Corporate Glocalization Strategy of Nongshim in America: The “Pendulum Theory” of Globalized Localization

Abstract

This study examines how Nongshim, a Korean instant noodle manufacturer, has expanded its operation globally within the concept of “open innovation” through its glocalization strategy, and how this strategy differs from the existing glocalization method enforced by global companies. The study shows how Nongshim used its unique glocalization strategy of “globalized localization”, outlining the three stages by which the company switched its “glocalization focus”, starting with “localizing”, moving through “globalizing”, then back to “localizing”, while retaining its ultimate purpose of globalization. From the basis of the case analysis, the study proposes a “pendulum theory” that can be applied to local companies that are planning to expand their business in a global market.

1. Introduction

Corporations must continue to innovate in a highly competitive business world, where the borders of each country no longer keep the competition domestic. In order to gain a competitive advantage over other firms in global commerce, they shift their business strategy. One of the most crucial changes in the global market is represented by glocalization, which is accompanied by an acceleration of the innovation cycle [1]. Since introducing products successfully in new markets is essential for every organization, an innovation in business strategy is needed to adapt to changes in competition and markets. Because the competitive advantage of the glocalization strategy may not be achieved through the traditional, closed innovation activities, the concept of “open innovation” may be adopted to overcome the limitations of closed innovation [1] (p. 26).

Glocalization has risen in popularity as a business strategy since the importance of local culture has been highlighted in a global era where the boundaries between countries are fading [2]. Its ultimate goal is to find the balance between the globalization and localization of business operations, to enable successful expansion into various local markets around the world, and to appeal to global consumers worldwide. For decades, certain global companies have adopted a glocalization strategy after realizing that pure globalization or localization strategies in global markets had profound limitations. Popular examples of successful glocal strategy include McDonald’s, who have both standardized and localized menus in their stores around the world to appeal to various groups of consumers in the local market, instead of foregoing one for the sake of the other.

Nongshim, a South Korean company that was founded in 1965, is one of the largest instant noodle manufacturers in South Korea and has been steadily pushing forward its expansion into other countries since the early 1990s. The United States is one of its target markets, and it has been slowly but steadily increasing its market share in the US despite the powerful presence of Japanese incumbents in the US instant noodle market. Nongshim first entered the US market with its focus on Korean consumers in the US, but began to shift its focus to the more major group of American consumers, to win over a greater market share and is currently one of the leading companies in the instant noodle market in the US. Nongshim’s unique glocalization strategy was at the center of its success.

Nongshim’s glocalization strategy can be summed up as that of “globalized localization”, with Nongshim, a local brand in South Korea, expanding into the global market through three stages of glocalization. This glocal strategy of Nongshim, while securing the optimal balance between being global and local, moved away from previous glocalization strategies in the sense that it went back and forth between globalization and localization over three different phases. Its first stage was localization, where Nongshim targeted the same consumers in the global market as it did in the domestic market using its figurehead product, Shin Ramyun. In the second stage of globalization, Nongshim reached out to global consumers by globalizing its product and its price but localized its other business operations. In the final stage of localization, Nongshim re-localized by finally diversifying its product line to suit the tastes of local consumers.

This unique glocalization strategy of Nongshim has proved to be so successful that Nongshim has risen as a formidable market force in the US instant noodle market among its Japanese rivals. In this paper, Nongshim’s three-stage glocalization strategy, which will later be referred to as “pendulum theory”, will be defined and examined in detail. Past theories on glocalization, which focused on “localized globalization”, will be discussed to explain how this new strategy differs from other methods, as well as how Nongshim’s glocalization strategy assisted in its successful expansion in the US market.

2. Literature Review

2.1. Globalization, Localization and Glocalization

As the interconnectedness of markets and the trending of multinational corporations has grown, so has the need for companies to adopt effective global strategic approaches when entering a foreign business environment. As companies started selling their products or services in other countries, they were met with various new obstacles, such as foreign competitors, new market environments, different regulations, and new groups of customers. Their strategic approaches, while some variations of the terminologies themselves exist, can be largely divided into three categories: globalization, localization and glocalization.

Before we move on to the adoption of the term “glocalization” in the business world, we should also note that, in a sociological sense, the definitions of these three terms vary among scholars. Khondker mentions that if one takes a long-term view of globalization, the concepts of “locality” and “local” are an inevitable consequence of globalization [3].

In his article “The Globalization of Markets”, Levitt (1983) talks about how, with the emergence of global markets for standardized consumer products on an extremely large scale, companies have structured themselves to benefit from large economies of scale in production, distribution, marketing, and management [4]. Levitt further explains the differences between “global” and “multinational” corporations, noting that “the multinational corporation operates in a number of countries, and adjusts its products and practices in each at higher relative costs”, while “the global corporation operates with resolute constancy at low relative cost as if the entire world (or major regions of it) were a single entity; it sells the same things in the same way everywhere” [4].

Yip (1989) mentions that three steps are essential in developing a total worldwide strategy: the first is developing the core strategy, which is the basis of a sustainable competitive advantage that is usually developed for the home country first; the second is internationalizing the core strategy through the international expansion of activities and through adaptation; the third is globalizing the international strategy by integrating this business strategy across countries [5].

On the other hand, Malnight (1996) developed an evolutionary framework on the transition process of multinational corporations in his paper, arguing that rather than deliberately moving toward a known network-based structure, each phase represented a viable strategic response to then-existing challenges and opportunities [6]. Svensson (2001) explains that this signifies that the global strategy approach is adapted to the specific business environment [7].

When companies became aware of the limitations of “pure” strategies, such as globalization or localization, they turned instead to a new approach, one that came to be known as “glocalization”. Segal-Horn (1996) argued that few companies lend themselves to “naive” global strategies, since all strategies require some degree of adaptation to regional and national conditions [8].

Grigorescu and Zaif (2017) note that when multinational enterprises realized the limitation of pure global marketing strategy in the face of varying degrees of environmental differences presented by the evolving global market, they took a glocalization, instead of a merely global, approach, one that involved searching for creative, novel communication methods to adapt to local needs and settings [9]. Grigorescu and Zaif (2017) further explain that “a new trend (glocalization) had emerged in the international business market, encouraging international organizations to ‘think global, act local’, using the global brand, but adapting their products to specific local elements and the regional particular necessities” [9] (p. 71).

Dumitrescu and Vinerean (2010) provide a definition for all three approaches, with globalization being “the tendency toward an international integration of goods, technology, information, labor, capital, or the process of making this integration”, localization as “the process of adapting a product or service to a particular culture or language, developing a local appeal and satisfying local needs” and, finally, glocalization as “providing a global offer (brand, idea, product, service, etc.), while taking local related issues into account” [10].

The adoption of this hybrid approach enables multinationals to reduce the risks that come with pure global or local business approaches. A global strategy would save costs because of the reduced need to tailor their products and services to fit the needs of local customers, allowing them to achieve economies of scale, and they would also be able to maintain their identity as a global corporation and use this to their advantage in marketing promotions. But the risks of this global strategy include that the local customers might fail to see the appeal of this brand image. On the other hand, a local strategy could allow the company to quickly identify potential opportunities for attractive niches in a given market that can improve their revenue, but it would be harder for them to save the costs incurred from the standardization of products and services; this would also need time and effort to decide on the optimal degree of local adaptation, which can change over time [11].

Taking on a glocalization strategy would enable companies to make more flexible changes and adopt or avoid these advantages and disadvantages; this is the reason why many multinational companies, such as McDonald’s or Nike, adopted such an approach in their international operations. These companies took on a “localized globalization approach”, which meant that these global companies glocalized by localizing their global products (while also maintaining some aspects of their global identity), allowing them to heighten their glocalization extent while extending their strategic direction, as their “glocalization focus” shifted from “globalizing” to “localizing”.

