the edge on why franchises must think “glocal”

According to the edge , a number of years ago, I had the chance to attend a conference in Tokyo for the Entrepreneurs’ Organization (EO). EO is a global business group with 6,500 members from around the planet – all very bright young entrepreneurs.

At one of the lunches of the conference, I was seated next to a gentleman by the name of Ernie Higa. Ernie was the man responsible for bringing Domino’s Pizza to Japan, and turning it into a huge success.

Over lunch, Ernie explained to me how his company’s ability to think ‘Glocal’ was one of the keys to his success. At the time, I wondered, ‘was glocal a strange Japanese word, a word that I just didn't know the meaning of?’ (and, for a while, I was too afraid to ask him for fear that I should have known what it meant). However, given that Ernie looks like a Japanese local, but has a very broad Californian accent, I had to ask.

Over the next 30 minutes, he explained how his business took the international branding and positioning of a company and offered it purpose and meaning in the minds of the local Japanese community by adopting some simple philosophies.

It was this conversation that led us to develop a strategy for our franchisor clients that was based around them taking a broader look at their brand from a global perspective. The next step was to peel back that brand positioning to work at a local level so they would have meaning and purpose in the minds of their consumers, at point of contact, in each outlet.

In short, we pushed franchisors to think about how they would look with their current positioning and brand values when they arrived in each of the countries, cities and suburbs that they were either present in with outlets or could well be present in sometime in the future.

At the time, it was a struggle to get some of these local franchisor brands to even think these concepts should be on their radar: ‘but I’ve only got 20 outlets and we’re only in NSW…I have no idea about international expansion…we’re years away from considering that as an option’.

Today, many of the groups we work with have a much greater understanding and appreciation of the term ‘glocal’. They now appreciate the fact that we pushed them to think about it during what now seems like a lifetime ago.

So just in case being ‘glocal’ has not hit your radar yet as a franchisor, here is a quick summary of how to bring that blip up on your screen, and how it might affect you in your business – here in Australia, and around the world.

Being one of the largest islands in the world, it is sometimes easy to think that, because we are on an island, we are protected from the outside world. Typically, our goals as franchisors are set in order of what we see as the next challenge: market domination in our suburb, then our city, then our state and then the nation…and then we’re done!

Some 10 years ago, this would have been a likely transition from a small franchised business to a medium franchised business and, in some cases, to a large franchised business – dependent on the product you sold or the resources you had at the time.

Today, doing business across the country is like having a chat over the fence to your neighbour. And international communication is now the equivalent of what we used to refer to as ' the trunk line call'.

Understanding this is one thing; dealing with the global communication issue in your business is another thing entirely. Ignoring it is fatal.

It would be foolish for any of us in franchising, here in Australia, to think that there is not someone out there on the other side of the world that may be able to do it harder, faster and better than we can. It would also be foolish of us to think for one moment that these international competitors do not have their eye on our backyard. And, even if we do feel we have the superior brand, product or service in the marketplace, the Australian consumer perception, in some instances, is that anything coming out of the United States is better anyway – just because they have ‘more of everything’.

Faced with this challenge, there is really only one thing to do from day one on your franchise adventure as a franchisor – think Glocal.

This is not rocket science, it is simply about being aware of your global market opportunities so you know how to take your product to market, glocally. This is done through the perception of a global positioning and the strength of your local contact with your consumers in each market you operate in. It’s like the concept of simple local marketing, on steroids.

Still sounds confusing, huh? Well, you’ve heard of the power of ‘global brands’ and you’ve heard of the power of ‘local marketing’. This is simply about combining the two.

Here are a few easy steps you can take, as a franchisor, to get your head around how to think ‘glocally’:

• Position your brand in the market with global marketing in mind. With Australian franchising increasingly being recognised as global best practice, your goal as a franchisor is now not only to be the best in your city or your country, but in the world. We live and work on a world stage, and this is where your brand needs to be solid enough to be able to survive on this stage, without having to change it and reinvent it over and over for each market. In my opinion, there is only one way to be able to do this, and that is to understand the global market, firsthand. As an Australian franchisor, you now need to travel and do research to know how you are to compete. Even if you aren’t considering international expansion of your brand at this stage in your franchise adventure, remember that an international brand may be considering expansion here. Magazines, the internet, second hand research and hearsay does not give you the information you need about your international competitors. Go there, see them, and watch what and how they do things.

• Take all of the information you can gather from your competitors in a global market and pick out the things that you think make your competitors great. Acknowledging they have strengths is not a bad thing; it’s an opportunity for you to learn how to improve your own brand, from a global perspective, and to better defend it locally.

• Take all of the things your competitors do in a local environment and work hard NOT to get caught up in a local street fight. The transition from local street fighter to world champion boxer is a tough one. If you position yourself as a world champion boxer from day one, people will believe you. By thinking like a world champion boxer you allow yourself to think strategically, as opposed to the tactical approach of a local street fighter.

• Armed with this information, and with what is now a solid positioning to your brand, you need to apply it in the local environment. This is usually the element that causes franchisees the most grief in a system. Cries from franchisees of ‘it’s different for me’ are a daily occurrence in most of the franchise groups we have worked for, and we’ve heard this now in 16 different countries. Sure it’s different for them, but in most case, it’s only different in their mind. If it was so different for them, then why would consumers keep wandering in and out of McDonald’s across the world without even thinking, or drive the same cars and watch the same TV shows? The only thing different is the environment in which you do business – not the people who live there.

Consumers across the world are all looking for the same thing. And there are certain transaction-drivers that prove this theory. Consumers everywhere want service, and that’s a given. They want a quality product, they want a relationship with the brand that lets them know that the brand will do what it says it is going to do for them, and that it will keep its promise to them. They want the transaction to be easy. Most of all, they want value. Contrary to popular belief, value does not equal ‘cheap’. If the core drivers of ‘service’, ‘quality’, ‘relationship’ and ‘ease’ are present in the transaction, then the consumer will have the perception of value. It’s that simple. With this in mind, you can make your brand 'local' by taking the global positioning and adding local marketing philosophies to these core transaction drivers.

• Look for local opportunities to leverage the brand into the marketplace using local community groups, businesses, sporting facilities – anywhere you feel you can touch a group of people with your brand in a personal way. This does not necessarily include local advertising. Advertising supports your global positioning as it is typically impersonal with a message that talks at you, not to you. Local marketing strategies allow you the opportunity to talk to your local market directly, and offer your brand a human side. In turn ‘glocalising’ it.

The best part about developing a local marketing strategy for your business is that your international competitors will, in the main, not be very good at this. ‘Local marketing’, or ‘neighbourhood marketing’ as the Americans call it, is just really taking off in the United States. Many Australian brands have been doing it here for years – mainly because, as struggling franchise brands, we haven’t had the money to stage large advertising campaigns.

The key message in all of this is that if you, as a franchisor, have a desire to build a solid brand in the marketplace – in particular, the local marketplace of each of your outlets – then it really means that you need to start the way you intend to finish, and to truly understand what your brand looks like ‘when it grows up’.

Over the past 10 years, we have seen many successful Australian brands apply this philosophy to their marketing, and with great success. We call it an ‘integrated marketing approach’. Mr Higa calls it ‘thinking Glocal’.

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