Topic 3

1. Industry Studies: Consumer Goods Industry
Topic: Product Design: Theories
and Approaches
Topic Number:3

2. Overview
Following on from the last lecture, where we looked at
globalisation versus localisation today we will focus on
this from a product perspective.
2
We will initially evaluate the approaches taken to
develop global products that are to be distributed
around the world and look at a number of challenges
in doing so.
We will thereafter assess the pros and cons of
developing global products and evaluate the extent to
which they need to be adapted to meet local needs.
Finally, we will develop our understanding of the ‘think
global, act local’ debate from a product perspective.

3. Learning Outcomes
• Determine and develop a view on how and why
3
global products are developed and sold
• Critically evaluate and articulate the challenges
with global product design and how these are
overcome
• Assess and discuss the pros and cons of
developing global products
• Highlight key issues in the ‘think global, act local’
debate from a product perspective

4. Convergence of Products
What Warhol said about
Coke is, he said, "What I
really like about Coca-Cola
is the president of the
United States can't get a
better Coke than the bum
on the corner of the
street." Now, that is,
actually, when you think
about it -- we take it for
granted -- it's actually a
remarkable achievement,
to produce something
that's that democratic.
Rory Sutherland

5. Does Coca-Cola taste the same all around
the world?

6. Theodore Levitt’s view…
“Gone are accustomed differences in national or regional
preference… nothing confirms this as much as the success of
McDonald’s from the Camps Elysees to the Ginza, of Coca-Cola
in Bahrain and Pepsi-Cola in Moscow, and of rock music, Greek
salad, Hollywood movies, Revlon cosmetics, Sony Televisions
and Levi jeans everywhere… The global corporation operates
with resolute constancy – at low relative cost – as if the entire
world (or major regions of it) were a single entity: it sells the
same things in the same way everywhere” Levitt 1983:92
Sold exactly the same in 74 different countries

7. Did you know, no matter where you are in the
world… 10 companies control everything you eat?

8. Do people prefer global products?
“Today, nearly every
industry has a significant
global segment in which
customers prefer
products that are much
more global than they
are local… The global
segment is increasing in
size in nearly all cases.”
George Yip, 2000

9. Why consumers prefer global products?
Convey
higher
quality
Enjoy higher
prestige and
status
reflected
onto the
consumer
Satisfy
customers’
desire to be
apart of a
global
community
Cater to
homogenising
tastes
Source:
Batra, 2000

10. Global products do not mean 100%
standardised
Consider each
level of a
product and
determine the
elements that
can be adapted
for local
countries.

11. Examples of Product Adaptions
Iran Europe
Africa USA

12. Pros of Global Products
Attainability
of scale and
experience
economies
Rising
Technological
feasibility
Homogenisation
of needs and
preferences
Intensification
of consumers’
mobility

13. Cons of Global Products
Unsuited to
some
aspects of
business
Stifles creativity
and response time
Loss of
uniqueness
Loss of
responsiveness in
new markets

14. Global design standardisation is easier said
than done
Cultural
Influences
Legal/
Political
Forces
Economic
Factors

15. Legal/Political Requirements
Legal Political
Some countries, for
instance, have
imposed detailed
labeling requirements
and health standards
on consumer products
that firms must follow.
Grupo Modelo SA had
to reduce the
nitrosamine levels of
the beer it sells in
Germany to meet
those countries’ health
standards
A minimum level of local content
is sometimes a requirement
under trade laws when giving
foreign companies the right to
manufacture in a particular
place.

16. Economic Factors

17. Cultural Influences

18. Understand local needs and appreciate
differences

19. Or consumers will just adapt things for you
Care for masala coke?
View video: https://www.youtube.com/watch?v=zFB-Yd6GW7k

20. What do consumers really want?
View video: http://www.ted.com/talks/joseph_pine_on_what_consumers_want

21. Which one is it?
Think Global,
Act Local Think Local,
Act Global
?

22. Think Global, Act Local: Not Enough
Global vs Holistic
Simply put, global is too broad and undefined. It implies that
we should standardize and lead from the center, so that we
can better drive efficiencies that meet the burgeoning
demands of local markets. This is in stark contrast with
thinking holistically, which I define as the ability to take into
account complex linkages and inter-connections in order to
facilitate decision-making of the highest order.
It is no longer enough to “think global,” we must:
• Gain appreciation of the world at large, and in turn,
know how to best position organizations to win the
supreme jackpot of sustained profit and growth.
• Capture interlocking elements, interdependencies, and
synergies of the commercial environment.
Source: Deloitte, 2013

23. Think Global, Act Local: Not Enough
Local vs Personal
Similar to thinking globally, acting locally does not touch upon
the essence of human behavior—what we do or don’t do in
response to change, challenge, and the status quo. Acting
personal, however, mirrors human dynamics and the multi-dimensional
profile of each individual. Act personal allows you
to engineer communities, making messages and actions a
relevant and timely response to the big picture needs of
people.
At Deloitte, we see the benefits of acting personal in our social
media efforts every day. Addressing the individual concerns
and aspirations of our stakeholders—talking to them about
what they really care about—drives the engagement to boost
client and employee satisfaction, retention, profits, and multi-stakeholder
advocacy. It has the capacity to not just act, but to
deliver “happiness” with each experience.

24. A different perspective
Video View:
http://www.ted.com/talks/sheikha_al_mayassa_globalizing_the_local_localizing_the_global

25. Appendix – Sources for illustrations
Slide 4:
www.weekendcontent.com
Slide 5:
www.mixerdirect.com
Slide 6:
www.telegraph.com
Slide 7:
www.businessinsider.com
Slide 10:
www.marketingteacher.com
Slide 11:
Unilever and Nokia websites
Slide 15:
www.beerbrewguru.com
Slide 16
www.wikipedia.org
Slide 17:
www.unilever.com
Slide 22:
www.jugaadinnovation.com

26. End of presentation
© Pearson College 2013