As someone who has assisted many companies into the European market during the last two decades, I've seen successive waves of American companies come into Europe. Microsoft, Intel and Compaq all opened offices throughout Europe in the mid '80s. Then there was the American recession of the early '90s, followed by a new wave of Net Economy companies opening their European offices in the mid '90s. But the tdownturn of the last year is different than those of 1980 or 1990. It would be ironic to miss this opportunity to expand internationally today. Keep reading and I will give you seven solid reasons why to go global now.

Today's economic situation poses a huge problem of how to continue developing sales. The U.S. business climate is depressed, true, but this opens up another opportunity: using the Internet to generate international sales in countries who are not going through a downturn. (In this article, we must leave aside Japan for its depression and China for its lack of disposable income.) The configuration of events today indicates an interesting opportunity that is not to be missed.

Figures first, please. As the rest of the world wakes up to doing business over the Internet, the U.S. online numbers relativize its own domestic market, given that it represents only 4% of the world's population and 20% of the world's economy. Jupiter’s Globalization Report, published in January 2001, finds that the U.S. share of the global Internet population will drop from 36% today to approximately 24% in 2005. The problem is that two-thirds of U.S. companies have not yet prepared for a global online marketplace. Forrester predicts that half of all online revenue will be generated outside the U.S. by 2004.

Here are reasons why you should give attention to using your compnay's Website to reach out to global markets:

1. Foreign economies remain basically sound. The economies of most European countries, as well as some Asian markets (Korea, Hong Kong and Singapore) are still healthy, since their stock markets did not grow so suddenly as it did in America 2-3 years ago at the advent of eBusiness companies. Business Week magazine quotes David Aaron (as Clinton's former Commerce Undersecretary for International Trade): "'If there is to be a recession in America, the only place to look for any potential dynamism is going to be Europe,' he says. If the U.S. helped pull along the rest of the world over this last decade, it may be time to shift the burden."

2. eBusiness has become much more credible in the last year. In late-March, 2001, CNN reported: "Less then a year ago, the skepticism of European businesses towards electronic business was much criticized. Now, with the dot-com crash in the U.S., Europeans will be able to benefit from their conservatism, according to market researcher Gartner Group Inc. 'Europe is not suffering from the U.S. dot-com hangover. U.S. companies have gone down the wrong road and need to back out. That will take them nine months to a year,' said Alexander Drobik, vice president at Gartner. European companies put a lot of thought into their electronic business strategies and learning about the Net, while their U.S. counterparts rushed to launch dot-coms, said Drobik."

You will miss an outstanding opportunity if you do not take advantage of this momentum built up today in Europe and Korea and address their market needs. This enthusiasm in other countries opens a door to those who can address foreign markets online.

3. A further point in their favor, Europe (and Asian) countries are going online faster than ever. Most countries online populations have doubled in the last year.

4. Expand internationally before your competitors do. Those who get in first have a "first mover advantage", early recognition that helps them gain later market acceptance.

5. Perhaps the best reason to go global is simply... "more sales". When global marketing is mature, non-U.S. sales should represent double or triple the amount of domestic U.S. sales.

6. People in other countries do not find that much content in their own language, and are hungry for Websites that bring them what they want.

7. Satisfy your shareholders: companies who have established global sales have a higher value than strictly domestic companies

In order for an American company to gain a critical understanding of market and cultural requirements, they would be best advised to enter global markets through partnerships with U.S. and European Web integrators and translation companies that have locations in the regions where they plan to conduct business. This method will allow these companies to gain a better understanding of local customers’ preferences, customs, and business practices, as well as brands and fulfillment practices, before they enter the market. They should make sure that their Web site(s) offer a local, culturally appropriate touch in order to gain and maintain a global competitive advantage.

Once you are convinced to make an action plan to expand internationally, you will need to locate firms to assist you in all the various aspects about globalizing your business -- marketing consultants, lawyers, freight forwarders, after-sales support teams, etc. How do you find knowledgeable partners to navigate through the myriad of details needed to globalize your business and minimize the risk of investment? When looking for advice, here are several questions to ask them:

• Do you have staff on the spot in countries my company wants to target? Local people?
• Are you easy to to reach by phone and by email?
• What can be done in local marketing, both online and offline, to make my company be taken seriously? I want my company to be a true competitor to local companies in these countries.
• What telecom services and call centers are available, to centralize marketing and after-sales support in the language of the markets?
• What legal structure does my company need in order to be able to sell in these countries?

Here are several pitfalls to avoid:

• Do not assume that a translation agency is sufficient to help your company go global. Nor is an international marketing consultancy sufficient for this purpose, or a legal firm... or for that matter, any one piece of the whole picture. You will need all these elements working together to go global.
• Do not abandon your international expansion if you have not brought in any sales after one or two quarters. It takes time to build a plan to go global and for your company to be recognized in a given country. Many Europeans, for instance, will not buy from a company when they first hear about it. They have seen many American companies come and go, and usually have had a negative experience with an American "fly-by-night" company that came into their country and left it hurriedly. They want to see that a company will be around in several years, after the bugs are worked out.
• Do not assume that "they speak English in other countries, so there is no reason to translate our marketing materials or Website". Even if some Europeans can read English, they have a tendency to ignore advertising in English. Many times they assume that if a company does not advertise in their own language, they would not want to buy from that company. Willy Brandt, the former German chancellor, put it this way: "If I'm selling to you, I speak your language. If I'm buying, dann müssen Sie Deutsch sprechen [then you must speak German]."

Whatever you decide to do about your global marketing strategy, do not delay. This is an excellent time to turn your attention to foreign shores and expand your business there. Ten years from now, once you are established globally, you will wonder how your company survived as a predominantly U.S. domestic business.

Written by Bill Dunlap, CEO
Global Reach
Tel./fax: 1/415/680-2423 (U.S.) or 888/942-6426 (toll-free)
+331/5301-0741 (Europe)
email: info@glreach.com
Web: http://glreach.com
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Last revised on 5 April, 2001
URL: glreach.com/eng/ed/art/rep-eur23.php3