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1、4. Product and service decisions International product strategiesCompanies pursue one or more of three generic strategies to penetrate foreign markets. These are:Extension. The company uses the same product or communication strategy as is used in the home market.Adaptation. The company makes changes
2、 to the product or communications strategy to suit the local marketplace.Invention. The company designs new products from scratch for international markets.Kotabe, M. & Helsen, K. (2004) Global Marketing Management 3Ed. Brisbane: Wiley Standardisation versus customisationStandardisation means offeri
3、ng a uniform product regionally or worldwide. Minor changes are made to meet local regulations or market conditions such as voltage adjustments for electrical appliances.Customisation focuses on crossborder differences in the needs and wants of the firms target customers adapting the product to loca
4、l market conditions.Kotabe, M. & Helsen, K. (2004) Global Marketing Management 3Ed. Brisbane: Wiley Standardisation versus customisation Forces driving a product strategy of standardisation are:Common customer needsGlobal customersEconomies of scaleRegional market agreementsKotabe, M. & Helsen, K. (
5、2004) Global Marketing Management 3Ed. Brisbane: Wiley Taste Patterns - ConvergenceKotabe and Helsen 2000Taste - Patterns: Transitions of body sizeKotabe and Helsen 2000TrendsGeneral Convergence of sizeSUVs, People movers, Utilities, Sedans, Sporsters and Micro carsProliferation of models 60 concept
6、 models in Detroit show.With SUVs 70 models Use of common platforms with shared components Trends to make cars more interesting eg. “Retro look”Standardisation versus customisation Two common product design philosophies are:Modular approach. This approach allows for the development of a range of sta
7、ndardised product parts that can be assembled into different product configurations. For example, most tyre makers developed a standardised set of sizes to fit most makes of automobiles.Core-product (platform) approach. This approach starts with the design of a mostly uniform core product or platfor
8、m. For example, Toyota follows this approach with many of its vehicles. Kotabe, M. & Helsen, K. (2004) Global Marketing Management 3Ed. Brisbane: Wiley Multinational diffusionThe adoption of new products is generally driven by:Individual differencesPersonal influencesProduct characteristicsKotabe, M
9、. & Helsen, K. (2004) Global Marketing Management 3Ed. Brisbane: Wiley Multinational diffusionLead countries are the first countries to which a new product is introduced.Lag countries are later countries to which a new product is introduced. Product adoption rates tend to be faster in lag countries.
10、Kotabe, M. & Helsen, K. (2004) Global Marketing Management 3Ed. Brisbane: Wiley Multinational diffusionResearch has identified a number of other country characteristics that identified factors that influence adoption patterns for consumer durables:Cosmopolitanism. Mobility. Proportion of women in th
11、e labour force. Kotabe, M. & Helsen, K. (2004) Global Marketing Management 3Ed. Brisbane: Wiley Innovators2.5%EarlyAdopters13.5%Laggards16%EarlyMajority34%LateMajority34%Adopter CategoriesDiffusion of innovation: Western culture Diffusion of innovation: Asian contextSource: Schutte p 75Global New Pr
12、oduct DevelopmentMarket (Product class) EvaluationOpportunityidentificationScreeningConcept EvaluationPre-test marketTest MarketGlobal rolloutSprinklerWaterfallNo goNo goNo goNo goNo goExpand mind of designer original productsProduct conceptSpecific R&D projects for materials and processesMarket ana
13、lysis and investment needsCompetition and profit analysisProduct planning Supplier ChoiceMarketing planningLaunchJapanese car manufacturersKotabe, M. & Helsen, K. (2004) Global Marketing Management 3Ed. Brisbane: Wiley Product Concept TestingInternational product development is expensiveIs there a w
14、ay to reduce risks and costs?Test product at concept stageOcean Spray - testing concept though description and tasteAnswer is to use technique: Conjoint analysisStep 1develop salient attributes of product/service concept Use of exploratory methods focus groups, judgementDetermine levels of attribute
15、Using example of satellite dishKotabe, M. & Helsen, K. (2004) Global Marketing Management 3Ed. Brisbane: Wiley Product Concept TestingConcept - salient attributes for levels of a satellite dish - developed from focus groupAttribute Attribute LevelNumber of Channels(1) 30(2) 50(3) 100Selling Price(1)