Svensson (2001) claimed that a glocal strategy approach reflects a global strategy approach’s aspirations and simultaneously acknowledges the necessity for local adaptations and the tailoring of businesses [6] (p. 15). According to Svensson, the concept of glocal strategy differs from the global strategy approach since it explicitly recognizes the importance of local adaptations and tailoring in the marketplace of business activities. He also stresses that this focus on balance and harmony is crucial in a company’s glocal strategy approach—the glocal strategy recognizes that there has to be a balance and harmony of standardization versus adaptation, and homogenization versus the tailoring of business activities. He goes on to explain that this harmony is achieved since the concept explicitly comprises the spectrum from local strategy issues to global strategy issues, through the “glocalization” of business activities [6] (p. 15).

2.2. Approaches to Glocalization

The first appearance of the term “glocalization” is believed to have been in Harvard Business Review articles, written by Japanese economists in the late 1980s, and to be derived from the word dochakuka, “which originally meant adapting farming techniques to one’s one local condition” [12]. In the business world, the idea was adopted to refer to global localization [3] (p. 14).

Later, the concept was developed by Roland Robertson. In his article “Globalisation or glocalization (1994)”, he states that “the idea of glocalization in its business sense is closely related to what in some contexts is called, in more straightforwardly economic terms, ‘micro-marketing’: the tailoring and advertising of goods and services on a global or near-global basis to increasingly differentiated local and particular markets” [13].

Khondker (2004) quoted Wong (1998), who argued that “a global company does not mean that it has gone global all the way. There are companies that are part global, part regional or part local involving different domains such as portfolio, supply chain, research and development and business processes.” [14], in his work [3] (p. 15).

Svensson (2001), in a continuation of his approach to glocal strategy as mentioned previously, argued that since glocalization means standardization versus adaptation, and homogenization versus the tailoring of companies, their business activities are then optimized and the focus on balance and harmony is crucial in a company’s global strategy approach and its glocalization of business activities [6] (p. 15).

Ritzer (2003a) defines glocalization as “the interpretation of the global and the local, resulting in unique outcomes in different geographic areas” [15]. He provides a unique perspective by reconceptualizing globalization, pairing heterogenization with the “glocalization of something” and homogenization with the “globalization of nothing”. The study explains that there is an “elective affinity” between the two elements of these pairs. According to Ritzer, throughout the relationship between global–grocal and something-nothing, “something” is likely to be glocalized. Ritzer (2003b) also introduced the term “grobalization” which focuses on the imperialistic ambitions of nations, corporations, organizations, and the like, and their desire and need to impose themselves on various geographic areas [16]. Khondker, upon mentioning this definition, claims that for Ritzer, globalization is the sum total of glocalization and “grobalization” [3] (p. 15).

In addition, glocalization can be linked with “corporate nationalism” in the sense that “the nation” is reimagined and represented by promotional activities through corporate glocalization. Consequently, corporate glocalization requires substantial negotiation and collaboration with local cultural intermediaries [17].

Moreover, Kang (2015) gives a macroscopic perspective, pointing out that there are two directions in which corporations carry glocalization into practice. Glocalization, which is a fusion term of globalization and localization by definition, refers to both the “globalization of local operation” and the “localization of global operation” [2]. Most glocalization strategies are executed by the large transnational companies, such as Coca-Cola, in a form of “localization of global” approach, perhaps simply consolidating globalization since the Second World War [2] (p. 86).

This directional approach was supplemented through Kobayashi (2012), who analyzed glocalization strategy through another big transnational corporation, Nike, arguing that “global idea, practices, and commodities are localized”, leading to the renewal of local space, culture, and identity [17] (p. 44).

In this paper, the main focus will be on which direction of glocalization Nongshim has implemented and how the company balanced the two elements—localization and globalization—when applying its glocalization approach. Svensson (2001) states that “glocalization means that the standardization versus the adaptation, and the homogenization versus the tailoring, of companies’ business activities are optimized” [6] (p. 15).

Each company has a unique business strategy when applying its glocalization approach. Grigorescu and Zaif (2017) present examples of different glocal marketing strategies in their paper that utilize a glocal combining of marketing mix components, such as product-based glocal strategies, in which “Lay’s Chips meet the preferential tastes of locals from different countries around the world [8] (p. 72)”, or price-based glocal strategies where “to reach the mass customers in India, Indonesia, the Philippines, and East European countries at the beginning of the 1900s, the multinationals created cheaper-priced products by small packaging, keeping old models, and using local suppliers” [8] (p. 73).

McDonald’s is a famous example of successfully mixing global and local marketing strategic approaches. Crawford, Humphries and Geddy (2015) examines the company’s glocal strategy across different elements, such as the menu, promotion, trademarks, restaurants, employees, and services, and explains that McDonald’s global system “connects franchises with local suppliers in order to deliver consistent, locally relevant restaurant experiences to customers” and “allows it to innovate and adapt to different consumer needs” [18] (p. 16). The main approaches to glocalization are arranged into a table below as

Table 1. Main Approaches to Glocalization.

Reference	Approach to Glocalization
Harvard Business Review (late 1980s)	A Japanese term for glocalization, “dochakuka”, meaning adapting farming techniques to one’s local condition [12]
Robertson (1994)	The idea of glocalization in its business sense is closely related to “micro-marketing”
Wong (1998)	A global company does not mean it has gone all the way; there are companies that are part-global, part-regional or part-local, involving different domains
Svensson (2001)	The focus on balance and harmony is crucial in a company’s global strategy approach and its glocalization of business activities
Ritzer (2003)	Glocalization is the interpretation of the global and the local, resulting in unique outcomes in different geographic areas
Kobayashi (2012)	Corporate glocalization requires substantial negotiation and collaboration with local cultural intermediaries

.

The concept of “open innovation” implies that companies use external ideas, resources and technology innovation and while the concept has been regarded as relevant primarily to “high-technology” industries, the strategies are already in use in a wide range of industries [1] (p. 28). We can see from the history of the term “glocalization” that glocalization can be a process of open innovation. Although much prior research has been conducted, there is no generally approved and accepted standard process and model for innovating services and products for glocalization [1] (p. 26).

This is where open innovation can come in, and this can be used to come up with efficient ways of glocalization to make its competitive advantages sustainable, as the competitive advantage of the glocalization strategy may not be achieved through the traditional closed innovation activities, due to some limitations of cost, lead-time and impact on the overall organization [1] (p. 28). Instead of relying on an internal operation system, companies that adopt a glocal strategy approach make use of resources and ideas that come from external sources. In this sense, many authors argue that glocalization is not a set-in-stone, immobile process or plan. Rather, glocalization keeps shifting forms, exchanging feedback back and forth between its consumers, suppliers, and stakeholders. A glocal strategy is spurred by, and ideally modifies itself constantly because of, open innovation. Thus, it can be conferred that glocalization is a dynamic, open process that relies on open innovation to find the optimal levels of uniformity and diversity.

3. Methodology

This case study analyzes the glocal strategy of Nongshim in the US market and attributes its success in the global market to its three-stage glocalization process. The study begins by explaining the academic background of “glocalization”, citing opinions from previous journals and papers on the subject to share a wider spectrum of opinions and thus boost the objectivity of the paper. The study also describes in textual detail the operational strategies and performance of Nongshim and other instant noodle companies in the US market, accompanied by secondary numerical data collected from published online reports and newspaper articles. Finally, the paper discusses Nongshim’s ongoing glocalization process, analyzing its changing dynamics using the data gathered from multiple literature resources.

Data Collection and Data Analysis

This paper is a descriptive case study, a research approach that can be used to generate an in-depth, multi-faceted understanding of a complex issue in its real-life context [19]. According to Crowe et al., the case study approach can offer additional insights into what gaps exist in its delivery or why one implementation strategy might be chosen over another, which, in turn, can help develop or refine a theory [19] (p. 4)—this will be the theory on glocal strategy described in this paper. The data collected as part of the research are from reliable secondary resources, including news articles about Nongshim’s performance in the market and its market strategy, Nongshim’s annual reports as published on the company’s website, containing important information about Nongshim’s global operations and R&D assets, as well as several journal articles and papers analyzing Nongshim’s competitive advantages and characteristics. These numerical and textual data regarding Nongshim’s performance in the global market were collected from various sources of evidence to boost the research’s validity; when analyzing them, the authors cross-checked various data sources to increase the reliability and accuracy of the analysis. While analyzing data, we developed a grounded theoretical framework that linked the various concepts emerging from the data by revisiting the full data set. We cycled between data analysis and connecting with relevant literature to develop theoretical arguments and concepts, and to guide subsequent data collection.

