Marketing Internationally

LECTURE 7:
INTERNATIONAL PRODUCT
AND
BRAND STRATEGY
AMN431 Course Outline
Week Content
1 Scope and Framework for International Marketing Analysis of
2 The Role of the International Environment Foreign
Environment
3 The Role of Culture in International Marketing
4 International Consumer Research Market
5 International Market Selection and Mode of Entry Selection
Mid semester break and Entry
6 International Marketing Strategy and
7 Competitive Advantage
International Product Strategy Marketing
8 Mix
9 Marketing Services Overseas Strategy
10 International Marketing Communication
11 Pricing for International Markets
Globalisation
12 International Channels of Distribution
and Emerging
13 Building the Global Brand Themes
Contemporary International Marketing
 Learning Objectives Lecture 7

 International product strategy: standardization

vs. adaptation.

 Develop an awareness of the complexities of

product strategies in the international
marketplace.
Walmart targets Vietnam as fruitful product source
The US-backed Walmart, one of the world’s biggest retail groups, is boosting its
purchase of Vietnamese goods
 Angry Birds opens first
foreign store (Retail Planet 18/07/12)
 Angry Birds, has opened an Angry Birds brand store in
Shanghai, the first one outside its home base in Finland.
 The store in Xujiahui area, which sells licensed apparel
and iPhone cases, is the first of 25 such outlets scheduled
to open in China.
 Rovio plans to launch 10 to 20 Angry Birds theme parks
in China, with the first one expected to open in Haining,
Zhejiang province.
 “The products (sold in stores and parks) are uniquely
designed for Chinese consumers,” Paul Chen, Rovio
China's GM, told Shanghai Daily in an interview.
 “We are opening the stores to provide our fans with the
easiest way
to get authorised Angry Birds products.”
 Angry Birds is one of the world’s most popular mobile
game on all platforms, including Apple’s iOS and
Google’s Android, with a total of one billion downloads.
China is Rovio’s second-biggest regional market
contributing almost 150 million downloads.
 Consumer Products in International Markets

 Product: collection of attributes that yield satisfaction to the consumer:

• International products: products with the potential to be extended from the domestic
market to a number of overseas markets
• Multinational products: products offered to many international markets but adapted
to suit the needs of each market
• Global products: products designed to meet the needs of market segments
that are the same the world over
 Consumer Products in International Markets

 World consumer markets are at different stages of

development, and growth is related to the general
increase in living standards and country income.
 Consumer products are generally found in developed
countries and transferred to developing markets.
 Unilever, P&G Try Tweaked Formulas, Higher Prices for
Developing World

BANGALORE, India—A. Ragini earns around

$130 a month as a nanny in this city of nearly
10 million, just about the average wage in
India. After paying for food and shelter, she
has little cash to spare.
Ms. Ragini recently noticed the price of her
favorite soap, Unilever PLC’s Hamam, had
gone up to 24 rupees, or about 39 cents, from
16 rupees. It also had new packaging, and
some variations offered different ingredients.
Even though it stretches her budget, Ms.
Ragini, 49, has continued to buy the soap. “I’m
so used to it, I don’t want to change it now,”
she says.

Unilever’s big global rivals are employing similar tactics. Procter & Gamble is trying to persuade Indian
men to upgrade from unguarded razors to Gillette products with added safety features.
Colgate-Palmolive Co. is selling tea-flavored mouthwash in China. Germany’s Henkel AG is focusing on
making premium-price, locally inspired products across the Middle East, such as shampoo for hair
covered by veils or washing detergent designed for black clothes.
 Elements of a Product
Potential improvements

Potential Customer
product Service

Delivery Legal
Pricing

Core and Basic Brand

Quality Product name

Spare
Warranty parts
Augmented Package
product
Maintenance
& repair
Expected
product
Potential
modifications
 Product: Elements
 Core and basic product:
 item actually purchased and its functional features
 Expected product:
 attributes the buyer expects to receive when purchasing
the item (eg. package)
 Augmented product:
 items that exceed customer expectations (e.g. warranties)
 Potential product:
 Possible improvements and modifications (e.g., increase
capacity)
 Extending the Product Life
Cycle Internationally
Sales International
market
extension
Maturity Asia

Growth Decay

Introduction

Time
Quality unravels in tested woolens
(ShanghaiDaily.com, 21/03/12)

 QUALITY problems were discovered in 20% of woolen sweaters

tested recently by Shanghai quality watchdogs.
 H&M woolen sweaters were found to contain less wool than claimed on their
labels. All products that failed quality tests have been removed from shelves, said
officials.
 H&M yesterday admitted that some of its products failed the tests because it
was not familiar with China's standards, although the products have passed
inspections in Europe.
 Since the Swedish retail giant entered the Chinese mainland market in 2007,
quality problems have been encountered in several cities. "We are now taking
advice from quality authorities to ensure our products meet Chinese standards
completely,“ H&M Shanghai's quality manager. "Quality standards have different
characteristics in different countries to meet consumers' needs," he said.
 "Thus, products passing European Union tests may still fail Chinese inspections.”
 Drivers of Product Adaptation

Characteristics of
the Environment

Characteristics of Characteristics of
the Company ADAPTATION
the Customer

Characteristics of
the Product
 Product Adaptation to New Markets
High

Need for
Adaptation
Degree of
Cultural
Grounding

Low

Industrial/Technology Nature of Consumer/Nondurable

Intensive Product
 Branding for Overseas Markets
 Brand:
• name, term, symbol, sign or design used by a firm to differentiate its offerings from
those of its competitors.
• Brand names - critical element in impacting the customer (leads to profits).
• Brand names do not travel well and semantic variations can hinder a firm’s products
overseas.

