In what kind of industries does a localization strategy make sense when does a global standardization strategy make most sense?

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2. Best Detailed Guide for Global Standardization Strategy

By Indeed Editorial Team

Published April 20, 2021

The competition in marketing strategies among businesses has changed from a local to a global perspective. Global standardization strategies are most suitable to promote products across various countries and cultures. Through the years, most companies have had challenges understanding how standardization works as a worldwide marketing strategy. In this article, we discuss what global standardization is and its various aspects.

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What is global standardization?

Global standardization is a marketing approach that uses standard marketing strategies to promote products internationally. Companies and businesses that sell their products and services to international audiences adopt global standardization. They must set guidelines that are generally acceptable with how their firms operate across various countries and cultures. The product or services should exhibit a high level of consistency and create the same appeal globally to drive steady sales. Most companies that adopt global standardization use standard methods to brand, package and distribute their products.

Why is global standardization important?

Due to evolving technology, trade barriers are noticeably decreasing. The digital revolution has also made international communication more efficient, allowing businesses to reach potential product consumers around the globe easily. Companies should develop effective marketing strategies to enable them to tap into international markets and increase their profits. Here are some reasons why global standardization is essential for businesses:

Economies of scale

Most companies achieve economies of scale by adopting global standardization. Increased demand globally results in a need for production in large quantities. The businesses minimize the cost of production since they spread it across a large number of products. Buying product components in bulk is also cheaper. Generally, companies can achieve low production costs and high profits with international expansion.

Product uniformity

When companies use global standardization, they ensure uniform manufacture of products. Adherence to the respective company's guidelines and standards is vital to ensure products maintain the same quality and specifications globally. Most renowned global electronic companies have adopted the global standardization strategy. It has enabled them to achieve product uniformity globally. The design, specifications and functions of their products match all regions. Their employees also follow strict guidelines in customer service. They also use more personalized communication approaches.

Reduced marketing costs

Through global standardization, businesses can employ a uniform marketing framework that works effectively globally. The frameworks are standard because they highlight uniformity in the benefits and other aspects of standardized products. The company may adopt a local language, but the message remains unaltered. Therefore, they can save on time and money since they do not need to develop customized marketing strategies for each region. These marketing strategies are more effective where customers across all nations and cultures use and understand the product the same way.

The nature of your products and services plays a central role in whether standardized marketing makes sense. Products that have virtually universal appeal in all countries and cultures make standardized marketing practical. If customers in each market use your product and understand it in the same way, you can maintain the same central messages that emphasize the distinct benefits of your products relative to competitors. For example, the packaging may be presented in different languages to relate more to the product for the different target audiences.

Improved quality standards

Laying out a standardized marketing strategy on products enables companies to focus on improving their quality. The companies spend more time looking for ways to enhance product delivery and relate to consumers all over the regions. Maintaining specific quality standards also makes it easier to detect and correct any inconsistencies that may arise during production.

Streamlined management

Global standardization of products makes it easier for the company to monitor, control and coordinate any brand activities. This is because the companies apply uniformity in advertising strategies and the products themselves.

Enhanced brand recognition

Consumers can recognize the uniformity of the brand across different countries. Incorporating social media as a platform to market your products is the right way to get noticed.

When to use global standardization strategies

Products may either be standardized or customized to suit specific consumers. When multinational companies decide to go global, they are often concerned about creating a global standardization strategy for their products. With a standardized approach, businesses develop and market the same product. There is uniformity across all the markets. Conversely, a localized system allows companies to customize their products depending on the region. Below, we highlight the factors that determine when to use global standardization strategies:

Nature of products

When products evoke the same feelings among people in different nations, there is no need to localize. Standardization is useful when other consumers show consistency in virtual appeal, usage and comprehension of a product.

Competition

Global standardization can work for companies whose products and services barely face any competition in the local market. It is useful since there is no rivalry from local brands offering tailor-made services for their local customers.

Geographic region

Small markets understand their local consumers better. Still, they welcome the idea of a better quality marketing strategy than what they could create. They are more willing to accept a standardized marketing strategy coming from a brand's headquarters.

Large markets are less willing to accept a standardization strategy since they have strong management teams. Profits on large markets are higher compared to what small markets register. For larger markets to take standardization strategies from brands, the headquarters should highly feature their needs in the standardized campaigns.

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How to create a global standardization strategy

Companies must understand some of the strategy's components before creating a global standardization strategy for their products. They include:

• A uniform brand

• Uniformity in packaging

• Identical products

• Standardized methods of advertising

• Synchronized sales campaigns

• Similar pricing across regions

• Concurrent product launches

For companies to achieve effective global standardization strategies, they should be aware of the targets they are aiming to hit. Follow these steps to create a global standardization strategy:

1. Settle on a specific service or product

Companies with multiple products or services should gauge which would sell more in a global market. It is much easier for businesses that have a single product to create their global standardization strategies.

2. Understand your market

Companies should have an in-depth understanding of their target markets before they launch their global standardization strategy. Every region has different cultures. Companies should seek to understand the behavior of people in a specific area. What kind of marketing gets their attention, and what do they perceive as inappropriate? Businesses should research how the target consumers will respond to their marketing approach.

3. Identify countries with business potential

Companies should identify countries where their products are more likely to be successful. They might decide to launch their products a single region at a time or in multiple countries at a go. Brands should understand the laws governing businesses, norms and acceptable payment modes in the specific regions.

4. Be aware of competitors

For companies to make profits, they should understand their competitors and the strategies they use. An effective global standardization strategy should attract more customers than other international or local brands in the region.

5. Set your goals

Companies should set a list of specific and realistic goals to achieve by standardizing their marketing approach. The company should have in mind a universal message it intends to deliver to its clients when setting goals.

6. Ensure uniformity in branding

Companies should settle for branding signifiers to enable them to express their standardized message effectively. The image, colors, sounds and logos used on the brand should be consistent across the regions.

7. Create a marketing plan

When creating a marketing plan, businesses should ensure that their objectives and goals align with the project. The marketing plan should entail strategies and techniques that will make the goals attainable. For the global standardization strategy to work, its actions should align with the specific region's efforts.

8. Ensure the approach is practical

Brands should recognize that what worked in their country may not be effective in a foreign country. Respective companies should therefore take time to understand if their products create the same appeal across regions. If consumers in all the target regions understand the product's usage the same way, standardization strategy becomes viable.

9. Localize your messaging

Some standardization strategies have to adopt a degree of localization to relate more with product consumers. There is a need to understand the cultural hurdles, language and important events or holidays.

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