reflect their local values, which rely heavily on local beliefs about social issues, politics and causes.”

CMOs therefore must have a global mindset, yet localize their messages, said Husson. “CMOs must anticipate the impact of this new global order on their brands and revisit their marketing in light of increasingly demanding and polarized customers. The key success factor here isn’t technology, but empowering local teams. Local trust is the key to morphing into a truly multi-national company.”

Husson added: “The next decade will belong to midsize enterprises that expand by prioritizing regional differences and local operations.”

He expects the process to take until the end of the decade. In the next couple of years, Husson sees the growth of digital platforms that can localize marketing and product strategies based on national differences.

“Technology will reinforce hyperlocal operations,” Husson said. “Cloud-native, edge, and intelligent automation technologies provide architectures for more localized operating modes, while low code [technology requiring little if any additional coding for customization] will empower firms to build more regional applications.”

Related Article: Supply Chains Face an Inflection Point

Pay Attention to Details

One of the best uses of localization in marketing is when you’re entering geographic areas with variances in dialect and or grammatical style, said Matt Bretzius, president at FischTank PR. “Utilizing localization strategies enable you to speak to your potential customers in those markets in a way that is native to them — for instance, using “s” instead of “z” in regions that speak British English, or ensuring you use proper greetings when addressing someone in correspondence. You want your potential customers to feel as if they are speaking to someone who is like them, knows where they come from, and what they are looking for."

Another obvious — yet overlooked — critical localization area is ensuring transactions can be completed using currency and payment methods that are prevalent in each region. For instance, a shopper in France should see their cart total in Euros, even if the online store is based in America using US dollars, Bretzius said. The same goes with payment methods, whether its credit cards or bank transfers — ensuring shoppers can seamlessly complete transactions in a way that is native and familiar to them fuels conversions and repeat sales.

"On the flip side, some companies can get too focused on hyper-localization which can then waste resources," Bretzius cautioned. "Consider the United States. While there certainly are some marketing initiatives you would want to localize to region or states (products specific to climate or terrain for instance) a focus on transactions or customer service may be redundant since payment methods and customer touch points (mobile, web, social) are essentially uniform across the country.”