Local Differences: Real or Imagined?
What really matters when you want to win locally and regionally?
TLDR
In transitioning to a World-Wise and Neighbourhood-Smart (WWNS) organisation, it's crucial to discern real versus imagined differences in your markets. This article explores factors like language, law, climate, location, culture, and consumer behaviour that drive decisions on whether to operate globally or locally. By questioning the significance of each difference and understanding genuine local needs, organisations can balance global consistency with local relevance, maximising value delivery to diverse customer bases.
Introduction
What does your organisation need to get about your market?
Local Differences: Real or imagined? is the second article in a trilogy on: One identifying the need; Two understanding the critical factors, and; Three creating a genuinely effective World Wise & Neighbourhood Smart (WWNS) organisation. If you have arrived here without reading the first article we recommend starting here.
As soon as your organisation serves more than one distinct area with different needs, you must consider how to efficiently serve this broader customer base. At one end of the scale, everyone gets the same; at the other, you could have entirely separate organisations with duplication. Neither is most efficient for an organisation, so we need to determine what's right for you.
In this article, we want to explore the factors that drive the decision points between working globally or locally and share some insight into how to think about these to be effective across multiple markets.
Drivers of Difference
Products are complicated and have many aspects; we have taken the most common factors that almost all products have to help us explore each. Note that additional factors you should add to this process may impact your specific product. Comment below the article, on what your specific industry needs to consider to help other readers improve too.
Differences
Firstly, let's define the fundamental differences between your product and those in these markets. But be careful to ask the hard questions: Are these differences real or imagined?
Language
Language is the most apparent difference in Europe, though it is more complex than it might first appear. Yes, in a country, you need to support its local language, but like any great product manager, look at your customers. Belgium has three official languages, Dutch, French & German; Switzerland has four. But look deeper, for example, the large number of people living in the Netherlands from other countries means that English is a de facto second language, as not many people learn "Spreek Nederlands".
Top Tip: Make your website/product/service language agnostic (the user chooses the language). Translations cost money but maximise your product's reach and become the standard operating method.
Law
In many world regions, local, national and supra-national legal set-ups will relate to the country/product/service you offer. In Europe, for example, there are many more similarities than differences because of the operation of the European Union, the European Economic Area, and national laws. However, note that legal differences exist. The UK still has many laws closely related to or identical to EU law, but because of Brexit, there are differences. Switzerland adheres to many EU rules but has its jurisdiction. However, even entirely within the Eurozone, local laws, e.g., German protection for individual rights, can still impact a product like Google Street View. Go and have a look.
It helps to divide these into two parts: the laws your product needs to meet and the laws your service needs to follow.
Top Tip: Work out early with your legal teams where the legal / compliance standards are the hardest and use those as the guide. We used to only half-joke that if we could launch our product in Germany, we could launch it anywhere.
Top Tip: Assume that your T&Cs require localisation for every market, even if only for the language, but have some oversight to keep consistency across multiple markets (To make this easy, use the same subsections across countries). Aligning T&Cs is a pain initially, but quickly isolating and editing only the impacted pieces/countries is a considerable advantage when the inevitable legal or product changes come through.
Climate
Where I live, we can go from 45C summer days in the Mediterranean to 8C summer days in the Outer Hebrides (Ask me about my chilly summer holiday last year) and in the winter -40C to +8C. People will be in very different situations when using your product/service. Situational usage, features and usage will vary significantly.
Top Tip: While there are some extremes, such as car engine block heaters in the most northerly countries, try to make your product work everywhere.
Location
Although your customers purchase or live in one place, they may move cross-country and border and still expect the product/service to work effectively. Some of the world's most populated areas are close to borders, and crossing daily is a way of life.
Top Tip: When designing a product or service for a country, consider that users may cross the border to use or purchase it. So, tools like finding a store need to work cross-border, as does your customer support.
Similarities
Like the differences again, ask yourself the hard questions: are these real or imagined?
Culture
Those from outside often see places like Europe or the USA as the same, and with a lot of cross-cultural mixing, this is true. However, differences exist across and inside regions, countries and states. If you get these wrong, your product will hit the buffers.
Top Tip: Consult locally about what consumers look for and need. But share these across the wider group. Shared needs are better value to develop.
Economic conditions
Like the US economy, Europe's economy is often considered similar across large areas, and we usually talk about the Eurozone economy. However, regions can have very different disposable income levels or price sensitivity.
Top Tip: Customers calculate Price/Value differently in different areas. You must get this right locally, but be aware of cross-border use/purchasing. It is often illegal to prevent a product from being used across borders in these areas, so people outside that country will exploit significant price differences.
Consumer behaviour
Increasingly, we think we see homogenous behaviour across the world from consumers, all using the same products and services, but behaviour locally varies considerably. Generally, UK consumers are some of the most online in Europe, and Spanish customers still strongly value social experiences and interactions.
Top Tip: Enabling your product to be accessed through multiple channels on the same infrastructure will set you up for success and keep your costs low, especially as consumer behaviour matures or changes.
Regulations & Tax
For much of Europe, regulations and taxes are similar, but some differences impact consumer behaviour. For example, lower tax rates on Electric cars in Norway have led to a boom in sales. VAT rates in Denmark and Sweden are very high, while in Luxembourg, they are very low. In Germany, stronger local environmental regulations feed through to a focus on environmentally friendly/sustainable products.
Top Tip: Learn the critical levers consumers consider for your product/service locally. Build these centrally (there are likely similarities with other countries), but remember also to promote the right ones for those consumers.
Brand loyalty / local brands
Brand loyalty also influences consumer behaviour. In Italy, local food and fashion brands garner stronger support than global ones. In the UK and Germany, brand loyalty to the "quality" they offer is high.
Top Tip: Depending on your product/service, the brand might need to differ locally, but you can still offer the same services or features to multiple markets.
Summary
Having identified that you are at that inflexion point and need to become a WWNS organisation. It is time to pause and systematically understand the factors that will drive the best way to deliver what your product needs to maximise value for your customers and your organisation.
Practical Steps:
Use the above factors on the wheel as a starter
Add to these any that are specific to your organisation
Set aside some time and ask your team to help (with proof points) identify which factors are fundamental for your product
Share what matters and what doesn't with your whole team to guide you all better.
Asking yourself and your teams the hard questions about what matters will give you a sound footing to consider the next step in the final article, which is all about how to set yourself up to operate as a WWNS organisation.
Now read part 3: Building a World Wise & Neighbourhood Smart Organisation