Sweet Smell of Failure

PRODUCT AND BRAND

1. Explain the product adaptation – communication extension strategies in the process of global product planning?

approach to global product planning  - adapt the product to local use or preference conditions while extending, with minimal change, the basic home-market communications strategy or brand name. (product adaptation–communication extension)

1. What are brands and what are their functions in global marketing? How do brands develop their image, identity, and equity? Are global product and global brands the same?

a brand is a complex bundle of images and experiences in the customer’s mind. Brands perform two important functions. First, a brand represents a promise by a particular company regarding a particular product; it is a type of quality certification. Second, brands enable customers to better organize their shopping experience by helping them seek out and find a particular product. Thus, an important brand function is to differentiate a particular company’s offering from all other companies’ offerings.

Customers integrate all their experiences of observing, using, or consuming a product with everything they hear and read about it. Information about products and brands comes from a variety of sources and cues, including advertising, publicity, word of mouth, sales personnel, and packaging. Perceptions of service after the sale, price, and distribution are also taken into account. The sum of these impressions is a brand image, defined as perceptions about a brand as reflected by brand associations that consumers hold in their memories

another important brand concept is brand equity, which represents the total value that accrues to a product as a result of a company’s cumulative investments in the marketing of the brand. Just as a homeowner’s equity grows as a mortgage is paid off over the years, brand equity grows as a company invests in the brand. Brand equity can also be thought of as an asset representing the value created by the relationship between the brand and its customers over time. The stronger the relationship, the greater the equity

a global product meets the wants and needs of a global market. a true global product is offered in all world regions, including the Triad and in countries at every stage of development. a global brand has the same name and, in some instances, a similar image and positioning throughout the world

1. Explain the term of brand equity, and give some examples of brand equity benefits?

the benefits of strong brand equity include:

● Greater loyalty
● Less vulnerability to marketing actions
● Less vulnerability to marketing crises
● Larger margins
● More inelastic consumer response to price increases
● More elastic consumer response to price decreases
● Increased marketing communication effectiveness

1. How can buyer attitudes about a product’s country of origin affect marketing strategy?

one of the facts of life in global marketing is that perceptions about and attitudes toward particular countries often extend to products and brands known to originate in those countries. Such perceptions contribute to the country-of-origin effect; they become part of a brand’s image and contribute to brand equity. This is particularly true for automobiles, electronics, fashion, beer, recorded music, and certain other product categories.

In some product categories, foreign products have a substantial advantage over their domestic counterparts simply because of their “foreign-ness.” Global marketers have an opportunity to capitalize on the situation by charging premium prices

1. What is the significance of innovation in global marketing? Describe different categories of innovation with examples

When potential customers have limited purchasing power, a company may need to develop an entirely new product designed to address the market opportunity at a price point that is within the reach of the potential customer. The converse is also true: Companies in low-income countries that have achieved local success may have to go beyond mere adaptation by “raising the bar” and bringing product designs up to world-class standards if they are to succeed in high-income countries. Innovation, the process of endowing resources with a new capacity to create value, is a demanding but potentially rewarding product strategy for reaching mass markets in less-developed countries as well as important market segments in industrialized countries.

The winners in global competition are the companies that can develop products offering the most benefits and, in turn, creating the greatest value for buyers anywhere in the world. In some instances, value is not defined in terms of performance, but rather in terms of customer perception. Product quality is essential—indeed, it is frequently a given—but it is also necessary to  support the product quality with imaginative, value-creating advertising and marketing communications. Most industry experts believe that a global appeal and a global advertising campaign are more effective in creating the perception of value than a series of separate national campaigns.

PRICE

1. How can price be used as a strategic variable to achieve specific financial goals? Under what conditions should skimming or penetration pricing be adapted as strategies?

Whether dealing with a single home-country market or multiple country markets, marketing managers must develop pricing objectives as well as strategies for achieving those objectives. Price is an independent variable; as a marketing tactic, managers can raise, lower, or maintain prices as part of the overall marketing strategy.

Pricing objectives may also vary depending on a product’s life-cycle stage and the country-specific competitive situation. In making global pricing decisions, it is additionally necessary to factor in external considerations such as the added cost associated with shipping goods long distances across national boundaries. The issue of global pricing can also be fully integrated in the product design process

Price can be used as a strategic variable to achieve specific financial goals, including return on investment, profit, and rapid recovery of product development costs. When financial criteria such as profit and maintenance of margins are the objectives, the product must be part of a superior value proposition for buyers; price is thus integral to the total positioning strategy. The market skimming pricing strategy is often part of a deliberate attempt to reach a market segment that is willing to pay a premium price for a particular brand or for a specialized or unique product