Localization strategy: The ultimate guide for businesses

As the world becomes more connected, businesses are increasingly looking for ways to tap into new markets. Localization offers a way to do this by adapting your offer to suit the needs of specific regions or markets.

But acting without a carefully planned strategy could tarnish your reputation. One too many brands learned this the hard way—some of which you may have heard of (like KFC and Mercedes Benz).

That's why we strongly recommend creating a comprehensive localization strategy. Not sure where to start? Read on.

A localization strategy is a plan to adapt a company’s branding, product or service to connect with a particular market. It's much more than translating content into another language and often requires adjusting color schemes, imagery, taglines, pricing, and marketing messages based on the culture and customs of the target country.

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It also encompasses everything from the marketing channels used to the topics covered on a company blog. What matters to one group may not resonate with folks in another country. For example, your marketing strategy may switch from Facebook ads to engaging with users in an online community.

Here’s an overview of some of the elements to cover in your strategy:

• Company website design and layout

• Texts for your web and print copy

• Branding colors, taglines, logos, and messaging

• Marketing channels used online and offline

• Product design/service offerings

• Mobile app design, layout, and translation

• Content formats (video, audio, blogs, slides, infographics, etc.)

The goal of a localization strategy is to create a localized experience that buyers in the target country can relate to.

The keyword here is "localize," which makes your business feel familiar (like shopping at any other business in the area).

When done effectively, localization can help your brand:

• Increase sales and market share. Localized products or services are more likely to be bought by customers in the target market, leading to increased sales and market share.

• Boost customer satisfaction. Customers are more likely to be satisfied with products or services that meet their specific needs and preferences. When customers feel you understand their needs and have tried to cater to them, they're more likely to be loyal and support your brand, leading to repeat business and positive word-of-mouth reviews.

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• Gain a competitive advantage. In many cases, businesses that adopt a localization strategy can better compete against larger, multinational companies because they can offer products or services that are better suited to the local market's needs.

Localization strategies vary depending on the business vertical and from one enterprise to another. However, below are the three key stages and the basic steps that anyone would benefit from.

At this stage you should focus on your company's needs and resources. Your aim is to obtain the data that will help you make informed decisions later.

Step 1: Market Research

Goal: Find out if you are targeting the right region

What is the size of your target market? How much influence do your competitors have there? Will your product meet local needs? To get answers to these and other similar questions you may want to look at:

• Competition map. Check how many competitors you currently have and how strong they are. Look at competitors’ products/services, marketing campaigns, and advertising methods. See what's working for them (and what's not). Look for gaps in their strategy and product offering using tools like Semrush .Trends.

For example, Taobao (operated by Alibaba group) is a widely used shopping app in China with more than 1 billion active users. So, if you launch a shopping application in China, you might face tough competition.

• Traffic flow. Check out the number of visitors to the local version of your website (or your competitors'). If there’s a high number of visitors from a particular country, the chances of success in that area are high.

• Cultural, political, legal, and technical nuances. Learn how these factors impact your product or service. For example, there might be no high-speed internet in your target region, so you will have to downgrade your app to perform better on slower networks.

Step 2. Audience research

Goal: Make sure your product will appeal to the target audience

Localization is all about catering to the needs of a specific audience. This means you'll have to consider language, traditions, and other specifics.

• Ask the locals. Keep in mind the best research involves the locals—get them involved in surveys, study groups, and interviews to gather first-party data.

• Check out the influencers. You can also learn who or what influences their purchasing decisions (it may not be creators on TikTok or YouTube). Depending on the audience, they may trust formal publications over social media personalities.

• Engage with the community. By connecting with local communities,you'll get insights you can't find elsewhere. You can hear stories, complaints, aspirations, and desires directly from your audience. Check the usual social networks like Facebook, Reddit, and Twitter. Ask locals which sites they frequently use to hang out with family and friends.

A road map lets you identify whether you have all the resources you need to localize your assets effectively and in time.

Step 3. Setting KPIs

Goal:  Measure the efficiency of your localized strategy

As you develop your localization strategy, you need to establish key performance indicators (KPIs) to gauge the success of your efforts.

KPIs help track results and highlight weak areas so that you can review your plan and make any necessary changes.

Below you'll find examples of KPIs reflecting customer experience and the performance of products/services:

Step 4. Selecting assets to localize

Goal: Prioritize localization efforts

You can't localize everything all at once. What you should focus on depends on your business and your target audience.