 Modification of brand names:

 Translation, Transliteration

 Brand name strategies:

 Use the same brand name worldwide
 Modify the brand name in each market
 Company name as a brand name
 Unilever Heart Brand
 Unilever is the world's biggest ice cream manufacturer, with an
annual turnover of €5 billion.
 The bulk of the company's ice cream business falls under its "Heartbrand" brand
umbrella, so called because of the brand's heart-shaped logo.
 The Heartbrand was launched in 1998 (and slightly modified in 2003) as an effort to
increase international brand awareness and promote cross-border synergies in
manufacturing and marketing ("centralisation"). It is present in more than 40
countries.
 Although the logo is common worldwide, each country retained the local brand so as to
keep the familiarity built over the years, one notable exception being Hungary where
the previous Eskimo brand was replaced with Algida in 2003.
 McDonald's embraces Aussie
nickname (Inside Retail 08/01/13)

 In a world first, McDonald’s Australia will change store signage to Macca’s

at selected restaurants, ahead of Australia Day.
 13 stores around the country will change to the Aussie nickname
from February 4.
 McDonald’s Australia, Chief Marketing Officer, Mark Lollback said
McDonald’s was incredibly proud to embrace its ‘Australian-only’
nickname.
 ‘With one in two Australians giving us the nickname Macca’s we decided
with the lead up to Australia day, it was a perfect time to embrace the
moniker and change our [name] across the country.” Lollback said.
 “Changing our signage to Macca’s is a world first for our business and
we’re thrilled to be celebrating the nick name that only Australians have
given us,” he added.
 OREO Adapt Product to New International
Markets, New Segments

In China, Oreo has always been popular

among kids. Their tagline “ 扭一扭，舔一舔，泡一泡”
(roughly translated as “Twist it. Lick it. Dunk
it.”) was established ever since the brand
launched it back in 1996. The product is
synonymous with the child-like style of fun.
But they seem to have fallen into a victim of
their success. Kids reaching a certain age have
grown out of it, and stop finding it relevant to
them.
So Oreo recently reinvented an extension of
the product by introducing a “slim version”
targeting to the trendy female adult
audiences. Supported by a locally relevant
multi-platform campaign and social media
push. The brand personality of “fun” has been
maintained, while attracting and retaining a https://www.youtube.com/watch?v=fA-9LRUn-60
new audience segment along the way.
 Packaging and Labelling for Overseas Markets

 Main functions of packaging

 Protection
 Travels longer distances, handled and
transferred more frequently
 Involves change in climate and temperature
 High incidence of pilfering (stealing)
 Promotion
 Vehicle for promotions
 Cultural sensitivities
 Convenience
 Applies for intermediaries and consumers
 Compatible to storage facilities and user’s
household
RED BULL IN CHINA
 [yellow tail]
 Number one imported wine in the U.S.
 in May 2010, [yellow tail] was named the
most powerful Australian wine brand in the
world (Power 100 report by Intangible Business).
 [yellow tail] was also ranked number 4 in the
global wine industry and number 34 in the top
100 wine brands globally.
 "People can’t be bothered by all the hype and
nonsense of wine. They just want to drink it."
~John Casella.
[yellow tail]
 The name comes from the yellow-footed rock wallaby, a
smaller cousin of the kangaroo that has a golden tail.
 Yellow Tail is a brand of wine produced by Casella Wines,
located in Yenda, Australia.
 The Casella family has produced wines since the 1820s in
Italy. However in 1951 the Casella family (Filippo &
Maria), moved to Australia for a better life.
 YellowTail was developed around the year 2000, originally
marketed internationally, and became the number one
imported wine to the USA by 2003.
 In that time the family-owned winery expanded 10
times its original size. The name comes from the
Yellow-footed Rock Wallaby, a relative of kangaroos.
Yellow Tail in USA
 Typical global-localisation of the mix

(Doole and Lowe, 2008)

Christine Comrie- UMKD6Q-15-3 2019-20
Glocalisation – Coca Cola

Standardisation Adaptation
• Global • Modify product for:
standardised • Particular
branding strategy consumer
• Core message and segments
visuals • Diet
standardised • Caffeine free
• Modify sweetness
for different national
tastes
Christine Comrie- UMKD6Q-
15-3 2019-20
 Next Week: Lecture 8

 Marketing Services Overseas

 Look over Draft Assignment for Midterm

Assignment

 Submit your choice of Brand/ Product you would

bring into Vietnam for your Final Assignment