International Business Trends and the New Normal

COVID-19 is dramatically transforming the way companies do business. HubSpot CEO and Co-Founder Brian Halligan recently shared some insightful views on what the new normal will look like. One of the best marketers I’ve ever worked with, my colleague Kieran Flanagan, also shared some insightful thoughts on how the new normal will change the future of B2B marketing

Inspired by the great ideas they offered in their posts, I decided to reflect on what the new normal will look like for the readers of this blog. Here are 16 international business trends I think we will need to start preparing for at our companies.

1. Executives won’t get on planes as frequently, but will be more virtually accessible.

One key factor in connecting local offices to a company’s HQ location has historically been having executives spend plenty of facetime in those offices. Doing so enabled them to build relationships with local leaders and team members. It also drove a strong sense of security and safety among employees in the local office, renewing their confidence in the company’s commitment to the markets they cover. Now that international travel is restricted, and will be for some time, execs simply won’t be able to visit those locations as frequently as they once did.

On the flip side, executives will be doubling down on connecting with those local offices virtually. While this won’t have the same effect as being there in person, executives can still recreate similar effects through remote collaboration tools, such as Zoom, Loom, and Slack. The watercooler conversations will be replaced with “executive drop-ins” to different team slack channels. The “town hall” meetings will be supplanted by virtual “ask me anything” sessions where people can ask any question, even the uncomfortable ones, in an online chat environment. This will open up new communication paths that weren’t there before, which will benefit globalization. 

However, these new internal comms channels definitely won’t replace the value of on-site and in-person visits. Actual office trips will just be “on hold” for the foreseeable future, and will probably decrease in frequency overall in the future. 

2. The quantity of cross-region communications will increase.

It won’t just be executives opening up more comms channels. All managers, all individual contributors, and all teams will be forced to do the same. In a virtual environment, geographic barriers tend to be obscured. As a result, more employees will be willing to reach across time zones and build connections and relationships.

With more comms channels and more frequent communications, some relationships will emerge that didn’t exist before, enabling more cross-region collaboration to happen. Overall, this is a good thing, and will promote more globalization, even if it may be scattered at first.

3. The quality of cross-region communications will take a hit… at first.

The depth of relationships across geographies will see some weakening initially. Global team off-sites will move to virtual, which won’t help teams build truly strong relationships. Local teams will lean into “protecting their own,” which as local leaders responsible for local jobs and the livelihoods of employees, they really should. This may temporarily cause them to distance themselves a little from global playbooks, so it’s something for global companies to be mindful of, just to ensure local teams feel fully supported. 

While frequency of “shallow” communications will increase across regions, as mentioned above, the “depth” of communications is what stands to take a temporary hit as teams double down on supporting their local needs. But that’s OK. Let them strengthen locally, to later be better reintegrated into the global system when they are all individually stronger. Autonomous local teams are critical for global success. This period of restrengthening and regrouping will serve companies well later on, so let it happen. Make sure local teams feel empowered during these times.

4. Heavy office launch playbooks will give way to lighter-weight ones.

Companies will be more conservative with big, up-front investments in their international growth. Digital-enabling businesses will see higher demand from overseas, but they will no longer be as confident about investing heavily in setting up new offices with all the expenses and hassle. As a result, they’ll seek out faster, easier, and lower-risk options to address customers in new markets. Creating local entities, offering local benefits to employees, worrying about local taxes… all of this will seem like a much taller and riskier proposition than it used to be. 

Remember my list of 141 questions to ask when launching an office in a new location? The first two phases (market research, strategy formation) will still be absolute musts. But for the latter and more operationally complex phases I’ve outlined, leadership teams will ask, “How can we do this in a lighter and easier way instead, opening up new markets, but adding less friction to our business?” As a result, I believe companies that offer professional “employer-of-record” services (like Globalization Partners) and those that offer international SaaS commerce platforms (like Paddle) will see a huge uptick in demand for their services.

5. Local teams will gain greater autonomy.

Local teams who feel a bit under the thumb of leaders who sit at HQ will feel the power dynamics shift. Leaders in HQ will need to trust their local leaders more and more to make the best decisions for their business, moving away from less flexible approaches that possibly never served them well in the first place. Companies that try to enforce a “global playbook” onto local teams when it was really designed with just a domestic market focus simply won’t be able to do that anymore. 

As a result, local teams will thrive, become more creative, and begin to really shine when they are unfettered a bit more and allowed to do what is best for their markets. It isn’t that people in global roles will intentionally set out to empower their local teams. It’s just that the local teams will become more unified and connected at the local level, and will take it upon themselves to ensure their teams and offices thrive, thus raising their own confidence in taking action on the many great ideas they’ve had over the years, but felt a bit unable to really execute on without permission.

6. Local brand awareness will become a top priority.

As people pay much more attention to their local news and local realities, playbooks for awareness that were applied globally will yield to local brand awareness plays. Content marketers who focused on regions will think about content marketing plays they can execute at the country, province, or even city level. Marketers who purchase advertising will start to look more closely at local channels they never considered before.

