Question

Products often service different needs, appeal to different buyers, or are perceived differently in different markets.

Consider a good or service that is sold in your country and another using different marketing strategies in each.

One of the countries must be the countries home market.

Describe the factors to consider in developing international product strategies.

Explain the factors to consider when designing international distribution strategies.

Answer 1

Apple manufacture's IPhones in China and sells it in USA (home country as Apple is based out of USA) and India.

Thus the product and distribution strategy for both markets are different.

International product strategies should take into consideration :

1. Which product or product lines to offer given the different consuming class and size of the market.

2. Which communication strategy to adopt given the different utilities and perception of the product

3. Decision on standardization or customization of the product

4. Distribution strategy to get higher penetration and accessibility while taking into consideration the local laws for Foreign investments in the foreign country.

5. Pricing strategy given the different competition dynamics in different country.

As mentioned above the international distribution strategy

1. Apple decided to launch the cheaper IPhone models in India in 2008 while offering the full range in USA. The thought process behind this strategy is that while USA is a developed nation having high per capita GDP (Gross Domestic Product) , India is a offering country and has low per capita GDP. USA is predominantly a features and design driven market while India is predominantly a value conscious market.

2. IPhone was launched in USA as the iconic brand with elite design, technological innovation and huge fan following. IPhone was launched in India as a aspirational phone which the Privileged class could own.

3. To keep the supply chain of the product simpler it was decided by Apple to offer standardized product across the globe.

4. Apple was launched in multi channel mode in US. However India had restriction in Single Brand retail in 2008 which prevented Apple from opening retail stores in India. Therefore Apple initially launched IPhone though exclusive ecommerce partners like Amazon and Flipkart who have deep penetration. However after the government of India eased the laws of investment for foreign single brands, Apple has now opened stores in major cities in India.

5. Apple had different pricing for the same models in US and India. In India it was facing stiff competition from Samsung and One plus .Samsung had entered the Indian market much earlier and had dominated the market . Therefore Apple launched the iPhone base models in India at more aggressive pricing in India to gain market share. However after Apple got a toehold in the Indian Market it launched its premium models at same price as at US.

The distribution strategy has been answered in 4.