International Marketing Chapter 13 Products and Services for Consumers MKT 425 International Marketing

Global Perspective Hong Kong – Disney Rolls the Dice Again Tokyo Disneyland – successful EuroDisney – disaster Hong Kong Disneyland – open for business Opportunities and challenges for international marketers of consumer goods and services are great and diverse Any marketing firm’s goal should be quality products and services that meet the needs and wants of consumers at an affordable price

Market offerings: the product or service that is sold into the marketplace.

Quality Why is Quality so important? Shift to a customer’s market Increased customer knowledge The customer defines quality The cost and quality of a product Among the most important criteria by which purchases are made Quality can be defined on two dimensions Market-perceived quality Performance quality Most consumers expect performance quality

Maintaining Quality Damage in the distribution chain Russian chocolate Quality is essential for success in today’s competitive global market The decision to standardize or adapt a product is crucial in delivering quality

Green Marketing and Product Development Green marketing concerns the environmental consequences of a variety of marketing activities Critical issues affecting product development Control of the packaging component of solid waste Consumer demand for environmentally friendly products European Commission guidelines for ecolabeling

Products and Culture A product is the sum of the physical and psychological satisfactions it provides the user Primary function Psychological attributes The need for cultural adaptation is often necessary, affected by how the product conforms Norms Values Behavior patterns

Innovative Products and Adaptation Determining the degree of newness as perceived by the intended market Diffusion Foreign marketing goal Gaining the largest number of consumers in the market In the shortest span of time Probable rate of acceptance

Diffusion of Innovations Variables affecting the rate of diffusion of an object Degree of perceived newness Perceived attributes of the innovation Method used to communicate the idea

Characteristics of Diffusion Analyzing five characteristics of diffusion helps in determining the kind of resistance and or acceptance of the market of a product. A product’s relative advantage (the perceived marginal value of the new product relative to the old one). Compatibility (its compatibility with acceptable behavior, norms, values and so forth) Complexity (the degree of complexity associated with product use) Trialability (the degree of economic/social risk associated with the product use) Observability (the ease with which the product benefits can be communicated)

Brands in International Markets A global brand is the worldwide use of a name, term, sign, symbol, design, or combination Intended to identify goods or services of one seller To differentiate them from those of competitors Importance is unquestionable Most valuable company resource

Difference between a global product and a global brand A product is not a brand. A global product differs from a global brand in one important respect: it does not carry the same name and image from country to country.

Global Brands Guided by same strategic principles Same name, similar image Similar positioning Marketing mix (Product, Price, Place, Promotion) may vary Mars Snickers & Marathon Raider & Twix

Global Brands The Internet and other technologies accelerate the pace of the globalization of brands Ideally gives the company a uniform worldwide image Balance-the countries with successful country-specific brand names must balance the benefits of a global brand against the risk of losing the benefits of an established brands.

National Brands Acquiring national brand names Using global brand names Nationalistic pride impact on brands Use global brands where possible and national brands where necessary

Country-of-Origin Effects and Global Brands Influences that the country of manufacture, assembly, or design Has on a consumer’s positive or negative perception of a product Consumers have broad but somewhat vague stereotypes about specific countries and specific product categories that they judge “best” Ethnocentrism

Country-of-Origin Effects and Global Brands Countries are stereotyped On the basis of whether they are industrialized In the process of industrializing In process of developing Technical products Perception of one manufactured in a less-developed or newly industrializing country less positive

Private Brands Growing as challengers to manufacturers’ brands Private labels Provide the retailer with high margins Receive preferential shelf space and in-store promotion Are quality products at low prices Manufacturers brands must be competitively priced and provide real consumer value