Transcript GLOBAL POLICY AND PRICING DECISIONS II

Global Marketing Management, 5e
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Chapter 11
Global Product Policy
Decisions II:
Marketing Products and
Services
Copyright (c) 2009 John Wiley & Sons, Inc.
Chapter 11
Chapter Overview
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1. Global Branding Strategies
2. Managing Multinational Product Lines
3. Product Piracy
4. Country-of-Origin (COO) Effects
5. Global Marketing of Services
Copyright (c) 2009 John Wiley & Sons, Inc.
Chapter 11
Introduction
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Companies that brand their products have various
options when they sell their goods in multiple
countries.
More and more companies see global (or at least
regional) branding as a must.
Copyright (c) 2009 John Wiley & Sons, Inc.
Chapter 11
Introduction
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Multinational product line management entails issues
such as:
 What
product assortment should the company launch
when it first enters a new market?
 How should the firm expand its multinational product line
over time?
 What product lines should be added or dropped?
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Global marketers also face the issue of global piracy.
In global marketing, firms have to use a multitude of
strategies to handle the negative country-of-origin
stereotypes.
Copyright (c) 2009 John Wiley & Sons, Inc.
Chapter 11
1. Global Branding Strategies
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Global Brands (Exhibit 11-1)
A
truly global brand is one that has a consistent identity
with consumers across the world.
 The development costs for products launched under the
global brand name can be spread over large volumes.
 A global brand has much more visibility than a local
brand.
 The fact of being global adds to the image of a brand
country.
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Chapter 11
Exhibit 11-1: World’s Most Valuable Brands
(2008)
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Chapter 11
1. Global Branding Strategies
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 Global
brands are also able to leverage the country
association for the product.
 The value of a global brand (brand equity) usually varies
a great deal from country to country (three key value
dimensions: quality signal, global myth, and social
responsibility).
 Inter-country gaps in brand equity may be due to any
following factors:
 History
 Competitive
climate
 Marketing support
 Cultural receptivity to brands
 Product category penetration
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Chapter 11
1. Global Branding Strategies
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Local Branding
 Examples: Coca Cola owns numerous local and regional
brands across the globe such as Thums Up in India
Global or Local Brands?
 Solo branding, hallmark branding, family branding, and
extension branding.
 A firm’s global brand is shaped by three types of
factors:
 Firm-based drivers
 Product-market drivers
 Market dynamics
Copyright (c) 2009 John Wiley & Sons, Inc.
Chapter 11
Exhibit 11-2: Sample of Philip Morris
International Brands
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Chapter 12
Exhibit 11-3: Dimensions of International
Brand Architecture
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Chapter 11
Exhibit 11-4: Nestlé Branding Tree
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Copyright (c) 2009 John Wiley & Sons, Inc.
Chapter 11
1. Global Branding Strategies
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Brand Name Changeover Strategies
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Fade-in/fade-out
Co-branding
Umbrella branding
Transparent forewarning
Summary axing
Copyright (c) 2009 John Wiley & Sons, Inc.
Chapter 11
Exhibit 11-5: German Print Ad for
Raider/Twix Change-Over
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Chapter 12
2. Management of Multinational
Product Lines
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Width of product line refers to the number of
different product lines of the firm
Length of product line is the number of different
products within a single line
Firms with a narrow product assortment usually
extend the domestic lines
Large companies select a subset for
international dispersal
Copyright (c) 2007 John Wiley & Sons, Inc.
Chapter 12
2. Management of Multinational
Product Lines
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Adaptations of products introduced in foreign
markets are driven by:
1) consumer preferences
2) price spectrum
3) competitive climate
4) organizational structure
5) history
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Chapter 12
Exhibit 11-6: Pantene Shampoo Brands in
Asia
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Chapter 12
Exhibit 11-7: How McDonald’s Customizes
Its Menu
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Chapter 12
Exhibit 11-8: KitKat Flavors in Japan
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Chapter 12
Exhibit 11-9: Coca-Cola Local Brands in
Japan
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Chapter 12
3. Product Piracy
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Over $500 billion in world merchandise sold in 2004
was bogus products
China is a major counterfeit product nation
Counterfeiting depresses profits directly
Bogus goods damage brand images
Any aspect of the product is vulnerable to piracy,
including the brand name, the logo, the design, and
the package
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Chapter 12
3. Product Piracy
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Options against Product Piracy
 Lobby
 Take
legal action
 Customs seizures
 Product protection options like holograms
 Change the distribution strategy
 Cut prices
 Launch educational campaigns against piracy
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Chapter 12
Exhibit 11-11: Guidelines for IP Protection
in China
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Chapter 12
4. Country-of-Origin (COO) Effects
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Country-of-Origin (COO) Influences
 For
many products, the “made in” label matters a
great deal to consumers.
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Chapter 11
Exhibit 11-12: Quality Image of Products
Made in Various Countries
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Chapter 12
4. Country-of-Origin (COO) Effects
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 Key
research findings of COO effects:
 COO
effects change over time
 Both the country of design and the country of
manufacturing/assembly play a role in consumer
attraction.
 COO influences are greater among elderly, less
educated and politically conservative
 Emotions affect COO use
 Culture affects COO outcomes
 COO varies with product category
Copyright (c) 2009 John Wiley & Sons, Inc.
Chapter 11
Exhibit 11-13: Product-Country Matches and
Mismatches: Examples and Strategic Implication
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Chapter 12
4. Country-of-Origin (COO) Effects
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 COO
particularly influences the elderly, less
educated, and politically conservative; consumer
expertise also makes a difference.
 Cultural orientation play a role.
 Consumers are likely to use the origin of a
product as a cue when they are unfamiliar with
the brand name carried by the product.
 COO effects depend on the product category.
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Chapter 11
4. Country-of-Origin (COO) Effects
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Strategies to Cope with COO Stereotypes:
Product Policy
 Pricing
 Use
highly respected distribution channels
 Communication
 Improve
the country image
 Bolster the brand image
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Chapter 11
5. Global Marketing of Services
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Challenges Marketing Services Internationally
 Protectionism
 Immediate
Face to Face Contacts with Service
Transactions
 Difficulties in Measuring Customer Satisfaction Overseas
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Opportunities for Global Services
 Deregulation
of Service Industries
 Increasing Demand for Premium Services
 Increased Value Consciousness
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Chapter 11
5. Global Marketing of Services
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Global Service Marketing Strategies:
 Capitalize
on Cultural Forces in the Host Market
 Standardize and Customize
 Give Information Technologies (IT) a Central Role
 Add Value by Differentiation
 Establish Global Service Networks
Copyright (c) 2009 John Wiley & Sons, Inc.
Chapter 11