The home replication strategy involves centralizing product development at headquarters and transferring developed products to foreign markets to capture additional value while leveraging home country capabilities. Advantages include lower initial production costs and leveraging home country strengths. However, disadvantages include a lack of integration economies, low dedication to local responsiveness which can alienate foreign customers, and lack of customization to local markets as demonstrated by Procter & Gamble's struggles in Japan and Poland by directly applying its American marketing strategy without localization.

1. HOME REPLICATION STRATEGY

2. Characteristics
Hanoi, Vietnam

3. 1. Characteristics
• Centralizes product development functions in
home country
• Developed products transferred to foreign
markets to capture additional value
• The company must posses a distinctive
competence that local companies lack
• Headquarters maintains tight control over
marketing & product strategy
• Subsidiaries leverage home country capabilities
Hanoi, Vietnam

4. Hanoi, Vietnam

5. Advantages:
• Cut the production cost down in the first stage
of investment
• Engage in the home replication strategy as it
initially expands into foreign markets
• In local market, not need to implement
manufacturing but importing finished goods
and apply marketing model
• For business, can be a competitive strength for
newcomers
• Can leverage home country-based advantages.
Hanoi, Vietnam

6. Disadvantages
Hanoi, Vietnam

7. Disadvantages:
• No integration economies
• A firm most often adjusts its structure to
include an international division.
• International division is separate from all other
divisions and oversees activities
(exporting, franchising, and licensing ) =>leads to critical
problems
• The primary drawback is its low dedication to
local responsiveness => alienation of foreign
customers
• Lack of local responsiveness
Hanoi, Vietnam

8. Case Study
Hanoi, Vietnam

9. Procter &
Gamble (P&G)
Hanoi, Vietnam

10. Procter & Gamble
• The large U.S. consumer products company - the
world’s best marketers
• A dominant global force in laundry
detergents, cleaning products , personal-care
products
• Expanded abroad in the post-World War II years
• The strategy was flawed began to emerge in the
1970s
• By 1985, after thirteen years in Japan, losing $40
million a year there
Hanoi, Vietnam

11. Procter & Gamble
• Since the late 1980s: Attempting to delegate far
more to its major firms in Japan & Europe
• Summer of 1991: Entered the Polish with Vidal
Sasson Wash & Go, a bestseller in the United
States & Europe
At first: captured more than 30% of the market
for shampoos in Poland.
Early 1992 sales suddenly plummeted. The
rumors—Wash& Go caused dandruff and hair loss
=> allegations P&G has strenuously denied.
Hanoi, Vietnam

12. Procter & Gamble
“I washed my car with Wash &
Go, and the tires went bald.”
Where did P&G go wrong?
Hanoi, Vietnam

13. Procter & Gamble
 Promoted Wash & Go too hard in a
country has little enthusiasm for brash
American-style advertising
 Some believe Wash& Go was
developed for U.S. consumers
 Marketing strategy wholesale from the
US to another country without
modification accommodate the tastes
and preferences of local consumers.
Hanoi, Vietnam

14. Hanoi, Vietnam