Product And Market Development

Product and Market Development

Chapter Overview • • • • •

Global Branding Strategies Management of Multinational Product Lines Product Piracy Country-of-origin (COO) effects Global Marketing of Services

Laundry practices variations in Europe Southern Europe

Northern Europe

Water

Lower Temperature

Higher Temperature

Detergents

Less powerful in Powerful combination with bleach bleach

Packaging

Large boxes

and

without

Compact products

Henkel Detergent Division Persil

Germany

Le Chat

France

Dixan

Italy

Wipp

Spain

Henkel

Objectives • To consider and assess different branding approaches • To understand how to manage international product line • To suggest several approaches in dealing with counterfeiting • To explore major findings on the impact of countryof-origin effects on consumer attitudes towards a product. • To examine different strategies that firms can use to handle negativity country-of-origin stereotypes.

Global Branding Strategies • ‘Brand they own are their most valuable asset” • Brand – a name, term, sign, symbol, or combination of them which is intended to identify the goods and services of one or group of sellers and to differentiate them from those of competitors.

Global Branding Strategies • Brand Equity o Brand-name awareness

o Perceived quality o associations

Managing brand equity in a multinational setting • How do we strike balance between a global brand that shuns cultural barriers and one that allows for local requirement? • What aspects of the brand policy can be adapted to global use? Which ones should remain flexible?

• Which brands are destined to become “global” or “local” brands?

Managing brand equity in a multinational setting • How do you condense a multitude of local brands into smaller, more manageable number global (or regional) brands? • How do you execute the changeover from a local to a global brand?

• How do you build up a portfolio of global megabrands?

Global Branding • A truly global brand is one that has a consistent identity with consumers across the worlds.

Global Product of P&G

Global Branding • Why go for Global Branding? Advantages o Economies of scale -Pharmaceutical, Chemicals and Automobiles o Brand awareness building -Cable TV o Prestige factor -Lenovo, o Country association of the product -L’Oreal-French Cosmetic, Swatch-Swiss Watch, Nissin Cup-Japanese Noodles

How do consumers value global brands? • Quality Signals – consumers perceive global brands as being high in quality. • Global Myth – consumers look at global brands as cultural ideas. • Social Responsibility – consumers also expect global brands to have a special duty to address social issues, to act as good citizens.

Factors affecting cross-country gaps 1. History – the longer the brand had existed, the more it is familiar to the consumers. 2. Competitive climate – different countries, different battlefield. 3. Marketing support – communication strategy used to support brands can vary a great deal. 4. Cultural receptivity to brands – Brand receptivity is largely driven by risk aversion. 5. Product category penetration – due to lifestyle difference, a given category will be established much more solidly in some countries than in others.

Local Branding • Why go for Local Branding? o o o o o o

By necessity Cultural barriers Local linkage Animosity toward the foreign country Established brand equity of the local brand Firm’s strategic positioning goals.

Global or Local Branding? • Brand structures or brand portfolio • Branding Approach: 1. 2. 3. 4.

Solo Branding Hallmark Branding Family (umbrella) branding Extension Branding

Factors affecting a firm’s global brand 1. Firm-based drivers: o

Organizational structure

o

Expansion strategy

o

Corporate identity

o

Product diversity

Management of Multinational Product Lines The Product assortment is usually describe on two dimension: the width and length of the product mix.

Dimension: Width => refers to the collection of different product lines marketed by firm. Length => refers to the number of different items that the company sells within a given product line.

Customer Preferences

Are expectations, likes, dislikes, motivations and inclinations that drive customer purchasin g decisions.

Product Piracy

Brand piracy is the act of naming a product in a manner which can result in confusion with other better known brands. According to author Robert Tönnis The term brand piracy is unauthorized usage of protected brand names, labels, designs or description of trade.

Strategic Options against Product Piracy lobbying activities- lobby the government to make more laws legal action- sue the perpetrator customs- have customs officers seize the goods product policy options- making your product have a hologram so it cannot be copied distribution- change where and how u sell pricing- cut price so people will buy communication options- warn people of the consequences of coping your goods

Country-of-origin (COO) effects • COO or Country of Origin Effect refers to the practice of marketers and consumers associating brands with countries and making buying decisions made on thecountry of origin of the product. ... In brief, the country of origin effect measures the impact of the country in which the product is made on the consumers.

Key Research Findings: • • • •

Stability over time COO Design versus manufacturing Willingness to pay Consumer demographics

Product Policy

as the broad guidelines related to the production and development of a product. These policies are generally decided by the top management of a company i.e. board of directors.

Strategies to cope with COO Stereotypes

Global Marketing of Services Global marketing is a firm's ability to market to almost all countries on the planet. With extensive reach, the need for a firm's product orservices is established.

Challenges in Marketing Services International • Protectionism • Need for geographical Proximity with service Transaction • Difficulties in measuring Customer Satisfaction Overseas

Opportunities in the Global Services Industries the promotion of economic activities offered by a business to its clients. example:selling telecommunications, health treatment, financial, or professional services. it

makes the nation look better overall.

Deregulation of Service Industry is the process of removing or reducing state regulations, typically in the economic sphere. ... Around the late 1970s, such reforms were deemed as burdensome on economic growth and many politicians espousing neoliberalism started promoting deregulation.

Increasing Demand for Premium Services

Technavio’s latest report on

the global marzipan market provides an analysis of the most important trends expected to impact the market outlook.

Increased Value Consciousness • Three, five-point Likert-type statements are used to measure a consumer's expressed tendency to buy products perceived to be good values for the money.

Global Services Marketing Strategies • • • • •

Capitalized on Cultural Forces in the Host Market Standardized and Customize Central Role of Information Technologies (IT) Add Value by Differentiation Establish Global Service Networks

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