Kelly Kroger
CEO
C&A Mexico
/
Expert Contributor

How to Leverage a ‘Glocal’ Business

By Kelly Kroger | Tue, 09/28/2021 - 14:49

Today, the world is a global marketplace and brands face increasing competition every day. In markets such as Mexico, we not only compete against national and international competitors but also against catalog sales (DTD) and the informal market, where products are brought into the country from the US, often without paying import dues.

Given such diverse competition, we must find a way to differentiate ourselves in the eye of the consumer. One option is a “Glocal” strategy, which allows a brand to maintain a consistent global identity while allowing for needed adjustments to be relevant to our local market. Although a global business is optimized when processes and products are standardized across markets to obtain scale, it is also important to ensure products, experiences and communication are relevant to the local culture, lifestyle and customer needs. The goal is to pursue consistency as a global brand but allow the organization within each market to adjust where needed; in retail, this can include changing product, pricing, communication, store concept and expansion strategy. 

But it is not always easy to achieve the optimal balance. Following are a few things to keep in mind if you are seeking to create a glocal strategy.

  1. Empower your local teams: It is imperative to empower the team within each market to define the necessary adjustments to a global program. No one knows the market, competition and consumer habits better than the local team and no amount of market research can provide insights to replace their experience and knowledge as local context is needed to properly interpret any analytical data.
  2. Do your homework: Before entering a new market, it is important to take the time to understand the environment and consumer behavior to define an implementation strategy that will be successful. There is no such thing as a global customer. As a customer-centric retailer, it is important that you gather information and even pilot ideas before a nationwide launch. 
  3. Connect the local teams to a global framework: However, it is important to also mention the need to connect local teams to a global framework and provide proper oversight. If the brand is overly customized to the local market it can lose the value created by its very global nature. 

At this point, you might be asking yourself why a business would pursue a glocal strategy. It is an approach that looks to offer a consumer the best of both worlds:

  • A global brand is perceived to deliver higher standards of quality and social responsibility.
  • Global brands become icons in the creation of a global culture. While local brands reflect what we are, global brands reflect what we aspire to be.
  • Customers need to hear a story that connects with them at an emotional level, which is difficult to achieve with a standardized global communication, and discover a product offering that fills their actual needs as defined by their local reality.

The theory is easy. Here are some examples of how we implement a glocal strategy at C&A in Mexico:

  • We are a global brand with 180 years of heritage in the fashion retail industry, present in over 20 countries with over 2,000 stores. These share a vision of being a value family fashion retailer, with shared values and a strong sustainability framework across all countries.
  • The heart of our business is developed locally: Product development, retail calendar, pricing strategy and store concept are all done locally to create fashion collections optimized for the Mexican consumer’s body, lifestyle, income level and climate of the Mexican market. 
  • All our marketing campaigns are developed locally and are specific to the Mexican market to optimize messaging and showcase local product offering.
  • We source our products 50 percent globally, through our global offices, and 50 percent locally through our own sourcing office to source as much product as possible locally, providing shorter lead times, avoiding exchange rate risk and supporting the local economy while creating employment opportunities in our market. This also provides greater flexibility and adaptability in this ever-changing industry.
  • We offer Retail Financial Services through our JV with Bradesco bank, offering credit and MSI for our customers to facilitate their purchases. This service is available in our stores in Brazil and Mexico but not in Europe.

I hope you found some value in my advice as you define your business strategy and evaluate the tradeoffs between global and local operating models. One last secret ingredient to add into the recipe is to ensure your brand has a purpose. According to a consumer survey done by Futerra agency, 98 percent of respondents think that brands have a responsibility to make positive change in the world. Brands, whether local or global, should use their power to do more good and not just less harm.

Photo by:   Kelly Kroger

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