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2015-03-11 02:20:59
Nataly Kelly
More than half of Google s revenue (57%) now comes from outside the United
States. Apple has a similar split, with 60% of its 2014 fourth-quarter revenue
accounted for by international markets. Why is it that some companies
experience tremendous success abroad, while others struggle to go global? In my
work as a global business advisor to Fortune 500 companies and high-tech
start-ups, I ve observed seven traits that distinguish companies with
accelerated global growth.
They have an innate global bias. American companies with strong performance in
international markets frequently have a founder or a prominent executive on
their team who is either from a foreign country or is a first-generation
American. Having global diversity in the C-Suite makes a business more likely
to optimize for global growth. Consider Google s Sergey Brin (Russia), Facebook
s Eduardo Saverin (Brazil), and Microsoft s Satya Nadella (India). Even Steve
Jobs was the son of a Syrian immigrant.
A study published by the National Venture Capital Association reveals that 40%
of publicly traded venture-backed companies operating in high-tech
manufacturing were founded by immigrants. Similarly, more than 40% of the 2010
Fortune 500 companies were founded by foreign-born immigrants or
first-generation Americans, according to a study by The Partnership for a New
American Economy.
On the flip side, businesses lacking an international perspective among their
leaders are often timid about moving into new markets. A fear of the unknown is
normal, and because they do not have first-hand experience, they sometimes fail
to recognize the importance of the rising middle class around the world. They
struggle to prioritize global expansion, because they are not convinced they
need to diversify geographically in order to scale.
They favor the web. Companies that deliver web-based products and services,
such as e-commerce, SaaS, PaaS, and consumer web and mobile, tend to experience
turbo-charged global growth, simply because they can take their software or
website international without making a large investment.
Even companies in industries that pre-dated the web, such as manufacturing and
pharmaceuticals, tend to have faster rates of global growth if they invest
heavily in online and software-based models for strategic areas of the
business. Moving to the web makes a company more nimble and capable of
responding to opportunity in international markets.
They work with the right partners. High-performing global businesses have an
ecosystem of channel relationships, resellers, and partners to help them expand
internationally. Carefully choosing international partners is important at the
onset of entering markets overseas, and especially when trying to push out
competitors to become the market leader. Apple s partnership with China Mobile,
the largest wireless network in the world, helped the company become the no. 1
smartphone maker in China. One year after the deal was announced, the company
moved past five local competitors that previously dominated. Likewise, Uber
recently announced a relationship with Starwood Hotels that will help it
strengthen its presence in 100 countries.
They know their metrics. All of the companies I ve worked with that have seen
their global revenues soar are diligent about analyzing international and
domestic sales and marketing data.
Companies that struggle with international growth tend to have a hard time
answering these basic questions: What are your top 10 countries by revenue
share? By customer base? What percentage of your marketing budget is allocated
toward international? What percentage of your sales team? Often, just the
exercise of obtaining this data helps a company get a better understanding of
their true international picture.
They value the opportunity. When advising executives, I watch closely to see
how they talk about international business. Does the company think about
international markets as a strategic advantage, a hassle, or something in
between? High-growth companies view global markets as an area of largely
untapped opportunity that simply must be explored. They talk about global
business as an investment in the future, a way to diversify and achieve scale.
Companies that aren t as destined for global success will interpret the same
data negatively, viewing global markets as more of an annoyance than an
opportunity. They tend to underestimate the revenue they currently obtain from
international markets, and they view any spending on global markets as a cost
to be reduced.
They put the customer first. The businesses I ve seen with the strongest track
record of global success all have this important mission in common. If the
customer lives outside of their home markets, customer-centric organizations
make an even greater effort to go the extra mile (or kilometer). They view
global marketing and localization not as a burden, but as an advantage against
competitors, which enables them to attract customers in other markets, better
serve them, and convert them into advocates for their brands.
They take international strategy seriously. Companies must value the people and
processes that are critical to global endeavors. Driving international revenue,
at most modern businesses, hinges on two key functions within the company:
global marketing and localization. Fast-growing companies prioritize these
areas, usually by assigning an executive who helps drive strategy for
international markets.
Businesses with unimpressive global trajectories make the common mistake of
diluting the importance of international growth, either by placing ownership at
lower levels of the organization that cannot influence strategy or within
multiple silos across the organization. When globalization becomes
decentralized and has no clear owner, the business struggles to coordinate all
the moving parts and drive international strategy forward.
When proper support for globalization is in place, the end result is a global
first culture. Employees throughout the company begin to display a
globally-minded attitude, which spills over into business processes. The
engineering team builds software with international users in mind. Content
creators think about their audiences in different countries before translation
ever happens. Executives frequently discuss the importance of international
customers. Global becomes a strong driver of the company s growth and future.
Nataly Kelly is the VP of Market Development at Smartling, the cloud-based
enterprise translation management company.