In fact, some marketing teams might consider these strategies to be “hyper-local” in nature. They will seek out more partnerships and co-marketing opportunities with local influencers and aligned brands. Their social media strategies will also become more locally targeted, all in the interest in driving awareness in a much more locally relevant way.

7. Native content will grow in importance.

I’m a huge fan of native content, as outlined in this post, for driving local growth. I believe the pandemic will force more teams to take a close look at their investments and strategies to figure out where local content can play a role. As they seek to optimize their resources, they will better be able to determine where a native approach makes sense as opposed to localization, or a combination of the two. 

As more teams understand the value of native content, there will be an increase in demand for local copywriting and creative services in multiple languages. Many marketers will partner more closely with agencies, and will look to bring more of these services in-house, to align them more closely with their teams.

8. Local offices will contribute more to global company culture.

Because of the rise in local autonomy, teams in local offices will come up with creative and innovative ideas than ever before. Their renewed ability to experiment will open up more creative thinking, leading them to have greater successes and local impact. This will give rise to the local “parts” of the system having an impact on the larger global whole.

Their impact on the global organizational culture won’t be visible immediately. At first, local teams will simply come up with new ideas as ways to address challenges that seem fairly unique to their needs. But later, as they share the news about their successes, other regions will pick up on these ideas. And the global company will ask: “What if we applied this in our domestic market?” “What if we tried the same experiment in a new segment?” “How could this work if we applied the same thing to this vertical?” and so on.

9.  International operations will play a bigger, more impactful role.

I like to think of international operations as “the global glue” that holds teams together across geos and functions. During times of uncertainty, companies will need to double dip into that glue to hold things together. As such, international ops will play an even bigger role at most companies than in the past.

International operations professionals typically work quietly behind the scenes, without seeking any limelight, making sure things run efficiently. I mean no disrespect when I say this, but with international growth, let’s face it: revenue-generating teams tend to get most of the credit. However, when the international ops role is underdeveloped or underfunded, cracks begin to show, especially as organizations get bigger. Many people misunderstand the role of international operations, which requires not only analytical excellence but also exceptional project management skills. 

Operations leaders need to work across functions. International ops leaders have a harder job in many ways, because they need to work across both functions and regions. Their role in keeping all these pieces connected and cohesive will be expanded, and highlighted, within the new normal.

10. Companies will reevaluate their strategies for emerging markets.

During any economic downturn or global crisis situation, the most vulnerable among us tend to suffer even more. This is hugely unjust, but it’s a fact. It applies at the domestic level (such as with minority populations suffering disproportionately by almost every health measure), but it also applies for entire economies. There is a reason most companies don’t target emerging markets until at later points in their international expansion evolution. These markets are the least stable economically. So, while they offer many cost advantages, along with geographic revenue diversification and high rates of growth, a company has to be careful about when to add them into the mix, as well as their percentage of overall revenue share.

In wealthy countries, governments have the ability to access funds to redistribute to their populations as they see fit. Even when wealth isn’t distributed very equitably within a country, if a rich country has wealthy segments of the population, including the business world, those segments might take it upon themselves to donate or access their cash reserves, and help provide some stimulus, or at least prevent unemployment from taking too big of a rise too quickly. Countries with less access to monetary resources simply don’t have this advantage. As a result, companies will take a hard look at their investments and strategies for emerging markets. 

This isn’t to say that companies will necessarily pull out of these markets. While that is a possibility, the opposite might happen instead and some companies will likely just change their approaches. For example, perhaps offices in low-cost locations will suddenly seem even more attractive for filling certain new roles globally than they did in the past under smooth sailing conditions. Or, companies might decide to lower their cost of goods sold (COGS) and/or customer acquisition cost (CAC) by leaning more heavily into spending in emerging markets versus more expensive, developed markets. No matter what, companies will be forced to pay closer attention to emerging market realities than they might have in the past, because these economies tend to offer different challenges, but also a wider variety of solutions to employ.

11. Remote work will smooth out an uneven global playing field. 

Flexible working hours in every time zone will mean that people working across more time zones will be able to connect. Working parents in North America who are forcibly homeschooling their kids during the day may find themselves working extra hours at night, thereby overlapping more with their colleagues in APAC time zones. Similarly, the employees in Europe in the same boat might suddenly have more overlap with Asia or North America than they did in the past.

In addition, when global meetings happen, the power dynamics will be less regionally focused. The meeting that used to have two people dialed in via Zoom at a disadvantage while the rest exchange small talk and jokes in a cozy conference room will be no more. Suddenly, teams will decide that all participants to such meetings should attend remotely, or that the people who normally have less power can attend in an office, and the rest can attend remotely to help balance out the power dynamics of the meeting better.

This was something I saw a major benefit from when I ran the office launch process for our Tokyo office at HubSpot. To change things up from other office launches, I intentionally scheduled all of our launch team meetings at a time when the non-local team members would have to attend via videoconference, so that our team based out of Singapore could attend easily and feel more empowered to drive the decisions. This was unconventional wisdom back then, but it forced the people in HQ to attend remotely, creating a more balanced power dynamic.

