Chapter 12Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 1 Global Marketing Management Masaaki Kotabe & Kristiaan Helsen Third Edition.

Chapter 12 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004

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Global Marketing ManagementGlobal Marketing Management

Masaaki Kotabe & Kristiaan HelsenMasaaki Kotabe & Kristiaan HelsenThird EditionThird Edition

John Wiley & Sons, Inc., 2004John Wiley & Sons, Inc., 2004


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Chapter 12Chapter 12

Global Product Policy Decisions Global Product Policy Decisions II: Marketing Products and II: Marketing Products and

ServicesServices


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Chapter OverviewChapter Overview

1. Global Branding Strategies1. Global Branding Strategies

2. Managing Multinational Product Lines2. Managing Multinational Product Lines

3. Product Piracy3. Product Piracy

4. Country-of-Origin (COO) Effects4. Country-of-Origin (COO) Effects

5. Global Marketing of Services5. Global Marketing of Services


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IntroductionIntroduction

Companies that brand their products have various Companies that brand their products have various options when they sell their goods in multiple options when they sell their goods in multiple countries.countries.

More and more companies see global (or at least More and more companies see global (or at least regional) branding as a must.regional) branding as a must.

Multinational product line management entails Multinational product line management entails issues such as: issues such as: – What product assortment should the company What product assortment should the company

launch when it first enters a new market?launch when it first enters a new market?


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Introduction (contd.)Introduction (contd.)

– How should the firm expand its multinational How should the firm expand its multinational product line over time?product line over time?

– What product lines should be added or What product lines should be added or dropped?dropped?

Global marketers also face the issue of global Global marketers also face the issue of global piracy.piracy.

In global marketing, firms have to use a multitude In global marketing, firms have to use a multitude of strategies to handle the negative country-of-of strategies to handle the negative country-of-origin stereotypes.origin stereotypes.


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1. Global Branding Strategies1. Global Branding Strategies

Global BrandsGlobal Brands (see Exhibit 12-1) (see Exhibit 12-1)– A truly global brand is one that has a consistent A truly global brand is one that has a consistent

identity with consumers across the world.identity with consumers across the world.– The development costs for products launched The development costs for products launched

under the global brand name can be spread over under the global brand name can be spread over large volumes.large volumes.

– A global brand has much more visibility than a A global brand has much more visibility than a local brand.local brand.

– The fact of being global adds to the image of a The fact of being global adds to the image of a brand country.brand country.


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1. Global Branding Strategies (contd.)1. Global Branding Strategies (contd.)

– Global brands are also able to leverage the Global brands are also able to leverage the country association for the product.country association for the product.

– The value of a global brand (brand equity) The value of a global brand (brand equity) usually varies a great deal from country to usually varies a great deal from country to country.country.

– Inter-country gaps in brand equity may be due Inter-country gaps in brand equity may be due to any following factors:to any following factors:» HistoryHistory» Competitive climateCompetitive climate» Marketing supportMarketing support


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» Cultural receptivity to brandsCultural receptivity to brands» Product category penetrationProduct category penetration

Local BrandingLocal Branding– ExamplesExamples: : InterbrewInterbrew has a portfolio of 200 has a portfolio of 200

local and regional brands across the globe; local and regional brands across the globe; Mecca ColaMecca Cola from France from France

Global or Local Brands?Global or Local Brands?– Solo branding, hallmark branding, family Solo branding, hallmark branding, family

branding, and extension branding.branding, and extension branding.


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– A firm’s global brand is shaped by three types A firm’s global brand is shaped by three types of factors:of factors:» Firm-based driversFirm-based drivers» Product-market driversProduct-market drivers» Market dynamicsMarket dynamics

Brand Name Changeover StrategiesBrand Name Changeover Strategies– Fade-in/fade-outFade-in/fade-out


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– Co-brandingCo-branding– Umbrella brandingUmbrella branding– Transparent forewarningTransparent forewarning– Summary axingSummary axing

Private Label Branding (“Store Brands”):Private Label Branding (“Store Brands”): Factors explaining success of private labels:Factors explaining success of private labels:

1.1. Improved quality of private-label productsImproved quality of private-label products

2. Development of premium private-label brands2. Development of premium private-label brands


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– A system where a single banner brand is used A system where a single banner brand is used worldwide, often with a sub-brand name, for worldwide, often with a sub-brand name, for almost the entire product mix of the company.almost the entire product mix of the company.

3. Shift in balance of power between retailers and 3. Shift in balance of power between retailers and manufacturersmanufacturers

4. Expansion into new product categories4. Expansion into new product categories

5. Internationalization of retail chains5. Internationalization of retail chains

6. Economic downturns6. Economic downturns


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Umbrella (Corporate) BrandingUmbrella (Corporate) Branding– Umbrella branding facilitates brand-building Umbrella branding facilitates brand-building

efforts over a range of products.efforts over a range of products.– Umbrella branding makes it easier to add or Umbrella branding makes it easier to add or

drop new products.drop new products. Protecting Brand NamesProtecting Brand Names

– Brands are vital assets to brand owners.Brands are vital assets to brand owners.


