Global Advertising for AD & Com

7/29/2019 Global Advertising for AD & Com

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Global Advertising

Cross national cultural understanding

Standardization vs adaptation

Global branding and positioning-Message & mediastrategy


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Global brand defined as

Basically same product or service

everywhere with only small variations like

Coca-Cola and McDonalds

Same positioning?

Same package design?

Same pricing schedule?

Same distribution plan?


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Global brand defined as

Consumer perception about McDonalds in

United States is different from perception

about it in developing countries

Everyday, low priced, convenient symbol

for America

However a status symbol in India, Russiaor Thailand


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Global brand factor

Must achieve more than a third of its sales

outside of its home country and have a visible

external market presence.

A global brand is one that is available in

many nations

may differ from country to country

local versions have common values and a similar

identity.


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Global brand factor

The brands

positioning

advertising strategy

Personality look and feel

same but allow for regional customization.

What remains consistent market-to-marketare the values communicated and delivered bythe brand.


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Why Go Global?

Harness the coherence and scale of a globalbrand as well as the closeness of a local brand

to succeed

Often referred to as the 70/30 principle,

70% of the brand must remain absolutelyconsistent,

30% reflecting flexibility market-to-market


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Several advantages

Highly attractive.

Perception of excellence

Same name, appearanceStatus & prestige

Maximising market benefits

Reduce advertisement costsBetter way to build value of brand


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Cultural differences

Deodorant usage in Men

What percentage of men use deodorants

USA= 80%

Sweden= 55%

Italy= 28%

The Philippines= 8%


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Cultural differences

House cleaning in Women Should a house be dusted and polished 3

times a week

Italy=86% UK=59%

France=55%

Germany= 49%

Australia=33%

USA=25%


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Hofstedes cultural model

Hofstedes 4D or 5D model

Quantitative and longitudinal study of culturaldifferences between countries

Why some concepts of motivation do not work in allcountries in the same way

Cultures Consequencesand Cultures and

Organizations: Software of the Mind

Scores for each country explain why people andorganizations in various countries differ, comparativedata.


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How do we measure cultural distance?

Geert Hofstedes Cultural Index

- National character survey

- 116.000 IBM employees

- 72 countries and 20 languages

Five different poles make up the cultural index:

- Power distance- Uncertainty avoidance

- Individualism

- Masculinity

- (Long term orientation)

Original scoresfor 56 countries,

extended tonearly 90


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5D Model

0

100

100

100

100 100

PDI

UAI

IDVMAS

LTO

Work-related valuesto consumption-

related values


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Examples of Hofstedes Dimensions


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Comparison of cultural dimensions

More information on www.geert-hofstede.com


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Cultural dimensions and advertising appea

Power distance High: status symbols, presence and importance of elders, master-learner relationships

Low: independence, empowered consumers

Individualism/Collectivism IDV: low context, direct, explicit (you, we, I), data, facts

COL: high context, indirect, symbols, entertainment, groups

Masculinity/Femininity MAS: winning, success, domination, persuasion, comparative advertising, reverse sexism

FEM: less endorsement, caring, less role differentiation

Uncertainty avoidance High: explanations, testing, technology, design, structure, well-groomed

Low: results are important, change, subtle

LTO/STO STO: sense of urgency, direct style

LTO: build trust, nature, entertainment


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Advertising models and culture (1/2)

Sales-response model Simple stimulus-response model

Very direct, buy now strategy, short term effect

Low PDI, IDV, MAS, Low UAI (Anglo-Saxon model)

Persuasion model Short term shift in attitude, buying intention, and brand preference

through providing arguments

Lecture form (presenters, demonstrations, testimonials), persuasiveand direct

US, UK, Germany, Switzerland, Austria

Involvement model Build relationships between consumers and brands by creating

emotional closeness

Brand becomes a personality, indirect style

FEM, IDV (Netherlands, Scandinavia, France)


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Advertising models and culture (2/2)

Awareness model Create awareness to differentiate brands from similar brands

Associations, metaphors, humor, build trust, indirect

Low IDV (Spain, Asia, Latin America...)

