In leading language service providers (LSPs), sales and service delivery teams are working hard to define the particular needs of their clients in order to provide stronger, more ingrained customer solution and increase share of wallet. While this commitment is often driven by customer demands for quicker response times, special discounts and fast-track deliveries, it is also shaping the way that LSPs are choosing to invest in language technologies.
The best way to cater to client needs in a particular customer segment, be it gaming, finance or e-commerce, is to understand the context around the original localization need, i.e. what happens in the business before content flows into the LSP, and after it is fed back to the customer.
The innovative LSP can alleviate more of the localization burden for their customers, which is often related to producing, organizing and disseminating content, or complying with regulation, and open up more of the localization supply chain and its resulting revenue streams. Many LSPs have integrated this approach into their service models, and have invested in language technologies that “talk to” the platforms that their customers are using both up- and down the supply chain.
Buy or Build
For different customer segments this will mean very different language technologies; hence we are seeing a range of buy and build strategies across the LSP landscape. As Richard Glasson, CEO of Hogarth Worldwide, put it when speaking of the need to innovate the client service model at SlatorCon London in May, “someone is going to disrupt us if we don’t disrupt ourselves”.
Generalist LSPs that operate across multiple segments will deploy the language technologies that are relevant to one or more segments they service, and can justify the investment due to potential cross-use of the technology. LSPs that specialise in one main segment will seek to expand themselves even further across the localization supply chain, often acquiring the skills and technology through M&A.
Slator spoke with Adolfo Hernandez, CEO of SDL, during SDL’s recent customer event on “The 5 Future States of Content”. SDL is the fourth largest LSP globally in the Slator LSPI and operates across a range of customer segments including regulated markets, marketing and high-volume, user-generated content spaces like eCommerce.
“You see growth everywhere but you don’t see growth everywhere with the same intensity,’ said Hernandez, “and even when [you do], it’s not growing for the same reason”. His assessment points at the different factors shaping the evolution of the language technologies space.
- Regulated markets
Regulated markets such as life sciences and finance are driving the use of Content Management Systems (CMS) and connectors. In these segments, regulatory requirements equate to a heavy need for content to be well organized and secure both up and downstream. Factors such as version control, content tagging and dissemination to regulatory authorities mean that companies operating within regulated markets look to CMS or CMS-compatible language technologies to manage their content for these stakeholders.
Life Sciences LSP GLS and its subsequent acquisition by Welocalize in 2016 is a good example of the complexities involved in regulated markets and illustrates the extent to which niche life science players have become coveted targets in the scramble for growth among global LSPs.
- Gaming and media localization
Gaming and media are highly specialized segments, with lots of functional pre and post-localization steps needed in order to make localized content ready for end-user consumption. LSPs catering to customers within this segment embed themselves deeply across the supply chain by deploying up- and downstream services such as art creation, audio, engineering, localization testing, functional testing and customer support.
A successful example of a buy-over-build strategy for these related service technologies in gaming is Keyword Studios, who made 11 acquisitions in 2017.
As the need increases for companies to customize their global marketing collateral for local audiences around the world, so does the demand for high quality marketing localization. Adolfo Hernandez, CEO of SDL, explains that this “very high quality, highly nuanced sector of the market is growing”. Achieving success in this segment typically means being able to produce creative, well-designed and sometimes interactive content, appropriate for the target market.
Speaking at SlatorCon London in May, CEO of Hogarth Worldwide Richard Glasson described how the company operates in advertising production across all media to deliver an array of marketing-related services, integrating strategies of “production de-coupling, on-site content operations, global consolidation and direct production relationships”, thus highlighting the diverse nature of the business.
The boom in the E-commerce is also spawning more user-generated content, such as online reviews, and is driving localization demand for content such as digital catalogs and product descriptions. Given that the segment is characterized by high volume and speed, localization output must be optimized. This means deploying language technologies that drive productivity such as neural machine translation (NMT) capabilities and translation management systems (TMS) that enable localization work to be quickly outsourced to linguists.
For companies wanting to deliver real-time customer support through web or mobile apps, using live chat with humans or bots, the challenge to provide the same level of support in multiple languages is a major challenge. According to Mihai Vlad, VP AI & Machine Learning Solutions at SDL, the purpose of Linguistic Artificial Intelligence (AI) is to “help customers and employees to get relevance faster”. While customer support is still a nascent segment, it will benefit from further developments in NMT, AI and machine learning as bots begin to integrate improved NMT.
While commentators can be quick to write certain segments off as language-technology resistant, it is clear that uptake is demand-driven and often segment-specific. LSPs will need to expand across more of the localization supply chain to thrive, and developing and selecting the right language technologies will help overcome the barriers to entry for these growth segments.
LSPs therefore, need to be proactive in adapting, changing and innovating. At SlatorCon London, Glasson set the challenge for LSPs, warning “someone is going to disrupt us if we don’t disrupt ourselves”.
For a more in-depth and long-term view of language technologies and the localization supply chain, sign up now for SlatorCon San Francisco in September 2018.