Lecture 12 Flashcards
Largest advertisers internationally (outside the US) are
Unilever, P&G, Nestle, Toyota, VW, Coca-Cola, Ford, GM, Peugeot, Fiat, etc.
Many international companies have a __ presence in the U.S.
strong
eg: Nokia, Ericsson, Nestle, Unilever, Sony, Toyota, Siemens, Philips, Suntory, Shiseido, etc.
Of the top 25 Ad agencies in the world, 13 are headquartered in…
…the U.S. - most of the others are in Great Britain & Japan.
International marketing & advertising is very difficult due to…
…vast differences in the marketing environment in other countries.
Reasons for the Importance of International Markets
Domestic Markets for Many Products and Services Are Stagnant
Many Companies Rely on Foreign Markets to Survive, Particularly Those With Small Domestic Markets
International Markets Offer Growth Opportunities for Many Companies
Competition Has Become Global and Marketers Must Be Able to Compete Globally
Markets such as China offer…
…strong growth opportunities for many companies
American Companies Make _ __ Their Market
the World
International Marketing And Promotional Decisions
Economic Environment
Cultural Environment
Demographic Environment
Political/Legal Environment
Economies of BRIC nations rapidly growing and ad expenditure is estimated as
$130B
in 2020
The ‘Four Tigers’ of Asia were
the fastest growing economies of the 1990s
(Taiwan, Hong Kong, Singapore and
S. Korea).
Nestle, the world’s largest food co. gets
80% of its sales from
20% of the world’s
population in Europe & N. America.
Economic environment
- Stage of economic development
- Economic infrastructure
- Standard of living
- Per capita income
- Distribution of wealth
- Currency stability
- Exchange rates
China Has Become Nike’s
Second Largest Market
‘CULTURAL VALUES’ are very different in
many countries (eg: individuality vs.
cooperation/conformity).
‘Ethnocentricism’
Pepsodent promised ‘white’ teeth -
unsuccessful in
Southeast Asia.
In France cosmetics are heavily marketed to
men
In most European countries the per capita
consumption of shampoo, deodorant, etc.
is
much lower than in the U.S.
In Japan, ‘soft-sell’ ads do far better than
‘hard-sell’ ads.
__ shapes the form that ads can take
in many countries.
Religion
Cultural environment
- Language
- Lifestyles
- Values
- Norms and customs
- Ethics and moral standards
- Taboos
Toyota’s initial Prado Land Cruiser ad campaign featured the Prado being bowed to by two large stone lions to demonstrate the imposing presence of the vehicle. The word Prado in Chinese can translate into…
…“overbearing.”
The lion’s symbolism can be traced to a contentious period in history between Japan and China.
In the end, Toyota backed down and pulled 30 magazine and newspaper ads and issued a formal, public apology—not the best start in a vast new market.
CPG MNCs are
focusing on
4B consumers in rural areas of developing countries
Demographic environment
- Size of population
- Number of households
- Household size
- Age distribution
- Occupation distribution
- Education level
- Employment rate
- Income level
China & India have _ of the world’s
population.
1/3
Many European countries, US, Canada,
China, Japan have very low __ __
growth rates
Latin America has one of the __
demographics.
‘youngest’
Over 50% under 26 yrs. 30% under 15 yrs.
A marketer may have to adapt its advertising to…
…local markets.
Political/Legal environment
- Government policies
- Laws and regulations
- Political stability
- Nationalism
- Attitudes toward multinational companies
Margarine & restaurant chains cannot be
advertised in
France.
In Greece, toys can only be advertised
during
evening hours.
Sweden has a ban on TV ads aimed at
children. Sweden & Denmark limit the amt
of time available for commercials.
Comparative advtg is illegal in
Korea, Belgium, etc.
Comparative advtg is legal in many countries, but often
very hard to get such an ad approved (eg: in Brazil).
Copyright restrictions
(eg: Diet Coke is known as ‘Coca Cola Light’ in Germany,
France, etc).
Advertising Aspects Subject to Regulation
Type of Products That May Be Advertised
The Content or Creative Approach Used
The Media Advertisers Are Permitted to Use
The Amount of Advertising One Can Use
The Use of Foreign Languages in Ads
Use of Ad Materials From Outside the Country
Use of Local Versus International Ad Agencies
The Specific Taxes Levied on Advertising
Global Marketer’s Dilemma
Should we offer the same product, marketing, and advertising throughout the world?
Should we adapt the product, marketing, and advertising to each of several societies throughout the world?
Globalization (standardization)
This approach assumes that differences between countries are more a matter of degree than direction, hence advertisers must instead focus on the similarities of consumers around the world.
“18 yr olds in Paris have more in common with 18 yr olds in NY than with their own parents”. Wiliam Rody, Director of MTV.
Localization (adaptation)
This approach is based on the fact that advertises must explicitly consider difference among countries, including culture, stage of economic & industrial development, stage of PLC, media availability, etc.
Contingency (moderate)
This approach suggests that neither complete globalization nor complete localization is necessary & that a combination of the 2 approaches is the most effective. Some mkters call this “Think globally, act locally”.
Globalization vs. Localization
- Advantages of ‘Global’ Marketing and Advertising
Economies of Scale in Production, Distribution
Lower Costs With Less in Planning and Control
Lower Advertising and Production Costs
Ability to Exploit Good Ideas Worldwide
Ability to Introduce Products Quickly, Worldwide
Consistent International Brand, Company Identity
Simplification of Coordination and Control
Globalization vs. Localization
- Problems With ‘Global’ Advertising
Differences in Culture, Market and Economic
Conditions Make It Difficult to Use Global Advertising
Media Availability or Usage May Vary by Country or Region
Consumers Needs and Usage Patterns Often Vary by Country or Region
Legal Restrictions May Make It Difficult to Develop an Effective Universal Appeal
Globalization Often Works Best For:
Brands can be adopted for visual appeal, avoiding problems of translating words into many languages
Brands promoted with image campaigns playing to universal appeals such as sex or wealth or fear.
High-tech products, new to the world, not steeped in the cultural heritage of the country of origin
Products with with a nationalistic flavor if the country has a favorable reputation in the field
Products appealing to a market segment with universally similar tastes, interests, needs, and values.
The company aims to have a __ advertising message and image in each country.
consistent
Contingency (moderate)
This approach suggests that neither complete globalization nor complete. Localization is necessary & that a combination of the 2 approaches is often the most
effective. Some mkters call this “Think globally, act locally”.
An In-between Approach
Standardizing Products
Localizing Ad Messages
“Think Globally, Act Locally”
Adapt Messages to Respond To
Differences in Language
Differences in Cultural - Use of Pattern Advertising
Differences in Market Conditions
Continental Airlines Used __ __ to
Promote Its “BusinessFirst” Class
Pattern Advertising
International Media Selection Issues
Widely Differing Characteristics
Media Information Problems
Widely Differing Characteristics
Quality Coverage Restrictions Availability Cost
Media Information Problems
Availability Reliability Circulation Audience Cost
Local Media Reach
Specialized Target Audiences
International Media Provide
Broad Coverage
