Marketing has undergone significant evolution over the past few years. Global marketing teams are under more pressure than ever, with increased workloads but often with fewer resources and budgets. According to McKinsey research, “Marketing leaders have to respond by balancing more traditional brand management with newer media, including performance marketing and social”.
In response to this new environment, a new lean global marketing organization is emerging. Instead of large marketing departments with regional experts, leading organizations are establishing small teams that serve global audiences with a strategic approach.
Take one impressive example, an industrial company that scaled up to serve 30 markets efficiently. It created 29 websites in 11 languages with only three full-time staff members. This is possible when organizations work strategically with vendors. For example, one localization vendor managed both translations and all optimization for different markets.
The boom of fractional CMOs is also a great example of this trend. “Businesses are discovering that they can access a CMO at a fraction of the cost for a fraction of the time, and still get the results that perhaps a full-time CMO might have delivered,” explains Ashley Gold. Medium-sized businesses with global aspirations can also leverage this world-class expertise with fractional staffing models.
Product managers should consider localization agencies as an extension of their marketing team. In an age of scarce resources and budget tightening, marketing teams often see localization as a cost center to be eliminated or reduced. However, this is usually a false economy, with bigger problems down the line.
The most successful product and marketing organizations will assemble an ecosystem of strategic partnerships to enable marketing-driven growth. This includes developing a trusted and ongoing relationship with localization vendors that understand the specific needs of their products in different markets.
Team size is no longer the most critical factor to global marketing success. The new recipe is the right mix of structure, technology, and strategic partnerships to amplify the impact of your teams worldwide.
The Balancing Act: Efficiency vs. Local Relevance
The most common challenge facing marketing decision-makers worldwide is achieving economies of scale through centralization while maintaining a competitive advantage through localization. This challenge is more than just a matter of translation. Markets and regions have distinct business environments, buying behaviors, and dynamics.
The impact of getting this balance right is enormous: 84% of revenue growth is attributed to localization. And local pages account for 72% of social media brand engagement. Yet, most brands and agencies do not effectively balance these forces. In fact, 90% of global campaign toolkits are never activated in local markets, and 45% of “core global assets” are “never used.” The total annual cost to a typical Fortune 500 company is $25 million.
Some organizations attempt to address these challenges by pursuing either extreme: strict global standardization that impacts local relevance or regional autonomy with complete freedom to innovate, which sacrifices scale and brand alignment. However, this back-and-forth does not work.
The most successful global brands typically build “flexible frameworks” that “keep tightly aligned” what matters at scale while “giving latitude” in other places. Localization agencies can become trusted partners in the brand decision-making process for evaluating which elements should remain “strategically constant” (those that need the strength of global scale) and which should be “tactical variables” (those that should be responsive to local markets and customers).
McDonald’s has achieved this balance nearly perfectly. The Golden Arches are one of the most recognized logos in the world. Each restaurant location worldwide, however, features localized menu items tailored to meet the tastes and preferences of the region’s market. These can range from Teriyaki Burgers and Green Tea McChoco Lattes in Japan to McSpicy Paneer and McVeggi Potset in India. The company has managed to do this while maintaining consistent service and ambiance.
Localization Agencies work with Product Managers to gain valuable insights into how they can build a similar “flexible framework” for their products. For example, a localization agency with experience working with multiple brands across industries will be able to help determine which of a brand’s elements are “Strategic Constants” and which are “Tactical Variables”.
Achieving “glocal” excellence (global thinking with local action) is not an either/or proposition between global efficiency and local relevancy.
Localization Isn’t a Cost Center—It’s a Conversion Engine
Competent product managers understand a universal truth about localization. Quality localization is not an afterthought or a cost center. Done well, it is a proven revenue driver. Here are some telling numbers that reflect this paradigm shift.
The Return on Investment (ROI) on Localization
Businesses that invest in localization reap the benefits. In fact, research suggests that for every dollar invested in localization, companies can expect a return of $25. Customers are also willing to pay up to 30% more for products with descriptions in their native tongue. Consider these figures: 72.4% of consumers prefer to browse websites in their native language.
Localization’s Impact on Conversion Rates
Businesses that localize content and campaigns experience a 70% higher conversion rate. Additionally, 74% of multinational companies report that localization has a significant impact on increasing revenue. It’s logical to consider this if you know that 40% of consumers are unwilling to purchase goods in foreign languages.
Localization and Product Managers
Product managers who partner with seasoned localization agencies reap strategic benefits. This collaboration helps determine which product features need localizing (cultural adaptation) versus direct translation. Additionally, proficient localization agencies can identify market hotspots where specific products are likely to thrive.
The Customer Experience and Revenue Impact
Localized products experience 50% greater customer engagement and satisfaction. Furthermore, businesses experience 70% more repeat purchases when they provide a localized experience at every touchpoint along the customer’s journey.
Lost Revenue and Brand Impact from Poor Localization
Localization failures that lead to a negative brand impact also result in lost revenue. It’s estimated that 65% of consumers have abandoned a purchase due to poor translations or localized content. Localization is not just a quality-of-life consideration, but a strategic initiative tied to the bottom line.
The Localization Paradigm
Product managers no longer consider localization to be an afterthought or an overhead cost. Partnering with the right localization agency is not merely a matter of cross-border communications. It has the power to transform the conversion, retention, and revenue landscape in international markets.
Structure, Strategy, and Smart Outsourcing: Doing More with Less
Product Managers aiming to establish efficient global marketing operations typically follow a tried-and-true team structure and well-vetted partnerships. Marketing leaders widely recommend the “hub and spoke” model, which is brand-centered with an agile periphery.
