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4 REASONS YOUR GLOBAL MARKET STRATEGY MAY BACKFIRE
We all know the drill: Go big or go home. You need to go big to get big and that means taking your company, products, and services to new markets. You can’t just stay at home and expect to become a worldwide sensation – you actually need to actively venture into new and sometimes scary uncharted waters.
So, how do you do it? Do you just throw tons of cash into getting your content translated, invest in some clever SEO strategies, tweet that you are now selling your wares in Belgium, and sit back and let the Euros roll in? You could, of course, do just that. You wouldn’t be the first.
What do you do if you find out that you have a competitor in Sweden with the same name?
Here are four key ways to ensure that your international business ventures don’t land you in hot water.
1. Global Legal Document Review
Global Legal Document Review (for your end-user licenses, data protection and security terms, employment contracts and distributor terms and agreements) can help you make sure that your overseas interests are well represented and secure, as well as ensuring that your international constituents and business partners have the coverage they need in each market. It is best to have access to on-the-ground legal counsel who can provide this level of review.
For example, you might not know that, according to Caron Beesely, who writes for the US Small Business Administration: 6 Legal Factors to Consider when Hiring Global Employees, “Many U.S. businesses write non-compete agreements into employee contracts. Foreign countries generally prohibit these.” But how do you know the specific contractual terms that apply in each of your target markets?
2. Safe Harbor Consulting
Safe Harbor Consulting for international markets helps you ensure that you have made the needed provisions in each new country, territory or even region, and show good faith that you are willing to comply with local laws. In-country lawyers specialized in your industry are best suited to ensure you have safe passage in these new markets. Having a solid safe harbor policy and understanding the regional differences of what you can and cannot do with your company is essential in your international business strategy.
In a 2014 case, Google ran into some hot water in Spain, as it was in violation of the new EU “Right to be forgotten” privacy ruling. The ruling requires search engine operators to remove any pages or content that the content owners deem to be defamatory, incorrect, or outdated. This ruling is counter to the way Google conducts business in the US and in other regions, but is now in place in Spain and throughout Europe.
According to CNN, “…if Google looks to make money in Spain, the search engine itself is subject to local data protection laws.” Watch the CNN video (5:23) and read their article here: Google privacy ruling could change how we all use the Internet.
3. Global Market Research
Global Market Research can help you to market your products and services overseas with confidence, knowing that your brand is unique and attractive for your target countries. Having the right market research consultants in each of your intended international regions is key to knowing what your target customers want and do not want. You will also gain a deep understanding of what and who are already in that market and how they are positioning themselves. Best Buy could have benefited greatly by having a solid market research strategy in place before they decided to venture out into Europe and China in 2011.
What Best Buy found was that big box stores were not as successful as smaller outlets for consumer electronics. And the company also had announced its expansion plans two years earlier, giving local business enough time to set up a counter-attack. “It was the wrong format, at the wrong time, in the wrong market,” Robert Gregory, research director at Planet Retail told the Guardian. Read more about the story at Business Insider, here: Best Buy’s Overseas Strategy Is Failing In Europe And China.
4. Global Staffing and Outsourcing
Global Staffing and Outsourcing Consulting are crucial components of any business venture beyond your home arena. Hiring the right team in each of your target markets is crucial in order for you to succeed and it can be a scary proposition if you do not have the needed in-country expertise. There are many stories of US companies setting up shop overseas only to fail because their regional staff were not the right fit.
In a recent article in the Association for Talent Development, Mike Butler discusses the mistake that Groupon made in hiring ex-pats to run their China operations. “Without understanding the basis of competition for supplier relationships, how to reach potential customers, or how to train and motivate local sales staffs, the expats were ineffective and the company was dismissed by some as arrogant. Local talent almost certainly would have better served Groupon.”
This is just one of the mistakes that US companies frequently make in staffing up their overseas operations. Having the needed in-country support network to find, train, and help hire the right local talent is a key step in any company’s international expansion plan. Read more about it here: Crossing Borders.
While no one will be able to guarantee that your international business venture will be a success, taking the above steps can help steer you clear of the most damaging issues. It is beneficial for any company to have a trusted international business partner that has a network of experts with deep local knowledge who can ask the right questions, do the needed research, mobilize their regional connections, and ensure that your first venture out is not your last.
Ready to go global the smart way? Call RSLS at 1-800-500-5808 and speak with one of our Global Reach consultants!