12. International experience will matter more than an MBA.

MBA programs are incredibly valuable, no doubt. However, fewer MBA students are being allowed into countries like the United States from other countries due to tighter visa restrictions and lately due to the pandemic. Aside from international MBA programs, or MBA students with international backgrounds, there is simply no replacement for direct, hands-on international business experience. This is of even greater importance when you’re working at a global company. And when you’re driving international expansion, it’s simply essential. Yes, you can learn on the job, but you simply have to have people with this experience in your corner.

By international experience, I mean people who have lived in, worked in, and studied in other countries, for a good chunk of their professional career. The reason I say this will matter more than an MBA does during our new normal is that you can do an MBA program from anywhere, including virtually. There are hundreds of thousands of newly minted MBAs every year. How many people with international business experience do you think are being created every year, by comparison? They are much more difficult to find. You can only gain deep international experience by going and living abroad. Because these opportunities will be exceedingly rare and more difficult to come by, the people who already have that international experience will be more sought after than ever before.

13. Local customer voices will stand out more in the global choir.

With more people sitting in offices and local markets having a higher frequency of comms with teams in HQ, people in leadership positions with global responsibility will be able to pay closer attention to some of the individual voices in the choir. It’s like listening to a song with surround sound for the first time and hearing notes and instruments you never noticed before.

To amplify those local voices, regional leaders and people driving international growth should leverage this unique opportunity. Blast that saxophone (or your instrument of choice in this analogy). Get those local voices in front of executives to highlight local needs, but make sure you pick the right markets that they are already committed to. There’s no point in turning up the volume on screechy bagpipes if you know they always remind your leadership team of a funeral. Make sure you’re advocating for the local markets that really matter most to advance the goals of your company.

14. “Global-first” as a mantra will give way to “local-first.”

One of the things I’ve mentioned in many talks, webinars, and one-on-one conversations with folks driving international expansion over the years is the importance of internally branding globalization until it sets fire at your company and can burn on its own, even after you leave. You have to pick a mantra and keep repeating it, weaving it into every conversation, new hire training, and internal Wiki post until it becomes simply the default “way people think” at your company. 

Getting international on people’s minds and creating organizational change is really challenging. Frankly, you have to be a masterful internal marketer to pull it off. And, you need a lot of patience. I’ve been advocating for the notion of “global-first” for many years, just as many of my colleagues at other companies push for “global readiness” and “global enablement” in their businesses. So, now that we’ve all done this and are starting to see some success with it, I’m sorry to say that your focus will need to change under the new normal. 😉

With the pandemic changing the way we do business globally, you’ll need to be more focused than ever before on driving a “local-first” approach. Yes, strategies still need to be global in nature, but more importantly, they need input from the local markets even more than at any other point in the past. Realities on the ground are changing, and will continue to change for quite some time. Local-first needs to be more top of mind for people all over your company. It doesn’t mean you will cease pushing for global-first thinking, but you’ll need to advocate more for local teams being involved and consulted than ever before.

15. Product-Led International Growth will matter more than ever.

Product-led growth is simply the best growth out there for modern companies, in my opinion. As I’ve written about in the past, I’m a major fan of driving international from within product, even though that can be hard to achieve, depending on the company you’re in and where your product team is focused. 

As discussed before on this blog, building products that are internationally scalable has a lot in common with prioritizing extensibility and open APIs. Localizability is just another type of extensibility. And if you’re designing a web app, simply following these 27 tips will make your localization much easier and faster.

16. Globalization will be seen as an extension of diversity, inclusion, and belonging.

Not everyone in this world has an equal opportunity to make their dreams a reality. It’s harder, if not totally out of reach for many people, to create something from nothing. Often, the economic conditions, country, and language they were born into directly dictate the opportunities that will be within reach, no matter how hard they stretch toward them. 

So yes, it’s exciting to see your own company’s international growth story unfold and have a big impact on your business. But if you pivot your thinking to a customer focus, what does it really mean for the impact your company can have on removing international barriers to access? If you believe strongly in your company’s products and services, your mission as a leader of international expansion for your company is even bigger in nature than you might first realize.

Going global isn’t just about your company. It’s about your customers in each country and the community you are creating in each market. There is always a reciprocal relationship at play between a company and the community you build in each local market. Your international expansion unlocks opportunities for your customers in other countries, who speak other languages, and whose economies likely stand to benefit from your offering. 

So, it’s not a stretch to say that if you extend what your company offers into more languages and countries, you might actually help address barriers of access along the way. I know that’s not most companies’ mission, much less what is on our minds during times of major societal and economic shifts. However, as someone who works at a company where I also believe in our product, it’s the added zing that drives me to support international growth, even on the hardest day.

I also believe the best, most innovative and creative ideas don’t come from sameness and homogeneity, but rather, from uniqueness and diversity. Global revenue diversification is good for business, in general, and that’s why international expansion always has business value. But expanding across borders ultimately strengthens a company in a similar way as diversity, inclusion, and belonging do. When more voices are heard and incorporated, from employees, from partners, from customers who have a variety of experiences and viewpoints, diversification improves, and companies grow stronger. All of us who’ve worked in international business know that this applies from the perspective of diversity of languages and countries too.

How do you think the new normal is redefining your own international expansion work? I’d love to hear from you.