And much to the chagrin of his 85-year-old grandparents, our son can rap with the best of them. His American cousins, on the other hand, are quite impressed, since he can do it in more than one language and culture … South Central L.A. and north coast Black Sea (Turkey).

Our son represents the main challenge when a company tries to develop a strategy for an emerging market (or for any market, for that matter) … to meet the human desire to be part of the “in group,” while at the same time providing some of the same freedom as that possessed by the originators of a product or service to add a bit of their own rhythm, their own message, their own spice.

It’s a mix of who you know and what you ask.

There’s no magic to the process, though. It’s still all about human relationships and networking. It’s a mix of who you know and what you ask. It’s about discovering and discerning people’s unspoken needs and desires – the feedback they don’t know how to give you, unless you ask in a way that they understand. It’s the difference between knowing your customer and understanding how to get to know your customer – in all their variations and flavors, while developing the ability to anticipate how their tastes, preferences and needs will change over time. It’s also about working to influence these same tastes, preferences and needs, and the environment in which they flourish.

It’s the difference between …

… the Ikeas and the Nokias of the world who follow their customers into their homes and to their work sites, while taking the time to intuitively observe and keenly analyze how their products are being used, and how they might be used in the future.

… and the Wal-Marts of the world who just can’t seem to get it right, regardless of the billions of dollars that they pour into global expansion. Wal-Mart – still the world’s largest retailer, incidentally – isn’t even close. It only operates in 13 countries and has stumbled badly in Brazil, German, S. Korea and Japan. International sales currently represent only 20% of its total sales!

So how can a medium- to large-sized company reach its targeted segment(s) in today’s emerging markets? Here are some general guidelines to follow when building an emerging markets strategy.

Internalize the fact that these potential customers simply represent a different part of the same prism.

It may be a different part of the prism, but the questions to ask are still the same, i.e., what need/want will your product/service meet for these potential customers? What methods must you use to uncover these needs/wants? Then how will you enable your product/service to deliver these new benefits at a profitable margin?

Many of your potential customers in emerging markets are earning their livelihoods by producing the products that the rest of us eat, wear, play with, etc. And they are also supporting the businesses that deliver the services to the rest of us.

As they make these products and deliver these services, it means that their tastes and preferences are changing as well. However, they often place a higher value on high quality products since a greater percentage of their income is required to buy a given product.

This also means that it is extremely important to spend the effort to understand how business practices, consumer tastes, religion, communication and the relationship to one’s family and community all intersect to determine your potential customer’s behavior, tastes, preferences and dreams. Who shapes the tastes and leads the trends, both internally and externally? This applies to all markets, but the importance is highlighted when moving to a market that is more dissimilar to your own.

Focus on one or two emerging markets and then drill down to focus on two or three possible customer profiles and how to reach them.

If you want to market a product, then follow people into their homes and businesses like Ikea has done with its Hispanic customers in California and Nokia has done with its targeted regions in India. There’s simply no way to get around this if you don’t know anything about your potential customers or find that you are not “connecting with” them.

Ikea didn’t do very well when it first tried to enter the U.S. in the early 1990’s. Its beds were measured in centimeters, and its sofas weren’t deep enough. Kitchens didn’t even fit U.S. appliances. In short, Americans were buying Ikea vases as drinking glasses!

The company then decided to focus on certain market segments and literally followed customers home to observe them in their own environments. It discovered that Hispanics in California needed bigger tables to accommodate their extended families when they sat down to eat, and that they were willing to pay a lot more money than other U.S. customers for ornate picture frames for family photos. Ikea listened and adapted, and is now on target to have 50 stores or more in the U.S. by 2010.

Nokia now commands 75% of the cell phone market in India.

Nokia is also following its customers into their homes and workplaces, as it watches how people hold their phones, how they charge them, how they interact with them if they are illiterate, etc. According to Jan Chipchase, Principal Researcher at Nokia Design, "If we want to remain relevant in all these markets, we need to know how our assumptions differ from other people's." (Source: Designing Mobiles for the World, 28 May 2007). According to Keith Pardy, Nokia’s Senior Vice President of Strategic Marketing, "The growth potential in emerging markets is amazing. They now represent a larger portion of the global market for our business than developed markets do … First we observe, then we design …"

But it can’t stop with product design if you want to be successful. According to Pardy, "It’s imperative that we provide the same quality experience in all our devices, whatever the price point. Building the whole customer care infrastructure in emerging markets is also extremely important." (Source: Confronting Proliferation in Mobile Communications: An Interview With Nokia’s Senior Marketer, Trond Riiber Knudsen, May 2007, McKinsey Quarterly)

Based on this strategy, Nokia now commands 75% of the cell phone market in India. And it is projected to become the company’s second largest market by 2010, even though only 23% of its population uses Hindi, which is just one of the country’s 22 official languages. This explains why Nokia has been one of the first high-tech companies to venture boldly into localizing for a minimum of 9 languages – in spite of the lack of full Unicode support for certain character sets.