Emotions model

Create positive attitude and brand loyalty Builds connections between brands and emotions, emotion often linked with

product category

Low IDV, low MAS (Spain, Latin America, Africa)

Likability model Liking the advertisement will lead to liking the brand Indirect, entertaining/story, make friends to build trust and dependence

Japan, China

Symbolism model Turn the brand into a symbol/code, cohesion to subculture

Very culture specific (symbols of status, success, self-expression, stability)

-


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Standardization vs. adaptation

Debate in marketing since Buzzell (1968) and Levitt (1983)

Factors encouraging standardization Economies of scale in production

Economies in R&D Economies in marketing

Global competition

Shrinking of world market

Converging, homogeneous cultures

Factors encouraging adaptation Differing use conditions

Government and regulatory influences

Local competition

Differing consumer behavior patterns

True to marketing concept

Degree of

standardization,

Degree ofadaptation,

global/local

paradox


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Need for adaptation

Degree ofcultural

grounding

High

Low

Nature of product

Industrial/Technology intensive Consumer

Source: Czinkota and Ronkainen


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Factors affecting adaptation

Consumption patterns

Psychosocial characteristics

Cultural criteria


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Consumption patterns

Pattern of purchase Is the product purchased by relatively the same consumer income

group from one country to the other?

Do the same family members motivate the purchase or dictate brandchoice in all target countries?

Do most consumers expect a product to have the same appearance?

Is the purchase rate the same regardless of the country? Are most purchases made at the same kind of retail outlet?

Do most consumers spend the same amount of time making thepurchase?

Pattern of usage Do most consumers use the product for the same purpose?

Is the product used in different amounts from one area to another?

Is the method of preparation the same in all target markets?

Is the product used along with other products?


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Psychosocial characteristics

Attitudes toward the product Are the basic psychological, social, and economic factors motivatingthe purchase and use of the product the same for all target markets?

Are the advantages/disadvantages of the product in the minds ofconsumers basically the same from one country to another?

Does the symbolic content of the product differ from one country to

another? Is the psychic cost of purchasing and using the product the same?

Attitudes toward the brand Is the brand name equally known and accepted in all target countries?

Are customer attitudes toward the package basically the same? Are customer attitudes toward pricing basically the same?

Is brand loyalty the same throughout target countries for the product?


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Cultural criteria

Does society restrict the purchase and/or use of the productto a particular group?

Is there a stigma attached to a product?

Does the usage of the product interfere with tradition in oneor more of the targeted markets?

Does the message of the product correspond to core cultural

values?

How do the different dimensions of culture influence thepurchase and use of the product?


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Global brands

Handful of truly global brands exist today,despite the increased globalization ofmarkets

Companies need not always create one-size-fits-all global brands just because theworld appears to be shrinking

Adapting brands to local conditions willon many occasions be the best approach


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Global brands

Global companies need global brands to some

extent

Global and local brands can be part of a

successful marketing mix at any spot along thecontinuum.

Decisions to use a combination of local and global

brands -- called the "hybrid" approach -- dependon many factors, including products, industry,

local cultures and the nature of the competition.


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Which Global brands are most

valuableTOP TEN BRANDS IN 2011

1 Coca-Cola 71,861 ($m)

2 IBM 69,905 ($m)

3 Microsoft 59,087 ($m)4 Google 55,317 ($m)

5 GE 42,808 ($m)

6 McDonald's 35,593 ($m)

7 Intel 35,217 ($m)8 Apple 33,492 ($m)

9 Disney 29,018 ($m)

10 Hewlett-Packard 28,479 ($m)


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Features of global brands

Some common features consistent name that is easy to pronounce

corporate sales are globally balanced with no

dominant market the essence and positioning of the brand is the

same the world over

they address the same customer needs, or the

same target segment, in every market and there is great similarity in execution

(pricing, packaging, advertising) across cultures


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What kind do not lend themselves

Food is one category where, literally,

differences in tastes from culture to culture

compel global companies to adapt to local

conditions


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Intel

Intel, whose products and markets make it easier forexecutives to establish a truly global brand with a

memorable catch-phrase: "Intel inside.

Intel has a smaller number of buyers [than many other

global companies] and all of those buyers are using

computer chips for the same purpose.

All of Intel's competitors are global.

Intel is a global brand without significant local adaptation Holds true for Disney, which stands for family

entertainment in all cultures


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The hybrid approach

Reibstein and Day see what they term

"countervailing pressures"

slowed the march toward global brands and

make the hybrid approach more appealing.

Inherent market differences that can exist

from country to country.


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The hybrid approach

KFC, formerly Kentucky Fried Chicken, has 5,000restaurants in the U.S. and 6,000 in othercountries.

learned that it cannot open restaurants globallybased on its U.S. model

In Japan, KFC sells tempura crispy strips. In Holland, it features potato-and-onion

croquettes. In China, KFC's chicken gets spicier the fartherinland one travels.


