The digital revolution has truly transformed how we conduct business, creating unprecedented opportunities for global expansion. But is that the full story? Or do we need to focus more on balancing online and offline in international sales?
With a stable internet connection and the right strategies, companies can now access international markets without physical borders limiting their reach. Sandra Schütt, a seasoned global growth consultant and the founder of Glocled GmbH, exemplifies the potential of global business expansion through her extensive expertise in the international arena. Our discussion explored Sandra’s experiences and her thoughts on the challenges, advantages, and best practices for international business today.
Table of Contents
A Brief Background on Sandra Schütt
Sandra Schütt was raised in a multicultural environment, with parents who emigrated from what is now Romania to Germany after World War II. Her upbringing in this diverse cultural setting sparked her interest in international business. She later spent time as an au pair in Silicon Valley in the United States, a melting pot of innovation, where she became convinced of the endless possibilities in global markets. After studying international business with a focus on marketing and sales, Sandra began her career in the IT sector, working for renowned companies such as SAP and various startups.
As the founder and CEO of Glocled GmbH, Sandra has since dedicated her efforts to helping IT businesses thrive in the international market. She provides strategic insights, helps identify suitable local partners, and guides growth strategies for firms looking to expand beyond their domestic market. Sandra’s extensive knowledge and personal experiences provide a robust background that informs her perspectives on the current state of online international business.
The Advantages of Online International Business
There are definitely a number of critical advantages that come from conducting business online, which include:
1. Global Reach with Minimal Barriers
The most striking feature of the internet is its ability to obliterate geographical boundaries. Companies, regardless of their size, can now reach potential customers worldwide. For example, Etsy, an online marketplace for handmade and vintage items, allows artisans from developing countries to sell their products globally without the prohibitive costs associated with setting up traditional export systems. This democratisation of access enables small businesses to compete on a global stage.
2. International Expansion with (relatively) Low Marketing Costs
Finding and reaching target audiences through digital platforms can be done at a fraction of the expense compared to traditional advertising. Dollar Shave Club, for instance, utilised YouTube for its launch marketing, creating a viral marketing campaign with minimal budget. The ad humorously highlighted the product’s value proposition, leading to millions of views and rapid subscriber growth without high investment in traditional media.
3. Diverse Talent Pools
Online business infrastructure facilitates remote employment, allowing organisations to source talent from around the globe. GitLab, a software development and collaboration platform, operates with a fully remote team dispersed across the globe. This model has enabled GitLab to tap into an extensive talent pool, yielding diverse perspectives that enhance creativity and innovation within the organisation.
4. Immediate Brand Establishment
Starting an online presence can occur almost overnight. A well-designed website, social media profiles, and a few strategic marketing initiatives can establish a company’s identity internationally without significant lead time or investment. For example, Shopify provides entrepreneurs with an easy-to-use platform for setting up online stores, helping countless small businesses get started within a matter of hours.
Today, your business is global
Nataly Kelly
from the moment you create a website. From that day forward, billions of people around the world can theoretically discover your company, learn about your products and services, and form an opinion of your
brand.
In her book “Take your company global”, Nataly Kelly recommends that companies think global from their very outset due to the way that business is evolving. A webpage is one of the first assets that companies set up, meaning that in theory they can be discovered from around the world.
5. Facilitated Communication
The rise of online communication tools has transformed business interactions. Companies can connect with partners and clients instantaneously, enabling quicker decision-making and fostering collaboration. Slack, for instance, has become a crucial tool for many remote teams, allowing seamless asynchronous communication across different time zones and enabling simultaneous discussions among team members.
When I started my first job in export, we didn’t have email in the company. Communication with our international partners was by telephone and fax, both of which were prohibitively expensive. It was only a couple of years later that we (well, some of us) got access to email, making customer communication much quicker and cheaper (although it also opened the floodgates to a lot of to & fro that simply didn’t happen before).
6. Rich Data and Analytics
Digital platforms provide valuable data insights that companies can utilise to understand customer preferences, market trends, and campaign effectiveness. Amazon exemplifies effective use of data analytics, tailoring product recommendations based on user behaviour and search history. This analytical approach enables informed decision-making and refinement of strategies over time, enhancing customer satisfaction and retention.
The Hidden Challenges of Online Business
While the advantages of online business are abundant, Sandra emphasised that these opportunities are not without challenges. Some of the significant obstacles include:
1. Information Overload
With so much data available, businesses can quickly become overwhelmed. Companies might struggle with indecision or ineffective strategies as a result of poor data management. For instance many companies don’t even LOOK at their website analytics data so could be missing out on opportunities to optimise their traffic return.
2. Building Genuine Relationships
An essential aspect of business, especially in international markets, is building relationships founded on trust. Sandra stressed that online interactions often lack the personal touch required to forge robust connections. It’s one thing to maintain existing relationships by having “in-between” meetings online, but it can be tough to build new relationships, especially in high-context cultures, purely online. I’ve spoken to a number of companies in the last couple of years who thought that they could drastically save on their travel expenses (seeing as it all “somehow worked” during the pandemic) only to find that distributor motivation sank when visits were limited to once per year.
