When you are dealing with a new foreign distributor you cannot forget to define who is the owner of the local website and who have to keep it updated.
A STEP BACK: opening a new market
Let’s clarify with an example. There is an Italian company that produces design chairs. It found a new potential distributor of chairs in Russia. It is a retailer of luxury furniture.
They started to discuss shipping, quantities, duties, local regulations, etc
And then they started to speak about marketing. Among the various topic, the Russian distributor asks if he can open a local version of the website on its own.
For example, your official company website is italiandesignluxuryfurnitureabc.com
And the distributor wants to open: italiandesignluxuryfurnitureabc.ru
Can he do it? What are the opportunities and risks? 2 are the options.
NOTE: We present the opportunities/risks from the point of view of the manufacturer.
OPTION 1: DO NOT OPEN A LOCAL WEBSITE
The Italian manufacturer can deny the distributor to directly open a local website with its own brand.
In this scenario, there will be only one official website of the Italian brand. It is managed directly by the manufacturer that has to update it.
In our example, the Italian company decided to have only the official websiteitaliandesignluxuryfurnitureabc.com
This option is adopted by many companies, it is the safest for the manufacturer, but could be less effective from a marketing perspective.
PROs:
- It is a safer option because of the manufacturer’s control of the ownership of the website (that is an important asset of a company)
- It is also safer because all the information about the products is directly updated by the manufacturer. It happens frequently that some distributors do not update the local website.
- The manufacturer can control all the website data (Google Analytics).
- The manufacturer keeps and increases the SEO asset.
CONs:
- The site should be not attractive for a specific market for different reasons.
- Graphic: simply not all the markets have the same feeling about website graphics.
- Product availability: often a distributor does not import all the available products, but only the ones that it thinks are better suitable for its market. However, if there is only the “.com” website, the local customer will see the entire range of products and can be confused.
- Prices: the distributor should decide to adopt a different pricing strategy in its market. Commonly, some products are sold “more premium” in foreign markets (often is not only a choice but the only way to be redditive considering import duties). In that case, local customers see cheap prices in the “.com” website… For this reason, many manufacturer do not indicate price lists on their official website, to avoid misunderstanding in local markets. However, not showing prices is not transparent and some customers do not like it.
- If the manufacturer decide to not open the local website, it should translate the “.com” one in the new language (e.g. Russian). It has some costs in terms of money and time, imagine that you have to translate every article or product description in 12 different languages…
OPTION 2: OPEN A LOCAL WEBSITE WITH LOCAL DOMAIN
The Italian manufacturer can keep the main website (italiandesignluxuryfurnitureabc.com) and the Russian distributor is allowed to open the local version (italiandesignluxuryfurnitureabc.ru).
In that case, it would be better if the manufacturer will be the owner of the local domain (.ru) and share the permission to use it to the distributor.
The ideal situation is that the manufacturer gives to the distributor the graphics, product description (in English), pictures, etc and the distributor is responsible to update it in Russian.
PROs:
- Local customer can access to a dedicated version with a proper graphic (if needed), only products sold in the market displayed, local prices, eCommerce corner (if needed), etc
- To implement an effective SEO strategy, it is necessary to have a site with contents destined to a specific market (especially for B2C products). Having a local website managed by the distributor with a certain autonomy in content creation is extremely useful.
- Delegating the maintenance of the website to a local distributor can save time and money for the manufacturer.
CONs
- Less control over the activity of the distributor. In particular, some contents created by cannot be in line with the marketing policy of the manufacturer.
- In the case of controversies, it could be dangerous. The distributors can keep the website and use the domain. Of course legal could limit it, but timing is always crucial. To limit the risk, it is always better to buy and maintain the property of the local domain (italiandesignluxuryfurnitureabc.ru).
- The main website (italiandesignluxuryfurnitureabc.com) does not improve in SEO, because the links are given by the local version of the site (italiandesignluxuryfurnitureabc.ru)
CONCLUSION
The 2 options described are both used.
There are other solutions in the middle, for example, some distributors are not interested to create a local website of a brand, but prefer to create a corner on their main website that is dedicated to the new products (especially if they have a strong website, with a strong SEO).
What is important is to consider that it is extremely important to discuss this topic with the distributor in the negotiation phase. It is not a secondary topic, that you can discuss in a second moment. The website is an important asset of a company, and to improve performance needs an investment of time and money. You must be clear about your policy in managing the website and it is necessary to specify the established conditions in the contract.
We spoke about the website, but those arguments are important also for the local page of social network (Instagram, Facebook, Twitter, etc)
Globartis Research
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