According to Thomas Heide Jorgenson, Director of Marketing at Danfoss, the key to a “global marketing success” is “regional marketing teams for maximum efficiency.” He explains that a single headquarters team sets brand guidelines and messaging for global campaigns. Then, specialized spokes (regional marketing teams) localize that content per market. In this way, a brand is culturally adapted without sacrificing a unified approach.
Marketing leaders of successful global teams also deploy an “around-the-sun support” staff strategy by spreading members evenly across time zones. One marketing operations leader ran a multinational enterprise with only four team members located in Europe, East Coast, and West Coast outposts. The team managed near 24/7 coverage with a small but strategic footprint.
Team members should have baseline capabilities, but no one should be expected to do everything. Instead, it’s best if team members focus on the components in which they are strong (campaign operations, platform management, content, etc.). Specialization enables small teams to move quickly and still undertake ambitious projects.
Of course, process and operational discipline play a significant role in this model’s success. Service level agreements (SLAs) are essential for setting team expectations and establishing priorities. Global marketing teams, as small as five people, have managed more than 70 active projects across markets simultaneously, with proper guidelines in place.
Product managers can scale operations globally without ballooning their team sizes by innovative outsourcing:
- Cost Savings: Outsource marketing operations to save up to 50% and gain access to specialized capabilities.
- Access to Expertise: 84% of B2B firms use outsourced content creators to help scale operations.
- Scalability: Teams can be ramped up quickly for larger projects on an as-needed basis, without long-term hiring commitments.
The best localization agencies are an extension of this model. They are essential partners who align closely with product managers, rather than vendors. Localization agencies can also advise product managers on what can be 1-to-1 translated and what requires proper localization.
Lessons from the Field: How Agile Teams Win Local Markets
The rise of agile methodologies has given smaller marketing teams the opportunity to make an international impact with minimal resources. Case studies of best practices offer valuable insights for product managers seeking to strike a balance between speed and local relevance.
The numbers back up the success of agile marketing methods in real-world applications. Organizations that have adopted agile marketing practices have increased revenue between 20 and 40%, including those in even the most technologically advanced sectors. In some instances, product lines that have adopted an agile framework have seen their revenues quadruple. Intuit Mailchimp’s success story, for example, boasts “the agility to adapt quickly to market fluctuations”.
The most notable benefit agile has had on marketing teams is the reduction in turnaround time. In some cases, the time to market for a campaign or product offering has been reduced to less than two weeks from the original idea, which is traditionally a much longer timeframe. By working faster, agile teams have had an easier time capitalizing on these new market developments and pivoting when needed without sacrificing quality.
The impressive returns smaller teams have been able to generate through agile methodologies are highlighted in the following case studies:
- The four-person marketing team at Northern Arizona University increased its content output by 400% during the first year of adopting agile methods.
- A European bank increased its conversion rates ten times through weekly, regimented A/B testing of its media.
- MetLife’s pet insurance business was able to sell more policies than ever after deploying an agile framework.
The most effective teams have focused workflows housed in “war rooms” or “pods” that take on distinct goals or geographical markets. These cross-functional teams have greater autonomy and fewer silos to stifle progress. Openness to innovation, as well as the frequent analysis of data to identify what works, are key. As one marketing leader succinctly summarizes, “The mantra in agile is fail fast, fail cheap”.
Product managers, in particular, stand to benefit from incorporating a localization agency into this framework. By being an integral part of a marketing team, the localization agency becomes an indispensable resource for surfacing cultural nuances that could derail a campaign. By continuously testing hypotheses about the local market, agile teams make decisions based on performance data, rather than assumptions.
Agile marketing has leveled the playing field for teams of all sizes. Smaller groups can now rapidly test, optimize, and refine campaigns, ensuring they continue to reach customers and stay ahead of evolving markets.
Conclusion: Depth Doesn’t Require Size—It Requires Focus
Businesses today are building smaller, more effective global marketing organizations. In this article, we’ll discuss why this is happening and how it’s creating incredible opportunities for the companies that “figure it out.” The core concept to understand is that localization agencies are strategic partners. They offer deep functional expertise, which often includes far more than translation.
Organizations that have cracked the code of global marketing operations tend to see massive revenue growth. Those who haven’t are often wasting millions in unmoved inventory. Product managers need to consider how a flexible structure enables this. They should work in a way that’s globally optimized while also delivering local relevance. This also needs to work in ways that respect cultural nuances across their organization.
Above and beyond this, localization is a significant revenue driver, not just a cost center. Businesses that invest in proper localization earn $25 for every dollar spent. This outstanding ROI is driven by customer demand for localized content. Shoppers around the world will pay higher prices for a well-localized product. Product managers who collaborate with the right localization agencies experience this firsthand and identify markets with the most significant conversion potential.
The hub-and-spoke model of operations, when combined with strategic outsourcing, enables small teams to produce a global impact. In many cases, an individual team member (living in a given time zone) can own dozens of concurrent projects. Product managers obtain the cost savings of lean operations while accessing expert resources without building massive internal teams.
Agile practices form a backbone that enables continuous improvement, regardless of the market. Small teams that have implemented agile practices have realized 20-40% revenue growth. In some product lines, these teams have quadrupled performance. Product managers can test assumptions about local audiences and rapidly respond with real data.
The future will belong to product managers who figure out how to staff lean global teams through strategic localization partnerships. The challenges facing global marketing are often complex and multifaceted. The “secret sauce” today combines effective structure, judicious use of technology, and external partnerships. Product managers can leverage this opportunity to give their medium-sized businesses a global reach.