Country Differences and Localized Marketing Strategies

Essay: Country Differences and Localized Marketing Strategies

Xing Li

I. Executive Summary

Localization is a way of marketing the products or services to the target customers of a particular country rather than simply translating contents on packaging and instructions into the language of that country. During the process of localization, firms have to overcome the national differences. The differences between countries include political, economic and, cultural differences. A set of proper localized marketing strategies is required for successful localization.

Localized marketing strategies include: (1) Localized marketing programs should be tailor-made for each country or region due to the big differences between countries and regions. (2) The international marketers should well-informed about the political, economic, social and cultural environment of the target market.

II. Introduction

Globalization refers to the shift toward a more integrated and interdependent world economy. In this world economy, the barriers to cross-border trade and investment are declining. At the same time, the competitions for firms to prevail in international markets are unprecedentedly fierce. Localization is a way of marketing the products or services to the target customers of a particular country rather than simply translating contents on packaging and instructions into the language of that country. During the process of localization, firms have to overcome the national differences in political economy and cultural environment. A set of proper localized marketing strategies is required for successful localization.

III. Country differences in political, economic, and cultural environment

In order to make proper strategies for localization, we need to understand the differences between countries, including political, economic and, cultural differences. All these differences can have major implications for the practice of international marketing.

A. Political Economy Issues

The differences in political, economy and legal system of the intended country are big obstacles for firms to carry out the localized marketing plan.

1. Political System

To those companies that want to localize their products or services in another country, the most important factor of the political environment is the stability of the served country markets' political system. Many countries have frequent changes of government, such as Republic of Congo. In such a climate, political instability can have many negative effects on economic development of a country. Other facts that will influence a country's political stability are public unrest, government crises, armed attacks, politically motivated assassinations, and irregular change in top government leaders. It is really risky for an international marketer to enter into a country without political stability.

As a form of government, democracies are regarded as the most effective government structure for economy. However, some examples show that a country's political stability is not directly related to the form of government of that country. For example, Serbia, a country in South-eastern Europe, experienced decreasing political stability after the change from an authoritarian regime to a more democratically constituted government. In China, as another example, the centrally controlled power keeps a stable political environment. That factor as well as the market-oriented economy helps China to achieve rapid economic growth.

2. Economic System

Before a marketer making a decision on the size and the value of a market, he or she should also analyze the economic system of the market, because it influences the economic environment of the host country. It is not necessary to consider a marketing plan in a pure command economy, because there is no free market. Another example could be in some Moslem countries, economic perspectives are based on fundamental Islamic principles. "This trend, led by Iran, is still in its formative stage and it is difficult to predict either how far it will go or what long-term effect it will have upon firms doing business in Moslem countries."

3. Legal Environment

It is important for international marketers to consider the legal environment relevant to their product market and assess the political and legal viability of potential markets. There will be a huge risk to set a place as a target localization place where a legal system to provide adequate safeguards in the case of contract or property rights violations is not available. It is always necessary for international marketers to heir a local legal counsel to know the information such as what international business regulations are applied to the potential place. Knowing the international trade policy of the potential country, including export and import policy, tariffs of localized products, import quotas, local content requirements, and so on, is valuable for international marketers to make a correct decision on their localization program.

B. Culture Issues

1. Language Issues

Language is the medium by which people can communicate with each other. As an important element of culture, language should be concerned carefully in international marketing. Support product localization, including localization of product literature. Here are two contrary examples of why language is so important in products localization in a different culture.

There was a Chinese manufacturer of baby lotion and powder. The brand name was "Fang Fang", a widely used name for girls just like "Lucy" or "Cathy" in English. "Fang Fang" in Chinese also means something smells good. When the manufacturer decided to sell its products to western countries, it chose to keep the brand name as same as its previous spelling. That was a fatal mistake to the company when it carried out its international marketing plan. "Fang" in English means a sharp or grooved tooth of a venomous snake. How people could buy a product for babies with such a horrible name?

The second example is Coca-Cola's entry in China. When Coke came to China in 1978 as the only foreign company that was allowed to sell packaged cold beverages, it hit the ground