| To understand how companies with ambitions beyond their own markets
think about and measure localization efforts, Common Sense Advisory
interviewed 50 managers responsible for setting or implementing
localization strategy at U.S.-based organizations.
Localization comprises the business practices by which a company
prepares its product or service offering for worldwide markets. Without
this practice a company would never bridge beyond its own borders. In
preparing their report – “Beggars at the Globalization Banquet” -
Common Sense Advisory found that localization investment happens to be
very small compared to the big international revenue it enables. Even
so, most American firms shortchange their budgets for translating and
adapting products, services, support materials, and output for non-U.S.
markets – but continue to expect increasingly more productivity.
Global business comprises on average 40 percent of assets at large
companies, but accounts for 45 percent of corporate profits, according
to a detailed analysis of 246 of the top 500 multinational enterprises
in Oxford’s Templeton Global Performance Index for 2001. Common Sense
Advisory sees localization and related activities as a vital part of
the business landscape and asserts that this profit ratio should grab
the attention of anyone wondering about the value of catering to buyers
in global markets.
“Localization sits at the end of the value chain and gets little
attention by corporate decision-makers, but enables the most return for
its investment,” said Don DePalma, president of Common Sense Advisory
and lead author of the report, “Beggars at the Globalization Banquet.”
According to Common Sense Advisory, for many Fortune 500 firms,
non-U.S. revenue – or xenorevenue - accounts for 20 percent to more
than 50 percent of their global income. This fact alone makes it easy
to see the value in catering to buyers in global markets with localized
products and services in their native language. Still localization
expenditures are minuscule — 2.5 percent and lower of non-US
revenue—compared to the benefits of gaining market share and customer
loyalty.
For Immediate Release
“Beggars at the Globalization Banquet” is the first in a series of
quarterly reports produced by Common Sense Advisory focusing on this
little-known field of translation and localization. This first report
offers a stepwise process for measuring and ensuring the return on
investment (ROI) of localization investments. Not focusing on
cost-cutting measures, the report considers a wide range of standard
business paybacks and offers formulas for calculating returns. Finally,
it looks to the future of the localization support industry, helping
practitioners, service providers, and technology suppliers prepare for
the inevitable changes driven by the unavoidable need to prove ROI.
Don DePalma is well known as the author of the seminal research report
on globalization, “Strategies for Global Sites,” published by Forrester
Research in 1998, and as the author of the insightful “Business Without Borders: A Strategic Guide to Global Marketing,” published in 2002 by John Wiley & Sons.
“Beggars at the Globalization Banquet” is available as part of a
subscription to clients. For information about subscribing, visit
www.commonsenseadvisory.com. |