4. Nongshim’s Glocalization in the U.S.

Nongshim focused on globalization, maintaining the standardized aspect of its products, but eventually encountered the need to meet the demands of the US market and thus incorporated local adaptation. In a way, this type of glocalization can be more specifically referred to as a “globalized localization”—one in which the company takes on localization “for” globalization. Companies that took off in the US market who also have a global strategy in mind eventually need to “localize” in the US market itself to enable globalization. In the case of Nongshim, the company started off in the Korean market as a local brand, using a localized strategy in that country but, after entering the US market with globalization as its goal, it later adopted a “globalized local operation” strategy.

In this paper, the success of Nongshim in the United States of America is attributed to this type of glocalization strategy. For example, the company started its business targeting Korean consumers living in America, distributing the product mainly to the Asian markets, and eventually became one of the three primary instant noodle companies in the United States, stacking the shelves with Shin Ramyun in the main retailers. Nongshim developed its own glocalization strategy in order to gain a competitive advantage against the localized instant noodle makers without having to change its main product, one that was certainly not designed for predominantly American consumers. As will be explained in detail in Figure 1 diagram, in adopting such a strategy, Nongshim’s “glocalization focus” started with localizing, moved on to globalizing, then moved back to localizing, while its “global penetration extent” continued to rise steadily through these stages, without withdrawals or fallbacks.

The issue at stake in this paper is why this pendulum-like glocalization strategy was the ideal strategy for Nongshim. This is an unusual form of glocalization strategy, in the sense that in most previous studies conducted on glocalization strategy, the techniques presented were mainly those of one-way glocalization or a glocal strategy categorized by different elements such as marketing or products. Such outdated forms of glocal strategies were adopted by rivals of Nongshim in the US instant noodle market, including the presiding Japanese market leaders.

These Japanese companies localized their products from the start to appeal to the American consumers in the market. For example, in deciding the flavors of noodle products, instead of going with strong or local flavors that were popular in their home country, with which their US consumers were likely to be unfamiliar, these companies decided on mild, safe and familiar flavors such as “chicken” or “vegetable”, and even when it said “spicy on the product, it was much less spicy than Nongshim’s Shin Ramyun.

But their marketing methods were localized, like Nongshim’s, to target young American consumers, the main example being Nissin’s production of cup noodle-related marketing goods like T-shirts, caps, etc. Then, what about the other types of cup noodles that remained unlocalized, like Nongshim’s Shin Ramyun? There were also other instant noodle products that were produced neither from Nongshim nor Japanese companies that maintained their original flavor and packaging as they were sold locally, but the problem was that they never made it to the mainstream market. They were stuck in the first stage of Nongshim’s glocal strategy; their main consumers were the Asian population in the US, and they were mainly sold in small and middle-sized stores. Such a one-way approach of glocalization by other companies, which in this case comprised the local product of instant noodles, aimed to be global by adapting their flavors to appeal to American consumers; this was usually the way that most local corporations entered the new market overseas.

But Nongshim took on a different path. It started with localization, targeting Korean consumers in the US market, then moved to globalization as it sought to increase the brand awareness of its standardized product among American consumers as well; finally, is in the re-localization phase as its product line is expanding to be localized for a wider range of customers in the market. This new glocal strategy, as adopted by Nongshim, will set a good example for other local companies who aim to become global by entering new foreign markets through a glocalization process. Before this, glocalization usually meant that multinational companies would use localization to appeal to local customers by familiarizing their products in the new market, but, in the case of Nongshim, they became seen as the most local (Korean) and yet global product through their glocal strategy. What makes this process even more interesting to examine is that while this strategic shift from globalization to localization in its glocal strategy was usually one adopted by a global company, in this case, Nongshim began as a local brand, then it went further afield and took on this three-stage glocalization. This glocal strategy ultimately enabled Nongshim to keep their local “identity” by maintaining their local product as it was, while also appealing to those outside their niche group of customers, allowing its market share to grow quickly and take on the Japanese market leaders in the industry.

5. Nongshim Company Background

Nongshim was founded under the name Lotte Food Industrial Company in Seoul, South Korea on September 18th, 1965, and later changed its name in 1978 to Nongshim Co. Ltd. (hereafter referred to as Nongshim). Nongshim is currently established in over 100 countries, including China and the US. Its main products are instant noodles and snacks, which acted as growth engines driving their success.

To put Nongshim’s strategies in context throughout its history, the company entered the industry as a late mover. The noodle industry at the time was occupied by powerful first movers such as Samyang, which provided Nongshim, a late mover, with a challenging task when trying to gain access to distribution channels. The fierce price competition was also another factor that hindered Nongshim from gaining a strong foothold in the industry. During this time, Nongshim began to develop a new product market and push forward active sales promotions to overcome these obstacles. According to Rhee and Choi (2006), its strategic direction was set as “creating customer demand through the quality improvement of instant noodles”, and Nongshim put in ample efforts regarding “technology development by launching its product laboratories as an independent organization” [20]. One interesting move of Nongshim that hints at the company’s strong determination to acquire creative and meaningful R&D knowledge is the establishment of its research lab as an independent organization during this time.

During the 1970s, Nongshim continued to invest in technology development and re-invested its profit in R&D, to improve the quality and speed up the process of introducing new products to its customers. During this time, the company also built a maintenance factory to ensure the premium quality of its products and worked to acquire nationwide operational effectiveness by rearranging its distribution structure [20] (p. 142).

In 1985, Nongshim had risen to first place by market share in the industry. Nongshim experienced continued success with its series of new products from 1980 to 1985, through which the company’s market share increased steadily and continuously. Although in the 1990s, instant noodle industry demand had grown somewhat static, Nongshim responded to this challenge with a novel differentiation strategy, introducing new premium products that met their customers’ new demands and deliberately worked on its brand development to win their loyalty.

Since then, Nongshim has maintained its position as one of the most recognized brands in the global industry of instant noodles and snacks. The most recent achievement of Nongshim that demonstrates its well-known ability to create new demand is its initiation of the “non-frying” noodle market in 2019. Nongshim’s most notable accomplishments throughout its history are displayed in

Table 2. Nongshim’s history throughout 1960s until the 2010s.

Year	Nongshim’s Accomplishments
1960s	Nongshim enters the ramen industry as a late mover
1970s	Nongshim’s investment in R&D development continues
1980s	A new facility is built in Ansung for making the soup base Nongshim wins over 50% of the market share in the industry
1990s	Nongshim builds facilities in China’s Shanghai and Qingdao Active overseas exportation of ramen products is initiated by Nongshim
2000s	New LA Plant started its operation in 2005 (12155 6th Street, Rancho Cucamonga, CA, USA) Nongshim leads a specialized factory project for health-friendly noodles
2010s	Nongshim enters into a direct transaction contract with Walmart Nongshim’s 50-year anniversary is celebrated in 2015 and Nongshim produces several hit products

.

The key pillars of Nongshim’s product line are instant noodles and snacks. Although many of Nongshim’s products, Shin Ramyun, Neoguri, and Ansungtangmyun, occupy large portions of the Korean ramen market, it is risky to rely too heavily upon these steady-sellers because not only is the instant noodle market in Korea declining but also the growth of the domestic instant noodle market is bound to be limited, due to a decrease in population caused by continuously low birth rates. Nongshim’s task has been to diversify its major sources of income with bottled water and not just ramen or snacks, while introducing premium products to increase margins [21].

Regarding Nongshim’s goals to become a successful brand both locally and globally, an important task for its survival was establishing a global production system, with the company’s building of new facilities abroad in China and America [22].

