Question

2. Give examples on how host-country culture affects MNC’s marketing mix strategy (product, price, promotion, distribution).

Answer 1

The marketing mix refers to the set of controllable, tactical marketing tools that a firm uses to produce a desired response from its target market. It includes of everything that a firm can do to influence demand for its product and also acts as a tool to help marketing planning and execution. The four Ps of marketing consists of product, price, place and promotion.

Product: For example McDonalds is an international player but their burgers are adapted to local requirements. In India as a cow is a sacred animal thus McDonalds burger contain fish or chicken instead of beef. In Mexico their burgers are offered with chilli sauce. In some parts of the world the taste of Coca-cola sweeter compared to other places.

Price: For example the general economic situation of the host country and personal disposal incomes as well as their expenditure habits in the target market affects MNC’s pricing strategy

Promotion: A promotional strategy in host country could cause offence thus every aspect of promotional detail will require planning and research. For example: the red is worm by brides in India and lucky in China and white is worn by mourners in India and China. However in United Kingdom white is worn by brides.

Distribution (Place): In foreign market there are more parties involved because the products need to be moved around international market where practices of business might be different to domestic markets. For example in Japan there are nearly five different wholesaler types indulged in the chain of distribution. MNC need to investigate the chain of distribution for host country they would like to operate in