chapter 14 global promotion strategies3072

Chapter 14Global Promotion Strategies

Copyright Houghton Mifflin Company. All rights reserved. Chapter 14 | Slide *

The Marketing MixA Well-PositionedMarketingMixTargeted PLACETargeted PRODUCTTargeted PROMOTIONTargeted PRICE


International Marketing DilemmaPromotionStandardizationPromotion Adaptationversus


IntegratedInternationalPromotion


Promotion Standardization AdvantagesEconomies of scope; production cost savingsAble to spend more time, attention and $ on campaign itselfStrong branding image, avoid confusionTravelersViewers of global mediaInternetInternational organizational buyers


PRESSURES FOR PROMOTION ADAPTATIONWritten and spoken language differencesDifferences in symbolic meaningDifferences in humorProduct use and preference differencesLack of cross-cultural icons Value and norm differences Collectivism versus individualismGovernment regulation


Push versus Pull StrategiesPull strategyFocuses on the end-user or the buyerDependence on sales promotions and advertisingAdvisable when product is widely used by consumers, channel is long, product is not complex, and when self-service is predominant shopping behavior

Push strategyFocuses on the distributors of a product Incentives offered to wholesalers or retailers to carry and promote a productMay resort to push when there is a lack of advertising media or difficulty transferring firms pull strategy in foreign markets


Hindu Festival Attracts U.S. MarketersKumbh Mela festival draws 30 million participants, many from small townsWestern brands promote productsSamples, billboard and poster advertising, and other sales promotions Encourage product trial Incites word-of-mouthCommercialization of ancient tradition?Economic imperialism?


Personal SellingInternational sellingCompany sales force travels across countries and meets directly with clients abroad

Local sellingCompany organizes and staffs a local sales force made up of local nationals to do selling in that countryWhen a customer is met in person by a representative of the marketing company


International SellingPurchasing behavior can vary country to country

Decision Maker

Who is the buying unit?What role does each play in the decision-making process?


International Selling (contd)Buying criteriaHow products/vendors are selected may vary market to marketLanguageImportance of knowing the local languageBusiness etiquetteHow and when appointments and introductions are made, if gifts are presented, attending sales banquets and other social/business occasions


International Sales NegotiationsNegotiation styleJapanese least aggressiveFrench and Brazilians most aggressiveRussia zero-sum gameTime orientationLonger in China versus U.S. and EuropeAttitude toward final contractU.S. get it in writing culture


Local SellingRole of local sales forceMissionary sales force Visiting clients together with local distributors sales forceCompany-owned sales force Company sales force ensures personnel have right training and qualifications and uniform price negotiationsForeign sales practicesNature of the interaction between salespeople and local customer can be different market to marketBausch & Lomb in Japan


Local Selling (contd)RecruitmentScarcity of skilled personnelDifferences in prestige of sales positions in different culturesCompensationSalespeople from different cultures may respond to motivation programs in the same wayRewarding volume, consistency, straight salary, etc.


What Makes a Great Salesperson?LOW CONTEXTPreparationGreat productAppearanceEnthusiasmSelf-confidenceGreat closer

HIGH CONTEXTPreparationGreat productThe personCultural awarenessRelationship oriented


Global Account TeamGlobal account team Services a customer in every country in which the customer operates

Siemens teams for Volkswagen & Ford

Response to centralized purchasing within global firmsInformation technology makes it possiblePrice pressures


International Trade FairsIdeal for exposing new customers and potential distributors to a companys product rangeVery important for B2B sales in markets with underdeveloped media channels600 trade shows in 70 countries each yearCologne Trade FairHanover Fair


Selling to Business and Government


Bidding ProcessSearch phase Purchaser utilizes media and business contacts to search for vendorsPrequalifying phase Purchaser requests documentation from potential biddersFormal bids Bidders provide written statement of how they will solve purchasers problem and their priceSelection Purchaser makes choicePerformance bond A guarantee that the company will pay certain specified damages if job not completed in accordance with specifications


Consortium SellingConsortium Group of firms that share a certain contract or project on a pre-agreed basis but act as one company toward the customerShare the riskEnhance competitiveness of turnkey projects


Sales PromotionAdd value to products in order to stimulate consumer purchasing and/or channel cooperationCoupons, sweepstakes, gifts, reduced-price labels, free goods, double-pack promotions, in-store displays, slotting allowance


Sales Promotion (contd)Country-to-country differences existCultural normsTaiwanese consumers prefer coupons to sweepstakes; Malaysians and Thais prefer sweepstakes to couponsGovernment restrictions and regulationsJapans limitation on value of promotional gifts attached to products is of the 10% products price


Sports Promotions and SponsorshipsSports events increasingly covered by global mediaOlympics, World CupSign spaceMust have logo or brand worth exposing to global audienceTake into consideration popularity of certain sports and the segments they attract