6. Nongshim in the US Market

In 1971, Nongshim first advanced into Los Angeles, USA, and continuously tried to extend its attempts at globalization, centered around making its main product Shin Ramyun into a global brand. Nongshim was already quite familiar with the US, considering the local exclusive sales contract Nongshim had made with companies such as Kellogg’s. There was a growing market targeting Korean residents living in America, centered around LA in the 1980s, and the export of certain products of the company had also been showing a certain amount of growth [20] (p. 146). In 1994, Nongshim’s first overseas corporate body, Nongshim America, was established—however, from the 1990s, a trade conflict between Korea and America took place and, combined with the extremely intense competition in the US instant noodle market and the entrance of Campbell into the industry in 1991, the situation took a turn for the worse. At this point, Nongshim realized the need to diversify its target market.

6.1. US Instant Noodle Market: Size and Current Situation

Efficiency being the top priority, Americans tend to consume a great deal of instant food and canned food for simplicity and have frozen food or semi-cooked food available to save costs, time, and effort spent on cooking [23]. In fact, the “2020 Food & Health Survey”, a new publication from the Washington, D.C.-based International Food Information Council (IFIC) noted that, when asked what they saw as the biggest changes in an average American’s diet since 2010, 24% of consumers cited greater amounts of fast food and eating out, followed by 20% who answered that there was more processed food [24]. In fact, instant noodles have taken root as part of the American diet, ranking sixth in the world according to demand (4630 million servings in 2019) in terms of instant noodles, following major Asian countries such as China, Japan, and others [25].

According to npd’s 2021 consumer trends analysis, 42% of U.S. adults reported shopping for groceries online at least once in the past 30 days during summer 2020, compared to just 29% in the same period 2019 [26]. Because Nongshim has a stable distribution channel online through Amazon, the digital grocery shopping trend actually works as an opportunity. While the online ordering trend is bound to remain, consumers would reprioritize their food consumption from the instantaneously increased stress-eating due to the pandemic situation in 2020 to nutritious eating. In fact, the overall consumption trend toward health, which conflicts with the efficiency tendency on food consumption, has been boosting interest in low-calorie, low-salt, and low-cholesterol food from Asian countries such as China, Japan, Taiwan, and Korea. Beginning in 2010, the nascence of health and wellness trends became more prevalent (Figure A1 and Figure A2). According to the IFIC, consumption of plant-based options increased, with 28% eating more protein from plant sources, 24% eating more plant-based dairy substitutes, and 17% eating more plant-based meat alternatives than in 2019 [27]. This is good news for Nongshim, who has released new products such as vegan noodles, along with non-fried noodles.

In 2017, the US instant noodle market size was estimated to be at least USD 1.5 billion, and Nongshim showed the highest growth rate among the top companies in the industry, which included Japanese companies such as Nissin and Maruchan [28]. Most recently, after the COVID-19 outbreak, Nongshim’s product sales in the US market showed a high increase, which, according to analysts, is likely not just a short-term improvement but instead the beginning of a steady consumer trend.

Nongshim’s products in the US market are widely available on the shelves of the local mainstream channels and are positioned in the industry as a premium product [29]. The most popular and well-known product is Shin Ramyun. The demand for Nongshim’s products in the US market is expected to increase steadily, which will eventually lead to an increase in the company’s market share and an improvement in the company’s profitability (Figure A3).

In the instant noodle market in Korea, there are countless numbers of products available. The instant noodle itself has a long history in the food product industry, and the local customer’s taste and preference are rarely subject to drastic changes—therefore, the local sales are also not prone to dramatic ups and downs. However, the situation in the US market is quite the opposite: instant noodles are quite “new”, and less popular products in the Asian region have seen unforeseen popularity in the Western market [30]. Nongshim’s continuous probing of the foreign market has gathered the company considerable data about the US consumer’s preferences. This is expected to contribute well to Nongshim’s growth in the long term.

As the demand for Korean instant noodles grows in foreign markets, other Korean rivals have also delved into the foreign competition and come up with various products designed for exportation purposes, but so far Nongshim and Shin Ramyun are showing the most promising figures amongst them, according to the results of a survey. As supporting evidence, Nongshim’s US corporate body’s sales in early 2020 were shown to be USD 164 million, a 35% increase from last year’s [30]. Giant companies such as Walmart’s and Costco’s sales for the first half-year grew by 35% and 51% each, and there was a 79% increase in Amazon’s. In comparison, most of Nongshim’s accomplishments in the US recently showed highly positive results.

Since it entered into a direct sales contract in 2013 to adopt more strategic marketing strategies in the US by analyzing sales data from Walmart, Nongshim America had continuously worked to enlarge its presence in the US instant noodle market. The company invested USD 200 million to build its second factory in California by 2021 and is working toward building profitable distribution channels across the country, which befits its goal to be the number one food brand in the US market.

6.2. U.S. Competitor Analysis

To briefly summarize Nongshim’s competitors in the US market, they can be mainly categorized into two types: the reigning Japanese instant noodle companies and the relatively new entrants, including the ramyun companies from Korea. The biggest difference between Nongshim and its Japanese competitors lies in their tactics for breaking into the market and gaining a market share. Japanese products used a cheap pricing strategy—one package, consisting of three or four packets in total, costs about USD 1, while Nongshim’s Shin Ramyun costs USD 1 per single packet, and Shin Ramyun Black, USD 1.99 [31].

Nissin and Toyo Suisan are some of Nongshim’s biggest Japanese rivals. Toyo Suisan is currently ranked in first place and Nissin in second place, in terms of market share in the US. Nongshim, which has 22% of the market share, is in hot pursuit of Nissin with its 24% market share [32]. Nissin set up its office in America in 1970 and introduced the world’s first instant cup noodle in the following year, named “Cup Noodles”, which sold more than 40 billion up until 2016 [33]. While Nissin introduces more than 300 types of new products each year in Japan, its “Cup Noodles” product was designed for entry into the US market, which it did with success.

To briefly provide background information about the Japanese instant noodle companies’ entry into the US market, when Nissin first moved to the US, ramyun was a very unfamiliar food for most Americans and there were not many stores that sold ramyun. Nissin worked hard to overcome this disadvantage by renting space in front of mega supermarkets to promote their products, and after realizing that many Americans did not like heavy spices like soy sauce, it also developed and started selling low-calorie “Top Ramen” products, which eventually led Nissin to become one of the most recognized ramyun brands in the US [34].

Then there are old Korean competitors, including Ottogi and Samyang Foods. Ottogi is known for its ability to diversify its product portfolio, which has met with favorable responses by consumers, and it is also well-known for meal replacement products. While it somewhat lacks backing in R&D investment efforts compared to Nongshim, Ottogi was often cited as the most formidable rival of Nongshim in Korea for its size and the ability to read trends in the market. Unlike Nongshim and Samyang Foods, Ottogi has yet to come up with a product that embodies their brand image (like Shin Ramyun and Buldak), but recently, its main products Jin Ramyun and Jjajang Ramyun have been quickly gaining popularity in the US market, giving rise to an increase in foreign sales [35]. With its main export brand product Jin-ramyun, Ottogi has boosted its sales, and although Ottogi’s presence in the US market pales in comparison to its fellow Korean rivals, its total export sales have steadily increased over the past few years.

While Samyang Foods was relatively late in starting to exporting to the US, its sales increased nearly twice as much, from KRW 8 billion in 2016 to KRW 18.5 billion in 2018, with its famous Buldak brand products, which became quickly popular through the “Fire noodle challenge” that went viral on social media [36]. Like Nongshim, these Buldak products provided the company with the momentum to break into the market and establish its “brand image”. Samyang Foods has also previously introduced its PB product, “Tapatio ramen”, targeting Hispanic consumers as a way to expand its presence in the North American market. Samyang Foods has also announced plans this year to establish foreign branches in the overseas market. While these two Korean companies’ market shares are relatively low compared to Nongshim and the Japanese giants, there is a serious risk that both of these two companies will pose a significant threat to Nongshim as late movers in the near future.