For example, you may not need to redesign your app much, but the channels you'll target are unique. Maybe the locals don't use social networks or websites you're used to communicating through. So explore popular channels within that region, like:

• Social media sites (e.g., Telegram, Qzone, and Viber),

• Forums (e.g., Reddit, Github, and Kaskus),

• Pay-per-click ads (search engines and social media),

• Industry or niche websites (health, technology, finance, etc.),

• Online communities (Slack, Discord, etc.),

• Influencer marketing (Imgur, Instagram, YouTube),

• Print content and ads (magazines, newspapers),

• Audio (radio, podcasts),

• Visual (billboards, TV commercials).

If you’re targeting online communities, you’ll need to learn and respect the community rules and tweak your marketing efforts. For example, Reddit will delete posts if it’s promotional so brands focus on creating helpful content with occasional links to a product or service.

The same goes for your products and content. See whether you need to change features or formats to accommodate for locals. For example, using video over blog posts. Or focusing on SEO instead of social media ads.

The restaurant industry, for example, adapts by adhering to local cultural preferences and religious beliefs (e.g. switching to turkey from bacon in an Islamic community.)

As for prioritization, focus on the assets closest to revenue generation or your other KPIs. For example, localizing your website and blog is ideal if that's the primary channel used by your audience (vs. a mobile app).

Step 5. Allocating budget

Goal: Make sure you'll have enough resources to complete the localization

Localization will take time and money, so make sure to budget accordingly. Account for both one-time costs like translation, testing, and cultural adaptation and ongoing expenses like maintenance and customer support.

This budget should also be separated from the general marketing budget and designated for localization purposes only.

It's also advisable to have some extra cash (around 20%) to cover for emergencies.

Step 6. Establishing timelines

Goal: To protect the company's marketing efforts by not falling behind schedule.

A clear timeline and understanding of the specific tasks will make the localization process smoother. So start with breaking it down into smaller tasks. This helps with setting deadlines correctly and keeping the project moving forward.

Step 7. Drafting guidelines

Goal: To make the localization process consistent and provide context for all participants

You need to find a way to ensure that everyone involved in the localization process is on the same page. The best way to do this is by creating documentation for each target region.

But what should your localization documentation include? Here's an overview:

• Brand style guide with your localized brand voice, colors, fonts, tagline, graphics, logos, customer profiles/personas, and campaign goals

• Information about the locals (culture, holidays, favorite channels, etc.)

• Words, gestures, or phrases to avoid

• Who will use the localization documentation and how (project managers, translators, marketers, salespeople, etc.)

• Product information, including localized descriptions, photos, pricing, manuals, guides, etc.

This isn't a comprehensive list since the localization documentation will vary from business to business. Once it’s complete, share your documentation with your teams.

Step 8. Building a localization team

Goal: Make sure you have enough people to achieve your goals

Localization requires a team of experts with assigned roles and tasks, all working together to ensure that the strategy is effectively executed. So who do you bring on board?

You may have everyone you need in-house, but there's a chance you'll need external help too.

Here's a list of the professionals to consider:

• Localization manager: Leader to build the localization strategy and oversee the localization program to meet your goals.

• Project manager: Someone to oversee the teams to ensure proper implementation of the localization strategy.

• Linguists: Professionals that not only know a language but understand the cultures behind them (and can perform customer research and interviews).

• Translators: Experts in translating text into one or more languages.

• Marketers: Strategists, writers, promoters to build visibility and recognition of your brand.

• QA manager: Someone to check the quality of the translations, marketing collateral, and product design.

• Designers: User experience experts to create the redesign of your digital and physical products (website or tangible product line).

• Developers: Programmers to build the design of your app, website, or software, so it meets the standards of the localized design.

• Business attorneys: Legal guidance to ensure the localization process remains within the regulations of the country you're expanding to.

Apart from making sure that you have someone for every role on the list, you need to clearly define their responsibilities and involvement in each of the tasks.

Step 9. Choosing a translation service provider

Goal: Avoid juggling multiple tools and switching between multiple companies

There are plenty of companies in the market offering to assist you in localization and even fully undertake the process.

It's up to you to decide how much to delegate but you should limit the number of service providers you work with to... ideally one. Let's try to list your needs to help you determine what vendor is right for you.

• Automated translation to help move your project forward at a steady pace.

• A database of linguists to complement your team or as a backup in case of emergencies.

• Translation management features to release you from manual work and eliminate human error.

• Integrations with your project and task management tools and a solution to streamline content delivery to your CMS or developer software.

It may sound like a task for two or even four tools. But guess what, Smartcat has it all: AI-powered translation, 500,000 professional linguists and agencies at your service, unlimited free seats for your team, 40+ integrations and connectors, and Autopilot, the smart project management system.

Step 10. Internationalization

Goal: Prepare your product for localization

Internationalization is the step that logically precedes localization. It's the preparation of your website or app design, service offerings, and products for the targeted markets.

Internationalization touches upon engineering, design, marketing, and content and is intended to make sure all your content can be easily translated without affecting the user experience.