16、 $500(2) $600(3) $700Size of dish(1) 18”(2) 25”(3) 30”Step 1Product Concept TestingStep 2Present profiles to consumers for evaluationSample profile1. Number of channels: 302. Price: $503. Size of dish: 25”Consumer responds with ratingor rankingUse of experimental methodto develop small number of pro
17、duct profilesTrade-off attributesagainst each otherFor this pro scale, (7= most likely to purchase, 1 least likely to purchase)Response = 6Converted to UtilityProduct Concept TestingStep 3Resultslevels of consumer utility for each level of product attribute ie. how much utility derived by each level
18、 of price, size, no. of channelsConsumer segmentation based onresponsesSegment 1Utility for Channels300.0501.51003.2Segment 2Utility for channels300.0503.41005.6Product Concept TestingStep 4Repeat for each countryThailandUtility profileMalaysiaUtility profileSegment 1Segment 2Segment1 Segment2Timing
19、 of EntryHighLowGNPTimeIndustrialisedDevelopingLDCsWaterfallSprinkler IndustrialisedDevelopingLDCsInnovationInnovationKotabe, M. & Helsen, K. (2004) Global Marketing Management 3Ed. Brisbane: Wiley What conditions favour launching a product with a single brand name, logo and/or slogan worldwide? Whe
20、n is it more appropriate to keep brands local?Interbrand, a consultancy, valued the brands of a number of companies with sales over US$1 billion per annum. Brand values were calculated regarding the brand as an asset and by determining the net present value (NPV) of the projected earnings resulting
21、directly from the brand.International branding strategies Brand PowerSource: Interbrand in Business Week 4 Aug 2003BrandValue (US$B)% ChangeCountry of OwnershipCoca-Cola70.45+1USMicrosoft65.17+2USIBM51.77+1USGE42.34+2USIntel31.11+1USNokia29.44-2FinlandDisney28.04-4USIntercountry differences in brand
22、 equity (the value of a brand) may be due to any of the following:History. Brands that have been around for a long time tend to have much more familiarity among consumers.Competitive climate. The greater the level of competitive rivalry in a country the more obstacles a brand faces in getting notice
23、d.International branding strategiesKotabe, M. & Helsen, K. (2004) Global Marketing Management 3Ed. Brisbane: Wiley Marketing support. Variation in communications strategies and distribution strategies in a country have an influence in creating brand awareness.Cultural receptivity. Brand receptivity
24、is largely driven by risk aversion to unknown brands.Product category penetration. The higher the product usage, the more solid will be the brand equity.International branding strategiesKotabe, M. & Helsen, K. (2004) Global Marketing Management 3Ed. Brisbane: Wiley Consider the following in developi
25、ng an appropriate branding strategy:Cost of creating and maintaining.Economies of scale.Value in the associations of a global brand or source country?Local associations generated by the global name, symbol, slogan or imagery?Culturally or legally possible?Value of the awareness and associations that
26、 a regional brand might create?International branding strategiesAarker (1996) Building Strong Brands. The Free Press. LondonWhen a company wishes to change a brand from a local to a global (or regional) brand there are a number of brand name changeover strategies. These are:Fade-in/fade-out.Combine
27、brands via co-branding or under one umbrella brand.Transparent forewarning.Summary axing.International branding strategiesKotabe, M. & Helsen, K. (2004) Global Marketing Management 3Ed. Brisbane: Wiley One of the most visible retailing phenomena of the past decade has been the spread of private labe
28、l (store brands). Co-branding exists when two products are linked to take advantage of the equity of each brand. Umbrella (corporate) branding is a system where a single banner brand is used worldwide, often with a sub-brand name. International branding strategiesKotabe, M. & Helsen, K. (2004) Globa
29、l Marketing Management 3Ed. Brisbane: Wiley A major issue is the protection of brand names. This involves such questions as:How should the brand be protected?Which aspects of the brand?When?Where?For which product classes?Answers to these questions can largely be found in an analysis of the costs an
30、d benefits of protecting the brand.International branding strategiesKotabe, M. & Helsen, K. (2004) Global Marketing Management 3Ed. Brisbane: Wiley Managing multinational product lines Drivers of a companys international product lines include:Customer preferencesPrice spectrumCompetitive climateOrga
