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Global branding


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Presentation of a conceptual study on "brand", "global brands" and "global brand management strategies" that covers the basic elements on the brand management.

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Global branding

  1. 1. International MarketingProf. Dr. Mustafa TanyeriGönenç DALGIÇYaşar UniversityPhD in Business Administration
  2. 2. Contents BRAND AND BASIC CONCEPTS Brands Versus Products Importance of Brands Local – International - Global Brands BECOMING GLOBAL Global Brands’ Competition Strategies Standardization Adaptation / Customization Country Of Origin Effect GLOBAL BRANDING Building a Global Brand Global Brand Positioning Brand Name Selection Global Brand Name Strategies Global Brand Development Strategies Global Brand Management Advantages of Strong Global Brands14.05.2013 2
  3. 3. Brands versus Products14.05.2013 3
  4. 4. Brands versus ProductsBRAND= Product + Distinctive features such as experience, belonging,self-expression, reputation, …)Look beyond the attributes of products!14.05.2013 4
  5. 5. Importance of Brands Consumer side Identification of makerthe product Risk reducer Search cost reducer Symbol of quality Symbolic devices thatallow costumers torepresent their valuesand images (belonging) Manufacturer side Valuable asset Signal of satisfiedcustomers and qualitylevel Premium prices Sustainable sales andprofit Financial returns Competitive advantage14.05.2013 5
  6. 6. Brand LoyaltyBrandInsistenceBrand preferenceBrand recognition(Consumer awareness)14.05.2013 6
  7. 7. Brand Equity 1- Positive differential effect that knowing the brand namehas on customer response to the product or service. 2- It represents the total value of a product is acquired as aresult of company’s cumulative investments in themarketing of the brand. Advantages: greater loyalty, less vulnerability to marketing actions, less vulnerability to marketing crises, more inelastic consumer response to price increases, more profits and stock returns.14.05.2013 7
  8. 8. Local - International - Global Brands Local Brands focus on a single national market. International Brands are offered in several markets in aparticular region. Global Brands have the same name and in someinstances a similar image and positioning throughoutthe world.14.05.2013 8
  9. 9. Becoming Global Many of well known global brands have derived much oftheir sales and profits from nondomestic markets for years Future growth for most companies will likely come fromforeign markets. In 2002, developed countries in North America, Europe,and East Asia accounted for 15% of the world’s populationof 6.3 billion. By 2030, according to the World Bank, theplanet’s population will rise to 9 billion, with 90% ofpeople living in developing countries.14.05.2013 9
  10. 10. Becoming Global Several forces lead to global marketing: Perception of slow growth and increased competition indomestic markets Perception of building a global profile as a prerequisitefor success Expectation of enhanced overseas growth and profitopportunities Desire to reduce costs from economies of scale Need to diversify risk Recognition of global mobility of customers14.05.2013 10
  11. 11. Becoming Global Theodore Levitt (1983) “The Globalization of Markets” He suggests a global market for uniform products andservices The idea was very popular in 1980s. Corporations should exploit the “economics of simplicity”and grow by selling standardized products all over theworld. Although Levitt did not explicitly discuss branding,managers interpreted his ideas to mean that transnationalcompanies should standardize products, packaging, andcommunication to achieve a least-common-denominatorpositioning that would be effective across cultures.11
  12. 12. Becoming GlobalAnti-globalization protests&Cross-cultural failuresHow consumers perceive global brands ???14.05.2013 12
  13. 13. Global Brands’ Competition StrategiesStandardization Adaptation (Customization)14.05.2013 13
  14. 14. Global Brands’ Competition StrategiesStandardization It refers to a tendency that the company prefers tomake its marketing program elements uniform, withsimilar products. Standardization strategies seek to capture benefits byminimising variations in the marketing mix betweencountries.14.05.2013 14
  15. 15. Global Brands’ Competition StrategiesStandardization This approach is appropriate when: Similar market segments exist across countries Customer seek similar features Products have universal specifications Business customers have converging expectations This approach is more likely to be pursued in globalindustries such as aircraft manufacturing,pharmaceuticals, credit cards.14.05.2013 15