6.3. Success Story of Nongshim

6.3.1. Core Competency of Nongshim: R&D Ability

Nongshim has accumulated unrivaled technical power by operating an R&D laboratory since its establishment in Korea in 1965, which allowed the company to release a wide range of trendsetting products. Its cutting-edge technology and the accumulated knowledge enabled the company to release novel innovative products over 50 years. These innovations include core technologies for instant noodles, such as the Zeodration continuous vacuum dryer (Z-CVD), a technique applied to soup bases at low temperature and pressure, chemical vapor deposition (CVD) and low-temperature concentration. Such unprecedented technologies resulted in Nonghsim’s ramyun products being impossible to imitate. In fact, its noodle production skills are at a globally recognized level. The establishment of the Nongshim R&D Center in 2007 created a momentum that increased the R&D system to a higher level. The R&D center changed its name to the R&BD Center and established the R&D system to prepare for global business.

Nongshim’s R&D center is in charge of new product development. Different researchers for each noodle type, main soup, annexed soup and nutrition work together and form a TF team to respond quickly to gaps in the market. Since the CEO of Nongshim, Dong-Won Shin, put emphasis on investment in R&D, Nongshim has been investing large amounts of money in the R&D center annually. In fact, the R&D investment to sales ratio was the highest in the food and beverage industry throughout the last three years from 2017 to 2019. Nongshim invested KRW 28.2 billion in R&D, which is 1.2% of the total sales (KRW 2.343 trillion) in 2019, whereas its major competitors, such as Ottogi and Samyang, invested less than 0.5% of the sales [37]. Nongshim’s current R&D investment size can be found in

Table 3. The present condition of Nongshim’s R&D investment (in millions of Korean won (KRW)).

2017	R&D cost-to-sales ratio	1.13%
	sales	2,208,260
	R&D cost	24,909
2018	R&D cost-to-sales ratio	1.25%
	sales	2,236,436
	R&D cost	27,998
2019	R&D cost-to-sales ratio	1.20%
	sales	2,343,942
	R&D cost	28,186

Source: CEO Score [38].

.

Based on this core competency, Nongshim has set an example in the domestic instant noodle market by continuously launching new products. Nongshim created new instant noodle trends that its competitors would have to follow in order to keep up with the highly competitive market and respond to new consumer demands.

Nongshim R&D center had mainly focused on the texture of the noodle from 2015, to mark the 50th anniversary. Nongshim successfully pioneered a thick-noodle-based instant noodle market, featuring beef flavor noodles (Uyuk Tang Myeon). Using a noodle manufacturing technology developed by Nongshim called HPTET (high-performance thermal energy transfer technology) that the R&D center had been developing for 2 years, not only is the texture chewy and taut but the noodles can also be cooked in a short time [39]. Nongshim has developed more products to conquer the thick-noodle market, with Zha Wang and Champong Noodle Soup (Mat Champong). Competitors such as Ottogi and Paldo followed the trend, releasing Jin Champong and Paldo Black Bean Noodles. Considering the fact that most of the new instant noodle items released in the instant noodle industry from 2015 to 2016 were thick-noodle products, the success of the thick-noodle type of instant noodle that Nongshim R&D center first developed is the result of the R&D center’s precise understanding of consumers’ needs in the industry [40].

Overall, Nongshim led the trend of value consumption in the instant noodle market through the continuous development of new products and quality upgrades. Under the slogan “Global R&D with Creativity, Challenge and Joy”, Nongshim puts effort into advancing the R&D process, human resources and researching culture. It hosts an Incubation Fair twice a year, for the researchers to introduce and share new results and processes. The researchers are given opportunities to participate in advanced education programs and global exhibitions [41].

6.3.2. Success Strategy of Nongshim

Since both the brands and the tastes of Korean spices were totally new to American consumers, and two Japanese companies were taking the lead in the market, Nongshim put efforts into increasing brand awareness with marketing promotions and via its entry into the mainstream distribution channels. Detailed strategies that led the company to succeed in the global market were as follows:

• Product Differentiation Strategy (Positioning Premium)

The company has maintained its main product brand, Shin Ramyun, since the beginning of full-scale business expansion in America, and has differentiated itself from the other Japanese noodle makers, positioning itself in the premium market. That is, unlike Japanese instant noodle brands that use a low-price strategy and that have developed instant noodle products such as chicken noodle soup to fit the taste of American consumers, Nongshim positioned themselves as offering a premium product, differentiating on both flavor and the overall quality of the product. Nongshim’s Japanese rivals’ main targets are customers with a low income, and their cheaper products are created using a noodle and soup base received from outside the U.S., although their facilities are located within the country. However, Nongshim’s Shin Ramyun products are winning over middle-class consumers.

One of the most common responses Nongshim received from local importers was that its products were too expensive, to which the company responded that this was inevitable—the raw cost difference between Nongshim’s products and other low-priced products was because the company created them with high-quality ingredients in facilities equipped with cutting-edge technology [42]. This decision to position themselves as a premium product was based on their realistic judgment that it would be very difficult to win the price war with local rivals. Thus, Nongshim chose to reflect the increasing global demand for high quality and price trends. This brought positive results for Nongshim in the US market; Japanese instant noodle producers, who were the first movers in the US market, tasted the bitter fruits of failure because of their down-market image.

Nongshim’s Shin’s original Korean spice flavoring was also one of the main components in its differentiated strategy; according to the consumer survey conducted by Nongshim in 1300 Walmart stores in 2018, customers chose the main reasons for their purchase as “A deep flavor that one cannot find in other products”, and “A flawless quality good enough to be consumed as a meal” [43]. Nongshim use quality raw materials in all of their products, and a large portion of the company’s success could be contributed to Nongshim’s own Engineering Division, which designs and produces its own noodle equipment—this ensures consistency from plant to plate [44].

• Promotion Strategy

In the beginning stages of globalization, Nongshim’s chairman Shin Chun-Ho, after long contemplation, made the difficult decision of maintaining their product for the American market the same as it was in Korea—not just the flavor but also the product specifications and the packaging design [42]. However, the performance was disappointing, and while the decisionmakers in Nongshim made a proposal to alter the strategy in order to localize the product, the chairman was adamant in pursuing his original strategy. In the end, he decided to make no change to the product itself, but instead decided to localize the marketing strategy. Strategic issues that the company had to solve through its marketing efforts were to increase brand awareness and its association in the marketplace, and to change the customer perception of the undervalued instant noodle market into that of a premium product.

Most of Nongshim’s customers were Korean Americans in the earlier stage of introduction; however, by 1998 the non-Korean customers had increased significantly. About 25% of customers were Chinese, Vietnamese and Japanese, and 10% were Hispanics, thanks to the “Sports Marketing” in which the company invested steadily and continuously [42]. Examples include joining sponsorships with popular US baseball teams, such as the LA Dodgers and New York Yankees, and conducting tasting events during home games.

Since the Korean spice flavor was one of the differentiated characteristics that were most unfamiliar to customers in the US market, Nongshim put its efforts into promoting aggressive marketing, with the main focus on increasing a sense of intimacy. Given that the lack of cultural context between the Korean and American markets needed to be addressed, Nongshim conducted promotion efforts using the keyword of “youth” to fill the gap between the two. For instance, Nongshim has participated in a Music Festival in Hollywood and NY every year since 2014 and introduced Shin Ramyun to the young potential customers there. What is more, Nongshim introduced its products with chef Chris Oh at the VIP lounge in Coachella Valley Music and Arts Festival in 2016, which is one of the largest, famous, and profitable music festivals in the United States and the world. Nongshim maximized the campaign’s effectiveness strategically by operating special stand-stores such as a “roadshow” centered around large local retailers and holding various tasting events. The company also employed its strategy that if it succeeded in preempting the mainstream market, the product sales would naturally expand into neighboring regions as well. Nongshim also used some creative marketing methods in approaching its foreign customers—one example is “Art Marketing”. In 2019, the company joined forces with Eva Armisen in creating a Shin Ramyun advertisement called “The Culture of Delicious Shin Ramyun” which originated from the concept of Nongshim’s past hit advertisement, “Big Brother first, Little Brother first”, only it changed the characters to a brother and his little sister offering each other the Shin Ramyun first.