31、nisational structureHistoryKotabe, M. & Helsen, K. (2004) Global Marketing Management 3Ed. Brisbane: Wiley Country of OriginCountry of origincountry of assemblycountry of designcountry of head officeCountry of origin implicationsHalo effects: general stereotypes about countriesSummary effects:specif
32、ic bits of information from prior experience with products and brands from countryPremium pricing where perception is favourablee.g Australian wines, niche markets in JapanBranding and Country of OriginCountry of ManufactureCountry of HQCountry of designHalo EffectsSummary EffectsPerceived Country o
33、fOriginInternational Services ClassificationDefinition:“deeds performances, efforts conducted across national boundaries in critical contact with foreign cultures” (Clark, Rajaratnam and Smith 1996)Fundamentally people based People are “culture bearers” interact with people directly in production an
34、d consumptionFour types of servicesVehicle basedContact basedAsset basedObject basedGlobal marketing of servicesChallenges in marketing services internationally include:Protectionism. Immediate face-to-face contacts with service transactions. Difficulties in measuring customer satisfaction overseas.
35、 Kotabe, M. & Helsen, K. (2004) Global Marketing Management 3Ed. Brisbane: Wiley Global marketing of services Opportunities for global service industries include:Deregulation. Increasing demand for premium services. Increased value consciousness. Kotabe, M. & Helsen, K. (2004) Global Marketing Manag
36、ement 3Ed. Brisbane: Wiley Global marketing of servicesTo compete in foreign markets, service firms resort to a wide range of different strategies:Capitalise on cultural forces in the host market.Standardise and customise. Central role of information technologies. Add value by differentiation. Estab
37、lish global service networks. Kotabe, M. & Helsen, K. (2004) Global Marketing Management 3Ed. Brisbane: Wiley Contemporary Global MarketingGSBS 60415. Promotion in international marketing0Promotion in International MarketingMajor form of communication with audiences - to achieve desired outcomesComm
38、unications strategyAdvertising - non personalPersonal selling - direct communication Public relations - favourable messageSales promotion - stimulate short-term resultRelative importance will vary from overseas market to overseas market Based on differences in international environments0Communicatio
39、n TheorySender of the messageUsually a person, can also be a brand or a company or a combination of all threeBefore being sent message is encodedSuitable for the medium to be usedWill appeal to its intended audience MediumCan take a wide variety of forms - a letter, phone directory, billboard, telev
40、ision commercial etc. Must be appropriate for environment and also for the product or service being promotedCommunication Theory (Cont.)Receiver of the messageEmployees, intermediaries, media editors, decision makers, present and future customersInterferenceCreates noise - disrupting communicationIn
41、cludes competitive activity - competitors messages being transmitted at the same time.Communication Theory (Cont.)Environmental factors impact on promotionsDegree to which local tastes and preferences are catered forSensitivity to social normsExtent to which religious mores are conformed toExtent to
42、 which standards of behaviour are conformed toFeedbackEnables assessment of the communications objectivesDepending on the form of promotion employed, the feedback can be immediateThe Communication Process0Constraints in International Marketing CommunicationLanguage differences - within and across wo
43、rld markets Marketing acceptability - varies with politics, history and economic developmentMedia availability - useabilityIntermediary availability - advertising agencies, research institutions etc. Activities of competitors - international and local firmsGovernment controls - regulation of promoti
44、onal activities0Factors in International CommunicationCultureHigh context cultures vs low context culturesImportance of social contextHigh context culture - communication approaches should imply rather than directly state the obviousLow context culture - the reverse appliesConversational principlesI
45、dentity of the people, the firm; body languagePresentation principlesMore formal cultures; length of messageWritten-word principles Vary structure of message according to context of cultureFactors in International Communication (Cont.)LanguageTranslationPrecision with which meaning is conveyedContex