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Favoring local brands

Conditions favoring local over global brands

include unique market needs

low frequency of purchase, so that brand loyalty

passes from one generation to another throughfamily traditions

Relative unimportance of advertising, which

makes it harder for global companies to changeloyalty patterns


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Growing concentration of retail buying

power -- labeled "growing channel power"

Can lead to heightened price sensitivity on

the part of the buyer.

Wal-Mart's goal to offer low prices every day

can constrain companies wishing to sell their

products through Wal-Mart stores.


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Criticism of global brands by activists opposedto globalization

Nike, Disney, Shell and McDonald's became

symbols of a host of complaints aboutglobalization.

Responded by establishing codes of conductand improving labor practices, but the anti-globalization movement served notice thathigh-profile brands carried risks.


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Managing Brands in global markets

Unilever and Music Television Networks

(MTV).

Various challenges faced by global firms to sell

their products and services worldwide.

Developing brands for global markets is more

complex.


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Unilever

In the 1990s, Unilever was struggling underthe weight of some 1,600 brands in morethan 50 countries.

Revenues were lopsided -- 3% of the brandsprovided 63% of revenues -- and the companywas not growing.

In 2002, Unilever launched a program to

reduce its number of brands to 400 "core"brands so that it could concentrate itsresources on fewer products.


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Unilever

The company combined branding strategies by

placing the 400 in three categories:

international brands (such as Dove and Lipton),

regional brands (such as a spread called Flora inthe United Kingdom and Becel in Germany),

Local brands with strong positions in single

countries (including Wishbone salad dressing in

the United States and Persil detergent in England).


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MTV

MTV entered Europe in 1987 with pan-regional programs in English.

Programming was provided to cableoperators at no charge, and all revenuecame from advertising.

Within a few years, however, thingschanged.

.


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MTV

Advertisers called on MTV to offer local programs,either because

could not afford pan-European coverage

their products were available only locally,

Their products were not uniformly branded in all countries

Strong local competitors emerged, such as VIVA inGermany and MCM in France.

MTV responded to the change in climate. Today, MTV Europe (MTVE) has a presence in 41

countries with multiple languages and formats andnearly 50% local programming.


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How MTV adapted to local conditions

Day and Reibstein cite several factors in MTV's

ability to adapt to local conditions.

1. MTV realized that the local advertising sales market

was much bigger than the pan-European market.2. Changes in technology allowed separate satellite

feeds to each country.

3. MTV managed to address local content and

advertising concerns, while simultaneouslyleveraging its powerful global brand identity -- the

anti-establishment voice of young people.


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Risks of taking brand global

Erroneously assuming the brand communicatesthe same meaning market-to-market, resulting in

message confusion

Over-standardizing or over-simplifying the brand

and its management, resulting in a culture of

discouraged innovation at the local level

Use of the wrong (or tried and true)

communications channels, resulting ininappropriate spending and ineffective impact


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Risks of taking brand global

Underestimating the investment in spending andtime for a market to become aware of the brand,try it, and adopt it

Not investing in internal brand alignment to ensure

that regional employees understand the brandvalues and benefits and are able and willing tocommunicate and deliver consistently

Failing to modulate performance metrics based on

local variables


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Interbrand

Interbrand has identified a consistent set of

principles shared by successful global brands.


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Recognition

Well-performing brands enjoy strong

awareness among consumers and opinion

leaders.

Recognition represents the nexus of

perception and reality, enabling brands to

rapidly establish credibility in new markets.


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Consistency

High degree of consistency in visual, verbal, sonic and

tactile identity across geographies.

Deliver a consistent customer experience worldwide

McDonalds has returned to its roots by simplifying theircore offer, and adhering to a shared message globally.

McDonalds appropriately modifies its approaches for

greater regional relevance.

Restaurants in France are more caf-like in appearance andthe menu is tailored to the local culture. Espresso is in quick

supply and the chairs are neither molded plastic nor bolted to

the floor.


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Emotion A brand is not a brand unless it competes along

emotional dimensions.

Brands can achieve the loyalty of consumers bytapping into human values and aspirations that cut

across cultural differences. Nike has appealed to the athlete in all, regardless of

true physical ability, allowing for a focused, yet mass-market offer.

Elevated the discussion beyond tangible aspects ofthe shoe or apparel to what the customer feels whenwearing and performing in Nike gear.


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Uniqueness

Express a unique position to all internal and externalaudiences.

Effectively use all elements in the communications mix to

position within and across international markets.

Apple has creatively addressed its marketing mix while

consistently ensuring that its people embody its most

ownable and beneficial brand attribute innovation.