3. Cultural Nuances
Conducting business across different cultures presents unique challenges, from varying negotiation styles to communication preferences. Misunderstanding cultural contexts can lead to misinterpretations and strained relationships. For example, entering the Japanese market requires more formal introductions and understanding of hierarchy, as demonstrated by the experience of Walmart, which had to rethink its strategies after struggling in Japan before eventually exiting the market.
4. Issues With Trust
Sometimes, businesses encounter a phenomenon dubbed “the invisible dog” where online presence might not correlate with credibility. A small company may seem less trustworthy compared to a larger competitor if there’s no established brand reputation. For example, many startups feel pressure to compete with companies like Apple and Samsung. If a new tech startup relies solely on online visibility without physical proof of reliability, gaining trust becomes a critical barrier.
5. Complexity of Regulations and Compliance
International business often requires navigating complex regulatory environments. Companies must comply with multiple legal frameworks, tax requirements, and trade agreements, leading to burdensome operational strife without local expertise. Even before President Trump started using tariffs as a tool for his geopolitics, I know of countless cases where small companies were taken aback that their deliveries were stopped due to non-compliance or consumers had to pay additional fees. There are many such cases with shipments to mainland Europe from the UK for example post-Brexit, where even if there is no duty to be paid, you have to pay a fee for the customs processing.
6. Dependence on Technical Infrastructure
A company that relies heavily on online solutions must also consider the vulnerability of its technical infrastructure. Cybersecurity threats increase as business interactions become digitalised, leading to potential data breaches that can damage reputations and cause financial loss. The data breach of Ticketmaster in 2024 is a stark reminder of the implications of failing to protect sensitive information.
Balancing Online and Offline Strategies in International Expansion
Despite the vast opportunities offered by online business, it’s important to maintain an active offline presence. Here is why combining both is crucial:
1. Relationship Management is the foundation of global sales expansion
Meeting clients and partners face-to-face fosters deeper connections. In-person meetings allow for more nuanced interactions, allowing businesses to engage with cultural subtleties and build trust more effectively. Speaking simply, you have less potential for misunderstandings when you are both in one room and it’s easier to read the body language. Also in online meetings you simply “do the meeting and move on” – there’s little chit chat or time (or inclination) for relationship building.
2. Hyperlocal Knowledge plays a key role in international expansion.
Online interactions can lead to a one-dimensional understanding of markets. Immediate access to local experts is necessary for comprehensive insights into market trends, understanding competitor activities, and aligning products with customer needs. Starbucks customisation in local markets, such as offering a range of tea drinks in Asian markets, showcases how understanding local preferences significantly impacts sales and brand relevance.
3. Sensory Engagement
Certain product sectors, particularly food and beverages, necessitate sensory engagement. Tasting, smelling, touching, and seeing products often need to occur in person to create strong buying incentives. Wine producers hosting tastings in local markets exemplify this, as the experience of tasting a product often leads to increased sales compared to traditional advertising alone. How many of you have gone ahead and bought a new product after trying a sample in a supermarket?
You might be happy to make repeat purchases online, but for the initial trial of food or drinks products, most consumers still prefer to buy in a physical store. For consumer goods brands this is one of the key points about balancing online and offline in international sales!
4. Quality Control and Issue Resolution
On-the-ground presence enables companies to monitor the performance of their products and services, implement quality control measures, and address any issues more efficiently.
If you don’t have local customer service support in markets like China then your brand is at risk of being dragged through a social media 💩storm. That support might be delivered online (locally) but needs to understand the local nuances and be in the same time zone.
Same if you have a local quality control question from the authorities: If nobody is available to jump right on that, it can potentially spiral out of control before head office is out of bed in the morning…
5. Adapting Strategies
Local expertise acquired through in-person interactions provides invaluable insights into market conditions that may not be visible through online analytics alone. This helps companies adapt their strategies to better suit local demands. That might mean having regional differences too, especially in huge countries such as Brazil, the US or China.
Best Practices for Online International Business
With the landscape of global commerce constantly evolving, companies must remain agile in adopting best practices. Here are the critical strategies that Sandra recommends to facilitate success in international ventures:
1. Invest in Local Expertise
A crucial initial step is to hire or consult with local experts who understand the market dynamics and cultural nuances. Engaging partners who already possess local knowledge can lay a more robust foundation for future success. For instance, Tesla effectively established its presence in China through partnerships with local firms, helping it navigate regulatory hurdles and quickly adapt to consumer preferences.
Make sure that you are really getting consumer feedback though – a motivated distributor invested in your product segment, who wants your business & thinks your products are great, is not the same as your brand being a household name amongst end consumers.
2. Create an Integrated Marketing Strategy
Sandra emphasized the importance of marrying sales initiatives with coherent marketing strategies to accelerate your international expansion. Companies should invest in localised marketing efforts to generate qualified leads that sales teams can effectively follow up. For example, Unilever successfully tailors its campaigns to reflect the culture and preferences of local markets, ensuring brand relevance in various regions.
