Saturday 11 August 2018

The Power of 'Glocalisation'

Say hello to 'Glocalisation': Globalisation's much more popular little brother.

There are currently over 36,000 McDonald's restaurants, spread across over 100 countries, hiring over 1 million staff, serving over 16,000 customers every second of the day.

If there is one emblem of the phenomenon of globalisation, it's a pair of Golden Arches. In just the span of 78 years, McDonald's has grown from a Californian hamburger stand to the global pioneer of fast food, whose span extends from the sunny shores of Los Angeles to the chilling depths of Siberia.

There are many things that McDonalds symbolises- the efficiency and ruthlessness of capitalism and the spoils of excesses among two of these- but more than anything the fact that the Golden Arches are pretty much everywhere indicates how well McDonald's have taken advantage of Globalisation. McDonald's has become a global brand, selling well to customers around the world.

What is often overlooked is how exactly McDonald's has reached this global status, as have many other brands.

If you were to try to take a standard American Big Mac, that has long been one of McDonald's hallmark products, and sell it across the world, you might be in for some surprises. Despite its reported deliciousness (unfortunately or not, this writer has never tasted one), you would find much of the global population turning their nose up at the burger. Hindus, who make up the majority of India's population of over 1 billion, would protest on the grounds that the burger stars beef. The predominantly Muslim Middle East would not be receptive to the non-Halal meat, and other populations may find the American burger not suited to their perhaps more exotic tastes.

So if McDonald's were to offer exactly the same products across the world, they would see no success in huge swathes of their stores. Of course, this has not happened in reality- thanks to McDonalds' effective use of 'Glocalisation'- Globalisation, but with a local twist.

Glocalisation means McDonald's offers the 'Maharaja Mac' in India- a Big Mac, with either chicken or vegetarian patties rather than beef patties, better suited to most of the Indian population. It means McDonald's serves halal meat in all its Middle Eastern stores, with no pork products offered. And it means throughout the globe, you will find special local products offered by McDonald's in various countries- from the Shrimp Burger offered in Korea (pictured) to McDrumsticks offered in South America.

All global fast food restaurants tailor their products to suit local markets, and there are other notable examples in other sectors. For example, car manufacturers like Audi produce special long wheelbase versions of their cars that are exclusively sold in the Chinese market, where legroom is known to be highly valued by buyers. In technology, Samsung are known for producing special items for certain markets, whether a new type of TV with a 'Cricket Mode' for India and an 'Ice Hockey Mode' for Russia, or a 'Convertible Refrigerator' offered in South East Asia, that allows Freezer drawers to be converted into refrigerated drawers.

A notably effective example of Glocalisation comes with the story of IKEA's launch in India. To sum up this excellent Quartz article, the Swedish furniture maker's launch in India was in the making for 6 years, during which extensive research was made on the local market and its needs. Over 1,000 Indian homes were visited in the process. As a result, the Hyderabad IKEA store which opened yesterday features many items unique to India, made from locally sourced materials and designed especially to meet local needs.

Globalisation is seen by many as a negative thing, primarily for the reason that it has the potential to eradicate local norms and cultures, and replace these with a single (predominantly American) style. There is no doubt that this has already happened- the spread of the McDonald's hamburger, for example, has arguably altered the tastebuds of a whole generation of youth across the world.

But as companies begin to understand the tastes of their local markets across the world, glocalisation is helping to combat the cultural shift caused by globalisation, by acknowledging and preserving certain aspects of culture. However, glocalisation is arguably sweetening the bitter pill of globalisation- allowing a uniform culture to spread gently, with less pushback. After all, American fries are still offered in every McDonald's across the world!

Therefore, multinational businesses must understand and embrace their new role in the various markets in which they operate- to bring the efficiency and affordability that makes them popular, but help preserve local culture by incorporating it into their offerings. To ensure long term sustainability, firms will need to arguably do more than they are doing now. In the area of food, for example, granting more autonomy to local markets in terms of the menu offered could help a great deal, not only to preserve local culture but also to increase the customer base and revenue.
Lone Editor