If you’re in marketing, you’ve likely heard the phrase “go global, act local” more than once. But in an era brimming with geopolitical disruption, economic volatility and social crises, localization is more than just a buzzword.
A Forrester report titled Geopolitical Disruption Demands Local Trust reveals that existing consumer demands for local, relevant experiences have compounded during the pandemic. Consumers are gravitating to values-based organizations and are paying closer attention to where and how products are manufactured, and as a result, CMOs at global brands must pivot and support “multilocal operations” that support more local marketing approaches. Thomas Husson, VP and Principal Analyst at Forrester, believes that the next decade will belong to these multilocal firms, which are midsize enterprises that “expand by prioritizing regional differences and local operations.”
Taking a multilocal approach gives teams in specific markets the autonomy to better understand and respond to consumer needs, creating highly localized content that spans digital, offline and human interactions. This level of autonomy will help create value and ultimately help build trust.
“The current crisis will drastically accelerate pre-existing fragmentation trends that were reinforcing the need for local brands, products and regulation,” said Husson. “Value-based consumption and the need to make meaning for both consumers and employees is deeply rooted into local cultures.”
During an in-depth interview with Retail TouchPoints, Husson provided in-depth insights into the report and recommendations for marketing leaders. He reveals:
- How this new era of localization will impact retail businesses;
- Ways CMOs can better balance global brand guidelines and local nuances; and
- Best practices for extending autonomy to local marketers.
Retail TouchPoints (RTP): “Go global, act local” has been a mantra for marketers and executives for years. Why have we not seen the appropriate level of focus and action in local marketing, despite it being so present in the business world?
Thomas Husson: I think it is difficult to execute well on this concept. Global marketers have long faced obstacles when expanding their brands into new regions. Digital, despite its helpful automation and scalability, brings unique challenges to global marketing strategies. Marketers’ digital immaturity prevents them from effectively localizing their marketing approach. Weak adoption of global marketing technology platforms hinders efficiency.
Marketers tend to default to homeland digital profiles. They tend to enforce global brand consistency over local customer experience in digital. The problem with that approach? Global brand standards solely reflect the digital norms of headquarters. The persistence of centralized marketing organizational structures results in leadership teams that think their digital audiences act just like them. In fact, digital increases customer expectations for relevance, giving local brands the edge. Such competition exposes global brands’ digital marketing gap, forcing them to localize their digital approach.
RTP: Social, political and economic priorities vary from market to market, and consumers are expecting businesses to be more transparent in their standing and overall values. What can senior leaders do to best determine where and how to focus their time, attention and budgets, for better local marketing?
Husson: It is indeed so tricky. The best way, as always, is to start by deep diving into consumers’ perceptions and emotions. The crisis has changed consumer behaviors, and consumers struggle to voice these changes. It is thus key to delve into their emotions to understand what’s happening below the surface. Additionally, monitoring changes in regulation is key.
RTP: Where do you see the biggest impacts on retail and consumer goods companies from this new era of localization?
Husson: I think the most profound impact will come from changes in consumer behaviors and expectations. Technology changes will take longer to take effect. Consumers increasingly seek and prefer brands that reflect their personal values, which rely heavily on local beliefs about social issues, politics and causes. For example, consumers across the globe increasingly care about climate change and prefer to buy products that are environmentally friendly, but this preference varies significantly between countries.
By forcing people to focus on health and hygiene, the pandemic also strengthened the perception that environmental sustainability affects our personal lives. We care more and more about the food and medicine we put in our bodies, the cosmetics we apply, the clothes we wear, and the cleaning products we use in our homes. Brands in the food, health, CPG and fashion industries are taking notice and establishing a more emotional relationship with consumers for everyday products.
RTP: With all this discussion around companies localizing their branding, campaigns and experiences to specific markets, do you believe brand heritage still matters as much as it has historically?
Husson: Yes, I think it does. The challenge is to stay true to the DNA while adapting to local cultures. One way to do this is to make sure your local marketers have a say in developing your global positioning, and they don’t just implement the directions received from a remote HQ.
RTP: How much power or flexibility should local marketers have in tailoring strategies based on what they know about their communities?
Husson: Empowering local execution through trust and autonomy is critical. HQ doesn’t know much about local communities, stores and business partners. Having a truly global mindset requires involving multiple stakeholders. A best practice comes from Schneider Electric, where any global marketing brief must be vetted and executed collectively with at least three different countries.
RTP: Data is central to deep consumer understanding and, in turn, offering better, more relevant experiences. How can brands and retailers best acquire the data they need to be successful while adhering to new data privacy guidelines and requirements?
Husson: New privacy regulations like the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA), a growing insistence on data localization, and the move to a cookie-less world make it much harder for brands to understand local customer behaviors. That said, there are ways retailers and brands can leverage and enrich their first-party data. New technologies like computer vision also enable marketers to turn unstructured data, such as images and videos, into insights on local communities. Beyond investing in social and consumer intelligence, the key is to get closer to consumers by establishing a dialogue with local consumers.