Foreign expansion is a major opportunity for global businesses, but sometimes, even the biggest brands get it wrong.
Misunderstanding local culture, ignoring consumer preferences, or underestimating competition has led to some high-profile failures.
This article looks at some of the worst examples of companies crashing and burning when they tried to conquer foreign markets.
Domino’s Pizza in Italy: Taking on the Home of Pizza
Domino’s launched in Italy in 2015, aiming to stand out with fast delivery and creative toppings. It was a bold move in the birthplace of pizza, but it didn’t go to plan.
What went wrong?
- Italians already had thousands of local pizzerias offering authentic, high-quality pizza.
- Domino’s menu featured options like pineapple and barbecue chicken, which clashed with traditional tastes.
- The rise of delivery apps like Deliveroo allowed independent pizzerias to offer delivery, removing Domino’s main selling point.
By 2022, Domino’s had closed all its Italian stores, officially ending its attempt to crack the market.
Taco Bell in Mexico: A Misstep with Mexican Food
Taco Bell first entered Mexico in 1992, selling its American take on tacos and nachos. To many Mexicans, the food felt unfamiliar — even though it was meant to represent their own cuisine.
Why did Taco Bell fail?
- Mexican customers found Taco Bell’s food bland and inauthentic.
- Local street vendors already served affordable, authentic tacos that beat Taco Bell on both quality and price.
- Taco Bell left in 1994, tried again in 2007, and failed a second time.
Today, Taco Bell has no locations in Mexico, a striking example of a brand misunderstanding its own image.
Walmart in Germany: Failing to Fit In
In 1997, Walmart entered Germany, expecting its low-price strategy to succeed. But German shoppers had different habits.
Key mistakes
- German customers valued service and product knowledge over rock-bottom prices.
- Walmart’s American-style greeters and over-friendly service felt strange and unnecessary.
- Local competitors, like Aldi and Lidl, were already trusted and better adapted to German tastes.
After losing nearly $1 billion, Walmart left Germany in 2006.
Starbucks in Australia: Missing the Coffee Culture
Starbucks entered Australia in 2000, assuming its global success would translate easily. It didn’t.
Why it didn’t work
- Australia already had a strong coffee culture centered around independent cafés.
- Australians preferred high-quality espresso over sugary, blended drinks.
- Starbucks’ high prices didn’t match the local market.
By 2008, Starbucks shut down 61 of its 87 Australian stores. The brand remains in Australia but on a much smaller scale.
Best Buy in the UK: Late and Out of Place
Best Buy arrived in the UK in 2010, hoping to dominate electronics retail. It didn’t last long.
What went wrong?
- British consumers were already shifting to online shopping for electronics.
- Established chains like Currys and PC World already had strong customer bases.
- Best Buy’s massive stores felt unnecessary and expensive to run.
By 2011, Best Buy pulled out after losing millions.
Carrefour in South Korea: Misjudging the Market
Carrefour, a French supermarket giant, opened stores in South Korea in 1996. But the competition was fierce.
Key issues
- Korean shoppers preferred local chains like Lotte and E-Mart.
- Carrefour’s product selection didn’t match local tastes.
- Carrefour failed to adapt its business model to fit Korean shopping habits.
In 2006, Carrefour exited South Korea, selling its stores to a local competitor.
eBay in China: Beaten by Local Competition
eBay launched in China in 2002, aiming to replicate its success in online auctions. It quickly ran into trouble.
Why eBay lost
- Alibaba’s Taobao offered free listings, while eBay charged fees.
- Taobao emphasized direct communication between buyers and sellers, which Chinese consumers preferred.
- eBay struggled to localize its platform and services.
By 2006, eBay had effectively abandoned the Chinese market.
Home Depot in China: Wrong Product, Wrong Time
Home Depot entered China in 2006, assuming the country’s property boom would drive DIY demand. It was a costly miscalculation.
What went wrong?
- Chinese homeowners preferred hiring contractors over doing home improvement themselves.
- Home Depot’s big-box store format felt unfamiliar to Chinese shoppers.
- The company failed to market itself in a way that resonated with local culture.
Home Depot closed all its Chinese stores by 2012.
What Global Brands Can Learn from These Failures
What do these stories teach us? One-size-fits-all doesn’t work in global business. Success at home doesn’t guarantee success abroad. Every market has unique tastes, habits, and competitors — ignoring them is a recipe for disaster.
For companies looking to expand, the message is clear:
- Study the culture.
- Understand local preferences.
- Respect the competition.
- Adapt your product and service to fit — or risk becoming the next case study in failure.
