Digitalization is the new globalization.
According to Mckinsey’s report on digital globalization, “some 900 million people have international connections on social media, and 360 million take part in cross-border e-commerce.” The opportunities for retail expansion have increased tenfold, with larger businesses no longer holding monopolies for shelf space. New brands worldwide are unlocking the ability to invest in international markets, simply by leveraging social media and other digitally native techniques.
This reduction in time-space convergence has accelerated brand expansion across all regions and business sizes, and the ability to utilize this newfound space is imperative when it comes to expanding business operations beyond borders. Analyzing exactly where, when and how to expand can be complex for most brands, considering the newness and continuing evolution of the digital age. Global flows have raised worldwide GDP by at least 10%, and with data flows accounting for a larger share of this impact than global trade in goods, it is important for brands to strategize their game in the digital playing field we are now all competing in.
First, let us take a look at an example of a brand that has gone international as a result of their digital initiatives.
A brand that is on everyone’s lips (both literally and figuratively) is cosmetics company, Glossier, who has continued to go from strength to strength. Interestingly, Glossier doesn’t rely on physical retail outlets to drive sales and most of their Share of Wallet comes from their digital channels.
Glossier’s strategy is focused on community management, and heavy utilization of user-generated content, primarily from fans of the brand, rather than ‘traditional’ influencers. A self-described “people-powered ecosystem” Glossier focuses on a digital word-of-mouth strategy, which encourages customers to share their purchases under branded hashtags, engage in discussions and become powerful brand ambassadors. By treating “each customer as an influencer” the brand has established authenticity and high engagement levels, which helps decrease costs when investing in international markets.
Additionally, the brand keeps the consumer discussion alive on their social channels, which allows them to gain insights on when and where demand is in relation to their products. Plus, the more engaged followers they gain, the more data insights they gain on their audience demographic, which is also essential to understand when deciding where to expand and whether it will be a success. The company itself has said that “three-quarters of new customers find them via peer-to-peer marketing and other organic channels” which has allowed them to expand both locally and internationally. Direct-to-consumer companies like Glossier, are an example of the effects of the digital era. They are able to quickly and successfully expand, simply because their trading is mostly online and they engage their social channels strategically.
So, how can a data analysis of your marketing performance give your brand insights on international expansion?
There are three areas you should consider: analyzing owned media, monitoring global media coverage, and benchmarking competitors’ marketing performance.
Global Media Coverage
Monitoring global media coverage is a key indicator when it comes to analyzing brand opportunities in other markets. For example, if you are receiving high levels of coverage in Dubai, it could indicate a solid market, as well as a responsive audience to your product. Using a digital platform, you can track and consolidate your coverage and mentions in one place, allowing you to analyze and compare which areas you are activating, and whether those Voices generate value for your brand.
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Also, if you are thinking about expanding into a specific new market perhaps based on your findings from your owned media insights, but haven’t tracked a large volume of coverage there, you can start by developing your PR relationships in that region, to monitor whether or not there is an increase in coverage. The more coverage you generate in a region, the higher the likelihood that you could successfully invest in that market.
The quality of coverage also plays a substantial role. Determine whether you are being mentioned by industry-leading publications, top-tier influencers or mostly micro-influencers. If coverage is mostly influencer related you might want to research into key editors or journalists you could develop relationships with, to expand your media coverage. Similarly, if your coverage is very media outlet focused you could investigate influencers that could be potential brand ambassadors for your brand. If you struggle to identify these individuals or develop these relationships, then maybe this market shouldn’t be your primary target for expansion. While there are no guarantees, the more coverage you can generate in a region indicates a greater opportunity for expansion.
Your owned media channels can provide you with useful and applicable insights on your geographical impact – just look at Glossier. Utilize the fact that your target audience has the ability to connect with your brand through platforms such as Instagram or Facebook. After you have a successfully engaged audience, you can then analyze your demographic in a series of ways:
Measure where your campaigns create the most impact by determining your Media Impact Value™(MIV®), which measures the value of your relevant posts, mentions, and coverage across all online and social channels. In doing so you can determine where the highest values are generated, and implement this into your strategies in terms of which regions would respond well to expansion.
Look at your data insights. By analyzing your individual platforms and tracing where the largest percentages of your audience lie, you can discover regions that you previously may have failed to consider, as well as reinforce potential opportunity decisions.
In order to analyze the potential of your own success in a region, it is extremely useful to analyze your competitors’ marketing performance, specifically in the regions you have identified as potential markets. In doing so, you can understand what has and hasn’t worked in your target regions when it comes to your competitors’ marketing strategies. This allows you to not only determine whether expansion is a good idea when it comes to specific regions but also to rethink your own marketing strategy in order to tailor it to specific regions and achieve higher levels of global success.
Using these measurement tactics of your (and your competitors’) current marketing strategies before deciding whether to invest in international markets is as important as measuring your business strategies. Marketing insights can provide you with critical information when it comes to anticipating the responses of different markets, and eventually the decision you make when it comes to where and how you will expand.