As the world has become globalised through increased trade, technology, media, political and economic agreements, the main challenge for global advertisers is whether to have a global, standardised advertising or localised, culturally effective advertising for each country. This is called the global versus local dilemma – a debate that has been going on for over five decades. This article describes what this dilemma is and introduces both global and local sides of it. The article also brings forward Finnish consumer’s opinions on localisation and globalisation of advertising.
Authors: Salla Palviainen & Tarja Ahonen
Global versus local dilemma
The core of the dilemma is a decision that companies have to make when operating globally: whether to create standardised advertising that works in all foreign markets equally for efficiency, or if advertising should be developed for each local market individually to be culturally effective. (Milenkovic 2009, 23-26.)
The dilemma has been on-going for over five decades – yet it is still a current topic. As a counterbalance to globalisation, a trend towards localisation has emerged and become top 10 global consumer trends in 2020. This means that consumers are withdrawing from mass consumption and are turning towards supporting local businesses. There is also a growing expectation for multinational companies to create advertising that responds appropriately and creatively to the local culture. Therefore, advertisers’ localisation efforts are needed. However, according to a study conducted by CMO Council and Partners Worldwide in 2019, 63% of marketers admit that they have significant dissatisfaction with their current localisation efforts. (De Mooij 2010, 11; Euromonitor International 2020; Stein 2019.)
Global standardised advertising
Standardising means that the same product, brand image and advertising is used around the world, saving costs in logistics, production and marketing. (De Mooij 2010, 11). In advertising, the message, art, photographs, and headlines have been developed to be suitable worldwide. Standardisation has its benefits: not only does standardisation simplify the coordination and control over the advertising, but it also leads to great cost management as well as gives an opportunity to use a good advertising idea often. The global strategy creates a consistent brand image around the world which strengthens consumer brand loyalty. (Milenkovic 2009, 23-24; Keegan & Green 2013, 410.)
On the other hand, standardisation creates more pressure on the brand to create a campaign that resonates with audiences from different cultural backgrounds, as it creates a bigger chance to failure if they do not. For example, the message of the advertisement might not get through to the intended customer as the advertisers lack knowledge about local customs and communication styles (Adams 2016; Keegan & Green 2013, 410).
In addition, there are cultural and legal restrictions in each country that companies need to take into consideration in standardised advertising. For example, the languages used in advertising can be restricted by law. In some countries, such as Finland, other languages are allowed in advertising, but for example in Mexico, Philippines and Malaysia, foreign languages are only allowed if the translation to the local language is impossible. Also, there are laws that restrict the advertising of alcohol, tobacco, and products only available with a prescription. (Milenkovic 2009, 23-25.)
In an adapted, localised campaign, the local market is researched, and an advertisement is created based on the found local market insights. Local market insights are the discovery of a new, relevant information about a target market and consumers. The insights can be, for example local values and beliefs, language, environment, and the trends. By using local market insights, companies can create advertisements that are locally suitable and effective. Such a practise would reduce any possible cultural blunders, i.e., mistakes made based on poorly understood cross-cultural differences that cause misunderstandings and communication errors, causing unsuccessful advertising campaigns. (Palviainen 2020, 10-23; Fromowitz 2017.)
There are many benefits on localising advertising. Localisation helps companies to connect with their target consumers. Adapting advertising content shows respect for the local culture and values. When brands integrate their brand message with the local values, they are able to connect on a deeper level with local consumers, also helping to gain customer’s loyalty. Using local languages can create a great advantage as 72% of customers globally are more likely to buy products or services if the information is in their language. In addition, localisation increases profit: companies who create localised content to their customers benefit from an uplift in sales compared to those using standardised campaigns. (Curmi 2018; Dias Marques 2018; Brandgility 2018.)
Finnish consumer’s opinions on localisation and globalisation of advertising
So, how do Finnish consumers feel about globalisation or localisation of the advertising targeted to them? According to the study by Palviainen (2020), there was an overall positivity towards localisation and making at least some advertisements specifically suitable for Finnish consumers via language, values and customs. In addition, 85.7% of the respondents were on the opinion that at least some degree of localisation needs to be made in advertising targeted to Finnish consumers. Finnish consumers clearly prefer that the execution of the advertisement is made relatable for them and a suitable advertising style is used in the advertisements targeted to them. Even though the Finnish consumers preferred localisation mostly, there was one factor that was in favour of globalisation: the Finnish consumers do not mind if the advertisement is presented in another language than Finnish. They are open towards other languages too. (Palviainen 2020.)
Global versus local dilemma deals with the advertising strategy of the company: whether to create standardised advertising to all the markets globally, or if advertising should be adapted for each local market individually. Both localised and standardised advertising have their pros and cons. Essentially, the dilemma is about efficiency versus effectivity. Many international companies have learned that standardisation is not effective. However, there is no denying that many companies aim to operate on a global scale and therefore global and local should be combined. Global advertisements can be modified, e.g., with voice-overs, localised execution, and different brand names, to suit the local culture. (De Mooij 2011, 11-283) Especially Finnish consumers expect localisation efforts when targeting advertisements towards them.
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Salla Palviainen, LAB Graduating Student. LAB University of Applied Sciences, Business and Hospitality Management. Lahti
Tarja Ahonen, Senior Lecturer. LAB University of Applied Sciences, Language Centre. Lahti.
Illustration: https://pxhere.com/fi/photo/33 (CC0)
Reference for this article
Palviainen, S. & Ahonen, T. 2020. Global Versus Local Dilemma in Global Advertising. LAB Pro. [Cited and date of citation]. Available at: https://www.labopen.fi/en/lab-pro/global-versus-local-dilemma-in-global-advertising/