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Archive for the ‘Globalization’ Category

Photograph: Susana Bates/Reuters

Analysts are questioning Microsoft’s $8.5 billion purchase of Skype this past week for good reason. Skype isn’t turning a net profit and Microsoft wasn’t truly in a competitive bid. This sets up the question as to what synergies can be created between these two firms that drives such a valuation. We’ve all heard about Skype’s role as a key technology across many Microsoft technologies such as Xbox and Outlook, but I think there is one focal area that takes the lead over all others – mobility.

Microsoft announced Windows Phone  7 Series at Mobile World Congress in February 2010 with the goal of re-invigorating their position in the smart phone space, one they pretty much created but have since lost. In a recent opportunity to meet Robbie Bach, Retired President of MS Entertainment & Devices, he emphasized the point that they learned that MS had made a key mistake in the past by allowing handset manufacturers and carriers to manipulate the user experience on the phones with little to no restrictions (which can be likened to the approach Android is taking today). Now Microsoft is tightening controls and limiting what modifications, if any can be made. With this new strategy and reach into both enterprise and consumer markets on a global scale, what was missing until last week?

Microsoft did not have a unique value proposition. Nothing to disrupt the space. Apple has the tightest user experience and ubiquity across devices. Android is in just about everything now. In order to thread the needle between these two heavyweights, Microsoft needs something that changes the current market trajectory which looks to be building towards a duopoly a few years out.

Let’s look at the dynamics on the buy side of the industry, specifically the carriers, as an example of what could happen next. With AT&T’s recent proposed acquisition of T-mobile, Sprint is concerned with extinction due to its relatively low market share. Until now, no carrier has been a big advocate of changing their lucrative business model by allowing highly integrated VoIP calling that negates the use of their airwaves for voice transmission. Why would Sprint or another carrier consider disrupting the industry with a low cost VoiP solution that uses MS Windows 7 and Skype? The simple reason is that that Microsoft can create cross subsidies with search advertising through Bing. Suddenly, the carrier doesn’t lose financially. The consumer wins as well with lower subscription costs. Thus, the industry is disrupted with a network effect between search advertising and VoiP.

Microsoft captures market share, perhaps just enough to be worth $8.5 billion.

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I recently heard a marketing executive talk about the art of persuasion. The person emphasized the need to convince customers why they need their product. For me personally, it felt as if we were trying to trick people.

Persuasion is only necessary if one or more of the following occurs:

1. Your business level strategy is unknown or there is misalignment.
2. Your products and services do not provide value.
3. Your competitive position is weakening or changing customer needs are making you irrelevant.

In sum, using persuasion is only needed if the business has failed at its primary responsibility, which is to create a relevant and sustainable value proposition in the marketplace.

Let’s banish persuasion with a shift in mindset towards a Total Customer Experience.

Want to learn more?

 Come hear my talk on November 18th at the Smart Seminar on Globalization in Santa Clara. Seating is limited for this Medialocate-sponsored event. If you are interested in attending the invitation-only seminar, please contact Ann Day at annday@medialocate.com.

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The mechanics of globalization have been mastered. From workflow and translation memory to statistical machine translation – the capabilities are known, the processes defined, and the expertise is abundant.

So, what’s next you might be asking?

We are entering an era or arriving at the realization that the personalized and integrated experiences we all demand in North America are also desirable globally. The phrase “total customer experience” symbolizes the perception each individual will have of a brand as a result of all of their brand experiences. The centralized, automated form of globalization that has allowed us to scale and expand is evolving towards a form where personal insights about the global audience lead to more relevant experiences across all touchpoints. Following a key principle of Total Customer Experience Design, these insights help guide design (business, technology, interface and graphic design) decisions to be made in defense of the customer.

Want to learn more how you can shift your organization’s mindset by defending your customer in this new era?

Come hear my talk on November 18th at the Smart Seminar on Globalization in Santa Clara. Seating is limited for this Medialocate-sponsored event. If you are interested in attending the invitation-only seminar, please contact Ann Day at annday@medialocate.com

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Google made a controversial decision to stop operating its Search site in March 2010. Now Google awaits approval from the Chinese government to operate its mapping service due to a new regulation, while wondering if the government will pull their license for providing online content due to their bold action back in March.

Google’s journey reminds me of how complicated business can be in China.

