Skip to main content

Think global, act local: The role of social in entering emerging markets

By Gerard Murnaghan / January 22, 2020

It’s hard to imagine Netflix got its start as a DVD by-mail rental service in the ‘90s. Today the streaming service is available in 190 countries and has over 158 million paying subscribers around the world.

I think it’s fair to assume most brands wish they could have a global presence and as wide of a customer base as Netflix. To be competitive in the 21st century, brands need to look beyond their proximate markets and start thinking about how they’ll win over customers overseas.

But when I look at the Netflixes of the world, what stands out the most is where those big brands are fighting for new market share. Businesses aren’t just competing for dominance in developed markets, they’re actively pursuing new opportunities in emerging markets. And while emerging markets represent a fruitful opportunity for brands, businesses need to think local to find success on the ground.

A market filled with untapped potential…

Unlike developed economies, where the competition is stiffer and the landscape already saturated, emerging markets like China, Poland and Turkey present brands an opportunity as a key source of growth. China’s consumers, for example, generate $4.9 trillion in economic activity a year and are estimated to make up 40% of the luxury goods global market by 2025.

Another reason brands are keen on pursuing emerging markets? Roughly half or more emerging countries, with the exception of India, currently use the internet, and social platforms like Facebook are gaining in popularity. For global brands hoping to establish themselves in a foreign market, the more emerging markets that embrace the Internet and social media, the better. Four out of ten European enterprises use at least one type of social media to build their image and market their products, and 27% use social to directly connect with their customers. British airline Virgin Atlantic, for example, directly engages with their European customers on social media and recently held an online contest to celebrate a new Star Wars-themed plane.

Given the rise of digital connectivity and revenue potential, it’s little wonder businesses are eager to stake their claim in emerging markets. Internet and social media usage is growing much faster in emerging markets compared to advanced economies. Greater connectivity means greater access to new and potential customers, especially in countries where global brands are only beginning to build a local presence.

But global brands need to tread carefully

There’s a lot to be gained when entering new and foreign markets. But rushing into an emerging market can backfire and lead to a PR nightmare for some global brands. KLM airlines recently found itself in hot water after its India team shared a Tweet telling passengers to sit in the back of the plane if they didn’t want to die in a crash. The Dutch airline had to apologize for the Tweet which, understandably, upset a number of their customers.

Failure to account for cultural differences is one way to anger an entire country. Dolce & Gabbana found this out the hard way when the luxury brand created a marketing campaign offending Chinese consumers. Since the brand’s marketing efforts first made an appearance, D&G has been the subject of nationwide boycotts that consumers promoted across social media.

Likewise, Walmart struggled to gain traction in emerging markets like South Korea because they neglected to account for local consumer preferences. For example, shoppers didn’t like the layout of Walmart stores and the Western brand’s sales tactics didn’t resonate with Korean housewives.

Then there’s the local competition global brands need to factor in. Even after big-name brands address cultural nuances, they still need to lure local customers away from smaller, local rivals. Research reveals global consumer packaged goods brands are actually losing market share in countries like China and Indonesia. If capturing emerging markets is part of a global brand’s expansion plans, they need to ditch their one-size-fits-all approach and think like the competition already on the ground.

Stick the landing with social media

It pays for businesses to get to know the locals. Brands operating in foreign markets need to be more targeted with how they segment their audiences and recognize what works at home doesn’t always translate abroad.

With social media, brands gain direct access to the customers they’re trying to market to and can better inform their product development while accounting for cultural nuances. Social listening plays a big role, helping brands learn what messages resonate with their audience and what is most likely to turn buyers away. Brands also gain access to consumer sentiment and can measure in real-time how prospective customers feel about a product or service. Social media enables brands to start thinking like their audience and forging connections with consumers before they ever break ground on foreign social. In other words, social enables brands to think ‘glocal’—in other words, the best brands maintain both global and local considerations.

Although platforms like Facebook and Twitter have an international presence, global brands should consider the impact local social platforms have on their strategies as well. WhatsApp is the third most popular social network globally; in South Korea, KakaoStory leapfrogs platforms like Instagram and Twitter, while Weibo takes the cake in China. Maintaining a presence on local social platforms not only gives brands greater access to their target customers, but it also provides brands with additional local context and content to work with.

Consider how Starbucks leverages social media to cement its market share in China. With over 600 million social media users in China, the coffee brand saw a way to target customers on one such platform, Sina Weibo. In addition to running mobile ads with downloadable skins for the app, Starbucks used social check-ins to encourage Sina Weibo users to visit the actual store. Similarly, the NBA was able to thrive in China because of their partnership with Chinese platforms like Weibo. The NBA’s willingness to understand what Chinese consumers wanted from American basketball has catapulted the league’s international presence and led to a $1.5 billion TV deal between China and the NBA.

Think and act with a “glocal” mindset

At some point in every brand’s journey, the topic of international expansion will likely arise. And when the time for growth comes, emerging markets will be a crucial battleground.

Social media will be the core to a successful expansion strategy as brands push to enter emerging markets in pursuit of global market share. Unlike traditional research tactics, social gives brands direct access to the customer insights they need to tailor their marketing efforts to the local audience. Only those with a firm understanding of international audiences will find their businesses poised to succeed.

Gerard Murnaghan

Gerard Murnaghan

Gerard Murnaghan is the VP and General Manager of Sprout Social EMEA. He is passionate about cultivating an inspirational culture, sustaining high performance and delighting customers with disruptive technologies that solve meaningful problems. Prior to joining Sprout, Gerard was the VP of EMEA Sales for Indeed.com.
Related Articles