• Accessing Mainstream Distribution Channels and Step-by-Step Strategy

Tracing back the history of Nongshim, one can see that Nongshim put efforts into securing profitable distribution networks. At the early stage of export, Nongshim used a target marketing strategy in which the company promotes its products, centered around the distribution networks that were mainly used by Hispanics, who were more familiar with spicy flavors [42]. In 1999, the company started supplying products to Jones (a major Hispanic supermarket) and eventually expanded its distribution network to other Hispanic markets, such as “Numero Uno” and others. In 2004, the company showed about a 20% average annual growth rate in the Hispanic market in the US [45]. Based upon this success, Nongshim was also able to supply its products in major supermarket chains in the US. In 2013, Nongshim entered into a direct contract with Wal-Mart. Thus, the formation of this contract lessened the burdens of the cost of working with local distributors. This direct contract, which was made possible because Nongshim had logistics competitiveness and product competitiveness, also allowed Nongshim a more sophisticated targeting of the US local market. Analysis of the Walmart sales data allowed for customized sales operating activities, in accordance with market trends, and efficient product shelving and sales promotion activities [46].

In 2017, Nongshim became the first in the industry to supply Shin Ramyun to over 4000 Walmart stores, and this also enabled the expansion of its sales into local mega-retailers such as Costco and Kroger, which resulted in a 34% increase in its mainstream market sales [43]. This contributed to Nongshim’s US mainstream sales outrunning its Asian market sales for the first time, and the sales proportion of each market, which remained at 5:5 until 2017, changed to about 6:4. The fact that Nongshim was chosen by the largest distribution corporation in the US became the biggest source of competitive edge for Shin Ramyun, in addition to the fact that it became a high point in the company’s history in the US when it was finally recognized as a global brand. This seizing of mainstream distribution channels allowed the company to build distribution networks all over the US continent, from the large cities in the East to Alaska and even Hawaii, a significant achievement showing that Shin Ramyun had become a product that American consumers now “actively” sought out and purchased.

Looking at Nongshim’s history in the US also provides a good insight into the company’s clever decision in choosing the “right” location for its strategy. In 1984, a west coast office was established, and the official Nongshim America Sales team began to work in the Southern California area. There was a reason why it picked southern California as a base of operations in the USA; Nongshim America (NSA) saw southern California as the central location for Asian culture—it had the greatest cultural diversity within a short traveling distance compared to other locations. Thus, NSA could field-test their products and get instant results on their performance [44]. In addition, the area ports allowed for relatively easy access for raw materials that entered the US, and local supporting business industries and the Interstate Highway systems created a great overall hub location for any company to thrive.

These efforts made by Nongshim to secure a strong, widespread distribution network across the US demonstrate part of Nongshim’s glocal strategy in moving from the direction of localization to glocalization. In its early stages, its use of a smaller distribution network mainly used by the Hispanics was enough for Nongshim to appeal to its niche group of Korean consumers, but its aim to globalize the brand required an expansion of the network. Nongshim’s striking of the deal with Walmart to reach out to larger, “global” consumers in the US helped reach its goal effectively, along with its strategy of choosing the most suitable location, which smoothed the process of expanding from a local to a global group of consumers. During this long process, the characteristics of its main product remained the same and did not go through any changes.

Nongshim’s so-called “Step-by-Step” strategy, which targets markets where those with the highest growth possibility were the first ones in order, is also another factor behind Nongshim’s success. Nongshim did not risk entering multiple markets at once–instead, they chose and concentrated on one market to establish their product there, and, with their success story, pursued other markets thereafter [42]. As mentioned previously, Nongshim ran their facilities in and expanded operations around the Western region, where there were large demands and attention focused on instant noodle products [46]. As also mentioned above, this location was an ideal one to push Nongshim’s glocal strategy because, as the level of diversity of customers in the region was high, Nongshim could gain some insight into how it should proceed with its shift from the localization to the globalization of its strategy.

• Brand Power Improvement

Japanese companies had been exporting various instant noodle products in the global market, and were the predominant winner in the competition until the 2000s. In response to this history, Nongshim set the main mission of its exporting strategy in the beginning as “Shin Ramyun only”. This was in accordance with its differentiation strategy as mentioned above, because the company, through this main product, Shin Ramyun, aimed to embody the flavor that most differentiated itself from instant noodles from Japan and Southeast Asia [47]. This would take a longer time, but the company took the risk—this was a meaningful move for the company, as many analysts estimate that if Nongshim had employed a “multi-product marketing strategy” following the trend in the food industry, it would only have carried on reaping short-lived achievements. Thus, Shin Ramyun’s brand competitiveness slowly but steadily increased—after the building of the LA facility in 2005, Nongshim was able to expand its distribution network into Alaska and Southern America as well. This was part of Nongshim’s glocal strategy to standardize its main product—its product remained unchanged and “global”, but the operations surrounding this product would be “localized”—at least during this time. Thus, Nongshim’s Shin Ramyun, backed by an aggressive marketing and distribution network strategy, rose as Korea’s figurehead product that was chosen by global retailers such as Wal-Mart, Costco, Amazon, and Alibaba, and it was through this brand power that the product acted both as an advance guard in developing new markets and a staple product in increasing sales in the original market [48].

7. Nongshim’s Glocal Strategy

From now on, we will discuss how Nongshim expanded its operation globally, with its own form of glocalization strategy. Nongshim’s glocalization strategy in the US works in a balanced glocalization approach, in the sense that it tries to find the optimal point of globalization and localization, and what is notable is that it is not moving in one direction; in fact, it is moving back and forth between globalization and localization. It is imperative to appreciate that Nongshim has set the example for the technique of “globalized localization” glocal strategy.

Starting from the definition of glocalization, the term itself implies both the “localization of global operation” and the “globalization of local operation” [2] (p. 75). Based on this definition, we have analyzed that there are two ways of glocalization, termed “localized globalization” and “globalized localization”. Kang has pointed out in her study that most of the glocalization strategies were implemented by big transnational companies—such as Coca-Cola and McDonald’s—that were already successful in the global market [2] (p. 86). This is due to the fact that after leading the world’s globalization, transnational companies have recognized the limits of a uniform way of business expansion in the world market, where the customer’s needs and wants will vary by country. Thus, the glocalization strategy increased noticeably among global companies, in order to take into account the cultural characteristics of different countries. Namely, most of the glocalization strategy was solely considered in the way of “localization of global operation” by transnational companies. In this paper, this way of glocalization is termed “localized globalization”.

7.1. Pendulum Theory: A Theoretical Framework for Corporate Glocalization

Since information technology has been developed and the barriers to a global market have decreased radically, not only globally successful companies but also small local companies are implementing glocal strategies in order to effectively broaden their business in the global market. This way of glocalization through which local operations can expand their business globally can be categorized as “globalized localization”. Unlike the way “localized globalization” strategy put emphasis on “localizing” its global operations in each country, what we have found through Nongshim’s glocal strategy in the US is that “globalized localization” requires three stages, balancing the two elements of glocalization, “localization” and “globalization”.

Figure 1 may help to understand Nongshim’s “globalized localization” glocalization strategy. Companies other than Nongshim took on the “localized globalization” strategy, in which their strategic focus started with globalizing then moved to localizing, and this decision did bring them higher global penetration. In the “globalized localization”, which was Nongshim’s glocal strategy, this policy resembles the movement of a pendulum: Its glocalization focus started off with a localization strategy, slowly moved toward globalization, then, once it matured, as of this point it is moving back toward localization. But all the while, its glocal strategy is carried out by balancing globalization and localization, trying to find the optimal point between these two with the purpose of global expansion. All the while, throughout these phases, Nongshim’s global penetration extent rose continuously. In the following section, we will examine exactly how these steps were carried out.

