With many businesses now engaging with a global consumer base, the importance of localization has become increasingly self-evident. What is localization, you ask? Simply put, it’s the process of adapting products or services to meet the linguistic, cultural, and regulatory demands of different markets.
However, as with any business investment, it’s crucial to measure the return on investment (ROI) of localization efforts. Understanding the ROI helps businesses make informed decisions about where and how to allocate resources for maximum impact. That said, it can be tricky to understand exactly how to measure the business results of localization processes, as they are often tightly embedded in marketing and sales endeavours, making it complicated to discern which results should be attributed strictly to translation and adaptation.
ROI in localization can be defined as the financial return gained from localization efforts relative to the costs incurred. The formula is as follows:
ROI = (current value of localization – cost of localization) / cost of localization
By understanding both the costs and the added value, businesses can assess the effectiveness of their localization strategies. As already mentioned, tracking the current value of localization isn’t always a simple process. Luckily, there are a number of key performance indicators (KPIs) that businesses can use.
To effectively measure localization ROI, businesses should track a variety of KPIs. Here are some examples:
Making accurate sales estimates is crucial for maximizing localization ROI. Businesses should consider factors such as population size, relevance to their business, and comparisons with existing markets. Tools like Google Trends can provide insights into market interest and demand. Additionally, understanding local laws and guidelines in new markets will help to avoid any regulatory barriers.
Beyond traditional KPIs, businesses should estimate the time given back to internal teams by outsourcing localization tasks. Conducting user testing studies can also provide valuable feedback to improve localized products and services.
Localization involves various costs, including translation, technology, and human resources. Accurately tracking these costs is essential for calculating ROI, but the world of localization can be difficult to navigate alone.
Partnering with a professional language service provider can help consolidate these costs, making them much easier to track. Alpha CRC offers an ‘under one roof’ model, centralizing all localization projects and enabling easier budget control for clients.
To maximize the ROI of localization efforts, businesses should adopt strategic approaches:
Localization is a powerful tool for businesses seeking to expand their global reach. By strategically measuring and maximizing the ROI of localization efforts, companies can ensure their investments yield significant returns. Continuous evaluation and adaptation of localization strategies are key to thriving in diverse international markets.
Businesses are encouraged to start evaluating their localization efforts today. By implementing the strategies outlined in this guide, companies can enhance their global presence and achieve sustainable growth in new markets.
Alpha CRC offers clients high-quality localization services that blend the best of human creativity with the speed and power of technology.
From translation to content creation, Alpha CRC enables clients to engage with their global customer bases and improve their reach.
Looking to get localization advice or begin a project today? Contact us.