Standardization vs localization: What to choose?

When it comes to marketing and selling products in new markets, a critical question arises: how do you balance consistency with cultural sensitivity? Two approaches stand out: standardization and localization. Read on as we uncover the pros and cons of each approach, analyze how major corporations are navigating this landscape, leaving you to decide on the best path for your own global aspirations.

What is standardization?

Standardization means maintaining uniformity across products, services, or marketing strategies regardless of the geographic location or cultural context. It emphasizes consistency, efficiency, and economies of scale by streamlining processes and minimizing variations.

In terms of marketing, standardization might involve using the same branding, messaging, and advertising campaigns globally, without significant modifications for different markets.

This process can lead to cost savings, simplified operations, and stronger brand recognition on a global scale. However, it may overlook important cultural nuances and preferences, which can hinder market penetration in certain regions.

What is localization?

Localization, on the other hand, involves customizing products, services, or marketing strategies to meet the specific cultural, linguistic, regulatory, and market requirements of different regions or countries.
It recognizes the diversity among markets and aims to adapt offerings to resonate with local preferences, behaviors, and norms.

When it comes to marketing, localization may involve translating content into multiple languages, adjusting imagery and messaging to align with cultural sensitivities, and tailoring product features or packaging to suit local tastes. According to a survey conducted by Unbabel, 84% of marketers globally acknowledge the beneficial impact of localization, attributing it to a rise in revenue growth.

Localization often leads to greater acceptance and adoption of products or services in new markets because it demonstrates a commitment to understanding and catering to local needs. Statistics demonstrate an increase demand for local-language content, one example being a CSA Research survey that found that 65% of consumers prefer content in their language.

Standardization vs localization

Now that we know what standardization and localization are, it’s easy to see the major differences between the two. First off, standardization prioritizes consistency and uniformity, while localization focuses on customization and adaptation. But customization requires resources, which means that localization often involves higher costs than standardization.

When it comes to targeting, we see that standardization aims for broader, more homogeneous market segments, while localization targets specific local markets. Localization allows for flexibility and responsiveness to diverse market conditions, whereas standardization may limit adaptability but offers efficiencies.

What to choose?

Deciding between standardization vs localization is a constant tightrope walk for companies aiming to conquer international markets. The best approach often depends on the industry and your goals. Here are some factors to consider:

• Product type: Is it a universal product like a cellphone or something more culturally specific like clothing?
• Target market: How different are the cultures and languages of the target markets?
• Budget: Do you have enough resources for localization?

But what if you don’t have to choose just one? In many cases, companies find success with a hybrid approach (you may know it as glocalization). In short, you establish a standardized core brand identity while incorporating localization elements for specific markets.

The hybrid approach

When you go hybrid, you need to create a foundation – branding, core product features, and messaging – that remains consistent across markets. This helps you maintain brand recognition and streamlines operations. A good example is fast-food chain McDonald’s, that uses a standardized golden arches logo globally, but tailors its menu offerings to include regional favorites.

With the hybrid approach, specific elements are adapted to resonate with local audiences. This involves things like the translation and cultural adaptation of software, marketing materials, and other forms of content, adjusting product features or packaging to suit local preferences, and developing culturally relevant marketing campaigns.

Other companies that are mastering glocalization include Coca-Cola (remember their iconic bottle campaign featuring local names?), IKEA (their stores have a standardized layout, but they offer furniture options that suit the living styles of different regions), and Procter & Gamble (they tailor their marketing messages and product formulations based on local hygiene and beauty preferences).

Final thoughts

The standardization vs. localization debate represents a fundamental strategic choice for businesses navigating the complexities of global markets. Both approaches have their advantages and challenges, and the optimal strategy depends on factors such as the nature of the product or service you are offering, your target markets, the competitive landscape, and organizational capabilities. And remember – even if you choose to go with standardization, you may still need to dip your toe into localization if you wish to promote customer-centricity.