“Global expansion strategy is key to most established companies,” said Santhi Ramesh, Director, Global Innovation & Commercialization, The Hershey Company in his presentation at BEI. “Hersey’s has a 70% market penetration in the U.S., but only 30% globally.”
Santhi Ramesh brings over 20 years of marketing and innovation experience to her position as Global Director, Innovation, Commercialization & Futures at The Hershey Company. In her role, Santhi leads a global team to uncover consumer needs, identify futuristic technologies, nurture accelerator business models and commercialize actionable customer-centric solutions.
To commercialize across the globe in food, “you need to deeply understand the local taste profiles,” she explains. She had taken a team to India and China that was launching products in those countries, and aside from herself, nobody from the team had previously been outside the U.S. Midway through this market tour, Santhi asked for reflections.
The key insight: you must balance opportunities with challenges when scaling globally. There are cultural differences and differences in how you execute the launch for each country.
The question then becomes; how can we gain global scale, drive growth, and adapt to each market, while creating a sense of ownership within in each?
They assert five essential building blocks to enable scale:
- Celebrate similarities (Mom is the gatekeeper, but you also have to appease grandmother). Celebrate power of the brands (Celebrating the power of the master brand and playing to strengths of Hersey’s was key.)
- Live the local culture. Each place has a unique way of living, through which we must get to know how people eat, snack, and store food. We had to adapt for local usage patterns—adapt the product, the packaging, and the commercialization for each market. For example, rituals inherent in Indian culture call for milk to be boiled for a long time before drinking. This means Hershey’s syrup now has to work in hot milk, whereas the U.S. version is designed for cold milk. In China, it is all about balancing the Yin and Yang. As well, you must understand and cater to local food profiles.
- Design to channel. Do not design for end consumers. Think about the places of purchase. Where do people shop? What are the other forms? How do these questions inform the product design given the channel constraint? In India, we developed syrup “sachets” rather than bottles. In China, channel thinking went even further as to initially launch chocolate in food service channels rather than retail stores.
- Grassroots Engagement. How has each country evolved over time? Is there access to technology? What are the normal go-to-market patterns? In some countries, consumers pay with their phones and do not carry a wallet. What are the social media platforms in each region? Wechat? Whatsapp? Understand what is relevant.
- Ownership. At the end of the day, to have sustainable ownership, the local team needs to have a say in the creation and adoption of products for local markets.
Michael Graber is the managing partner of the Southern Growth Studio, an insight, innovation, and strategy firm based in Memphis, TN, and the author of Going Electric. Visit www.southerngrowthstudio.com