On the surface, international business expansion seems easier than ever. Today, any company can reach multiple markets in a matter of seconds: Publish a blog post, launch a mobile app, buy digital ads, and target customers in as many countries as you wish. The rise of online global marketplaces has made it even easier for companies to launch into multiple countries simultaneously, often from their earliest days. This has given rise to a wave of “global native” companies that have an international presence from day one.
When Ian Harkin founded Lottie, a toy company based in Donegal, Ireland that manufactures Barbie doll alternatives with a child’s dimensions instead of an adult’s, he began with international markets in mind from the very start. “In the toy industry, with very high up-front development costs, it’s difficult to justify the expense to launch in just one country,” he explains. Harkin, the company’s CEO, integrated their storefront into Amazon, and immediately reached customers in the United States, Canada, Mexico, Germany, France, Italy, Spain, Holland, Sweden, and Poland. Nearly 100% of the company’s revenue today comes from outside of Ireland. Harkin points out, “For us, going global early helped our product and brand reach more potential customers, much faster, than if we would have expanded one country at a time.”
This growing phenomenon of going global as early as possible in the life of a business isn’t only happening with physical products that can launch via global platforms like Amazon or Etsy. Partners at Andreessen Horowitz have written about the new wave of “default global” companies, which radically compress the timeframe it takes to go global. They contrast these with “default local” firms, which often take five years before operating in just a few foreign markets. The default global companies are often in double the number of markets as default local companies are by year three. In addition, research from Stripe shows that 89% of successful tech companies had expanded internationally prior to achieving “unicorn” status, a valuation of $1 billion or higher.
But building a global company is also more nuanced and complex than ever before. In the past, companies could limit expansion in a more controlled fashion to just one market at a time. In the digital age, global growth is far more continuous and incremental in nature. But with this new approach comes risk: If your customers in one market receive less value than those in another, they perceive your offering differently. This is not only unfair to them, but it can also hurt your business in the long run.
For this reason, even if you’re already having success as a global company, it’s time to raise the bar. To sustain your success for the long term, you’ll need to build not just a company that has customers or revenue streams from many different countries, but one that operates as a globally equitable organization (GEO for shorthand).
The Rise of the Globally Equitable Organization
When I ran international expansion efforts for HubSpot, a large public tech company, over the space of nearly eight years, I noticed this pronounced shift toward continuous expansion happening before my eyes. But I also observed another important trend at play in the broader market. In the past, companies that sought to expand internationally measured their success strictly using qualitative measures, usually in the form of revenue or customer count from new markets.
Today, with global becoming the new default, the goal is no longer as simple as just increasing revenue share from between different parts of the world. Instead, the new measure is more customer-oriented in nature. Companies have realized that it’s not enough to initially acquire new customers in other geographies — retaining them is critical, as this ensures that revenue can be sustained. The best global companies ask themselves: How successful can our local customers be with our business in each market, without geography getting in the way?
Take Teamwork, a project management software company headquartered in Cork, Ireland. “You can sell software from anywhere in the world from the get-go. There are no boundaries,” explains Peter Coppinger, Teamwork CEO and co-founder. “One of the biggest lessons we learned with Teamwork’s international expansion is that once you reach a certain scale, you need to get more deliberate about targeting the regions with the most potential.”
As the company deepened its presence in specific markets, Coppinger and team found that they needed to ramp up sales and customer talent in order to support customers in new time zones. “There is no substitute for having staff in the same time zone speaking the same language as your target customer,” he points out. When Teamwork recognized some customers were feeling this pain, they were proactive about creating a more equitable experience for all customers. Today, the company has 20,000 customers in 170 countries, and a global workforce of 350 employees in 15 countries.
Make Local Customer Experiences Equitable, Not Identical
In the digital age, it’s easy to go global without adapting the customer experience. But if companies fail to make sufficient adaptations, they miss the chance to build true connections of value with their customers.
Making local experiences equitable doesn’t mean they have to be identical. In fact, where many companies go wrong is that they try to enforce a cookie-cutter approach onto all markets, in the name of “global leverage.” But in doing so, they miss out on the importance of local adaptations that ensure their customers across markets are equally happy with the value they’re receiving, even if they define and derive that value in different ways.
As a shining example, look no further than Starbucks. At the product level, customers can order many of the same standard menu items in every location globally. But to appeal to local tastes, a customer in Peru, where the Lúcuma fruit grows, can order a Lúcuma Crème Frappuccino from their local barista. Starbucks adapts not only their physical products, but their digital outreach to customers too. They achieve global consistency offline as well as online, but the company customizes their digital marketing campaigns in each country tied to the seasons, holidays, and local traditions.
The table below offers some examples of adaptations a company might make in order to ensure it is providing an equitable experience to customers in a new market:
The temptation at most global companies, especially ones with digital and software products, is to always do the same thing, all at once, in every market. While this is a natural inclination, it actually can have the opposite effect and require investments that are disproportional for each local market. Instead of doing “all things in all markets,” be selective and show a true willingness to adapt. Encourage your employees to flex their creative muscles when thinking about what strategy will work best for a new local market so that they can derive equal value, even if the approaches vary.
Ensure Your Organization Has a Globally Equitable Mindset
To truly create an equitable experience for your customers, you will need to focus as early as possible on driving what I call a GLOBE mindset, one that’s geography-agnostic, linguistically inclusive, operationalized, balanced, and empathetic. This will ensure that all of your employees — not just those with “international” in their titles — keep the global equity momentum going in perpetuity.
When you’re launching a new global initiative at your company, I recommend asking these five questions to ensure your approach is equitable:
- Geography-agnostic: Is this project designed around the needs of customers in one market, or is it inclusive of multiple geographies?
- Linguistically inclusive: Have we considered the language and literacy needs of customers in the local markets we serve?
- Operationalized: Have we accounted for local differences with our plans, so we can prevent friction for local teams when it’s time to execute?
- Balanced: Are our resources, especially funding and headcount, aligned to support our priority markets?
- Empathetic: Have we talked with customers and/or leaders of our local markets to ensure we are truly taking their needs into consideration?
If you get into the habit of putting these five simple principles at the center of your leadership team’s mindset, you’ll naturally be driving equitable experiences for your customers around the globe.
Today, international expansion is more ongoing in nature, with a constant pace of change. The more you focus on driving up value across all markets in an equitable way, the greater the financial success that will follow — but only as a consequence of taking a new approach, one that places value on delivering equitable experiences to your local customers.