‘The world is your oyster.’ This is such an insidious idiom because it assumes that the world is full of limitless possibilities and these will ultimately yield that precious pearl that your company has been dreaming about. In reality, this oyster is harder to open and the pearl is even harder to come by. But it is not impossible if one follows some key strategies.
The global marketplace has become so accessible to us in the last few decades that there are vast possibilities within our reach. However, it would be imprudent to assume that just because technology has progressed in leaps and bounds, marketing across borders is an easily achievable task.
How do we work towards it? Here are a few steps to guide you.
International marketing today
Global brands such as Nike, Coca-Cola, H&M and Pizza Hut (just to name a few) have become buzzwords because they offer a Unique Selling Point (USP) that no other competitor can completely replicate. Whether it is value-for-money, safety and style or precise taste, such brands are still sought after even decades into their businesses because they are strong brands, and also because some great marketing teams got the message out there and maintained that momentum.
However, no matter how strong a brand is and how robust its marketing and promotions are, there can still be challenges that impede decent growth in international markets. The key is to see these for the opportunities they are. For instance, developed markets may demonstrate slow growth trends, but this does not mean that the situation is hopeless. Rather, developed markets already yield a substantial proportion of brand sales, and though this may not grow significantly year-on-year, the slice of sales such markets offer can still be pleasing enough to carry on marketing and selling to these markets.
Furthermore, another challenge is that such developed markets tend to comprise more of an ageing population. Therefore, unless your brand is geared towards the older demographics, it will tend to be a smaller size of the market share that will be available to you. To offset this, the solution is to strike a balance between these markets and emerging markets as the latter encompasses the younger age groups.
This brings us to the next hurdle to be overcome- the fact that emerging markets have been seeing falling growth rates caused by export slumps, inflation and flagging trade conditions.
According to S&P Global Market Intelligence PMI (Purchasing Managers’ Index), data in July suggested that the growth in emerging markets was at its slowest pace in six months. However, the expectation is that emerging markets will show better growth than developed markets due to the larger population in the former. However, this expectation is also buoyed by the anticipation of rising income levels in such markets. In current market conditions, this has become quite challenging, especially on the back of post-pandemic job losses and falling demand in certain industries. Still, S&P Global Market Intelligence notes that emerging markets continued to grow at a reasonable pace in July.
The resilient nature of emerging markets is also likely to fuel a greater level of competition in international markets. A focus on innovation and a reduction of production costs will be the principal method of outdoing the competition. Fortunately, with the strengthening of digital technology and Artificial Intelligence (AI), this has become an accessible target than it was before.
Certainly, a brand’s advent into any international market will entail in-depth research into the target demographic of that market. Understanding the people’s culture, customs, traditions, spending patterns, leisure habits and such will drive the decision to market a brand in such a geographical area. Thus, communicating one’s brand values effectively and sensitively is paramount in garnering sales and brand loyalty. Keep in mind also that international markets will follow varied trade laws and regulations including taxation policies. Be well-versed in these so that you don’t encounter difficulties after having entered the market.
This said it is possible that with changing governments and legislation laws and regulations within these markets can change after you have entered it. There is no way around such changes in regulations, though. It is imperative that in venturing into international markets your company hires the services of a Tax and Legal Consultant who will be able to advise you and your team on how to navigate new and existing parameters. The advice you obtain will span areas such as intellectual property, hiring of employees, shareholding and data protection in addition to taxation.
Why aspire to international markets
A large number of Fortune 500 companies engage in operations in overseas locations and their international client portfolio bolsters sales and profit margins. Engaging in business overseas also ensures that any losses that a company or brand may suffer due to economic conditions in one geographical area can be offset by better economic climates in other regions of the world. The goal overall, is to increase one’s customer base, sales and margins and also counterbalance changes in taxation, currency and regulation in one area that may affect one’s business in an adverse manner.
The University of York, in an article titled ‘Business across borders: The importance of international business law’ shows that the recent global pandemic inadvertently stressed the need for business across international boundaries to build on commercial capability. It is not just the post-pandemic era that should spur us on, however; we also need to consider changing market dynamics across the world due to technological advancements that have made global markets more accessible.
For a company that has weathered the economic storms of the recent past and still managed to hold its own, there is no excuse to refrain from moving into the global market. It is the expected next step in growth, really.
(Anouk De Silva)