Giuseppe Marcigliano
Giuseppe Marcigliano 9 September 2016

KPIs for Localisation

The advantages of winning new costumers or satisfying existing ones with products and content provided in their native language are obvious. That is why so many successful companies use localisation to generate more than 50% of their revenues internationally. It's hard to find and support this case with concrete numbers and metrics, but not impossible.

Measuring the return on investment(ROI) of globalization efforts is notoriously difficult, especially the return part of the equation. Setting a couple of business metrics that can serve as key performance indicators (KPIs) is useful. The latter can change the perception of localisation from cost centre to revenue enabler.

Currently there are no generally accepted standards. (Have a look at the Localisation Metrics Initiative of 2003.) To analyse the return it's better to distinguish three areas: pre-sales content localization (marketing, websites, social media or advertising); actual product or service globalization; and after-sales content localisation.

Pre-sales metrics

Forward-looking companies consider localisation an investment capable of enabling international revenue growth. International market growth and relative market share in a given local market are two metrics that provide the most relevant information.

Understanding how product localisation actually influences the extra revenue is not easy. When calculating the ROI for localisation, it is necessary to include other non-localisation investments into the new markets. The "return" part has to include the decreased cost of doing business in a given locale, such as lower support costs.

Companies invest in local product releases(hardly discreet events) in order to expand the content made available in a local language. Many localisation ROI calculations may fail to account for the ongoing nature of such an investment in localised assets.

It is important to calculate the return on localisation assets, as a parallel of ROA. This metric would define the impact of the income of localised products on the total or average value of the existing localised assets in the same period. This indicates the efficiency of using the assets that companies have at their disposal as well as an understanding of the current value of such assets. This metric can be very useful for making comparisons over time.

When data on the above mentioned localised revenues is not immediately available we have another range of metrics that is readily available. Customer online engagement is a set of metrics that shows how engaged customers are with your online presence. The following are the key metrics for localisation:

  • Number of unique visits from target locale
  • Number of conversions and conversion rate by target locale
  • Percentage of visitors from target locale accessing content in local language
  • Click-through rates in local content pages or email campaigns
  • Bounce rate on localized pages
  • Average time on site by target locale
  • Percentage of new versus returning visitors per target locale
  • Percentage of new versus returning visitors per target locale
  • Search engine ranking for target keywords in target locales using local search engines

How many leads have you generated? What is your conversion rate?

The correct question is: What is the impact of the converted local lead on the total investment for the localization of the digital marketing strategy?

This benchmark can be very useful to understand the ROI of the digital marketing localization investment. In calculating the total cost per such leads, it is important to consider the total cost of local marketing(online ads, web content localisation, PPC campaigns, internal costs).

Moreover it is important to focus on the behaviour of the customers on the localized content. Following the navigation on the local website and how they convert to non localised web content could be very useful as a metric.

Online share of voice can give you an idea of the perception of your brand when it's discussed in social media. You can then narrow down by target market or by language use. The "WWW" offers you a wide range of sentiment analysis tools. This metric will give you an indication of the impact a localised approach to a given language market has. The online share of voice is calculated as the number of mentions of your brand/products in a given market relative to the total number of mentions of all brands in a given segment.

Brand awareness is another important indicator. It is fundamental to conduct brand awareness research before and after the localisation process. It is critical to test both aided and unaided brand awareness, in order to notice the difference in between brand recall and brand recognition.

Globalisation metrics

There are a n number of KPIs used to measure the efficiency of the localisation efforts.

One useful measure is looking at the total localization headcount: the total number of in-house staff directly involved in the localisation activities. This measure can be assessed as a number relative to the company's total international revenues.

Another measure is considering the total localisation cost(internal +outsourced budgets) on the total of the international revenue.

Where it is possible it is useful to consider the fully-loaded cost per word, which includes the overall internal as well as outsourced costs required to produce localized content divided by the total number of words localised. This shows you an overall efficiency of the operations and the total cost of localisation on a per-word basis.

Time to market is very critical in this process. The integration of the content is a crucial step and can play an important role in the overall product/release process. Every week of delay in providing a given product on the market means a week of lost sales. The first to market advantage can be potentially huge.

After-sales metrics

The main goals of after sales are to increase and maintain local users' satisfaction, ongoing engagement and reduction of the support costs necessary to provide local content.

Pre-sales information is a priority as it serves to get the client to buy and use the given product. After-sales customer support, on the other hand, is very expensive and represents a high percentage of the total revenue.

Key after sales KPIs:

  • Support call deflection: Decrease in number of support calls after the publication of localised support content.
  • First contact resolution: Percentage of support requests resolved at first contact.
  • Customer satisfaction: Net Promoter Score.

Final Thoughts

Focus on few KPIs and share them in order to enable comparisons. Create a direct link to your company's KPIs. This is an excellent opportunity to promote the critical role localization teams have in reaching the overall goals in every organization.

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