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Global Marketing Strategy: Adaptation vs Standardization
Transcript of Global Marketing Strategy: Adaptation vs Standardization
(1984) In India, McDonald’s serves chicken, fish, and vegetable burgers, and the Maharaja Mac—two all-mutton patties, special sauce, lettuce, cheese, pickles, onions, on a sesame-seed bun. BOTH International Marketing Mix Glocalisation think globally, act locally Global Strategy Same brand, same positioning, same product
Mostly luxury brands, High tech brands
Price Discrimination: Price is around 40% higher in Japan than in France (585 €)
Louis Vuitton has to impose purchase limits to Japanese tourists in France Country - What are the political, legal and economic issues of your potential overseas market, as well as its current market potential and your knowledge and experience of it?
Currency - If foreign currencies fluctuate a lot against your home currency, you may have difficulties in pricing your goods or making a profit. Some countries, like China don’t allow their currency to leave the country, so you may have to work in $
Culture - Every culture is different - even from one European country to another. Your product, advertising and even brand may need to be adapted to suit your new market.
Control & Co-ordination - Trading abroad is not only about selling, but also after sales service. All these people will have to be hired, trained, managed and controled.
Concentration (of markets) – some countries are vast (China, India etc). It may not be so easy or cost effective to sell to different groups in isolated areas. However, there may be opportunities to sell cross-countries to different nationalities with similar cultural/language attitudes
Commitment - Selling abroad seriously requires long term planning, significant financial investment, time and skills of your staff. There are risks and the return on investment may be long to come. The 12C framework The 12C framework Communication - You need to consider the language skills of you, your staff and your contacts abroad, and what media or information technology they have (advertising, telecommunications, e-mail etc). If it is difficult to communicate, it will slow up and complicate matters. It may also prevent you from developing your business properly.
Choices (of consumers) - It is possible that there are perfectly good products or services available from local suppliers. Yours are likely to be more expensive, so consider what would make your product better or more desirable.
Channels of distribution - Getting goods and services to overseas markets can be difficult. Building an efficient retail network is usually hard and long.
Contractual obligations - Make sure that the contract meets everyone’s needs and that you and your customer are fully aware of the commitments listed. Failure to meet the exact requirements of the contract, can result in non-payment.
Capacity to pay - You should take a look at the customer and their ability to pay as well as the country itself. This will include not only financial health, but also political issues, and currency and banking regulations.
Caveats (laws) Some countries have laws that are very protective of their local traders and do not readily accept imports. There may be restrictions or differences between your country and the foreign market about what can be sold and under what circumstances. Product Difference High Low Need for
Difference Low High Strategic Adaptation to Foreign Markets pros
- Respect local specifications and expectations
- Excellent local image
- Customers keeps their landmark and feel noticed
- Higher cost
- Time consuming and poor speed of execution
- Difficult to really know what consumers want pros
- Economies of scale
- Faster set up time
- Single coherent global image
- Excellent monitoring of communication
- Possible loss of advertising effectiveness
- Little reactivity and little flexibility
- Can create negative reactions when it neglects local needs Adaptation Standardization Dong Li
Huiting Liu BOTH QUIZ Dong Li
Heather Liu Adaptation Standardization Global Marketing Strategy What is the meaning of the chinese name of Big Mac? Which of these websites are available in China? NONE QUIZ 2010