Step 11. Translation

Goal: Translate your texts into the target language without grammar or cultural mistakes

Translation is a critical step in the localization process. It's at least three steps actually, as to get high quality you will not only need to translate your content, but also have it checked by a spell-checker to eliminate basic typos and then reviewed and assessed by a professional editor (preferably a native speaker).

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Step 12. Ensuring compliance

Goal: Protect your business from reputational risks and financial losses

Every country has its own set of norms and standards, and if you want to tap into a new market, you need to be aware of those and strategize accordingly. What might be considered normal or polite in one culture could be seen as inappropriate in another.

For instance, parts of Asia are known for their strict laws, which affect both citizens and the companies that venture there. So, depending on your business, you may need to make important changes to comply with the different laws and regulations, and you'll need legal experts to ensure translations are accurate and within your best interest.

Consider business legalities like:

• Establishing entities in other countries (you're liable to paying taxes and filing registration documents).

• Hiring contractors and employees (countries like the UK have similar laws about categorizing workers as employees).

• Using stock options to pay employees (check local tax laws to see if there's a large tax bill attached).

• Registering intellectual property (register your trademarks, patents, and design rights in each market).

• Localizing terms of service and sales contracts (translate all legal documents into the local language to avoid complaints and their consequences).

• Paying taxes (get tax structuring advice to minimize tax obligations).

• Protecting data (data protection laws are strict in the EU, so be sure to follow local rules for receipt, use, and retention, and always get consent).

• Renting or buying real estate (tenant obligations vary globally, so understand your responsibilities and rights while operating in the space).

• Entering disputes (understand local dispute resolution procedures and arbitration options to avoid litigation).

Step 13. Testing

Goal: Guarantee positive user experiences

You've covered all the subtleties of your brand and product. How confident are you that everything will run smoothly? Don't wait until launch day to find out. Test your apps, websites, ads, and other marketing materials to ensure they work.

Your teams should consistently test layouts on different devices. But don't stop there—enlist the help of locals. Include them in experiments to get a fresh pair of eyes and feedback on aspects you may have overlooked.

Determine whether your team will do this along the way or wait until the end to perform testing in one go. Each comes with pros and cons.

For example, parallel testing:

• Finds and resolves problems right away

• Slows down progress, since teams have to cater to problems before moving on

• Keeps your team agile to make changes on the fly

Then testing after development:

• Keeps team focused on the project, not fixes

• Delays the project if there are many changes to make

• More time and money is spent on major design and translation overhauls

Want to learn more? Here's a guide and checklist we created to execute localization testing.

Value-giving. Your product should offer additional features in a unique style to attract attention. Do some research about the competitors' offerings — you will likely find holes in their strategy and chances to sell your products by filling in gaps. Make sure your product not only syncs with audience needs, but it is also relevant to the local culture.

Respectful to the community. Helping a community in times of distress enhances the positive image of international businesses among locals. For instance, Coca-Cola has granted $1.2 billion to support local communities.

Approved by local experts. Getting help from local experts is the best way to improve your strategy. They can help you with the language, culture, and other local nuances you may not know. With their assistance, you can ensure that your message is conveyed effectively to your target audience.

Competitive. It's crucial to keep an eye on your rivals to sustain your position in the market. By observing their offerings, you can make a better deal and set competitive prices. Competitors are sometimes a great source of learning. You can follow their successful marketing strategy and ignore their mistakes.

Culturally sensitive. To connect with the audience, connecting with what they value the most is critical. For example, in some regions of the world, religion occupies the highest status in the lives of the public. You can develop your influence by offering special discounts on their holy event dates.

Moreover, it's essential to be aware of the trigger points of your target culture. If you unknowingly hit these areas, it can lead to a widespread reaction against you.

Optimized.  An effective localization strategy includes proper research of locally used keywords related to a particular product. The keywords that rank in your region might not be effective when translated. Instead of using translated keywords, add locally-used relevant phrases or queries in your content.

Comprehensive.  If users find your payment or other system difficult, they might not buy the product even if they like it the most. Hence, to increase customer compliance, one way is to connect your systems with locally used  platforms.

Below you'll find examples of localization strategies that were overwhelmingly successful.

In 2010, Netflix was limited to American audiences. Now, it’s available in more than 190 countries in 30 languages. The key to its global success is its localization strategy.

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The following are the steps that Netflix takes to connect with global audiences and keep existing members engaged.

Market conditions research

Netflix begins the localization process by analyzing data to determine which countries are potential new markets. Instead of spreading themselves too thin, they target specific regions and look at the cultural preferences of these countries to create content that appeals to their interests. For example, in Japan, Netflix offers a range of anime titles that are popular with Japanese audiences.

