Five Essentials to Consider Before Expanding to Foreign Markets

gonner_five_essentials_to_consider_before_expanding_to_foreign_markets May 18, 2021 By: Sylvia Gonner, CAE

As associations look to bolster revenue, some may wonder if they can start selling a popular product or service overseas. Before launching in a foreign market, consider five variables to help determine if current success will translate.

At a time when organizations are revamping their strategies and rethinking ways to deliver value to their customers, the opportunity to expand to a broader international market is worth considering. After all, virtual online technologies are increasingly removing national barriers. In search of new revenue streams, associations see international market diversification as a wise strategy.

But how do organizations know their products and services will appeal to audiences in other parts of the world? There are five key pieces to the global appeals test to determine whether any product or service will be welcomed by foreign audiences. The 5 As include applicability, accessibility, acceptability, affordability, and adaptability. If one of these is missing, organizations need to rethink their strategy before launching to international markets.

Applicable. The first test is to check whether the product, service, or program is applicable to audiences in other countries. Does the content apply? Is it relevant? Do laws permit it? Are the customs in the country open to it? For example, an app that involves betting won’t be permitted where gambling is illegal. Or guidance specific to Title VII of the Civil Rights Act won’t be applicable outside the United States. The applicability test considers laws, customs, and traditions in other countries when deciding what products and services to select and where to expand.

Accessible. The second global appeals test is to check whether the product or service is accessible in other countries. Accessibility must consider time zones if it’s a live service, such as a conference or webcast. While virtual tools open many borders, there are some restrictions. It’s important to research the availability in some countries of internet bandwidth, software licenses, and access to any platform used. For example, not all countries can purchase books on Amazon, view videos on YouTube, or access Facebook. Even payment methods have accessibility components, as options such as Venmo and PayPal aren’t universal.

A product will not meet the global appeals test unless the price point is considered affordable in target countries. Keep in mind that purchasing power is greatly affected by where people live and work.

Acceptable. The next test is whether the product or service is acceptable from a cultural standpoint. Are there any values or social norms that would make it unacceptable or culturally offensive? This ingredient means reviewing not only the product but also the marketing and imagery linked to it. Many companies learn this too late. For example, Nike had to pull thousands of sneakers from the Middle East market because the logo featured on the shoe’s sole resembled Allah (God) written in Arabic, something highly offensive to Muslims. Acceptability is an often-missed aspect that can create tremendous costs and lasting reputational damage when left unchecked.

Affordable. A product will not meet the global appeals test unless the price point is considered affordable in target countries. Keep in mind that purchasing power is greatly affected by where people live and work. For example, while the price of a webcast could equate to the cost of a business lunch in Germany, it could represent a week’s salary to a member in Brazil. Affordability is also affected by foreign exchange rates.

Adaptable. The ultimate test of global appeal is whether a product or service is suitable for adaptation. Translation and localization are common forms of adaptation to a foreign market.

Common impediments to translation include unsuitable format, length, availability of source material, and frequent updates. As a result, any attempt to translate will be an overly complicated and costly undertaking. For example, while it could make sense to translate an established publication to penetrate foreign markets, it would be much harder to translate an online training course that involves a lot of graphics, animation, video, and audio. Translations of a major book can be lengthy and could be outdated by the time a new edition is published.

Localization may involve taking into account different norms and requirements, such as business practices, climate, wattage, measurements, holidays, and so forth. For example, a marketing campaign featuring photos of people may need adaptation to depict local cultures. And an online course offered Monday to Friday in the U.S. would need to be switched to Sunday-Thursday in Muslim cultures, where Friday prayers are sacred.

Ultimately, it’s best to consider these five ingredients before creating, finalizing, and launching a product or service in another country. Doing so helps to avoid unnecessary risks, costs, delays, and overall surprises down the road.

 

Sylvia Gonner, CAE

Sylvia Gonner, CAE, is founder and CEO of CultureWiz and vice chair of ASAE’s International Associations Advisory Council.