Language Localization – A Business Opportunity for Financial Institutions: A Chinese Market Perspective

As the global marketplace becomes increasingly integrated, companies are finding it easier than ever to reach customers worldwide. However, the challenge now is to establish long-lasting connections and ensure that customers in different markets perceive the same value, even though they may perceive it in different ways. While it may seem "easy" to do business in English (especially in sophisticated financial services), the most successful companies adapt their strategies for each market and make sure they communicate in the local language—quite literally.

While many people in China’s urban areas have some level of English proficiency, not all Chinese customers can speak fluent English, let alone conduct financial transactions in it. There are significant differences in English proficiency across regions and demographics in China, especially in second- and third-tier cities, which makes understanding these differences crucial for developing an effective market entry strategy. While large cities tend to have a higher level of English proficiency, data from the 2023 English Proficiency Index shows that in some regions, particularly those outside the major cities, English proficiency remains low.

The Importance of Communicating in Local Languages

Reaching customers in their native language is not only crucial for clarity but also significantly impacts their market behavior. In a survey conducted by Common Sense Advisory involving 2,430 web consumers across eight countries, 56.2% of consumers said receiving information in their native language is more important to them than the price.

Therefore, failing to provide local customers with content in their language, particularly in markets with low English proficiency, can result in customers turning to competitors who communicate in their language or using machine translation tools to convert content into their native language. The latter not only damages the customer experience but also creates new risks—incorrect translations can mislead customers or create misunderstandings, ultimately tarnishing your brand image.

As Nataly Kelly pointed out in a 2023 Harvard Business Review article, "Instead of doing ‘all things in all markets,’ be selective and show a true willingness to adapt." This will make local experiences truly equitable. Below are some strategies to help achieve this goal.

1. Localized Presence on Social Media

In China, 76.1% of internet users use social media to research companies and brands. Having a localized presence on these platforms and running targeted campaigns gives financial institutions the ability to effectively meet their customers where they are and offer them a clear understanding of their brand. This also helps institutions humanize themselves and build trust with customers.

2. Simple Translation May Not Meet Customer Needs

Translating a website from the home market into the local language can help local customers understand the content, but it may not fully meet their needs. As websites build up with more products and services over time, starting with a microsite containing key company information and core offerings will allow local customers to easily understand the most important aspects of the business.

3. Understanding Local Search Behaviors

Understanding local market search behaviors is essential for optimizing content so that local sites are more easily found. Developing a data-driven SEO strategy for the local market and regularly reassessing it will make the website easier to find, reduce bounce rates, and increase time spent on the website.

4. Customer Retention Is More Important Than Acquisition

In the Chinese market, acquiring new customers is important, but retaining them is crucial for long-term success. To create lasting connections with customers, companies must ensure they provide a seamless customer experience. An effective way to do this is by adopting an omnichannel approach. As customers increasingly expect access to their financial information anytime and anywhere, the touchpoints between companies and customers are becoming smaller and more frequent. Therefore, minimizing friction, which often takes the form of language barriers at various points in the customer journey, is crucial.

5. Direct Customer Service Touchpoints

Direct touchpoints in customer service are especially important in the Chinese market. Having a chatbot that can provide first-level support in the local language around the clock is an efficient way to increase the time spent on the website and improve satisfaction. Providing phone support by local representatives during business hours will further enhance the experience and significantly shorten resolution times.

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