Localization And Its Positive Effects On a Global eCommerce Brand
The Internet has revolutionized the way people view commerce – from the ancient barter system then heading on currency, to buying groceries at a local store. Till the first half of the 20th-century, commerce remained a give and take transaction business. Everything changed with the boom of the internet in the late 90s with the advent of websites, such as Amazon which started in 1994 by selling books, or even Wayfair (called CSN Stores) which started in 2002.
A walk down the nostalgic lane
As global ecommerce started to take form, regulations were put in place by various governments. Thus began the era of localization which essentially meant adapting a product for a certain country, locality, etc. By 2015. eCommerce became a part of the modern lifestyle, with stores such as Shein, Macy’s, Nike, Hennes and Mauritz (stylized as H&M).
This set a trend that shows fashion brands that have traditionally been brick and mortar stores.
From people discussing trust issues back in 2013 to today people ordering pretty much everything from online stores, this is a journey that seems unreal to common observant intuition.
Why the Customer Buys
The first access barrier is the website or mobile app. Here, one basic psychology principle has been applied, “People make convenient decisions, not correct decisions”. One great example of this principle can be people preferring the use of Bluetooth headphones instead of wired headphones. Doing so reduces the phone battery significantly however since not having to untangle wires is a major burden reduced, people prefer using a Bluetooth device instead.
In the same way, eCommerce became relatively convenient after the rise of 4G data subscriptions. The global ecommerce revolution focused on reducing the steps needed from registering as a user on the website to paying for the order. This is where the first point of localization would occur. The taxes, discounts, and credit cards supported are all vastly different for almost every country.
Global brands have to cater to countries that are different in culture, climate, lifestyle, habits, etc. This creates a conundrum for what products to list which is positive since the more the variety of products the more time a user would spend on the platform. This, in turn, would lead to more conversions at the checkout stage. The localization done by a global ecommerce brand allows a brand to create a product catalog that is personalized to the user itself.
Streaming platforms have been using a recommendation system that recommends products that are based on a pattern-matching algorithm and backed up with a neural network for heuristic learning. This system is being used by some fashion-based ecommerce brands such as Amazon Fashion.
Leading by Example
A few advantages that present themselves to the business of a global ecommerce company from a branding standpoint by using localization as a part of the core strategy can be listed as follows:
Above a point of using, a recommendation system was addressed using this in conjunction to custom requirements of an area on a macroscale to create a sense of local identity with that brand. One effective campaign that managed to achieve the same is Bata which, according to most Indians, is a native brand; however, the brand is Czech in origin with its headquarters in Switzerland.
Inherent Competitive Advantage
A sense of brand loyalty leads to a point of competitive advantage. This is crucial since each country’s audience is different and that is a distinction that companies have failed to understand and thus failed in highly profitable markets.
A case study that justifies this point as perfectly as a cookie-cutter template is most probably Uber entering the Chinese markets. Uber, the taxi aggregator service provider, tried to enter the Chinese market. However, the irony of the tale is that they couldn’t compete with the existing local services. Soon, the Chinese subsidiary of Uber ended up being acquired by a Chinese ride aggregator.
Thus, having an innate sense of the market allows for better customer acquisition. One firm that did this perfectly is the fresh meat packaging company Licious. The founders sensed an absence of a meat provider and went ahead plugging the gap.
Supply Chain Optimization
Localization has another merit which is that when linked to predictive systems, personalization can allow brands to predict demand in quantities for any product in their catalog. This gives two major benefits to the brand. The first is, by knowing when supply would likely pick up or drop, the company can strategically rotate the price, thus stimulating demand and maximizing inventory clearance.
Secondly, the supply chain can emphasize mostly on the material procurement and manufacturing portion. The requirement can be better defined and a drop shipping-like paradigm can be established. This technique has been in use for decades (at least in a crude sense) in the form of end of the season, Black Friday, or Thanksgiving day sales.
With all these points in mind, branding of a firm can take advantage of the uniqueness of a market and maximize the revenue as well as the margins. To check out the best deals on manufacturing apparel, head down to the official website of Fashinza.