“For companies looking to expand their reach into new markets across the world, the importance of market research translation cannot be overstated. The scale of the opportunity particularly in developing markets is colossal, with the world’s emerging market economies expected to deliver “the biggest growth opportunity in the history of capitalism” in the coming years.”
Much of the world reckoned with unexpected slowdowns in 2020 as countries were caught in the grip of the COVID-19 pandemic. However, as we continue to collectively tackle the pandemic and more of the global population is vaccinated, a resurgence is anticipated for many developing markets through 2021 and beyond. In short, there has never before been a more appropriate time to consider entering a new market. But nothing is a given, and as the saying goes, failure to prepare is preparation for failure. In other words, those who invest in market research will likely gain the valuable global insights necessary to ensure business growth success — and those who don’t will likely fall behind.
Emerging markets present opportunities…
Expanding into a new market allows businesses to pursue alternative sources of revenue generation but there are benefits to be had over and above this as well. For one, expansion enables companies to tap into a more diverse talent pool, a clear differentiator when considering the impact a diverse workforce has on innovation, productivity, and financial performance. Businesses can also enjoy significant cost savings when considering economies of scale as well as cheaper operational costs from entering these less mature markets.
It is odd, then, that this potential remains largely untapped by companies that are domiciled outside of these markets. According to McKinsey & Company, despite emerging markets accounting for 36% of global GDP in 2010, large multinational firms in developing economies derived just 17% of their revenue from these territories that year. With emerging markets set to reach annual consumption of $30 trillion by 2025 and contributing over 70% to global GDP growth between now and then, there is cause to wonder why so much potential revenue is being left on the table.
…and challenges
Just why is it so difficult for established businesses to gain a foothold in these emerging markets? In truth, the answer may not be as complicated as it might initially seem. McKinsey’s paper details the challenges faced by large multinational companies which, despite all their inherent advantages, struggle to compete with local players who simply know the territory much better. These companies are able to more effectively identify and cater to their consumers’ particular needs due to their intimate knowledge of local customs, culture, and language.
Taking a deeper dive into the markets themselves may provide some additional insight.
Most of the 15 countries in the above graph share a number of important characteristics that make it difficult for foreign entities to establish themselves there. First, the majority use an official language other than English, a significant barrier to entry for companies from developed economies for whom English is the lingua franca. Some, in fact — like India, China and Brazil — play host to an assortment of different languages, dialects, ethnicities, religions, and cultures. This results in further diversification of consumer preferences and purchasing power. For such markets, a one-size-fits-all approach to market research is simply not going to deliver the degree of consumer insights necessary to add value for a company’s expansion goals. This is precisely where a targeted market research translation programme can help.
Common market research challenges for international businesses
As we’ve mentioned, failure to prepare is preparation for failure, and this is never truer than for a business looking to expand into a new market. It may be tempting to dismiss the benefits of embarking on an expensive and time-consuming market research campaign in favour of getting boots on the ground as soon as possible. But the consequences of sidestepping this — especially when pursuing a market with varying language needs — can prove costly and damage your reputation.
Red Bull presents a perfect example of a company that doesn’t sidestep on market research, but instead, handles international market expansion the right way. As Jason Sargent, former managing director of Red Bull Australia puts it, Red Bull “employ[s] local teams to interpret what [our motto] means in each market we operate in to ensure we are relevant to our target consumer.”1 This strategy is certainly paying off. In 2020, Red Bull sold a record 7.9 billion cans in over 171 countries, achieving group sales of €6.307 billion.
Communicate for success in international markets
When it comes to global expansion, there are clearly lessons to be had from both epic fails and successes of the past — perhaps the greatest of which is the critical importance of an extensive and in-depth market research programme. However, just as crucial is ensuring that your market research efforts communicate effectively to participants in a manner which aids their understanding and enables them to respond to your prompts with nuance and valuable consumer insights. This means that market research materials (such as surveys, questionnaires, stimuli, or videos) must be adapted and/or localised for the local market(s) you are trying to reach. But that’s not all.
Participants’ responses also need to be accurately translated back into the principal language of the study, which will likely be English in most cases. Professional market research translators help companies create emotional connections with their target markets, ultimately strengthening trust. When communication is enhanced, your audience will be more willing to actively participate in your surveys, and you will be more able to conduct open-ended discussions. All of this results in a robust and accurate collection of market data, guiding you toward successful expansion into new markets.
Global Lingo — A trusted partner in market research translation
As a global supplier with years of experience providing market research translation in countless markets around the world, Global Lingo is your trusted partner for market research translation. Whether localisation of research materials such as questionnaires, back translation of open-ended responses, or the provision of interpreters for in-depth interviews or focus group discussions, you can count on us to provide the right expertise for the job. But don’t just take our word for it. We invite you to read what our clients have to say about the solutions we provide for their market research translation challenges.
To ensure your product or service hits the right note with your target audience wherever they are in the world, partner with Global Lingo today.
REFERENCES
In addition to:
Winning The $30 Trillion Decathlon – Going for Gold in Emerging Markets. McKinsey & Company, Aug. 2012,
Lyons, Sheryl. “Council Post: The Benefits Of Creating A Diverse Workforce.” Forbes, Forbes Magazine, 9 Sept. 2019, www.forbes.com/sites/forbescoachescouncil/2019/09/09/the-benefits-of-creating-a-diverse-workforce/?sh=55b8f979140b.
“Economic Outlook Emerging Markets Q2 2021: Tailwinds From Stronger Global Growth, But Several Challenges On The Radar.” Economic Outlook Emerging Markets Q2 2021: Tailwinds From Stronger Global Growth, But Several Challenges On The Radar | S&P Global Ratings, www.spglobal.com/ratings/en/research/articles/210330-economic-outlook-emerging-markets-q2-2021-tailwinds-from-stronger-global-growth-but-several-challenges-on-t-11897263.
“How to Avoid International Marketing Mistakes.” Business News Daily, www.businessnewsdaily.com/5241-international-marketing-fails.html.
“Giving Wings to People and Ideas.” Red Bull Energy Drink – Official Website :: Energy Drink :: Red Bull Kenya, www.redbull.com/ke-en/energydrink/company-profile.
Previously published GL articles:
https://global-lingo.com/en-us/how-to-conduct-international-market-research/