These days that means balancing online and offline in international sales if you want to reach the widest relevant audience via as many touchpoints as possible.
3. Foster Genuine Relationships to aid Global Expansion
Encourage networking and relationship-building as an ongoing effort. Whether through social media platforms or traditional methods, creating meaningful connections form the backbone of successful business practices. LinkedIn serves as an excellent platform for professionals to cultivate relationships that could lead to business opportunities. Ideally those online business relationships should morph at some point into an in-person relationship, especially if you plan to do business together.
4. Balance Virtual and In-Person Engagements
Maintain a strategic balance between online and offline interactions. Consistent in-person visits, especially in critical markets, ensure that relationships remain strong and compounded knowledge is acquired (after all it’s better to observe market developments for yourself than to always rely on someone else’s perception). Most medium sized German and Austrian companies for example have plans for regular market visits & of course you can have regular short online meetings with a broader range of team members to clarify urgent questions and ongoing project updates.
5. Develop Clear Processes
Establish clear steps for qualifying markets and distributors. Implementing a systematic process helps create an efficient approach to entering new markets. If you need help with this, sign up for my free ebook to help you select the right market using objective criteria, make sure you define an ideal distributor profile or reach out to learn more about my done for you services.
6. Be Cognisant of Regulatory Requirements
As companies expand internationally, they must remain aware of different compliance and regulatory nuances across markets. Understanding local legal implications can prevent punitive actions or reputational damage.
This can be especially tricky in situations where it’s relatively easy for parallel importers to bring in smaller quantities of products that may not actually meet the local regulations eg in Singapore or Hong Kong. It also happens within Europe though, with chains such as Müller, who are not always 100% accurate in their interpretation of labelling laws (so you could find your brand on the wrong side of the law, even though you’ve done nothing wrong).
7. Continuous Learning
Encourage teams to engage in ongoing training related to cultural intricacies, emerging market trends, or new technologies. Global sales expansion isn’t a “one and done” activity it’s an ongoing process that needs your teams to continuously improve their knowledge of the markets involved.
Case Studies
As with all case studies, I’d add that you have to also see them in the context of the time that they happened. So a market entry strategy may have been a success 15 years ago, even if the brand has subsequently decided to exit the market concerned.
Case Study 1: Airbnb’s Global Expansion
Airbnb saw explosive growth by leveraging online infrastructure and local partnerships. Initially, the company launched in English-speaking countries, leveraging digital marketing to create brand awareness. However, as it attempted to penetrate non-English-speaking markets, it faced challenges. They adapted their strategies by engaging local hosts, ensuring cultural sensitivities were respected, and promoting local experiences. By using local representatives, Airbnb could tailor its approach and validify its credibility, which ultimately led to its success in diverse international markets.
Case Study 2: Alibaba’s B2B Model
Alibaba, a Chinese e-commerce giant, has successfully established itself as a key player in international business. By creating a platform that connects businesses worldwide, the company provides an online marketplace for suppliers and buyers to interact seamlessly. Its model emphasises low entry barriers and easy communication, but it also requires a strong understanding of local laws and regulations. Alibaba addresses this by employing local teams in various regions to navigate these complexities, ensuring both buyers and sellers are supported through the purchasing process.
Case Study 3: L’Oreal’s Digital Global Expansion Strategy
L’Oreal has been a front-runner in leveraging online platforms, understanding the power of e-commerce and social media. It developed tailored campaigns across different regions while engaging local influencers to enhance brand visibility. During the pandemic, L’Oreal expanded its use of augmented reality try-ons and virtual consultations, maintaining customer engagement and sales growth despite physical store limitations. This adaptability serves as a prime example of balancing online engagement with responsive marketing strategies in real-time.
Balancing online and offline in international sales
The landscape of international business has irrevocably shifted due to the internet’s meteoric rise, creating unprecedented opportunities alongside new challenges. While online solutions play a pivotal role in contemporary business operations, the significance of cultivating strong relationships and leveraging local insights can’t be overstated. (I mean, could you imagine doing your job without email or zoom?).
The age of the internet has made international expansion seemingly simple, but that can be both a blessing and a curse. You can’t just ignore the interpersonal aspects that are harder to build online (especially across cultures) and which are so significant for success (or failure) when working across borders.
Sandra’s insights provide a roadmap for navigating the complexities of online international business, highlighting that success lies in striking the right balance between the digital and the traditional. Just being glued behind your screen isn’t the way for international expansion success!
As you explore the potential of global expansion, focus on building relationships, deepening cultural understanding, and staying agile. These are the keys to thriving in international markets. In an interconnected world, strong networks built on trust and respect will always be invaluable, whether online or off.
You can watch the full discussion with Sandra below
To contact Sandra with questions or for further discussions:
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Kathryn firmly believes that business is done between people, and therefore places her focus on building strong relationships that form a solid foundation for doing business.
When she's not travelling around the world, Kathryn enjoys playing clarinet in her town's wind orchestra or sharing her love of the outdoors with her Scout group.
