Nowadays, new content is produced constantly. At the same time, there is an increasing need for translation and localisation, i.e. the adaptation of content into different languages and cultures. When even global publishing is fast and easy, the question that comes up is which languages the content should be translated into and in which languages the different language versions should be maintained.
And how might return on investment (ROI) be measured when it comes to translations and the maintenance of language versions?
Objectives of buying translations
The buying of translations should always be linked with business objectives.
First, consider why software or materials, for instance, should be translated into a certain language and what are the objectives that are pursued with the language versions.
Most commonly, the aim of adding a new language version is to attract more customers and sales. Translations are needed because studies indicate that people prefer to make purchases using their own language. If increasing net revenue or the number of customers or users in a language area is a strategic goal for you, follow the development of these figures after adding the language version and compare them with the corresponding figures before the language was added.
Then again, things that are more difficult to measure, such as brand recognition or customer satisfaction in a language area, can also be interesting indicators.
Therefore, the business benefits of buying translations are best calculated on the basis of what is most important for the business.
Calculate (all) translation costs
Translation prices are often given on the basis of the source text word count. That makes it easy to calculate how much translations cost. Therefore, the customer is often very tempted to choose the cheapest service provider.
It is more difficult to calculate the hidden costs of translations, such as the cost of the internal administrative work related to ordering translations or the time spent correcting poor translations. If translations are ordered from different providers, costs are also incurred by translating the same materials or parts of them several times.
Moreover, it should be remembered that buying translations is rarely a one-off expense item: the materials must be updated regularly and websites in different languages often also lead to costs related to foreign-language customer service and marketing, for instance.
Think about profit as well
If calculating the actual translation costs is challenging, it is even more difficult to calculate translation profitability. In this context, the language service research company Common Sense Advisory has found that the vast majority of companies that spend substantial amounts of money each year on translations measure only costs and not the opportunities created by translations at all.
If you want to measure monetary profit, the actual ROI is obtained by dividing the net profit generated by the net revenue from the language area by the investment costs. Naturally, ROI is not a static figure, but should be reviewed at regular intervals.
ROI only takes monetary results into account, although other important objectives can also be achieved through translations. For instance, brand recognition and customer loyalty can be a result of well-localised language versions and are extremely important for a company’s success.
Since translation with all its related costs requires an investment, the benefits yielded by the investment should be measured in one way or another. However, the potential return on investment can be challenging to measure as a percentage. It is particularly difficult to assess what is ultimately due to the language version and what is due to other efforts made. Even if there isn’t really a perfect formula for calculating the ROI for translations, localisation is an enabler for many other internationalisation-related matters that can be measured.
In addition to the growth indicators mentioned above, good indicators in the digital era include, for instance, website traffic volumes, visitor engagement or the conversion rate. For instance, you can count website impressions and the number of downloads or compare the success of a localised advertisement campaign in different language areas. If there is a language area where nothing seems to work, consider if something could be done and whether it’s worth maintaining the language version in the first place.
Improving translation profitability
The higher the ROI of translations, the better the cost control and the higher the return on the investment. Here are a few tips on saving costs and improving profitability:
1. Concentrate translations
Choose a good translation agency and concentrate your translation assignments to a single place. This ensures your translation partner learns your special terminology, quality remains consistent and you can benefit from seamless cooperation optimally. Smooth cooperation reduces your own administrative work.
2. Take advantage of translation technology
Professional translation agencies use technology that makes your life easier and also generates clear savings. Make the most of translation memories, various integrations with your own systems and the opportunities offered by machine translation. Accelerating the translation process will increase profitability.
3. Add languages and keep an eye on profit
Adding language versions has never been this easy. Translating a single website into one language is a relatively small investment, but the benefits may be limited. So, choose the languages carefully and keep an eye on the performance of different language versions. Add and remove language versions as necessary.
If you need more tips on how to measure translation profitability, read our guide on the topic or contact us! We are happy to help improve the profitability of your translations.