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Adaptability

Global brands must respect local needs, wantsand tastes.

Brands adapt to the local marketplace while

fulfilling a global mission. HSBC

excellence in financial services with its deepknowledge of local custom and practice.

In essence, it is communicating a glocaladvantage.


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How are Global Brands Managed?

Several management traits that are employed

by leading global brands.


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Seek Out Insights

Outstanding brands identify customer insights. When these insights appeal across cultures they assist in

a brands adoption globally. The Economistbrand appeals to its audience because

they know when they are in the know.

Hyundai sells two-thirds of its cars outside of Korea, hasa multinational product portfolio, a worldwide sloganand fairly consistent advertising.

Despite all this, it is not a truly global brand becausethe Hyundai name carries very different associations in

each market. On the other hand, over 60% of Mercedes Benzs sales

are in Europe, yet the brands associations with prestigeand quality are global.


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Integrate Local Intelligence

Brand guidelines are tremendous tools for

ensuring consistency.

Brands are dynamic never static so

managing them must integrate new thought.In the case of global brands, to assume that

one message can appeal uniformly to all

audiences with equal relevance is unrealistic


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The Team

Global brands demand a global brand managementteam.

Regional and international organization is in place tomaintain brand leadership.

Companies with large brand portfolios tend to haveseparate managers for each brand.

Brand management team reports to a senior executiveofficer of the company

CEO has direct involvement in brand decisions.

Global brand management teams implement processesto create, review and improve brand performance.


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Investment

Intangible assets, including brand, now

comprise the majority of the value of a

company.

These assets require capital investment likeany other. Progressive companies and

enlightened management recognize the need

for appropriate communications spending.


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Measurement Systems

In order to sustain a global brands long-term

position, there must be consistent and

widespread brand equity measurement.

This will not only help brand development byhighlighting and demonstrating best practice

but it will also provide the brand management

team with a means of monitoring globalconsistency.


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Measurement Systems

This equity measurement should include

top-of-mind awareness

overall opinion (preference, satisfaction, loyalty,

recommendation)

Brand image attributes

Perceptions of product/service performance

Brand valuation to determine the financialcontribution of brand to the balance sheet.


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The company's 'Priceless' advertising

campaign currently is airing in more than 90

countries worldwide.


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Every country used a different agency, a differentcampaign, and a different strategy.

The success of 'Priceless' as a platform in the U.S.helped persuade other countries to adopt one

single approach. Over time this became a consistent global

positioning.

'Priceless' campaign now appears in 96 countriesand 45 languages and forms the framework weuse for all brand communications


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The U.S. strategy based on

a lot of consumer research

Insight arrived at was that there had been a significant

change since the 70's attitude of, 'you are what you buy'.

Consumers now focus on lifestyle and quality, and on the

concept of 'rewarding yourself for what you've earned'.

Their core values are family, security, companionship and

'making time for yourself'.

It was unique for a credit card company to say to consumers,

"It's not about what you buy; it's about how you take care of

yourself.

Global branding : positioning AND


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Global branding : positioning ANDproperties
http://wheresthesausage.typepad.com/.a/6a00d8341c5f1b53ef0154361a4434970c-pi


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Akzo Nobel creating a visual brand property for it's14 paint brands around the world.

The brands have different names, such as Dulux inthe UK and Coral in Brazil.

This approach allows each market to keep (for now)the local brand name that consumers know andtrust. At the same time, it unifies the brands with acommon brand identity and brand property - the

colourful "swoosh" - intended to communicateinspiration to decorate the home. The globalpositioning is based on the strap line "Let's Colour".


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Unilever & P&G

Unilever have successfully used a similar approach on severalof their global brands.

Having had a more localised culture historically compared to

P&G, the company had a total mish-mash of brand names,

designs and positionings. For their main laundry cleaning brands the "splat" icon was

used to create some consistency in identity, even though the

brand names were different. An example of this for two

countries is shown below.
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Some trends

McDonalds does not standardise its

product

Provides beer in GermanyWine in France

Coconut, mango and tropical mint

shakes in Hongkong


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Transplants that did not work

Hallmark cards bombed in France as French

prefer writing their own card

Tang initially failed in France as it was

positioned as a substitute for orange juice.

The French hardly drink orange juice at breakfast


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Conclusion

In conclusion, global branding is not only

about positioning.

It's also about creating powerful brand

properties which can unify brands acrossmarkets , creating economies of scale and

economies of ideas.


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Documents

Global Advertising for AD & Com