Transcript Global Marketing Strategy

Global Marketing
Strategy
• Examples of Global
Companies are:
– IBM, Intel, Coca-Cola (North
America)
– Philips, Nokia, LVMH
(Europe)
– Sony, Canon, Flextronics
(Asia)
• To develop a coordinated global marketing
strategy, the first step is typically to decide
upon which countries and product lines
should be involved.
Selling Orientation
• Remember that “good” marketing should have a
“customer orientation.” However, typically, the global
marketer sells what it makes, not makes what it can
sell as the ideal marketer supposedly does.
• The introduction of a new product is always difficult
and uncertain. Launching it into a foreign market
only adds complexity and risks to the problem.
Consequently, the global marketer will typically delay
its plans until the product is successful at home or in
a lead market.
Selling Orientation
• There are cases where a global marketer has
introduced completely new products in a foreign
market, after assessing the preferences in that
market.
• The Japanese show several examples of this..
– Toshiba, the first to introduce the laptop computer,
designed it for the American market.
– Sony’s sporty Walkman designs are targeted at consumers
in the West.
Standardization
• Standardization is the norm not only for global
products and brands but also extends to advertising,
pricing, and other elements of the marketing mix.
• Nowhere is standardization more prominent than in
the strategic use of brands.
• As many travelers have observed, global
standardization makes foreign countries look like
home – or at least more similar. Standardization also
makes people’s behavior, habits, and tastes more
similar.
Coordination
• Coordination means that what happens in one
country market is made to depend on actions in
other countries.
• The delays in the launch of Microsoft Windows 98
release was due to the difficulty of coordinating 30
language versions for simultaneous launch. After the
US and European releases in mid-1998, the Chinese
launch came on September 2 and the Thai version on
October 28. And some countries did not get
Windows 98 until ‘99.
Centralization
• Another reason for a deficient customer orientation is
the decidedly centralized character of most firms’
global marketing efforts.
• Even under the best circumstances, with cross-country
product teams, strategic input from lead countries and
global mandates for local subsidiaries, the global
marketing effort is a top-down activity.
– The timing of software releases from Microsoft is carefully
calibrated from HQ in Redmond, Washington; Disney’s
release dates for films and videos is set from its Orlando HQ.
– Volvo cars did not have cup holders until recently despite
appeals from their American dealers (Volvo engineers in
Sweden were too busy with more serious design issues)
• With the renewed emphasis
on localization in the new
millennium, the benefits of
global coordination of
strategies need to be
balanced against local
sensitivity. Today, while
globalization might still be
the dominating factor driving
international business, the
balance is shifting toward a
coordinated strategy that is
adapted to local differences.
• Typically involves a 2-stage
procedure. First, countries
are grouped using more
general criteria, to identify
clusters of countries that are
similar in socioeconomic and
cultural characteristics.
Second, market research is
used to collect data on the
potential customers in each
of the countries belonging to
the selected cluster or
clusters.
• To determine the level of
competitive intensity, the firm
has to go beyond the simple
identification of which domestic
and global competitors operate
in each market and which
segments they target. The firm
also needs to assess the
commitment of these firms to
defending their market
positions, and the resources
they can marshal to sustain
their local advantages in
selected segments.
• Before doing a forecast of
projected sales and revenues from
each country and segment,
competitive advantages need to
be translated into market share
estimates.
• In global segmentation, this needs
to be done across all the countries
in the selected cluster or clusters.
• The targeting decision needs, of
course, to be based not only on
forecasted revenues but also on
costs of achieving those revenues.
• Two major considerations
play a role in the chosen
positioning strategy:
– The degree to which the
market is global
– The stage of the product life
cycle