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products

Meaning of global products

International product planning

Brand names & trade marks

Screening products for adaptation

Analysis of product components

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What is a Product?

Any thing that could beoffered to a market tosatisfy a need or want or

Customers do not buy a

physical product, butsatisfaction or solution toa problem

Price and quality of aproduct create the valuewhich is the most

important criteria by whichpurchases are made

Products that are marketedinclude-

Goods

Services

Experiences Events

Persons

Places

Properties

Organizations

Information

Ideas

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Analyzing Product Components for

Adaptation

Insert Exhibit 12.1 Product Component

Model

Exhibit 12.1

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components

Core- basic product- platform-

contain essential technology- enough tosatisfy core need and

bear the design and functional features Modifications in platform make radical

changes- costly to change- standardize it

Modifications in design & funtionalfeatures to local cultural needs could beadded or eliminated without much cost

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components of a product

(2) the packaging

component- includes

the physical package in

which the product is

presented, the brand name,

trademark,

styling and design features,

price and quality levels-

need adaptation- there

could be mandatory

requirements too;

(3) the support services

component- include-

repair and maintenance

services,

Installation & delivery,

warranty, spare parts,

training and instructions,

credit, and other services

related to the use and

purchase of the product-

need 100% adaptation

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Global products

One product for all markets

It mean products preferred by world markets, as

it is without any adaptation

But adaptation for packaging and after salessupport is must

More global products but still localised products

rule markets

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International product planning

Companies need to decide their product strategy forinternational markets Standardisation- Companies could offer an existing product

meant for national markets (ethnocentrism) or

Innovation- Altogether new product, developed exclusively foreach new country and market- (polycentrism)

Adaptation- Companies could adapt making appropriatechanges to match requirements of overseas markets(geocentrism) or

While planning for international markets, the issue is notwhether to adapt or standardize, but the real issue ishow much of adaptation and up to what point a productcan be standardized.

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benefits of standardisation

projecting a global product image

catering to customers globally

cost savings in terms of economies of scale inproduction

designing and monitoring various components ofmarketing mix economically

facilitating the development of a product as aglobal brand

high level of technology intensity formidable adaptation costs

convergence of customer needs worldwide

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benefits of adaptation

enables a firm to tap markets, which arenot accessible due to mandatoryrequirements

fulfils the needs and expectations ofcustomers in varied cultures andenvironments

helps in gaining market share increases sales leading to economies of

scale

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Adaptation and standardization

Customers buy satisfaction of a need orsolution to a problem

Needs and problems are global and

basically similar Satisfiers and solutions could be different oil massage and pills for headache- butones with speed, economy, ease of use

and longevity in effects shall be moreversatile

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Adaptation and standardization

Core components of product could bestandardized and accepted as it isglobally.

Packaging and support components shallrequire adaptation to local culture,preferences, styles, usage pattern- like driving rules,

electricity current, government rules,

Language

Veg/non veg contents

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Standardization suit companies.

Save cost, economy of scale,

adaptations-

Suit marketers- pro customer

could be simple packing change to totalredesign of core product

Adaptations are needed due to- Mandatory requirements- must no option

Geographical environments

Cultural environments- specially material

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Homologation or Mandatory

Homologation- term to describe mandatorychanges of a country

You must adapt- no option

Studies show that mandatory requirements aremain causes of adaptation. More binding thancultural adaptations- Safety norms of country

Environmental norms

Quality standards Country practices- left or right hand drives, electric

currents,

local or multilingual labels, packaging,

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non mandatory adaptations:

Economic- pack size, basic products to keep low pricesin poor countries

Technological- simple and less complex products in lowtechnology countries- must to cope with after sales

Political- a local brand name, low prices Changes based on climates, temperatures-

Climate- washing m/c in less sunny areas,

Temperatures- GM cars felt problems and required

different clutches and supplementary air filters in hotand dusty middle east

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Brands in International Markets

Very important

Most valuable resource a company

hasA global brand is defined as the worldwide use of

a name, term, sign, symbol, design, or combination

thereof intended to identify goods or services ofone seller and to differentiate them from those of

competitors.

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Benefits of branding

provides a marketing edge-

secure better margins

facilitate coping with market competition

increase the life of a product

serve as an important tool in international marketing as

the image of the brand crosses national boundaries

facilitates the forging of an emotional relationship

between consumers and products

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Brands in international marketing

it is important to understand the cultural traits of the

target markets

the failure to recognize the repercussions of the

brand name in international markets proved

detrimental to brand image.

carefully research the linguistic and cultural repercussions

while extending brand name in international markets

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Global Brands

The Internet and other technologies

accelerate the pace of the globalization of

brands

Ideally gives the company a uniform

worldwide image

Balance

Ability to translate

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Country-of-Origin Effect and Global

Brands Countries stereotyped on the

basis of being- industrialized,

in the process of

industrializing, or developing

Consumers have broad but bit

vague stereotypes about

specific countries and specific

product categories that they

judge best.

The more technical the

product, the less positive is the

perception of one

manufactured in a less-

developed or newly

industrializing country

Country-of-origin effect (COE) can be defined as any

influence that the country of manufacture, assembly, or

design has on a consumers positive or negative perception

of a product.

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Private Brands

Growing as challengers to manufacturers

brands

Private labels:

Provide the retailer with high margins

Receive preferential shelf space and in-store

promotion

Are quality products at low prices

Must be competitively priced and provide

real consumer value