Olympics Versus the World CupSoccer is favorite TV sport in 24 out of 34 countries surveyed by Ipsos-Reid Corporation250 million registered soccer players and 1 billion spectators worldwideWorld Cup sponsors get good deal!Pay $20 million - $50 million Get rights to World Cup marks, behind-the-scenes access, 2 on-field ad boards in 20 stadiumsYear-long run-up to event


TelemarketingCan be used to solicit sales and to offer enhanced customer service to current and potential consumersEfficient telephone system requiredTelephone numbers must be easy to obtain phone books dont exist in every country!Government restrictions and regulations


Managing Word-of-MouthCultural differences in product recommendation referencesIndividualistic cultures versus collectivist culturesBuzz marketing Marketing activities undertaken to stimulate consumer discussion of the productGood buzz and bad buzz


Public RelationsMarketing activities that enhance brand equity by promoting goodwill toward the organizationMay be necessary to defend brand against bad publicityPR campaigns can go wrong if not managed correctlyPhilip Morris in Czech RepublicNestls baby formula in developing countries


Growing Importance of Promotions in Developing CountriesShift from mass to target marketingNo ones ever spoken to them personally before.Role of collectivismLocal partnersMessageAppropriate adaptationTalk to someone about a trip to Tahiti and you may lose them. But talk about supermarket coupons for groceries and a TV or stereo, then youve got more attention.


Dunkin Donuts Love Campaign in ThailandMothers Day campaignGood cultural fit with Thai importance on family, Queen Mother, etc.Integrated promotion campaignIn-store promotionsSales promotion and packagingPublic relationsPublicityVery successful!


Axe & Durex Co-Branded Campaign in ThailandAxe is positioned as a sexy brand; co-brands with condom manufacturerIntegrated promotion campaignPremiumPackaging insertsFlyersAdvertisements

Now that we are at the end of the 4P story, this is a good summary slide to remind the student how all of the Ps work together to insure a well-positioned marketing mix.Some of the advantages of standardizing promotion:

Companies can gain economies of scope and take advantage of production cost savings when advertisements and other promotions are standardized across markets.By focusing on a standardized promotion campaign, the company is able to spend more time, attention, and money on the campaign rather than these resources being fractured among several different national and even sub-national campaigns.Consumers now are exposed to a companys promotions beyond their national boundaries, via travel, viewing global media, or the Internet. International organizational buyers are exposed to a companys promotions beyond their immediate location through employee travel and information passed to them from the companys other foreign locations. A standard promotion campaign helps build a strong brand image and avoids the confusion that can occur when individuals are exposed to different promotions in different countries.Based on article:

Andruss, Paula Lyon. 2000. Running for the Border: Loyalty Programs Catch on in South America, Marketing News, 4 December: 19. Based on the article:

Andruss, Paula Lyon. 2000. Thais Sweet on Mom, Love Campaign: Go Nuts for Doughnuts Marketing News, 11 September: 1.

This was a Mothers Day promotional campaign. Mothers Day is set on the Queen Mothers birthday. In Thailand there are parades and other events to commemorate the holiday.

This was an integrated promotion campaign (refer to earlier graphic). It utilized a wide variety of promotions to communicate the same Mothers Day, Buy Donuts Campaign.In-store promotions (customers invited come into the store and sign banner/love letter to Mom, sweepstakes/drawings for cash and prizes, in-store posters and leaflet advertising)Sales Promotion & Packaging - Buy 5 doughnuts for $1.86, and put in special Millenium Mom boxPR (a sweepstakes the winner and his mom do a lunch for underprivileged kids, movie stars and Prime Minister sign banner, banners strung together in national parade)Publicity Media discussions about who signed banner and the parade

This was a very successful campaign.Sales increased $373,000 above normal limits$207,000 in media coverage related to promotionOverall donut mkt share increased 14% from 10% and DD share increassed to 71% from 67%Based on the article:

Witwam, Bryce. 2003. Gee Dad, Where Did That Come From? Promo Magazine, 3 February: 15.

Axe deodorant is positioned as a sexy brand. In Thailand, they co-branded with Durex, a condom manufacturer to execute an integrated promotion campaign (refer to earlier integrated promotions graphic).Integrated promotions used:Premium deodorant was sold with a free condom attached to itPackaging Inserts included in the packaging was a list of places to take a date, such as hip restaurants and clubsFlyers condom-shaped flyers promoting the co-branded product were distributed at malls that were known to be major hang-outs of teenage boysAdvertisements particularly targeted advertisements in sports newspapers (targeting young males)This was a very successful campaign.54% of target achieved in 3 months, Durex increase sales of 25%

chapter 14 global promotion strategies3072

Documents

sales promotions

local sales force

sales banquets

product trial

product incentives

promotion adaptationwritten

local nationals

hindu festival