46、t and interpretation of the messageEducationUse of different media and literacyEconomic developmentConsumers able to afford the productAcceptable level of sophistication of productMedia availability - which can people afford to patronise?Factors in International Communication (Cont.)Media Infrastruc
47、tureAvailability, reach, cost and effectivenessMedia availability limited in relation to demandLocal content requirementsAlters optimal promotional mixGovernment RegulationMost countries regulate the use of the mediaRelate to product, the content of what is said, how it is said, etc.Bans on advertis
48、ingMoral and religious valuesPromotion to childrenContent of International CommunicationMany of the blunders in international advertising and promotion are due to words being translated literally rather than meaning being translated!Management of Promotional CommunicationInvolves six stepsIsolate th
49、e communication problem to be solvedIdentify the target populationDefine the communication objectiveEstablish the creative strategyDesign the Media PlanImplement and monitor the promotional campaign5 Stage Decision ProcessNeed recognitionInformation searchEvaluation and comparisonVendor and product
50、purchase decisionPost-purchase evaluationMessage Strategy FormulationMessage will vary between home and OS market:Linguistic and cultural nuancesDifferent product groups - different sensitivitiesDifferent users - differences in buyer consumption patternsAvailable media alternatives - varies between
51、marketsSophistication level of communication - must meet the needs of consumersBusiness priorities - USA short-term; Japan long-termStatus of marketing- developed countries vs developing countriesPull Strategies in International PromotionTargeted directly at overseas customer or end-userNeed to be c
52、rafted correctly to appeal to themAdvertisingNewspapers, magazines, trade publications, telephone directories, TV, radio, cinema, and outdoor and transit advertisingPowerful, effective, expensive, non-personalBetween country differencesUsage, form, content, and presentationPull Strategies in Interna
53、tional Promotion (Cont.)Media selection will need to be made based on a number of criteria which will vary across overseas marketsImportant to be specific as to which is the target audienceNature of the product or service being promotedType of message to be conveyedThe objective of the campaignForms
54、 of MediaPrint mediaNewspapers, magazines, other print media, posters, billboards, signage and transit mediaVisual mediaTelevision and cinemaAudio mediaRadio is main formRelies on the sense of soundThe mental picture created can be added to by use of sound forms other than voiceForms of Media (Cont.
55、)Global mediaGlobal print mediaGlobal visual mediaGlobal audio mediaInternetGlobal media and national boundariesThere are also aspects of language and mass media that require commentUse of foreign wordsImpact on advertising layoutTranslation problemsPull Strategies in International Promotion (Cont.)
56、Publicity and public relationsNews releasesSponsorshipsPublic relations activityLoyalty programsAgenciesEvaluating advertising effectivenessPush Strategies in International PromotionSales PromotionAdded importance because of the focus of international marketingTrade shows/fairsBusiness to business-d
57、ecision makers, relationships; raises credibility; importance of research; attracting a specific audience; costs of participationTechnical seminars Push Strategies in International Promotion (Cont.)Personal sellingTrade missionsInward/outward - advantages/disadvantages Sales force activitiesManage r
58、elationships; different cultures; negotiation principlesBrochuresCulturally sensitive; well designedDirect mailEffectivenessIssues Unique to International PromotionsCountry of originProvides customer with a tangible cue for evaluationCan either add or detract from the image of the productResearch fi
59、nds that owned by is becoming as important as the country of origin cue of made inStandardisation vs differentiationNeed for tailoring promotions to individual overseas marketsthere also exists a move towards global promotionsNecessary to evaluate the extent that products appeal to global customers
60、Contemporary Global MarketingGSBS60416.International pricing for profit0International Pricing IssuesRole of PriceProduce revenueRelationship between price and demandRelationship between price and perceived value - set price at equivalent or below perceived valueReference pricesThe price buyer pays o
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