• Stage 1: Localization

Nongshim began with focusing on “localization” when first entering the US market. This may seem similar to the “localized globalization” strategy that implements localization when glocalizing the operation. However, Nongshim’s case is different because the targeted consumer has not changed from its domestic market; the company was still targeting the local Korean consumers in the domestic market, along with a small proportion of American consumers. Shin Ramyun was sold mainly to Korean consumers who missed the flavors of their homeland. Since the customers were already familiar with Nongshim, as well as the brand “Shin”, the company did not need to put great effort into sales marketing, but simply needed to export the same products to America and distribute them to the local Asian markets, where consumers would willingly purchase Nongshim’s noodle products.

• Stage 2: Globalization

The true meaning of globalization began in earnest when Nongshim realized the potential of the US instant noodle market and entered it, establishing offices in Los Angeles and New York and eventually settling down into the US operation by launching the corporation Nongshim America. From that point, it pursued its goal to globalize the product so that it could appeal to the majority of American consumers and used various marketing and distribution efforts to reach out to this “global” group of customers. The notable point is that Nongshim balanced out the two glocalization elements by “globalizing” its product and its price, while “localizing” its distribution channel and promotion strategy. That is, Nongshim was bold enough to differentiate itself by keeping the main product the same, and the price—which was more than 2 times higher than the average instant noodle sold in the US market—remained unchanged from that in the domestic market throughout this whole journey, positioning the product brand of Shin as a premium product. Since both the brand and the taste of the Korean spice were totally new to American consumers, and two Japanese companies were taking the lead in the market, Nongshim put efforts into increasing brand awareness with marketing promotions, and entry into the mainstream distribution channels. The detailed marketing strategies in Stage 2 are listed in

Table 4. Four Business Strategies of Nongshim in Stage 2. Globalization.

A. Production Differentiation Strategy (Positioning Premium)	B. Promotion Strategy
- Nongshim’s product is positioned as premium, reflecting the global demand of high quality and price trend - Target customers: middle-class consumers - High-quality ingredients and cutting-edge technology in product facility - Differentiated its product from Japanese rivals in terms of price and quality - Unique Korean spice helped it stand out among competitors	- No change to the product itself, but the marketing strategy was localized - Strategic issues: Increasing brand awareness and association in the market, change the customer perception - Joined in sponsorship with popular baseball teams in the US - Marketing focus on increasing the sense of intimacy - Promotion of products in large music festivals - Operation special stand-stores such as roadshows centered around large local retailers and held tasting events - Creative marketing methods by collaborating with famous artists
C. Accessing Mainstream Distribution Channels and Step-by-Step Strategy	D. Brand Power Improvement
- Distribution network mainly centered around the one used by Hispanics at first, and later expanded to major supermarket chains. - In 2013, Nongshim secured a direct contract with Wal-Mart through its logistics competitiveness and product competitiveness. - Continued expansion into local mega- retailers such as Costco and Kroger allowed Nongshim’s US mainstream sales to outrun its Asian market sales - Choosing Southern California as a US operations base because it was a central location for Asian culture and an ideal hub for distribution and production. - Step-by-step strategy: Focus on one market instead of entering multiple markets at the same time led to safe, successful expansion over the continent	- Nongshim’s single-product marketing strategy increased Shin Ramyun’s brand competitiveness slowly but steadily - Rise of Shin Ramyun backed by aggressive marketing and distribution network strategy increased Nongshim’s brand power - Nongshim’s brand power acted as an advance guard in developing new markets and a staple good in increasing its sales in the original market

, which also contains the success factors that were discussed earlier.

• Stage 3: Re-Localization

The third phase in the glocalization process is re-localization, where the product is localized permanently. Nongshim moved to this third stage after it had secured a safe amount of the market share, and its target positioning had stabilized. Nongshim’s brand awareness had been increased significantly among US consumers at this point—Nongshim’s Shin Ramyun was nominated in the list of tasty ramyun products in The New York Times—and Nongshim also had loyal customers of the brand. At this point, the company estimated that there were much higher chances of their regular customers also buying their new line of products, including those that suited the tastes of their American consumers. In addition, Nongshim was confident that it could turn those customers who had not been too inclined to buy Korean noodles and were fans of Japanese noodle products into buyers of their products. This “re-localization” stage was where the company could make use of its “R&D capability”, which was its core competency, and come up with new localized products that would allow the company to target and satisfy the needs of a more diverse range of customers, ultimately increasing the company’s market share steadily. This final stage was a major step for Nongshim, as a way to tackle the market leaders and steal away their customers. It was carried out in the spirit of “globalized local adaptation”; its focus was on the globalization of the product but it finally had to make local adaptations to be truly global.

7.2. Reasoning behind the Re-Localization

Explaining why the “re-localization” phase is vital for the “globalized localization” glocal strategy should help readers to better realize its importance as the driving force behind Nongshim’s final moves. First, Nongshim’s heavy reliance on the “Shin Ramyun” brand alone limited the increase of its market share in the United States in the long run. Although it was “Shin Ramyun” that led the company to win the recognition of being the most popular Korean instant noodle in America and ranked it third in market share, the spiciness of the Shin Ramyun noodle still functioned as a hurdle regarding purchase for US consumers who were not familiar with the flavors. According to FOOD Navigator-USA, the interest in and consumption of spicy foods have been growing year by year, and the percentage of the consumers who choose spicy options has increased compared to 2017 [49]. However, scientists suggest that marketing strategies for spicy food products need to consider regional preferences, since the tolerance of pungency differs across countries [49]. This means that although the interest in spicy flavors has increased in America, general American consumers might not enjoy the level of spiciness in Shin Ramyun that the Korean consumers consider “mild”. Thus, even if a consumer purchased Shin Ramyun, the possibility of repurchasing is not guaranteed. Another reason Shin Ramyun had limitations when looking to expand their market share is the uncertainty of the K-Food trend as to whether the fashion would persist in the United States. According to the study, The Korean Wave in America: Assessing the Status of K-pop and K-drama between Global and Local (Longenecker and Lee, 2018), the Korean wave has succeeded and expanded its reach in the United States, but the consumer base for K-culture is still a relatively niche market in North America [50]. Given that the rapid success of Nongshim was largely due to the spread of K-culture in America, such as the movie Parasite, in which Nongshim’s instant noodle products made an appearance in a particular scene [51], Nongshim’s promoting solely Shin Ramyun, with its distinctive taste of “Korean” spiciness, in the market would only be effective for those narrow niche-market consumers who are interested in K-culture for a short period of time.

Second, the issue of other Korean noodle makers launching a full-scale business in the United States was a threat to Nongshim America. This is due to the possibility that the unique “Korean Spiciness” that the Shin Ramyun brand emphasizes to differentiate their products from their Japanese competitors would no longer be as effective as it was before, if it was competing with other Korean companies in the US market. In fact, Ottogi and Samyang have already entered the US market, and Samyang developed an instant noodle product targeting Hispanic consumers in the US [52] and has increased sales with its main product Buldak, marketing through SNS [53]. What is more, the rate of exports from Korea by Ottogi has grown by 40%, compared to the rate in 2019 [54]. Regarding Jin Ramyun, Ottogi has increased the market share up to 13.9% in 2018 from 5.3% in 2009, whereas the market share of Nongshim Shin Ramyun has decreased to 16.9% in 2018 from 25.6% in 2009 in terms of the Korean instant noodles market [55]. Ottogi has the potential to capture the market share in the US market as well they did over past years in Korea. On top of that concern, the strategy of providing the exact same product, replicating what Nongshim did in the Korean market, and supplying the exact same product—Shin Ramyun—as in the domestic market to U.S. consumers can also be easily performed by the competitors. From this perspective, Nongshim needs to be prepared to fight, otherwise it could experience the same situation as in the Korean market, where the company finds it hard to increase its market share, due to the competitors chasing after Nongshim in the US market as well. One way it could brace itself for the ensuing fierce competition was by re-localizing its product line.

