Glo Brands Local Markets

8/6/2019 Glo Brands Local Markets

http://slidepdf.com/reader/full/glo-brands-local-markets 1/16

Global Brands & Local Markets

Ram BrijeshPudi ravi krishna



Definition:

� Globalization has been defined in business schools as the production anddistribution of products and services of a homogenous type and quality on aworldwide basis.

� Why?

� the fact that foreign sales account for more than 50 per cent of the annualrevenues of companies such as Hewlett Packard, IBM, Johnson and Johnson,Mobil, Motorola, Procter & Gamble, etc..



Yesterday·s Globalism

In yesterday·s one-size-fits-all world, big companies could often migratesomething that was a hit in the U.S. or Europe by tweaking thelanguage and advertising .

Examples:

� Mercedes-Benz, traded on its reputation for building highlyengineered automobiles to drive into foreign markets.

� Coca-Cola Co. and Marlboro cigarettes traded on their ́ American-nessµ to create large overseas followings.

� Sony Corp. found that compact, economical, and reliable

electronics like the Walkman, struck a chord with peopleeverywhere.



Today·s Globalism

Things have changed.

No company can safely assume there will be viable foreign markets for anexisting product.

Any company seeking to expand globally needs to ask if its offerings are culturally

and socially appropriate for its targeted market.



Problems faced by Global brands

Companies find it difficult to succeed in new markets that are culturallyunfamiliar.

� They often underestimate differences in the patterns of daily life in the newmarkets.

� This makes it difficult to develop products and services that fit peoples· lives,

� It is difficult to extend their brand, and manage culturally diverse teams.

Western companies are now paying a great deal of attention to the growing number ofpeople with expendable income in China, India, and other developing regions where thecultures are very different from those in the West.





Disney: Learning to Say Oui Not Yes

Before :

� workers were required to speak English, even if most people in attendancewere French.

� liquor was not sold in the park, they have a drink with lunch or dinner.

� many of the exhibits and rides did not have a local theme, they were the

same as those in Disneyland USA and thus did not appeal to Europeans.

After :

� began creating European-specific attractions

� Started to serve alcoholic beverages

series of changes, abandoning its global approach, and substituting one thatappealed to local tastes.



P&G: Regional Focus and Global Coordination

Procter & Gamble (P&G) with annual sales of almost $40 billion has operations invirtually every country of the world.

Trick:

� the firm employs a strategy that combines high national responsiveness with

high economic integration.� strategies being developed and implemented locally and/or regionally. In

particular, product delivery and marketing are local.

� the ¶back office· of payroll, financing, human resource management andother general services and processes is coordinated on a more global basis, inorder to achieve internal economies of scale.

Result:

� economic efficiency and localization.



Kingfisher: Where Retail is Detail

The Kingfisher Group, a British retail enterprise with annual sales of over $10 billion,was founded in 1989.

� ¶retail is detail· and ¶local knowledge is vital.·

� The approach that is used in managing these geographically dispersedoperations



How Companies Try to Understand Consumers

Two general types of research that companies use to understand new markets

1. product-focused research: asks consumers through surveys, focus groups,interviews, home visits and usability tests, about existing or prototypicalproducts and services.

2. culture-focused research: uses measures like census-taking anddemographic data, to look at general patterns of daily life like valuesystems, social structures, and relationships among friends and relatives.



Advantages & Disadvantages

The advantage of product focussed research is that

� it leads to specific insights about the offering, enabling the company to fixproblems or add features.

� It can be fast, practical and can lead to statistically valid conclusions aboutimportant details.

� if a prototype of a new offering is being examined by a sample group, theseresearch techniques can tell you if they hate it ² a good thing to know early inthe process.

The problem with this type of research is

� the results almost never lead to insights about possibilities that could make

large-scale improvements for users.� The insights from focus groups and surveys are almost always limited to

thecurrent expectations of the subjects.



Advantages & Disadvantages

The advantage of culture focussed research is that

� A company can learn, for example, that increasing numbers of families havetwo people earning salaries, that more people are getting high-schooleducations, and that people are putting more value on the privacy of their personal information.

� This research will give deep insights into behaviors, beliefs and peoples· goals,which can be used, in turn, to think about the products a company isplanning to launch.

The problem with this type of research is

� Findings are seldom specific enough to lead a development team to improve

the offering they are trying to create.� research is time-consuming, and development time for companies only gets

shorter,

� this is a difficult research technique to use.



� the product research that is practical but does not lead to new insights

� the culture research that leads to major insights that are difficult to apply

� Of course, the answer is that companies usually do some of both and hopefor the best.

Activity focussed research

� focusing on people·s activities when they are using a product or service acompany wants to develop.



««

� Which market do we want to access.

� Take macro and micro data to make a segmentation decisions on thesemarkets and choose our priorities.

� How can we modify our product to make more attractive to each sepategroup: you can change.

² Performance levels ² Design

² Support

² Speed of services

² Packagining

² Positioning

² Price?

� Can we position ourselves as being the best where there are many others tochoose from?



Tips

� Do not assume an integrated global market.

� be prepared to design strategies that take into account regional trade andinvestment agreements.

� Encourage all your managers to think regional, act local ³ and forget global!

� Develop new thinking and knowledge about regional business networks and

assess the similar attributes of competitors, rather than always developingpure global strategies.

� The foreign market is not always the same as your home market.

� Make alliances and foster cross-cultural awareness.

� When global brands target their regional markets using the appropriateeconomic integration/national responsiveness, they tend to be successful.



How it will help?

� Planning products and services for culturally divergent markets.

� Managing their brand across cultures.

� Create and managing teams of culturally diverse employees.

�

Documents

Glo Brands Local Markets