How to master global expansion like Klarna

An essential part of launching in a new market is working out how receptive consumers in that market are to your brand and product offering. Nuances in language and regional attitudes mean that getting this understanding directly from your target consumers right at the beginning of the process is a must. 

Roel Lammers, Marketing Manager at Klarna, spoke to Attest’s Head of Content Sarah Hollinshead about the challenges of international expansion at Campaign Brand Forum – in particular, how the unicorn buy-now-pay-later provider overcame a problem with their product name when entering the Belgian market. You can watch the full session here or read the highlights below…

How to confidently launch in a new market 

Whenever Klarna launches in a new market they always carry out qualitative go-to market research, which involves small focus groups and one-to-one interviews.

“It’s a project I do every time to better understand the local culture, the payment habits and the online shopping habits, so we set ourselves up as well as possible for success,” says Lammers. 

It was carrying out this qualitative research in Belgium that uncovered a crucial piece of information: Belgian consumers didn’t like the name of the product Klarna intended to launch there, which offers shoppers 21 days interest-free credit.  

“We discovered that when we talked about the product that we were going to launch, people had kind of a negative reaction to it. We were like, ‘Hmm, this is a problem. This is actually an issue if we want to launch the product successfully.’ So we needed to do some more research into what would work as a product name.”

We discovered when we talked about the product, people had a negative reaction to it.

Lammers turned to Attest to do a quantitative study, choosing the platform for its ease of use, speed and quality of data. “I found that the platform was the best in terms of price and performance,” he adds.

Klarna created a survey to test different product names and to see what would convert best. The survey asked people to imagine buying two pairs of trousers online, with the intention of returning one pair.

Says Lammers: “It gave us very good insights and we decided to change the product name to ‘Pay in 21 Days’. It’s a very clear name because it’s actually telling you what you can do with the product. And it just proved to be the absolute best name compared to all the names that we tested.” 

Adapting the messaging

After finding success with the naming survey, Klarna decided to try using Attest for creative and messaging testing, something that Lammers says has proved to be “very valuable”. 

By showing adverts designed for one market to consumers in a different market, Lammers and his team are able to test the reaction and adjust the messaging accordingly. (Side note: Attest makes testing creative easy by letting you integrate graphics, videos and sound clips into your survey and get feedback from more than 110 million consumers in 49 markets).

“Klarna is kind of quirky sometimes,” notes Lammers. “We try to stand out by being disruptive but there’s also different markets and different cultures, right? So one of the things we do before entering the markets is that we show communication and we see how people react. So an example would be that I’ve just done market research in Poland and, obviously, this is a very different market than Spain.”

Without doing research, I think you potentially lose a lot of value and momentum.

While Klarna wants to maintain its unique brand voice and personality, carrying out this type of testing lets the brand finetune its messaging – and avoid any embarrassing PR disasters (remember when KFC entered China with the slogan ‘Eat your fingers off?!’).

Says Lammers: “We’re not changing our tone of voice or the way we market, but we might tone it up or down slightly, depending on how the culture is receiving our messaging.” 

He concludes that consumer research – especially when it can be done so quickly and cost efficiently through a platform like Attest – is a must for brands trying to make a splash in new markets. 

“It just saves a lot of mistakes and it helps positioning of the product, and building the right messaging for the products,” he says. “These are kind of pivotal when doing a product launch. Without doing research, I think you potentially lose a lot of value and momentum.”