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– In the area of brand protection, the oldest treaty In the area of brand protection, the oldest treaty is the Paris Convention for the Protection of is the Paris Convention for the Protection of Intellectual Property.Intellectual Property.

– The difference in opinion held by industrialized The difference in opinion held by industrialized and developing countries on intellectual and developing countries on intellectual property (see Exhibit 12-6)property (see Exhibit 12-6)

– Many elements of the brand franchise may Many elements of the brand franchise may require protection.require protection.


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2. Managing Multinational Product Lines2. Managing Multinational Product Lines

The product assortment is usually described on The product assortment is usually described on two dimensions: the width and the length.two dimensions: the width and the length.

Drivers affecting the composition of a firm’s Drivers affecting the composition of a firm’s international product line:international product line:– Customer PreferenceCustomer Preference– Price SpectrumPrice Spectrum– Competitive ClimateCompetitive Climate– Organizational StructureOrganizational Structure– HistoryHistory


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2. Managing Multinational Product Lines 2. Managing Multinational Product Lines (contd.)(contd.)

Categories of product lines:Categories of product lines:– Core productsCore products– Niche productsNiche products– Seasonal productsSeasonal products– Filler productsFiller products


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3. Product Piracy3. Product Piracy Any aspect of the product is vulnerable to piracy, Any aspect of the product is vulnerable to piracy,

including the brand name, the logo, the design, including the brand name, the logo, the design, and the package (see Exhibit 12-10).and the package (see Exhibit 12-10).

Strategic Options Against Product PiracyStrategic Options Against Product Piracy: : – Lobbying ActivitiesLobbying Activities– Legal ActionLegal Action– CustomsCustoms– Product Policy OptionsProduct Policy Options– DistributionDistribution– Communication OptionsCommunication Options


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4. Country-of-Origin Stereotypes4. Country-of-Origin Stereotypes Country-of-Origin (COO) Influences on Country-of-Origin (COO) Influences on

ConsumersConsumers– For many products, the “made in” label matters For many products, the “made in” label matters

a great deal to consumers.a great deal to consumers.– Key research findings of COO effectsKey research findings of COO effects::

» COO effects are not stableCOO effects are not stable» Consumers prefer domestic products over Consumers prefer domestic products over

importsimports» Both the country of design and the country Both the country of design and the country

of manufacturing/assembly play a role in of manufacturing/assembly play a role in consumer attraction.consumer attraction.


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4. Country of Origin Stereotypes (contd.)4. Country of Origin Stereotypes (contd.)

» COO particularly influences the elderly, less COO particularly influences the elderly, less educated, and politically conservative; educated, and politically conservative; consumer expertise also makes a difference.consumer expertise also makes a difference.

» Cultural orientation play a role.Cultural orientation play a role.» Consumers are likely to use the origin of a Consumers are likely to use the origin of a

product as a cue when they are unfamiliar product as a cue when they are unfamiliar with the brand name carried by the product.with the brand name carried by the product.

» COO effects depend on the product category.COO effects depend on the product category.


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4. Country of Origin Stereotypes (contd.)4. Country of Origin Stereotypes (contd.)

Strategies to Cope with COO Stereotypes (see Strategies to Cope with COO Stereotypes (see Exhibit 12-11):Exhibit 12-11):

Product PolicyProduct Policy– PricingPricing– DistributionDistribution– CommunicationCommunication


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5. Global Marketing of Services5. Global Marketing of Services

Challenges in Marketing Services InternationallyChallenges in Marketing Services Internationally::– ProtectionismProtectionism– Immediate Face-to-Face Contacts with Service Immediate Face-to-Face Contacts with Service

TransactionsTransactions– Difficulties in Measuring Customer Satisfaction Difficulties in Measuring Customer Satisfaction

OverseasOverseas Opportunities in the Global Service IndustriesOpportunities in the Global Service Industries::

– Deregulation of Service IndustriesDeregulation of Service Industries– Increasing Demand for Premium ServicesIncreasing Demand for Premium Services


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5. Global Marketing of Services (contd.)5. Global Marketing of Services (contd.)

– Increased Value ConsciousnessIncreased Value Consciousness Global Service Marketing StrategiesGlobal Service Marketing Strategies::

– Capitalize on Cultural Forces in the Host Capitalize on Cultural Forces in the Host MarketMarket

– Standardize and CustomizeStandardize and Customize– Give Information Technologies (IT) a Central Give Information Technologies (IT) a Central

RoleRole– Add Value by DifferentiationAdd Value by Differentiation– Establish Global Service NetworksEstablish Global Service Networks


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Copyright © John Wiley & Sons, Inc. 2004Copyright © John Wiley & Sons, Inc. 2004

Chapter 12Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 1 Global Marketing Management Masaaki Kotabe & Kristiaan Helsen Third Edition.

Documents

global marketers

global branding strategies2

firms global brand

global brand brand equity

issue of global piracy

marketing products

brand country

regional branding