Question

Define, “The One-Box Model: Global Standardization” by examining the premise that a global brand should be the same everywhere, regardless of culture, language, customs, and values by doing the following:

•Having one standardized, global positioning

•Having a single globally standardized product or service

•Ensuring that the product or service is supported by a single expression

and execution of this brand positioning; everything is uniform and unvarying

Please present the pros and cons of this model. Can this model be successful? Are there global brands that fit into this model today? Are they successful? If yes, why? If no, why not?

Answer 1

Introduction

Over the years, for small organizations that engage in business, finding the perfect strategy to sell their products and services to the public has been a major challenge. Economists have tried to analyses the different types of strategies available to take a pragmatic view of how companies can earn profits in a better way. This is valid for both companies which want to sell within the political boundaries of a nation and beyond that also.

The case study presented is one such example of a strategy that has said to work and is widely followed across many companies which follow globalization as a tool to increase their overall profits respectively.

Case Specifics

The One Box Model is a new form of standardization followed by companies which go global. They try to replicate the already successful product and service offering and sell the same experience to the customer in terms of the overall product and the after sale services which are offered.

Many companies across the globe today are trying their best to have a policy like the same. Companies such as Dominos, Apple, Samsung, Mc Donald’s etc. have tried to maintain the same with certain variations if necessary.

For example Mc Donald’s tends to sell the same kind of products and service offerings in the United States and modifies the same for Asian markets but tries to sell it with the same kind of overall experience respectively.

Companies such as Apple and Samsung make sure that they sell the same product to the customers to allow for similar experience to the customers.

The advantages and disadvantages of this strategy are as explained:-

Advantages:-

The main advantages of this strategy are how the companies standardize their offerings so that they can reduce their overall costs of operations. A standardized product would require the same type of raw materials and the bargaining power of the company for the same would increase since the per unit cost comes down.

Inventory management becomes much easier since similar products are used in the manufacturing process and the products can be sold anywhere across the globe as long as these are not perishable.

The customers tend to have similar experiences and the company deals with problems in a systematic way. It can learn from errors made in other areas and can implement changes to all seamlessly.

Further, brands create greater value with consistency in service delivery. The higher quality of an Apple product are relatable from the overall experience which the company tends to offer thus allowing for greater connection with the end customer respectively.

Disadvantages:-

The major disadvantage of the strategy comes from the lack of customization and the over emphasis of the same product selling to different people.

Over the years, customers have left these companies to get satisfaction from local brands which tend to realize the problems in a better manner.

For example Apple has been selling the same high priced products across the globe and is seeing bad results in countries such as India where the per unit cost of phones tends to be low. The company is not making sufficient sales in Asian Countries because it follows a policy of same product across every area without realizing the actual needs of the customers thus losing out on many potential customers.

How to Make The Strategy a Success:-

The strategy can become successful if companies were to realize the importance of be global but look local at the same time as they focus on standardization and One Box policies. It means incorporating the needs and wants of the locals and offering similar products while making sure that the overall needs of the customers can be achieved properly.

For example:-

Mc Donald’s find itself selling beef burgers in countries such as the United States where overall consumption of the product is relatively higher. However, the company follows a different strategy in countries such as India where beef is not consumed at all. Even then it maintains standardization and one box policy within the country.

Therefore, even when one box policy can be very helpful for an organization, customization of the same is required to allow for easier and sustained profits for the enterprise respectively.

Please feel free to ask your doubts in the comments section if any.