• Why are there so many product blunder stories???
• How to meet an unmet need? - Fruit Magix instead is a clear and appropriate market entry backed by solid research
• How is the need met in home market?
• How can it be met in the destination market?
• Can “good” products become “bad” in an inappropriate market?
• Forcing the customer to fit
• Reluctance to adapt

Consider the Company, Government, and Environment

• What are the company’s core competencies
• How much local content is required?
• Is local manufacturing possible? Advisable?
• How sophisticated is local manufacturing?
• Affects market entry decisions:  export, licensing, franchising, joint ventures, subsidiaries
• What percent of ownership is required? desired?

Product Components

• Core: what is the physical product
• Packaging: package, trademark, logo, price, quality
• Support services:  repair, installation, instructions, spare parts…

• 1: Product and Communication Extension - Dual Extension- many mistakes here - consumers may not think alike, may not want same product
• 2: Product Extension - Communications Adaptation - what we say differs, product is the same
• 3: Product Adaptation - Communications Extension - pattern advertising - like Levis around the world
• 4: Product and Communications Adaptation - Dual Adaptation - changes in both
• 5: Product Invention - invent a product which is aimed at cultural universals - it meets needs worldwide

• Old product/old use:  same promo, language changes - Nestle infant formula
• Old product/new use: education explanation,  infant formula as diet supplement
• New product/old use:  old version washing machine, going back on PLC to match compatibility with consumer desires, needs
• New product/new use:  detergent for Japanese non-flush toilets

Standardization versus Customization
Common Customer Needs vs. Different Formats of Same Needs vs. Different Needs Entirely
Convergence in Drinking Patterns
Comparison of Recognitions  Around Car Value Between Europe, USA, and Japan
Differences in Car Requirements for Various European Countries
 

Global  New Product Development Process
Identifying New Product Ideas + mkt entry issues
Screening
Concept Testing - must be understandable/ blend of phrases and possibly pictures or sketches, perhaps early prototype
 Focus groups: salient attributes and product profiles (combinations) are identified
Compensatory vs. Noncompensatory Process
Conjoint Analysis - what are the preference combinations and weightings?
Test Marketing - simulation vs. country surrogates
Prototypes - can it be built? Where? Blend with market entry strategy
Timing of Entry: Waterfall vs Sprinkler (Simultaneous) Strategies

International Product Life Cycle
Products from different parts of the PLC will be marketed in different countries, depending on their levels of development and need
Volkswagen Beetle is still made and sold in Latin American countries
NCR:  hand-cranked cash register for countries with unreliable electricity
Stages of demand growth, staggered across countries

Characteristics of an Innovation

• Relative advantage:  how is it better than the other alternatives?
• Compatibility:  does it fit within the lives of the customers
• Complexity:  how hard is it to understand?
• Trialability:  Can the customer try it out? How risky is it to try? Expensive? Breakable?
• Observability:  Can the customer see others using it? Reference group use?

Cultural Adaptations:  What Would a Barbie Doll be like in Iran?
Sara and Dara
Wears long, flowing clothings, or Iranian national costumes
Resisting “cultural corruption” from the West
Barbie dolls are considered anti-Islamic; importing them is prohibited

Degrees of Newness of a Product

• Congruent innovations:  no disruption of behaviors, like adding another flavor or size
• Continuous innovations:  some slight change in behavior is likely, product is improved: vitamin C cigarettes in Hungary
• Dynamically continuous innovations:  old behaviors must change, more improvement:  electric toothbrush, cellular phone
• Discontinuous innovations: a total break with what is known, a previously unknown product:  robots for the home; cell phones in Brazil

Campbell Soups:
Poland: chicken noodle soup
China:  watercress, duck-gizzard soup
Argentina:  split pea with ham, do not like chicken noodle
Mexico:  Creama de Chile Pablano soup

Global Branding Strategies
Local Branding, Regional Branding
Private Label Branding (“Store Brands”)
Improved quality of private-label products
Development of premium private-label brands
Shift in balance of power between retailers and manufacturers
Expansion into new product categories
Internationalization of retail chains
Economic downturns