  16. 16. Global Brands’ Competition StrategiesAdaptation Adaptation of an international marketing programrepresents local responsiveness in terms of brandname, product, or positioning. Adaptation strategies seek to maximise responsivenessto local variations in preferences by varying themarketing mix. Adaptation strategies let companies to meet needs ofcustomers more certainly as well as governmentalregulations on health or technical standards.14.05.2013 16
  17. 17. Global Brands’ Competition StrategiesAdaptation Adaptation can be pursed when there are distinct: national preferences laws and regulations living standards and economic conditions national infrastructure Under these circumstances, companies focus on localpreferences, thoughts, and cultural attributes in somedegree. Balancing these contradicting subjects is a complexand comprehensive process.14.05.2013 17
  18. 18. Global Brands’ Competition Strategies BALANCING ACT ; Rather than a choice either standardization oradaptation another approach = to make a decision with some variation in between Balancing act is also called the contingency approach.14.05.2013 18
  19. 19. Country of Origin Effect = any influence (positive or negative) that themanufacturer country has on consumers’ perception of aproduct. It refers to the image of the country which makes me tothink in this way. Therefore the label of “Made in…” on thebranded product: affects customer choice. Many factors such as business history, economic andtechnological conditions are influential on image of acountry. Dutch cheese, French wines, Chinese silk, Japan electronics,German car, Italian pasta…14.05.2013 19
  20. 20. Global BrandingBuilding a Global Brand Global marketers talk about products, brands, markets butnot about people. However, there may be global products, but there are noglobal people. Different languages that people fromdifferent countries speak represent different worldviews. There may be global brands, but there are no globalmotivations for buying those brands. Although there are different motivations of people but it isnot a drawback to using the same global product. In somecases people prefer the same brand with differentviewpoints.14.05.2013 20
  21. 21. Global BrandingBuilding a Global Brand “The Sony Walkman is often used as an example of aglobal product, developed for global consumers withglobal needs, who would use it with similar motives.That is not true: There are two distinctly differentmotives for using that product. In the Western world, the motive is to enjoy musicwithout being disturbed by others. This was not the motive for Masaru Ibuka – cofounderwith Akio Morita of the Sony Corporation – forinventing the Walkman. He wanted to listen to musicwithout disturbing others.”14.05.2013 21
  22. 22. Global BrandingBuilding a Global BrandKeller (2003) - “Ten Commandments of Global Branding”: Understand similarities and differences in the globalbranding landscape. Don’t take shortcuts in brand building. Establish marketing infrastructure. Embrace integrated marketing communications. Cultivate brand partnerships. Balance standardization and adaptation. Balance global and local control. Establish operable guidelines. Implement a global brand equity measurement system. Leverage brand elements.14.05.2013 22
  23. 23. Global BrandingGlobal Brand Positioning This stage refers to position the brand clearly in targetcostumers’ minds. Attributes, benefits or experiences that the brandprovides can be expressed in brand positioning. The company may have to reposition its brands due toa competitor in response or changing customer wantsor demand conditions.14.05.2013 23
  24. 24.  This stage involves creating mental maps, defining core brandvalues, and identifying points of difference. Thus, three keyquestions should be asked and answered: How appropriate is the positioning? What is the existing brandawareness? How valuable are the core brand values, and points ofdifference? What changes need to be made to the positioning? Do existingassociations need to be modified? Do any new associations need to becreated? Do existing marketing activities need to be changed? What newmarketing activities need to be created regarding different consumerperceptions, tastes, and environments?14.05.2013 24Global BrandingGlobal Brand Positioning
  25. 25. Global BrandingGlobal Brand Name Selection Some important points that should be considered inbrand name selection are as follows: It should be easy to pronounce, recognize, andremember in foreign languages. E.g.: Dove, Google. It should suggest something about the product’sbenefits and qualities. E.g.: Kinder Surprise, Nescafé: MyCoffee, Volkswagen: Das Auto. It should be distinctive. E.g.: Shell, Apple, Blackberry. It should be capable of registration and legal protection.14.05.2013 25
