The factors that are changing our world are affecting the way we build and manage brands. The three forces of globalization, localization and personalization are increasing simultaneously. The world is more connected, but relevant regional differences and personalized experience cannot be ignored.
Globalization means coherence, reliability and certainty, while addressing universal truths such as hunger, family, status, performance and acceptance. Localization means regional relevance to help brands respect variances in geography, communities and neighborhoods. Personalization defines each of us as an individual, defining who we are, differentiating us from others.
How do we build strong brands in such a world?
What's needed is an evolution in global marketing from the global standardization approach (a one-box model where the focus is on global brand homogeneity) to the "Think globally, act locally" mantra (a two-box model where the center creates the strategy and the regions are responsible for merely executing the direction they receive from the center) to a new approach, one we're calling the Collaborative Three-Box Model.
In 1983, Theodore Levitt recommended a globally standardized approach. We call this a one-box model, forcing the whole world into the same marketing box. The one-box model asserts that a global brand should be the same everywhere regardless of culture, language, customs and values. This creates globally centralized, standardized, homogenized marketing. With all the fragmentation, segmentation and fractionalization already happening today, homogenization is hazardous for brand health.
The two-box model is commonly referred to as "Think globally, act locally." Marketing strategies and ideas are globally generated, but the regions now have the opportunity to implement these ideas in locally relevant ways. Unfortunately, this devolved into just another way for the center to be in control. It is a handoff model: from the central brains to the regional brawn, global thinking with regional tinkering. And the regions do not have to accept accountably, as they did not develop the ideas. Further, it creates a serious tension between the strategists at the center and the implementers in the local geographies.
There is a need for collaboration rather than confrontation. The Collaborative Three-Box Model is one with shared responsibility. The three boxes allocate responsibilities properly for the central global teams and the local/regional teams. Above all, the process requires collaboration across geographies and functional silos.
BOX 1: Define the brand's common global ambition. "Since the ambition is common across geographies, it is the leadership team's responsibility, but they must respect and take into account the input of the regions." This means the responsibilities are shared 80% globally and 20% regionally/locally.
BOX 2: Define the brand framework. This step presents the most difficult collaborative challenge. Responsibility is shared equally between global and local teams. The brand framework defines the boundaries and the global plan of action within which there is local freedom. It is the global brand leadership's responsibility to maintain the framework's integrity around the world and across functions.
BOX 3: Bring the brand to life. It is the responsibility of the local/regional teams to create plans that are both locally relevant and that increase the personal connection customers will have with the brand. However, the creativity on the part of the local teams must be within the framework of the global ambition from Box 1. In Box 3, responsibility is 80% regional/local and 20% global.
With the Collaborative Three-Box Model, local marketers become regional thought leaders rather than mere implementers of the directions received from remote, central big thinkers. Using cross-functional, cross-geographic teams, the Collaborative Three-Box Model helps to define the respective leadership responsibilities of the global and local brand teams. Ultimately, the local teams know the local customers best.
With the new approach, marketers build global brands that are globally coherent as well as locally and personally relevant. And as a collaborative mindset, it helps organizations manage through the tensions that arise from global and local decision rights.
Adapted from "New Brand Leadership: Managing at the Intersection of Globalization, Localization and Personalization," by Larry Light and Joan Kiddon (Pearson, 2015). Mr. Light is chairman and Ms. Kiddon is president-COO of Arcature, a management consulting company that advises on creating, building and managing brands.