Sink or Swim: Successful vs. Unsuccessful Businesses Overseas

Often when people assess how successful a business is they don’t think much past their own home country. We see businesses thriving around the corner from our homes and think how great they must be, however many companies that thrive in one country may completely fail in another. For example, Starbucks, easily the worlds biggest coffee company thrives in dozens of countries but completely failed in one country in particular.

When Starbucks made their move into Australia they found it hard to compete with small local coffee shops. Many Australians preferred the homey and boutique feeling of the small coffee shops and liked the wider variety of roasts and coffees. They said Starbucks wasn’t “creative” with their drinks and they preferred to go somewhere they could really connect with their baristas instead of feeling like they were in a giant conglomerate store.

-Mare

There are many stores that do very well in some countries but fail in others because of different cultural factors such as religion and family values. One of these stores would be Walmart. It is said to be the predominant retailer in the world, with up to 35 million shoppers a day. However, there are several countries Walmart has failed to succeed in, including India, Russia, Germany, and South Korea. Issues in India had to do with not having appropriate licenses required to sell certain products and for allegedly violating foreign retail investment rules. Walmart failed in Russia because it has a population of about 140 million people, but not a lot of retail development, some people even believe that Walmart didn’t have a strong enough presence and were too slow starting to manage its entry into Russian retail. In Germany, customers complained about the Walmart employees having to handle their groceries at the check-out line and many Europeans prefer to shop at local markets anyways. In South Korea, individuals prefer to spend their money on food and drinks and Walmart marketed items such as electronics, so they weren’t as interested as Americans are. This just goes to show that even one of the world’s most powerful retailers can’t overcome certain obstacles, especially when it comes to people of different cultures.

-Chatty Charlie

The American market likes the ability to purchase items easily and quickly. Sometimes the comments and/or ratings of other influence our choice to purchase or not.

America’s largest ecommerce site eBay struggled to succeed using the American buying tactics in the Chinese online market. The Chinese customers were opposed to hearing the opinion of other buyers – instead wanted to hear from the seller themselves. With the lack of one-to-one communication the Chinese consumer was unable to develop trust with the seller. eBay was incapable to be successful.

-Mary

In today’s society electronics have become part of our daily lives.  Best Buy being the largest retailer to sell a variety of electronics and entertainment this big box store may appeal to Americans but has struggled to make headway in foreign markets such as Europe and China.  The big box failed in its European efforts through poor marketing strategy and failing to notice that Europeans prefer smaller shops rather than large box stores.

In addition being in the European culture Best Buy was unsuccessful in reaching the demographic by not being effective to help consumers identify with a product or service.  Furthermore unlike American culture purchasing the newest products once it is released, Europeans only purchase a few times a year and from smaller stores as mentioned before.  Best buy failed in China due to their prices considering that the consumers are too cheap to purchase expensive products that they would rather purchase the same product from a local retailer. Therefore Best Buy is unable to be successful despite the popular products they carry. 

-KeAnna

Who wants to go to Europe to eat a cheeseburger? Apparently nobody.

When you travel you want to experience the culture of the natives. Disney is such an established and tourist central to American culture they believed they could produce the same effects in Europe, but Euro Disney was a failure.

Many Europeans visit Disney when they are in America so they were confident in its success in Europe.  But Europeans only visit these parks because they are in America and want the American experience. The park was 35 minutes outside of Paris. The idea was to create a complete experience- including guests staying in the hotels and eating all of their meals in the park. But the price of the Disney hotel was about the same price as some of the most expensive hotels in the heart of Paris, so naturally people chose the romanticism and culture of the city of Paris over the isolated American theme park. Disney tried to bring the American culture to Europe. This did not work because they were going against the European culture, trying to tell the natives that they cannot bring food into the park and have breakfast and wine, and were instead offered American food such as cheeseburgers. Disney missed the mark in recognizing the important cultural differences. Just because something is great in one culture does not mean it will transfer well to another.

-Shani