Finally, there was also the issue of Nongshim’s persuading the existing Japanese ramyun consumers in the US market to switch to their brand. For example, Nongshim’s Shin Ramyun product, which had an extremely spicy flavor and required consumers to use an unfamiliar cooking method, using a stove to eat instant noodles, was very distinct from its Japanese competitors’ products, which bore a strong resemblance among themselves in many ways, including pricing strategy. Such differences could have brought Nongshim complicated problems in the future. For example, many of its Japanese rivals had enjoyed profits from their low-cost, instant noodle products with the new chicken soup flavor, which is a very familiar and popular preference for American consumers. Nongshim being a noodle company that provided truly different instant noodles new to the US market, it had indeed provided a new choice for US customers. However, the fact that the company created new demand had the fatal limitation of further expansion of the market share. Nongshim had to fulfill the needs of the maximum number of American consumers. From observation, one can see that almost all of the instant noodle companies in the US saw chicken-soup-based noodles as a necessary step in their localization strategy. Because Nongshim had equipped itself with a strong brand power from the former marketing strategy via the “Globalization” method, it was the right time to introduce a new product line and invade the Japanese noodle makers’ consumer group. Nongshim’s successful differentiation strategy would allow them to gain a competitive advantage, even when it released the same localized noodle product as its competitors. Converting the existing customers in the market was Nongshim’s priority, in order to fully penetrate into the American market and become one of the Big Three instant noodle makers. All these meant it was crucial for Nongshim to adopt the new, third “localization” stage in its glocalization process, to succeed in the US market.

8. Discussion

8.1. Theoretical and Practical Implications

This analysis of complexity within the three stages of “globalized localization” provided insight into both the theoretical and practical debate on corporate glocalization.

The study presents a theoretical framework of glocal strategy in a way that can help companies in analyzing and reviewing their corporate glocalization strategy. Previous case studies on business glocalization largely described a company’s glocalization process as a shift from globalization to localization. It mainly focused on how big global companies, after settling down in foreign markets, made local adaptations to appeal to the native consumers. This was the widely accepted process of glocalization. However, this paper proposes a different definition of glocalization strategy that can be applied to local companies willing to expand their business globally. The study brings up a three-stage glocalization process in the form of “globalized localization”, presenting a new method of globalization for local corporations and gave it the name of “pendulum theory”. This new glocal strategy emphasizes that by swinging back and forth between localization and globalization, the company can find the optimal “balance” to secure the competitive advantages that come with glocalization. This new approach will be able to contribute to the birth of fresh perspectives on glocalization in the future.

Regarding the practical implications of this paper, the study provides an important insight on glocalization for local companies seeking to go global, while maintaining their brand identities and expanding their target customer range from a niche group to a large majority of native consumers. Most of the previous research and papers described corporate glocal strategy as a set of stationary actions, such as by categorizing marketing mixes. On the other hand, the “pendulum theory” focuses on the shifting dynamics of glocalization in a stepwise approach. Considering that many local companies are staying in the first stage without being able to expand further into a global market, the study’s detailed categorization and analysis of the sequential steps of glocalization will serve as an important and useful guideline for those early-stage global companies.

8.2. Glocalization as Open Innovation

The case study reveals that open innovation in the form of glocalization is necessary in order to sustain competitive advantage in a globally fierce competition, not only in a high-tech industry but also in the instant noodle market. In the past years, as sales plunged, global-brand corporations started to pay more attention and listen to their local business partners about how to adapt their product attributes and advertising messages to local tastes [9] (p. 152). In order to find the glocal “balance”, like in the pendulum theory, it is absolutely necessary for insiders to look for ideas and resources, such as this article, that are available in the new market environment. It is only through this process that companies will successfully pull off glocalization and find success in the industry. In the case of the pendulum theory of glocalization, for a company to successfully forge ahead through these three stages, it follows that there must be a constant exchange of knowledge between interested parties for the purpose of innovation of some kind. The pendulum theory, in this way, will act as a form of open innovation in the field of glocalization.

9. Conclusions

9.1. Findings

This study analyzed the way that Nongshim’s global expansion, especially in the US market, was strategized by focusing on the corporate strategy of glocalization. In Nongshim’s case, the study revealed that corporate glocalization is no longer the exclusive strategy of the globally successful companies—in the study, we termed this way of glocalization “localized globalization”. Local countries in each country that are willing to operate their business globally can also use glocalization—“globalized localization”—as a globalizing method. To be more specific, the case analysis revealed how “globalized localization” works through multiple stages of balancing out the corporation’s strategic focus on the two glocalization elements of globalization and localization.

From the pendulum theory point of view, “globalized localization” is demonstrated within a varying relationship between the corporate “global penetration extent” and “glocalization focus”. Unlike global companies that began glocalization at the original point from which the global penetration extent was already somewhat high, local companies initiate the glocal strategy when the extent of global penetration is below 0. In both “localized globalization” and “globalized localization”, the global penetration extent rises and ultimately hits the highest point, wherein the glocalization strategy reaches its goal to successfully localize the operation at the optimal level. However, while most of the main focus of traditional glocalization strategies was solely on glocal “localizing", and prior research on corporate glocalization was used to present a static glocal strategy describing how to localize global marketing mix components that ended after the global company was deemed to be “localized” enough, this Nongshim study’s “globalized localization’’ requires three stages, with focuses moving back and forth, from “localizing” to “globalizing”, and then back to “localizing”—just like a pendulum.

In the primary stage of glocalization, the main focus is on “localizing”. In Nongshim’s case, the company simply targeted the same consumer market that existed in America, who were Korean consumers. Limited marketing efforts were needed, since the consumers were already aware of the brand and they would seek out and purchase Nongshim’s product anyway. This is considered to be the most passive glocal stage. However, during the second stage, where companies move their focus to “globalizing”, huge amounts of marketing efforts and investments are required, since the product or service that the formerly local company is now trying to provide in the foreign market would not be familiar to the new group of consumers. This is the stage where the company truly enters the global market. In Nongshim’s case, it maintained the main product as it was in the Korean market but localized the other elements of the marketing mix. In the final stage of “globalized localization”, corporations should turn the focus back toward “localizing”. Based on increased brand awareness and stable market share, this is a step in which companies demonstrate their core competencies. To be specific, Nongshim put efforts into their R&D department, and this drove the company’s success in the domestic market, developing new products that are targeted at American taste buds.

9.2. Limitations and Future Research Topics

The study conducted in the paper examined the process of glocalization and focused on the “pendulum theory”, which introduces a new method of glocalization that consists of three stages of globalization and localization. In fact, not many companies have used “globalized localization”, and most of the past studies that have been conducted mainly centered on “localized globalization” as a common method of glocalization. Our academic attempt, through the case of Nongshim, has been made to present a new approach to glocalization strategy. In addition, our approach of identifying the sequential steps of a glocalization strategy is unprecedented. We termed our findings a theory—the “pendulum theory”—in the sense that our research is logically arguing the original perspective. However, we acknowledge the limitation that the theory of the three stages of “globalized localization” is based on our observations of a single company. The lack of information and corporate cases due to the short history of “globalized localization” show the need for future research to reinforce the sequential approach. Thus, there is not enough data to determine how successful this three-stage glocalization will prove to be for other companies. Given that the other Korean instant noodle companies’ globalizing attempt is applicable regarding the first and second stages of our theory, it can be interpreted that the theory can be applied to other cases of a local company intending to enter the global market. In addition, Nongshim is currently in the early stage of phase three of glocalization, and there is no guarantee of its success in the long run, which is added to the possibility that Nongshim may change its course of glocalization in the future.

This study also offers the following future research topics. The study focused on three stages of glocalization for Nongshim, but there may be a rising need for a fourth stage in the future due to the fast-changing dynamics of business industries. It is also worth wondering whether this glocalization strategy will be applicable for companies attempting to expand in other types of products, or even in the field of services. Finally, while the pendulum strategy was defined as movement from localization to globalization and back, it would be interesting to examine whether this pendulum strategy could apply to global brands, which would reverse the direction of the “pendulum”.