David A. Griffith, a professor of marketing, recently joined Lehigh's College of Business and Economics as the Chair of the Department of Marketing. We connected with Griffith, a leading authority on marketing strategy devleopment and implementation, and asked him a few questions about global marketing and branding.
What are the big international markets that could possibly give the U.S. economy a boost?
“Every country is looking to the international marketplace to jump start their economies. At the company level, competitive positioning and opportunity are the real keys for identifying ideal markets. It’s simply not a one-size-fits all solution. Managers need to assess whether they can provide value within a specific country market and if so, at what short-term and long-term cost. In doing this, managers need to assess their resource base, potential market growth, current and potential levels of competition, as well as how the specific country market figures into their long-term strategic plan. Simply states, what’s good for Apple may not be good for General Motors.
"So, where should the U.S. head? There is really no simple solution. While many firm’s are strategically advancing their positions in the BRIC countries (Brazil, Russia, India and China), many are taking advantages of the economic turbulence in Western Europe, or opportunities in Mexico and South America. Africa has also gained the attention of many firms. Great opportunities exist in all country markets the world, the real question is which firm should work to cease which opportunities.”
Is there a foreign company marketing in the U.S. that has done it well, or one that has failed?
“Much as there are many U.S. firms that have achieved great success or failure in international markets, there are many international firms that have succeeded or failed. International firms such as Toyota, Honda, Mercedes-Benz, Audi, Samsung, Luis Vuitton, SAP, IKEA, Olympus, Sony, Cannon and others have become significant players in the U.S. market.
“We see a lot of foreign companies that are doing very well in the U.S. However, much as the challenges faced by U.S. firms in their international markets, international firms have found the U.S. market to have its own hurdles. Recent economic circumstances in the U.S. have generated a movement toward more strongly incorporating a product’s place of manufacturer into a consumer’s decision making. In an attempt to leverage this, in early 2011 Chrysler began the 'Imported from Detroit' campaign. This campaign, worked to highlight the hard working American spirit and closely to the brand to the U.S. market (a somewhat interesting move as Italian automaker Fiat became majority owner in 2009).
“Whether you market your product well at home or in foreign markets is less important to your long-term success than your ability to change and adapt in all markets. An examination of the Fortune Global 5100, dominated by U.S. multinational 20 years ago, has become significantly diversified with multinationals from around the world. Firms from Brazil (e.g., Petrobras), Japan (e.g., Hitachi ), Britain (Tesco) and many other countries signals that foreign firms are becoming more effective in serving the needs of the global marketplace. However, this does not mean that a firm will be successful in all markets. For example, although Tesco currently garners approximately 30% of their revenues from outside of the U.K., maintaining a number one or two market share position in 8 of its 12 country markets, it has found the international marketplace continually challenging. While building momentum in markets such as Thailand, China, Tesco reassessed its opportunities in Japan, deciding to withdraw in 2012. Currently, Tesco is assessing whether to remain in the highly competitive U.S. supermarket segment after a revamp of its Fresh & Easy stores have resulted in less than satisfactory sales.”
So, what is a global brand? Is Coca Cola a global brand, U.S. brand or a local brand? Would a consumer in the U.S. relate to it the same as a consumer in India?
“Brands have become increasingly curious and confusing. What we have been discovering is that consumers relate in very different ways to brands. While one consumer may view a brand as being global, another may view that same brand as being local (or domestic). We’re seeing a great deal of research working to understand how consumers relate to brands. Much of this research has focused on the issue of global vs. local, “glocal” brands and regional brands. “Glocal” brands can be considered global brand that have worked to localize themselves by creating a strong connection to the local markets that they serve. In essence, they have worked toward the “think global, act local” philosophy.
“At the global marketing level, when you get think global, act local, you can get a global brand that most consumers have a relationship with and with minor, local modifications through advertising, recipe or styling can be local. While this approach can create strong bonds within each local marketplace, while maintaining an overall sense of the brand, the local modifications cannot be inconsistent. For example, McDonald’s operates in 119 different countries. Although McDonald’s mission is to be a favorite place and way to eat aligned across the global by focusing on an exceptional customer service experience, adaptations to local preferences create vast differences in not only menu items (such as the McRice burger in Singapore or beer in Germany) but operational issues as well, such as whether it can use unbleached paper napkins made from recycled materials in all countries. As such, although McDonald’s works to give each customer an excellent service experience, their experiences will vary across markets.
“Today, with global communications, consistency of positioning across markets is ever more important. For, with the Internet, global television and increased international travel, consumers can become somewhat confused if brands are positioning differently across markets. While Mercedes-Benz in the U.S. market is clearly positioned as a luxury automaker, it surprises some American’s when in Europe to see the Mercedes-Benz three-pointed star emblem on vehicles such as economy cars, trucks and buses.”
Story by Jordan Reese
Posted on Tuesday, October 02, 2012