So, how has Nokia done it? Deepak Chari (User Guidance Manager for Nokia in Singapore) provided a fascinating look at what it really means to “enter the Indian market” in his case study, The Anatomy of Building Dominant Market Share. (You can download a copy of Chari’s presentation by logging into the LISA web site as a LISA Member and going to http://www.lisa.org/archive/forums/2007beijing/presentations.html.) Nokia did it the “old-fashioned way,” by conducting market research and then designing a product from the ground up to meet the needs that it had uncovered. Voilà – the Nokia 1100 in 2003 – including a flashlight (to use in the dark during India’s frequent power outages), dust-proof casing, a Hindi UI and input capability, and non-slip casing (for those sweaty palm days …).

Don’t fall into the trap of only focusing on the top tier of the socioeconomic pyramid, or just the two or three biggest cities in a particular market.

Incomes are growing quickly among many groups throughout the world. For example, purchasing power has increased enough in Turkey during the last eight years that Carrefour, the French retailer, recently opened a store in a third-rate city like Antioch. Once this happens, it means that it’s time to focus on the mid-tier cities within an emerging market, so that you don’t cede them totally to local or regional competitors.

Editor’s Note: For more insights into this topic, read Capitalism at the Crossroads.)

Obviously, the web serves as an important medium to reach many potential customers in emerging markets, especially as more and more of them access it through their cell phones. The web allows your potential customers to go places they normally could not reach – as if they were on a flying carpet. It allows you to do the same with your customers. You should give serious consideration to how to better leverage this tool for getting to know your potential customers in emerging markets.

For the latest best practice in the area of international web support, read an excerpt from the new book just published by LISA, Best International Web Support Sites – 2007. The book covers the international web support strategies of all seven of this year’s winners: Cathay Pacific Airlines, Cisco Systems, CX Agents, Dell, HP, McAfee and Sony. You can download the book for free if you are a LISA Sponsor, Corporate or Introductory Member, or order it online at http://www.lisa.org/awards/download.html.

For a case study on how VeriSign has linked a centralized web site localization strategy to building and supporting its brand worldwide, read Web Globalization From the Ground Up: A VeriSign Case Study, by Anna Schlegel (Executive Producer for Localization and Global Web Properties at VeriSign) in this week's issue.

John Freivalds covers content management, his adventures with Microsoft VISTA aka “frumpy old woman” and the latest financials for the industry in this month’s installment of Money Talks.

LISA Will Be in Beijing in August

If you need to catch up on the latest trends in offshore application software development and testing, then plan to attend the LISA Professional Skills Workshops (including a LISA Roundtable for Product Developers) in Beijing from August 27-31. For more information, click here.

LISA Will Be in Berlin and Antwerp – Special Packages Available

If your travel budget includes Europe this year, then mark your calendar for Berlin in October and Antwerp in November. Join us for the LISA Forum Europe in Berlin from October 22-26. Our theme will be Building Global Teams Locally: Outsourcing, European Integration and Globalization. For information on special packages, please click here.

From December 10-12, LISA and the Lessius Hogeschool in Antwerp will host a unique Forum, Teaching Localisation for Global Business Readiness. The Forum will bring together localization professionals from academia and industry seeking to improve career development and training in today's localization industry. Click here for more information.

TBX Survey

TBX has been submitted for approval as an ISO standard. The LISA Terminology SIG is running a brief survey to determine how widely it is being used and to gather feedback from (potential) implementers. To participate, click here.

Current Topics in Globalization: Outsourcing Best Practices

If you are responsible for developing or executing strategies for localized software QA, we have just published Current Topics in Globalization: Outsourcing Best Practices for the QA of Localized Software. Compare and benchmark your company’s QA processes against the best practices currently in use by some of the world’s most respected software developers. You can download the book for free if you are a LISA Sponsor, Corporate or Introductory Member, or order it online at http://www.lisa.org/products/obp/?from=gi.

Taking Software to the World: China Edition

LISA announces the release of Taking Software to the World: China Edition, an update to its large-scale examination of the factors that influence business users’ purchase and use of localized software. The updated research in China confirms that the quality of multilingual content is one area where companies entering the Chinese market can differentiate themselves. You can download the book for free if you are a LISA Sponsor, Corporate or Introductory Member, or order it online at http://www.lisa.org/products/surveys/gssurvey.html/?from=gi.

If you haven’t participated in the LISA Globalization Professionals Salary Survey, please click here. The data is always up-to-date and always live.

And we want to hear from you about your strategy vis-à-vis emerging markets. Do you have one? What markets are you focusing on? What new customer profiles are you developing? Drop me a line at Rebecca@lisa.org , so that I can share it with the rest of our readers.