Topic 5, INTERNATIONAL PRODUCT AND SERVICE DECISIONS Flashcards
Define the four stages in the Product Life Cycle
Introduction, growth, maturity, and decline
Product Communication Mix
Define ‘Straight extension’
Standardized product with the same promotion strategy throughout the world market (i.e. Coca Cola).
Product Communication Mix
Define ‘Promotion adaptation’
Standardized product and promotion taking into account the cultural differences between markets.
It is a relatively cost-effective strategy as changing promotion messages is not as expensive as adapting products.
Product Communication Mix
Define ‘Product adaptation’
The process of changing a product to meet the needs of customers in a market other than the one in which it is made.
Basic function of the product is maintained.
Product Communication Mix
Define ‘Dual adaptation’
Product and promotion are adapted for each market (this strategy is costly).
Product Communication Mix
Define ‘Product invention’
New products in order to adapt prices to less developed economies.
Explain the process of International Positioning.
- Identify attributes capable to generate benefits to buyers
- Benefits to buyers
- Join these attributes so that the benefits match the requirements of specific segments.
International Positioning: a process whereby a company establishes an image for its product in the minds of consumers relative to the image of competitors’ product offerings.
Identify the Brand Equity dimensions.
Brand equity dimensions:
- Brand loyalty
- Brand awareness
- Perceived quality
- Brand associations
- Other assets exclusive of the brand
When a company has positive brand equity, customers willingly pay a high price for its products, even though they could get the same thing from a competitor for less.
Define “Country of Origin Effect” and explain this concept with an example.
It is the perception that customers – current and potential; direct and indirect – hold on to the image of the country.
The country-of-origin effect can positively influence consumer perceptions of a product.
For example – Germany is typically known for building good cars, whereas the French produce the best wine, the Swiss the best watches,
