Breaking Barriers: How Chinese Companies Can Overcome Challenges When Going Global
The need for localization runs deep, often becoming relevant when you least expect it. Even the process of globalization itself takes on local flavors and is shaped by a company’s home culture. Over the last 20 years, and particularly in the last decade, more and more Chinese companies have been going global, seeking success outside their own expansive borders. However, this global expansion hasn’t come without its challenges. Some of these challenges that they face are universal, faced by expanding companies everywhere. Others are unique to China.
The Local Challenges of Going Global
With nearly 1.4 billion people, China is a big market all on its own. For a long time, Chinese companies could be happy with the revenues earned without crossing any borders. But economic and cultural shifts over the past two decades have pushed Chinese businesses to think bigger. Regulations have been updated, culture has changed, and the global community has grown stronger than ever.
Chinese companies from a wide variety of industries are expanding internationally, with tech, ecommerce, and gaming leading the way. As companies take the leap, they need to deal with a few common hurdles:
1. Legal and regulatory localization
In some areas of the world, driving three hours in any direction will get you to four different countries, each with its own rules and regulations. In these places, like Europe, international companies are accustomed to dealing with other countries’ legal requirements. But if you’re a Chinese company that has been satisfied with your own 9.59 million km2 stomping ground until now, dealing with new legal systems can take some adjusting. You’ll need to find experts who can navigate in the local language and likely will need to tweak your product, your security and privacy measures, and even your production process to fit with the expectations and laws of new markets.
2. Localized pricing
One of the most important elements of localization is adapting pricing for local markets. While this has a major economic element, it’s also affected by culture. For example, BLEND’s Chinese Business Development Manager, Ann Chen, likes to give the example of a Chinese bicycle manufacturer who set the price of their products to compete in the local market. Chinese consumers saw a good deal.
“But in Germany, the same price sent a very different message,” Ann explained. “German customers saw it as suspiciously low and doubted the bike’s quality and safety.”
As Chinese companies move abroad, they not only need to know what the standard prices are in local markets, but what signals they send.
3. Building a brand
Every business community around the world runs on slightly different norms. Ann points out a stark difference in Chinese business culture:
"It may come as a surprise to people accustomed to Western cultures, but the concept of a brand just isn’t as strong in China. Consumers don’t look for it and companies don’t even think to develop it."
The Chinese market isn’t built around branding the way that American and European markets often are. The result is that Chinese companies don’t have the content infrastructure they need to compete in those markets. When they want to expand they have to start from scratch to build a reputation and brand recognition. Localization audits and fresh, targeted content, help to build that foundation.
4. Translating cultures
Certain industries face additional challenges. Gaming is an important sector in China, and one that is leading the way toward more globalization. As many serious gamers will tell you, a good game needs a good story. Some Chinese game companies have achieved this by digging through Chinese history, literature, and legend. These games are steeped in Chinese culture and require cultural context to understand. To take these games to new markets, a fluent translator isn’t enough. This challenge demands a localization expert with a native understanding of both Chinese cultural nuance and the target market to help local gamers fully experience the in-game world.
How Can BLEND help Chinese companies overcome challenges when going global?
BLEND can help break through these expansion barriers with localization services that cover everything from pricing and technological compatibility, to intercultural communications. For Xiaomi, one of BLEND’s largest Chinese clients, this broad perspective is vital. Xiaomi, and other Chinese tech companies, need teams that can translate to multiple languages quickly while taking into account precise technical details and cultural nuance.
Read our latest case study to learn more about how BLEND supported Xiaomi’s global expansion and how we can help you put down roots all over the world.
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