
In his new book “The World Is Flat”, esteemed New York Times columnist Thomas L. Friedman argues that the emerging era of globalisation is levelling the economic playing field like never before. Anti-globalisationalists watch out; if he’s right then the contention that it only benefits wealthy Western nations starts to look a little shaky. SwelledHead has been more interested in what a flat world means to international brands and their marketers, especially those coming out of the US and UK.
Who’s afraid of some healthy competition?
Following on from his last book on the same subject, “The Lexus and the Olive Tree”, Friedman’s latest analysis has been both commended and criticised. You can check out an excerpt and two reviews here: Excerpt, US review, UK review.
In the US, where he is a well known opinion leader on foreign affairs, and where outsourcing of jobs to the East has become a political hot potato, his account appears to make sense to a nation more fearful than ever of external threats. In Britain, a combination of closer historical ties to the East and a stronger economy reducing the impact of jobs lost overseas, means there is less trepidation about outsourcing as competition. And in common with everywhere else in the world, the British often equate globalisation with Americanisation.
Friedman argues that the developing world wants to adopt US style free-market capitalism and that the US and other Western nations will soon be competing head to head with companies in China, India et al. This notion has a flaw; it’s true that developing nations will happily accept Western investment, and imitate Western business practice when doing so, but China especially is showing that it will go its own way. It would be foolhardy to expect other nations not to exhibit different patterns of behaviour.
What does this mean for transatlantic brands?
In a new flat world, brands can come from anywhere. Japan, South Korea and now Eastern Europe have proven that. In the future we can expect new ones to emerge from China, India and other fast developing nations.
The notion that the US, the UK and other major Western economies are more sophisticated in branding is probably true today, but it’s not an ability that only we can possess. The US and UK share a long history of riding roughshod over foreign cultures, but we shouldn’t be surprised to find that these cultures themselves may in fact be more sensitive to our local needs when entering new markets because, unlike us, they expect the process to be difficult.
The thing to remember is that local relevance for any product and brand is critical. Increasing competition is only likely to heighten the need to be culturally applicable. British and American brands trading even within Western nations will need to be smarter than ever if they are to fend off new challenges.
And there’s every reason to expect that developing nations may take on ‘our’ brands to enable them to trade using local values. Consider that Chrysler is now German owned, US favourites Dr Pepper and Holiday Inn have been purchased by the British, and treasured British brands Rolls Royce and Bentley have too been snapped up by the Germans. Nothing major as yet has been bought by the Indians or Chinese, but recent interest in MG Rover by China demonstrates that there is both the understanding and ambition to proceed in this way.
And for marketing consultancies?
Marketing talent isn’t confined to the West, but the ability to market to Western consumers probably is. Language and more importantly, culture, are significant barriers and probably enough to make outsourcing of this nature too complex to be worthwhile.
The argument that high end of product design is now being outsourced overseas, and that other intellectually demanding tasks could follow, holds water. Yet when it comes to communicating the nuances of the meaning of products and services to culturally dissimilar peoples, there will always need to be local adaptation at the very least.
This is something Austin Lawrence Group, the brains inside SwelledHead, has always maintained. Through our Brand Translation Service™, we wouldn’t recommend going without local experience and expertise even when simply crossing the Atlantic. For brands coming from cultures even further afield (socially, if not geographically), the notion of brand translation is just as relevant. The irony is that developing nations may actually comprehend this better than those of us sharing a language and with pretty similar daily lives.
A new world view
Friedman’s view that globalisation is a greater threat to Western economies that we realise is almost certainly true, but this is hardly a great revelation. The reality is likely to be much more complex, affected by cultural and macro-economic influences along the way. Even the concept of The West may cease to be relevant, as Brian Walden, the astute political interviewer who's stepped into radio slot previously occupied by Alistair Cooke's "Letter from America", contends in his latest musing for the BBC.
For transatlantic and international marketers, the future may not be a flat world, but one which demands a much greater ability to see beyond the miasma of ones own borders to appreciate and adapt to new foreign market opportunities.
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