Pros and Cons of Branding
What happens when a firm like P and G takes their product mix to many countries?
Will brand image, attributes, and identification transfer?Are there local brands with strong loyalties?
Will brand equities remain the same?
Better identification and awareness
Added expense
Protection risks - trademark, copyright
Personality of the product - what does Levis mean
Local: meaningful names, recognizable figures and logos vs. Country ID, “American brands”
 

CHECKLIST for analyzing the costs and benefits of a branding strategy:

• What is the cost of creating and maintaining awareness and associations for a local brand vs. a global one?
• Are there significant economies of scale in the creation and running of a global communication program?
• Is there value to associations of a global brand or of a brand associated with the source country? Georgia?
• What local associations will be generated by the global name? Symbol? Slogan? Imagery? Pocari Sweat?
• Is it culturally and legally do-able to use the brand name, symbol or slogan across different countries? Calpis?
• What is the value of the awareness and associations that a regional brand might create?

Some Examples - keeping the brand, changing attributes
Levis in Japan: a new scale of sizes and cuts; brand name is desirable
Sears:  smaller refrigerator, little freezer; scale down attributes, keep name
Ore-Ida:  scaled down packages for smaller freezer, lowered salt content, use of toaster oven
Brand equity - collection of assets plus liabilities
Can there be global brands?

Global or Local Brands?
Real firm strategies
Sara Lee’s Hierarchy of Brands
Nestle Branding Tree
Brands of Six Multinational Companies in 67 Countries
Umbrella (Corporate) Branding - single banner name used worldwide - like Sony, Kodak, Campbells
Protecting Brand Names
 Pizza Domino in Israel: Twin Brother of Domino’s Pizza

Brand name Changeover Strategies

• Fade in-fade out;  new global brand gradually is brought in while old brand fades out
• Transparent forewarning:  explicitly tells customers that there will be a brand change
• Summary Axing:  just drops the old brand name - RISKY!

Labeling
Multilingual: which languages?
Instructions:  pictures, words?
What do people need to know to use the product safely?
Functional literacy
Legal requirements
Warranties and ways to contact the company

Packaging
Recycling
Protection of product:  Shelf life, climate, storage, transportation
Display and regulations
Size:  what is usage rate?
What kind of containers are people used to?

Global Marketing of Services
Challenges in Marketing Services Internationally
Immediate face-to-face Contacts with Service Transactions
Difficulties Measuring Customer Satisfaction Overseas
Opportunities in the Global Service Industries
Deregulation of Service Industries
Increasing Demand for Premium Services
Increase Value Consciousness

Piracy and Intellectual Property
International organizations - WTO
Register with International Patent Conventions
impact of counterfeiters

National Image
Made in - where???
Country of Origin (COO) Influences on Consumers - stereotypes vs. nationalism
Which products are associated with home market preferences - consumer ethnocentrism
Which products are associated with specific countries based on expertise, reputation, image?
Are there any countries which would NOT be expected to produce a desirable product?

Global Service Marketing Strategies
Capitalize on Cultural Forces in the Host Market
Standardize and Customize
Central Role of Information Technologies (IT)
Add Value by Differentiation
Japanese Practices to Achieve Customer Satisfaction
Establish Global Service Networks

What’s Different About Industrial Products?
Product must be designed with the service and the user in mind - realistic!
Is it possible to sell people a product which is of “too high” quality? Too complex?
Suppose that regular maintenance is unknown?  Who will do it?
Suppose that people need the most basic product, with little repair needed?
Suppose that your customer has never had to think about maintenance before?

The Importance of Post-Sale Service
What is customary usage?
What is the frequency of breakdowns?
What needs to go into a spare parts kit?
Where should service facilities and repair personnel be located?
are there specific conditions in the home office which need to be part of training?
How is product liability handled?

Should Warranties be Standardized? - Pro
Is the good sold in many markets?
Will customers find your product in several countries?
Is safety a factor - everyone must be protected in the same way
Is there worldwide service?

Should Warranties be Standardized? - Con
Expensive
Production in many countries may mean different levels of quality
Different usage conditions - what is customary care?
Government requirements may differ
Will service levels differ?
 

 

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