  26. 26. Global BrandingGlobal Brand Name Strategies Company Name as a Brand Name (Corporate Umbrella Approach): NikeShoes, Nike clothing, Nike athletic gear are all offered under the overallNike brand. One Product Name Worldwide: Coca Cola produces only non-alcoholbeverages and it is marketed all around the world with the same brandname. Modifying Brand Names for Each Market: Nescafé introduced its solublecoffee in Germany under the name Nescafé Gold, but in Britain under thename Nescafé Gold Blend. Different Brand Names for Different Markets: Langnese ice cream is soldunder different names around the world: Algida (Greece, Italy, Poland,Russia, Slovakia, Turkey, Hungary, Croatia), Eskimo (Slovenia, Croatia,Austria, Czech Republic), Frigo (Spain), Frisko (Denmark), Holanda (Mexico&Latin America), Langnese (Germany), Miko (France, Morocco), Ola(Belgium, Luxembourg, Portugal, Netherlands &South-Africa)… 26
  27. 27. Global BrandingGlobal Brand Development Strategies14.05.2013 27PRODUCT CATEGORYBRANDNAMEExisting NewExistingLINEEXTENSIONBRANDEXTENSIONNew MULTIBRANDS NEW BRANDS
  28. 28. Global BrandingGlobal Brand Development Strategies Line extension (Existing product X Existing brand)• Introduction of additional items in a given productcategory under the same and already successfulbrand name, with new forms, colors, flavors, orpackage sizes.• (+) tool for a company to deliver new products withlow-cost, low risk or to use excess capacity, or tomeet customer desires of variety.• (-) overextension may lead to lose brand’s specificmeaning or heavily extended brands may causeconsumer confusion or frustration.14.05.2013 28
  29. 29. Global BrandingGlobal Brand Development Strategies Brand extension (New product X Existing brand)• Company uses its successful brand name in order tolaunch a new or modified product in a new category.• (+) It gives the new product instant recognition andfaster acceptance in the market due to the positiveimage that the brand has already have.• (-) It involves a risk that some brand extensions faceearly deaths and it damages the image of the mainbrand14.05.2013 29
  30. 30. Global BrandingGlobal Brand Development Strategies Multibrands (Existing product X New brand) Introduction of additional brands in the same category. (+) It offers a way to set up different features and enables to attract differentbuying motives of the customers. (-) There is a risk that each brand might obtain only a small market share andnone may be very profitable.14.05.2013 30
  31. 31. Global BrandingGlobal Brand Development Strategies New Brands (New product X New brand) A company may create a new brand name when it enters a newproduct category for which none of the company’s current brandnames is appropriate. (+) a company applies to it when it believes the power of the existingbrand name is decreasing and thus a new brand name is needed.14.05.2013 31
  32. 32. Global BrandingGlobal Brand Management Strategies Brands should be managed professionally, because: Brands are not only names or symbols. They are used as external cues to quality, performance,prestige, experience, value, design, taste and so on. Consumers associate the value of the product with thebrand. The brand conveys either a positive or negative messageabout the product to the consumer and it is affected bypast advertising and promotion, product experience,evaluation and reputation.14.05.2013 32
  33. 33. Product-CommunicationExtension(Dual Extension)Product Extension-CommunicationAdaptationProductAdaptation-CommunicationExtensionProduct-CommunicationAdaptation(Dual Adaptation)14.05.2013 33Global BrandingGlobal Brand Management Strategies
  34. 34. 14.05.2013 34Global BrandingGlobal Brand Management Strategies Designing appropriate product –without any change or withsome modifications: due to the product itself and alsopreferences, motivations, needs and abilities of theconsumers in targeted market. Marketing the branded product regarding legal andadministrative procedures, economic, social andenvironmental conditions. Marketing research, effective communication, innovativeand creative practices are key elements in this process.
  35. 35. Global BrandingAdvantages of Strong Brands Powerful brands achieve global status through high levelsof investment in R&D, innovation, technology, andmarketing mix elements. These investments and consistent management across theworld last a long period of time. Then, in return, a strong global brand; generates a valuable financial asset stimulates brand loyalty and brand equity14.05.2013 35
  36. 36. Global BrandingAdvantages of Strong Brands
  37. 37. A strong global brand;•symbol of brand value,quality and prestige,• facilitates the ability tocharge premium prices .14.05.2013 37Global BrandingAdvantages of Strong Brands
  38. 38. Thank you for your attention.14.05.2013 38