It has been 5 years since I studied abroad in China. The charter of our trip was to examine how business operates in China and see if the incredible economic growth over recent years was “real” and how successful companies navigate the perceived complexity. It is interesting to reflect back on a subset of my research that was conducted during my intensive 2-week visit. The following are a few of the predictions and observations that I made during that trip, juxtaposed against more recent events.

First, I predicted that entering the World Trade Organization will force China to move towards a more open economy that allows for private ownership and foreign investment in an increasing number of industries. I was watching the news a few weeks ago, and a Chinese business woman was quoted saying that “[she doesn’t] run her business, the government does.” Although this is only one data point, I guess my first prediction hasn’t fared so well.

Second, I predicted that as income rises, consumers will expect a higher standard of living. In turn, this means they will also expect more regulations related to consumer protection and labor rights. A staggering estimate of 90,000 demonstrations occur in China each year. It is no wonder that civilian unrest exists when catastrophic events such as the 2008 Chinese milk scandal occur, where milk and infant formula using melamine resulted in infants dying and being hospitalized. Sadly, the demand for consumer protection and labor rights continues; however, it appears little progress may have been made.

Third, I was not convinced that government sponsored business incubators such ZPark could emulate the entrepreneurial spirit of Silicon Valley.  Essentially, we saw a replication of Silicon Valley that lacked free-market forces and was underpinned by little private funding from venture capitalists.  The largest concern I had was around the lack of visible rigor put into each start-up’s business plan.  It appeared new ventures had little to prove in order to receive and maintain funding, which makes me skeptical of the phenomenally low failure rate of 2% for new business ventures. In Silicon Valley, I would expect almost the opposite failure rate. For every true business success, there are many failures. I continue to believe my observations regarding entrepreneurialism are true based on the news Google has been generating as of late. If the government interferes with business, entrepreneurialism will suffer.

It seems navigating business in China might not be any less challenging than it was 5 years ago. Best of luck to Google and others trying to make a positive difference, while expanding their businesses into such important markets as China.

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Aerial view of Disney Hong KongThe Wall Street Journal reported on July 1st that Disney is making a $452 million dollar investment to expand Disney Hong Kong with three new lands. This is being done to address subpar attendance, citing a “… lack of attractions that appeal to its key target market of mainland Chinese tourists, who are often unfamiliar with Disney stories and characters.”

It is easy to draw the parallel between Disney’s need to add these new attractions, and expanding a company’s localized Web site content and functionality in order to meet local user needs.  Although I expect a company like Disney to be highly successful in this expansion, it still surprises me that even the largest global brands don’t always know what to expect when expanding internationally.  The parallel ends here, however.  Unlike adding new attractions to an amusement park, when you have to add unexpected content to a local Web site, it is very difficult to do so in a way that preserves the intended user experience.  Moreover, unplanned expansion on a site typically breaks an efficient publishing model, which layers on new costs.

At LEVEL, I’ve been pondering this challenge for some time and found that there are ways to build global ready solutions. If you are starting a project where the assumption is that time constraints, budget availability and/or stakeholder support is lacking for a global ready solution, here are some thoughts to consider.  With help from LEVEL:

  • Internationalization can just happen. As a full service agency, LEVEL builds everything global ready from the start. How do we do this? Simple. A firm that is founded with deep technical capabilities knows what it takes to ensure that what is being developed doesn’t have to be reworked later when the need to expand into new markets arises. This happens because our Strategists, Information Architects and Creatives are working directly with the team that builds what is being designed.
  • Localization doesn’t have to slow you down. Typically, budget and timeline concerns exist when considering the extension of a corporate-centric solution globally from the start. LEVEL has established key relationships in the localization industry to rapidly prototype and test solutions in just about any market, even when we are in the early design phase of a project. This results in a cost effective and efficient localization process.
  • Learning now, leads to flexibility later. Disney was lucky they had the funds and space to buy more land. Unfortunately, a poorly designed Web site cannot expand as easily. Once you break a well thought out user experience strategy, there is typically no going back. Obtaining local requirements in the discovery phase of a project can avoid costly redesign efforts due to inflexible design templates and infrastructure components, even if you don’t offer localized sites or content to start. What’s great is that you’ll be ready to respond to the need for global expansion when it arises.

With a little extra planning and the right experience by your side, you can have a global ready solution that maximizes your brand impact in new markets.

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