Question

What is an example of how an international company (such as Unilever or Mondelez International) changes its distribution channels and/or marketing messages based on country?

Answer 1

With the rapidly emerging force of globalization, the distinction between marketing within an organization’s home country and marketing within external markets is disappearing very quickly. With this in mind, organizations are modifying their marketing strategies to meet the challenges of the global marketplace in addition to sustaining their competitiveness within home markets. These changes also have prompted brands to customize their global marketing mix for different markets, based on local languages, needs, wants, and values.

The “Four P’s” of marketing—product, price, placement, and promotion—are all affected as a company moves through the different phases to become and maintain dominance as a global company. Promotion becomes particularly important for positioning the company in such a way that a single product can be tweaked instead of revamped for different markets. Coca-Cola is one strong example of global marketing. The drink brand uses two formulas (one with sugar and one with corn syrup) for all markets. The product packaging in every country incorporates Coca-Cola’s contour bottle design and signature ribbon in some shape or form. However, the bottle can also include the country’s native language and appear in identical sizes as other beverage bottles or cans in that country’s market.

Before launching promotional programs, global companies must first define their target markets and determine the products that will resonate most with those consumers and businesses. In addition to pinpointing which price point and distribution channels would best serve those country markets, global marketers must decide how to introduce their products. Promotional tactics for global audiences can range from television commercials to social media marketing on Facebook or YouTube. It is the job of global marketers to create and place product advertisements in settings where local consumers will be most receptive to receiving and acting on those messages.

While global promotion enables global brands to engage in uniform marketing practices and promote a consistent brand and image, marketers also face the challenge of responding to differences in consumer response to marketing mix elements. Promotional and product marketing challenges also come into play when dealing with differences in brand and product development and fending off local or global competition.

While global promotion enables global brands to engage in uniform marketing practices and promote a consistent brand and image, marketers also face the challenge of responding to differences in consumer response to marketing mix elements. Promotional and product marketing challenges also come into play when dealing with differences in brand and product development and fending off local or global competition.

To successfully implement these approaches, brands must ensure their promotional campaigns take into how consumer behavior is shaped by internal conditions (e.g., demographics, knowledge, attitude, beliefs ) and external influences (e.g., culture, ethnicity, family, lifestyle) in local markets.

• Language – The importance of language differences is extremely crucial in global marketing, as there are almost 3,000 languages in the world. Language differences have caused many problems for marketers in designing advertising campaigns and product labels. Language becomes even more significant if a country’s population speaks several languages.
• Colors – Colors also have different meanings in different cultures. For example, in Egypt, the country’s national color of green is considered unacceptable for packaging because religious leaders once wore it. In Japan, black and white are colors of mourning and should not be used on a product’s package. Similarly, purple is unacceptable in Hispanic nations because it is associated with death.
• Values – An individual’s values arise from his or her moral or religious beliefs and are learned through experiences. For example, Americans place a very high value on material well-being and are much more likely to purchase status symbols than people in India. In India, the Hindu religion forbids the consumption of beef.
• Business norms – The norms of conducting business also vary from one country to the next. In France, wholesalers do not like to promote products. They are mainly interested in supplying retailers with the products they need.

When launching global advertising, public relations or sales campaigns, global companies test promotional ideas using marketing research systems that provide results comparable across countries. The ability to identify the elements or moments of an advertisement that contribute to the success of a product launch or expansion is how economies of scale are maximized in marketing communications. Market research measures such as flow of attention, flow of emotion, and branding moments provide insight into what is working in an advertisement in one or many countries. These measures can be particularly helpful for marketers since they are based on visual, not verbal, elements of the promotion.

Global marketing presents more challenges compared to domestic or local marketing. Consequently, brands competing in the global marketplace often conduct extensive research to accurately define the market, as well as the attributes that define the product’s potential environment. Successfully positioning products on a global scale also requires marketers to determine each product’s current location in the product space, as well as the target market’s preferred combination of attributes. These attributes span the range of the marketing mix, including price, promotion, distribution, packaging and competition.

Regardless of its size or visibility, a global brand must adjust its country strategies to take into account placement and distribution in the marketing mix. For example, not all cultures use or have access to vending machines. In the United States, beverages are sold by the pallet via warehouse stores. However, in India, this is not an option.

Price will always vary from market to market. However, global marketers must be prepared to deal with not only cultural expectations of pricing, but also external variables including trade tariffs, political and economic fluctuations, and the administrative or legal criteria of specific jurisdictions. Pricing can also be affected by the cost of production (locally or internationally), natural resources (product ingredients or components), and the cost of delivery (e.g., the availability of fuel). For instance, if a country imposes a minimum wage law that forces the company to pay more to its workers, the price of the product is likely to raise to cover some of that cost. Natural resources, such as oil, may also fluctuate in price, changing the price of the final good.

One of the biggest challenges of global marketing is not only communicating a consistent message and brand image, but developing a deep understanding of the cultural differences that separate consumer markets from one another.

Luckily for global companies, web monitoring and tracking tools have become increasingly sophisticated and offer insights into consumer behavior both online and offline. The nature of the Internet is such that users tend to organize themselves into far more focused groupings and in greater concentrations than in offline settings. For example, social networking websites and personalization features can offer valuable information for global marketers looking to access hard-to-reach and overseas markets.