Breaking down the language barrier

Netflix translates content into the local languages of the target countries, ensuring that viewers can understand the dialogue and enjoy the film or show without subtitles. For this purpose, they dub the content by employing voice actors who can speak the local language. Dubbing provides a more immersive experience for viewers and makes it more likely that they will continue using Netflix.

Creating local versions of the website and applications

Netflix designs their website and app interface using a "pseudo localization strategy" specifically for each market to allow users in different countries to navigate the site and app in their language.

Launching partnership programs with local companies

The company's localization strategy has been particularly effective in Asia. In China, for example, Netflix partnered with Baidu and other local companies to offer a localized version of their services. As a result, they established themselves in the Chinese market.

Similarly, in India, Netflix partnered with Reliance Jio to offer an affordable mobile-only plan that has helped the company attract new subscribers.

Generating original content

After expanding into different regions worldwide, Netflix partnered with local producers to produce region-specific content. Blockbuster shows, like Money Heist, Game of Thrones, and Squid Game, cater to local and international audiences.

Localization is crucial to any international business strategy, and Coca-Cola saw the potential. With this strategy, Coca-Cola sells about 2 million drinks every day. Here are the key steps Coca-Cola took to localize and reach every corner of the world.

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Creating localized products

Based on the market research with local consumers, Coca-Cola develops products tailored to meet each market's specific needs. For example, in China, the company offers a range of herbal tea drinks that are popular with consumers.

Another example of Coca-Cola introducing localized products was in India, where they launched a grape-based sparkling drink in one of the Indian states, Tamil Nadu, where it was widely popular.

Developing localized marketing campaigns

In another example, the company launched the "Share the Coke" campaign in 2013 to engage customers and build an emotional connection. The idea behind this campaign was to urge the audience to share a coke with friends by using their common names, i.e., Sarah, Jack, and John, on each label instead of writing the company name. The strategy proved successful and was adopted all over the world.

The company took a different approach with the campaign in China. Chinese people don't like to call each other by their first names so Coca-Cola used phrases like "share with classmates" or "share with your best friend."

Moreover, Coca-Cola also works with local TV stars or famous personalities to create influential marketing campaigns.

Partnering with local businesses

Creating partnerships with local businesses on celebratory occasions is an effective strategy businesses employ to increase participation in other countries.

For instance, in India, cricket events are hugely celebrated events. To show their presence during these events, Coca-Cola partnered with cricket teams. The company employed a similar strategy in China which worked with the Beijing Winter Olympics.

They also produced musical shows like Coke Studio in regions like South Asia and Africa as part of their localization strategy.

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Airbnb is a company that has mastered localization. It is a global hospitality company that enables people to find unique places to stay in more than 40 languages. During its expansion, Airbnb focused more on providing localized experiences to customers rather than translating their websites.

Personalization of the customer's journey

Airbnb has been trying to personalize the travel experience for guests by using their data, so it introduced some new features:

• Interests Feed, which shows guests upcoming events in their area that match their interests

• Localized weather features, which provide real-time temperature and humidity forecasts for neighbourhoods worldwide

• Experiences section, which offers local activities like sightseeing and dining recommendations tailored to the guest's preferences

Partnership with local companies

Airbnb partnered with local businesses to help tourists find the best local experiences.

For example, in China, WeChat or Weibo are common apps for communication. Before starting its localization strategy in China, Airbnb changed its sign-in policy. Instead of accepting login credentials from Facebook, Gmail, or email address, Airbnb decided to accept login credentials from WeChat and Weibo. This strategy worked exceptionally well, and the company grew by 700% in just a year.

Airbnb adopted the same strategy in Brazil as well. Before the Olympics, the company introduced a local payment system that allowed visitors to pay in both Brazilian and their local currency during travel. This strategy resulted in more than 30 million guests in Brazil from all over the world.

Localization of website and apps

Airbnb localized its websites and apps in over 40 languages to better serve its international users.

Their localization team consists of linguists, creative designers, and software engineers who work collaboratively to create the best-localized experiences for all Airbnb users worldwide.

The localization algorithm of Airbnb uses machine learning to analyze the text on each platform and translate it into the corresponding language. To ensure that translations are accurate, Airbnb employs human translators in their localization team.

These steps make booking accommodations easier for people traveling to foreign countries and speaking different languages.

The result of localizing a product or brand can only be as good as your planning and execution. Here's a quick summary of what to keep in mind to develop a strong localization strategy:

• do extensive market and audience research to collect the data you need to build upon

• remember that your strategy is only efficient if you know how to measure its efficiency

• the right localization partner can replace needing several tools and suppliers

We hope you enjoyed this article and will use it to conquer the global market.