Building a global brand can give you a big competitive advantage. Savvy business leaders understand the importance of making strategic decisions based on data. With so much information available online, how do you know which data will guide you to make the best decisions for your global expansion?
In this guide, we’ll examine a few data sources that can help you build a transnational strategy.
What is Transnational Strategy?
A transnational strategy is a type of global business model where a company’s activities are coordinated between its domestic headquarters and one or more international outlets. There’s an overarching organizational structure: one center of operations controls the decision-making and supply chain of the company.
Transnational companies are defined by two qualities:
- high global integration:
A transnational company is an international business that has branches or offices in every country they serve.
- Example: Fast-food giant McDonald’s is a big multinational company with a home office in the US and many local branches and restaurants all over the globe.
- high local responsiveness:
A transnational business has a customer-centric approach that’s focused on appealing to unique local markets.
- Example: The world’s biggest food and beverage company, Nestlé, is owned by a Swiss parent company. From Milo chocolate milk in Mexico to Nesquick in the US, the company has unique products for local markets.
McDonald’s and Nestle are successful global companies now, but they started small: by examining market trends and data sources to build a transnational strategy.
Top Data Sources for Transnational Strategy
Here are five of the most important data sources to help with your transnational marketing strategy.
1. Language Proficiency
When building a transnational strategy, start with markets where you have a good chance of success. The easiest starting point is a foreign market that already speaks your language. For example, if your company is headquartered in the US, consider branching out to the United Kingdom, Canada, or Australia.
After you’ve successfully gained market share in other English-speaking countries, consider expanding to countries with high levels of English language proficiency. Click here to access the EF English Proficiency Index, which ranks countries according to their levels of proficiency in English.
2. Gross Domestic Product (GDP)
GDP is the overall value of goods and services produced in an economy. According to Harvard Business School, it’s a good sign when GDP is growing, but there’s some nuance. If a country’s GDP isn’t growing as fast as the population, per capita GDP isn’t rising. This means the purchasing power of the locale isn’t increasing.
3. Internet Access and Penetration Stats
Different countries come with varying levels of internet access. The higher the percentage of internet penetration within a country, the more likely it is for people to pay for things online. An excellent resource is Internet World Stats.
Take Afghanistan and Singapore, for example. Afghanistan has around 7.3 million internet users, while Singapore has about 5 million. Do you think Afghanistan represents a better marketing opportunity than Singapore? It depends on what you’re selling, but in most cases, the answer is no. If you look at the rate of internet penetration, you will see that Singapore, with 84.5% penetration, is a far superior market to Afghanistan with just 19.7% penetration.
4. Credit Card Availability
Think about your pricing and payment options. Some payment types, like credit cards, may not be available in other locales. When expanding into a new country, you will likely need to add other forms of payment. If this isn’t something you can easily do, you may need to initially stay in countries where you can accept payment.
When it comes to credit cards, Global Economy provides data showing the percentage of credit card users in each country. You might be surprised to discover that some countries – Canada, Israel, Norway, Luxembourg, Japan – have much higher levels of credit card usage than the USA.
5. Ease of Doing Business
Most countries have laws and regulations that apply to global companies in their local market. In some places, these regulations can be challenging to navigate. An excellent resource on this topic is the World Bank. Their data set informs how difficult it will be for you to operate in a given market. The site also provides insight into hard it will be for your potential customers and partners to do business with you.
A Note About Internal Data
Investment decisions on a global scale need to be informed with reliable external data. Internal data can be helpful, but you should avoid making global strategy decisions based on internal data alone. For example, if a particular country is leading a disproportionate rate of traffic to your site, there could be a variety of reasons for this:
- The country has a vast population, and many of them speak the language of your website’s content.
- You have content that they are unable to find online from a local site.
- You publish content that has captured the interest of people in a given country for reasons that have no relation to what you are offering.
- There is a lot of activity by hackers from the country in question that is showing up in your analytics as an increase in traffic.
- Your SEO rankings are higher because of strong inbound linking from websites in a particular country.
- You’ve recently attracted attention from local bloggers or in local media in a given country.
Conclusion: Go Transnational with Localize
These are just a few of the indicators you can consider when building your transnational business strategy.
When it’s time for your brand to go global, consider a top-quality translation management system (TMS) like Localize. Localize is trusted by hundreds of top international companies like Microsoft and Cisco to manage their multilingual websites, apps, documents, and software products.
Talk to us to see how we can help prepare your brand for a successful launch into global markets!