As tech companies expand their reach across the globe, it’s inevitable that some assumptions about various markets will turn out to be wrong, if you don’t rely on the knowledge and expertise of those working on this particular market.
At JetBrains, which grew from a small startup in Prague to an established company whose tools are used across 213 countries and territories, my colleagues and I had the early assumption that most developers speak English, for instance. It’s a requirement for developers at JetBrains to have good English skills, and most developers in our inner circle are fluent, so we thought it was a safe assumption to make. It isn’t.
And it’s getting even more demanding when we talk about non-technical decision-makers, which might be the ones deciding on the purchase for their technical team.
Thus, JetBrains had to learn how to localize its product, marketing, and sales strategy as it expanded. Here are the five top lessons my team and I learned from that experience — read it so you don’t waste time repeating our mistakes.
At JetBrains, we had organic growth across the entire globe, which means our tools were being used around the world before we started local market-specific activities. In Mainland China, which has been one of the most challenging markets to expand on, our software was used and sold prior to our local activities launch back in 2015.
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That year, as a joint initiative of our Sales and Marketing departments, we launched a pilot program in the country, which is a great way to get your toes in a new market. Mainland China is a huge market, but the culture and purchasing patterns are very different from what we got used to, so we had to adapt our business approaches a lot.
Moreover, the company was expected to communicate in Chinese rather than in English, and international credit cards are not widely available in favor of local payment methods, such as WeChat, AliPay, UnionPay, along with many other specifics.
That all meant we had to localize not just purchasing methods, sales support, and product info, but even the product itself. Only once we saw positive results from our pilot program did we scale that approach to more markets all around the globe, where we have local teams building local operations with an understanding of local business specifics.
Starting small through the pilot program is important because localizing your business processes, web site, or a product is expensive and cumbersome — especially when it comes to localizing the product itself.
Our product IntelliJ IDEA is now localized to Chinese, Korean, and Japanese, which requires a lot of investment on our side. And it’s not just the upfront investment, as you can’t localize the product once and then live with it. It requires continuous updates in perpetuity.
Thus, companies need to do the math and make sure the market in question helps you enough to be worth this lift. In our case, we ran macroeconomics research internally and with third-party agencies. Through that research, we curated countries into different clusters to understand where to go.
The first goal for us was to identify low-hanging fruit where the least effort and expenses can grow revenue the most and then start from there, scaling our local marketing and sales operations country by country, while maintaining a global approach to all other markets.
Once you decide it’s worthwhile to expand into a certain market, it’s important to not assume anything. Even if you think you know the market, you probably don’t. Thus, you must hire local professionals who understand the local business.
I personally had a lot of assumptions about the Russian market, for instance, because I was born there, although I live in Germany now. But it came apparent I didn’t know how sales and marketing worked there, as I had worked internationally for many years.
Your local team should consist of a regional marketing manager and a regional sales manager to start, and then you can grow the team as required. In Greater China, we also have a developer advocate and support engineers — and we always prefer to expand the team in that order (and it generally corresponds to the market needs as we grow local operations).
In some countries, like South Korea, we also have a distributor who runs sales, marketing, and support themselves. We quite like this approach, as our partners can help us scale the business a lot, but it’s hard to find reliable partners who would be able to cover all the products and a range of activities required, not acting solely as a billing agent.
We have resellers and distributors in many countries, and while JetBrains keeps selling directly on these markets and hiring local teams, too, we rely on our partners to provide a truly local experience.
In general, the Asian market is the most complicated and the European/USA market is the easiest for us since we focused our operations there from the beginning. But despite that, we still haven’t been able to crack the code in France.
While we expected the market to be similar to Germany (due to macroeconomics similarities and comparable IT industry size), the adoption of our products is roughly four times lower there. Clearly, there are differences in the market structure itself and the way stakeholders learn about products, choose them, and promote them inside their organizations.
Obviously, we’ve made localization mistakes in other markets as well. For instance, some translations don’t make sense in a particular context (that’s why you always need to localize the experience rather than translate, and why you need to have a local team to verify the artifacts).
We had a booth at an event in South Korea with an unfortunate banner saying “PyCharm is the best IDE for pythons!” The local contractor did their best but didn’t understand the software development context well enough to localize the slogan. The lesson here is to always be prepared for challenges to pop up — there will be so many!
Still, we’ve managed quite some successes too, as most of the target markets we chose for local marketing and sales development are outperforming the average worldwide growth of our company revenue.
As we expanded to new markets, we’ve been able to standardize much of the localization tools, terminology, and workflows. We’ve built out these protocols internally to ensure a high level of quality.
For instance, we noticed paid events (well, at least when we had events before the pandemics) increase conversions to real participants even if tickets are cheap (we normally set a price tag of a couple of cups of coffee, which is quickly returned by the swag we gave out), while free events tend to lead to a high number of sign-ups but low turnout.
The former approach also enables predictable attendance forecasts. This has different effects in different markets, but it tends to apply more or less across the board. Some markets and strategies will be useful no matter where in the world your company is.
The bottom line is that expanding across the globe is not easy — but it can be worth it. The key is to identify the markets where the investment in localization is worth your time and effort. Then, hire local people who understand the nuance of that country.
Doing thorough research and running pilot programs are two strategies that have served us well in numerous countries, but the defining feature of global expansion is not assuming anything and learning as you go.
Still, there is no silver bullet, and you will need to find your own approaches depending on your industry, product, and business strategy. I hope that some of the JetBrains experiences I’ve shared will come in handy.
Published November 2, 2020 — 06:30 UTC
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