• August 18, 2023
  • By Edd Ovington, general manager, Americas, Phrase

High-Growth U.S. Startups Are Missing a Big Revenue Driver: Localization

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Ask CEOs and heads of growth at fast-growing U.S. startups to think about new revenue drivers, and they’ll likely tell you about viral product dynamics, new marketing channels, and fresh offerings. But for many, there’s much lower-hanging fruit that could open up sizable revenue growth within months: localization.

It’s not uncommon for startups in the U.S. market to reach as much as $150 million in revenue without hiring an employee outside the U.S. or translating their UX and marketing communications into languages other than English. At that point, getting started with translation and localization may sound like a hassle or cost center.

But neither needs to be true—and, on the contrary, embracing localization can be the move that spurs a company into its next phase of growth.

Here’s what U.S. startups need to know about getting started with localization and the growth opportunities translation and localization unlock.

How Startups Can Get Started with Localization

Historically, translating materials such as an app interface, customer support resources, or marketing materials required working with a language service provider or other translation agency. Localization was a human expert-intensive process that was relatively slow and expensive.

Now, the industry has become much more tech-centric. The challenge for startups seeking localization services will not be whether to adopt a tech-driven solution; it will be distinguishing between companies with robust tech bona fides and those that are trying to cobble together or acquire tech to keep up.

Don’t just look for a company that can tell you about all the details and features of its localization process or solution. (Of course, every company will do that.) Look for localization services that are focused on driving revenue and scale. Can the company grow with you as you enter dozens of new markets and need to support thousands more customer support requests? Can they integrate with all your other software and make translation easy and understandable, even at the global level and pace of fast-growing companies?

Another criterion is partnership. Can the company connect you with translation experts or help you hire a localization manager? What resources, other than technology, can they provide to foster long-term success?

How Localization Drives Profits and Revenue

Even translation experts often fail to grasp how big the opportunity is for companies that can localize all of their information. Traditionally, an LSP might have looked at a global company, for example, and said the firm could earn $60 million in additional revenue by localizing. But with advances in machine translation that make it possible to translate more, and faster, at scale, revenue gains could be orders of magnitude higher.

Consider a company that provides a SaaS marketing technology platform. The company originated in the U.S. and only provides an English-language platform, which has worked to this point because many overseas professionals speak English. But how many don’t speak English? How many do but would prefer to use tools in their native language? How many can get along OK in English but have a customer support question for a complex technical issue and struggle to figure it out due to conversations with an English-language customer support bot, spurring them to cancel the service?

Companies with global ambitions shouldn’t content themselves with “good-enough” communications. They should provide a UX and customer support that moves every customer along the journey—and supports them after conversion to foster retention—in their preferred mode of communication. Don’t expect everyone in a deeply multicultural and multilingual city like New York or Toronto to interact with your company in English. Allow them to discover and build bonds with your brand in their language. The connections that approach will foster are better than those a TV ad can deliver.

Most companies, even startups with nine-digit revenues, do not fully exploit localization technology and machine translation to unlock seamless communication and user experience. Scale, operational efficiency, and cost savings await the ones that do.

Edd Ovington is general manager, Americas, at Phrase. Ovington has 15-plus years of experience in B2B SaaS, including key leadership roles in sales and channel at Unbabel, Microsoft (via Yammer), Beem, and Percolate.

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