BSc MarketingMG 3038 International Marketing 2011-12

L2 Branding IssuesJon Twomey - Chartered Marketer

To reduce the file size photos have been removed

Shaded slides are provided as background notes only

Understand contemporary issues surrounding international marketing, including the central debate between globalisation/ standardisation versus localisation/adaptation

Develop an awareness and understanding of differences in international marketing environment in a number of countries, especially in the Big Emerging Markets

Understand and be able to apply the theories and techniques in international market analysis, particularly in political risk assessment, and market entry evaluation

Understand key factors in making marketing mix decisions internationally and how to integrate each element to achieve the firm’s goals

Learning outcomes

Term 2 Lecture PlanWeek Date* Lecture Topics1 09/01 L1 Product - SvA debate and product decisions

2 16/01 L2 Branding - International branding issues (impact of COO)

3 23/01 L3 Distribution - Foreign distribution structure and key influencing factors

4 30/01 L4 Pricing - Price escalation, transfer pricing and grey marketing

5 06/02 L5 Promotion - Personal selling, sales promotion and PR

6 13/02 L6 Advertising - Challenges in global advertising

7 20/02 Effective Learning Week - No lecture8 27/02 L7 Negotiation - Culture and negotiation, gift giving

9 05/03 L8 Nation branding - What and how can a country be branded?

10 12/03 L9 Revision11 19/03 L10 Help with examination12 26/03 Question & answer session

International marketing, A customised book for Brunel students Complied by Ying Fan Pearson Custom Publishing ISBN 978-1-84776-733-2

Keegan Ch10, Brand and Product Decisions in Global Marketing Usunier Ch9, Product Policy 2: Managing meaning

CUSTOMISED BOOK

What is a brand? Why are brands so powerful? Best UK & Global brands Branding strategies◦ Combination branding; Co-branding; private label branding;

packaging & labelling, Umbrella branding; Family branding Country of origin effects Brand scope: Local (National), International or Global Global brand development

Key Topics

How much is this white “T shirt” worth to you?

So what exactly is a Brand?

A brand :

is defined as a promise of a known, consistent, repeatable experience

is comprised of functional (rational) & emotional values

adds value by connecting hearts and minds

meets a real need of a coherent group of customers.

Brands – What are they?

Bundle of images & experiences in the customer’s mind A promise made by a particular company about a

particular product A quality certification Differentiation between competing products

The sum of impressions about a brand is the Brand Image

The Power of Branding Great brands connect with customers and motivate them to buy

What do you

think

and

feel

about these brands?

The added value that accrues to a product as a result of investments in the marketing of the brand

An asset that represents the value created by the relationship between the brand and customer over time

Brand relationships

Britain’s best-loved brands http://money.uk.msn.com/news/uk-economy/photos.aspx?cp-documentid=156244460&page=20

Best Global brands 2011http://www.interbrand.com/en/best-global-brands/best-global-brands-2008/best-global-brands-2011.aspx

Interact with the Best Global brands of 2011http://www.interbrand.com/en/best-global-brands/BGB-Interactive-Charts.aspx

UK Best loved Digital Brand 2011http://www.browsermedia.co.uk/2011/09/30/and-the-award-for-britains-best-loved-digital-brand-goes-to/

Best UK Hotel Chains – most twittered!http://www.hotel-blogs.com/.a/6a00d83451625269e201539129df4b970b-pi

Brand information sources

Combination (or tiered) branding Leveraging a company’s reputation while developing a

distinctive identity for a line of products◦ Sony - Vaio◦ Panasonic - Viera

Co-branding Features two or more company or product brands◦NutraSweet and Coca-Cola◦ Intel Inside

Branding Strategies

Large retailers are moving increasingly into their own brand, i. e. Marks & Spencer

They try to obtain greater control and higher margins

Private branding can be an effective way to break into foreign markets(Asian TV manufacturers)

Private Label Branding

Consumer Packaged Goods when the packaging is designed to protect or contain the product during shipping

Eco-Packaging because package designers must address environmental issues

Offers communication cues that provide consumers with a basis for making a purchase decision

Packaging decisions

Product Packaging and Labeling

Protection

Legal ConstraintsPromotion

ClimateTransport & HandlingBuyer's slow usage rateLack of storage facilities

Merchandising ( income level, shopping habits)Minimum breakage / theftEase of handlingMultilingual Labels to Convey an International Image (Zara, Hollywood Chewing Gum)

Recycling of Packaging(Duales System, Eco-Emballage)Regulations on consumer info.(Origin, weight, ingredients)

Provides consumers with various types of information Regulations differ by country regarding various products◦Health warnings on tobacco products◦American Automobile Labeling Act clarifies the country of

origin, and final assembly point◦ European Union requires labels on all food products that

include ingredients from genetically modified crops

(also, see last week’s lecture notes)

Labelling

Brand acts as an umbrella for new products

Virgin Entertainment: Virgin Mega-stores and MGM Cinemas

Virgin Trading: Virgin Cola and Virgin Vodka

Virgin Radio Virgin Media Group: Virgin Publishing,

Virgin Television, Virgin Net Virgin Hotels Virgin Travel Group: Virgin Atlantic

Airways, Virgin Holidays Virgin Bank

Branding Strategies – Example Virgin Group

http://www.virgin.com/richard-branson/blog/40-years-of-virgin-history-now-in-a-bank

Local, International or Global?Family Brands

Family Brand Volkswagen

USA Europe Mexico

"Rabbit" "Golf" "Caribe"-> lightness -> prestige -> avoid negative

connotation

These are brands that have achieved success in a single national market

Represent the lifeblood of domestic companies

Entrenched local products/brands can be a significant competitive hurdle to global companies

Brand scope: Local, International or Global?

Country of Origin (COO) effect

For many products, the “made in” label matters a great deal to consumers

Key research findings of COO effects:• COO effects are not stable• Consumers prefer domestic products

over imports• Both the country of design and the

country of manufacturing/assembly play a role in consumer attraction.

Perceptions about and attitudes toward particular countries often extend to products and brands known to originate in those countries:◦Germany – Engineering◦ Switzerland – Precision (and neutrality)◦ France - Chic◦ Italy – Style◦ Japan◦ India?◦ China?◦ Etc.?

Country of Origin as Brand Element

Country of origin – a studyOne of the most recent studies on this topic has been conducted by Lampert and Jaffe (1998). Although, they did not run any empirical tests in their study, they proposed a model in which the level of the products' price differentiation within a category groups the product categories they have defined into classes. The classes they haveproposed include high differentiation goods (cars, luxury products like perfumes, designer clothing and high fashion watches), medium differentiation goods (vacuum cleaners, branded food items, and color televisions), low differentiation (gasoline, tires, and toothpaste), and homogeneous goods (sugar, salt, etc.).

Based on their proposal, Lampert and Jaffe hypothesized that the country image will be more salient for high differentiation goods than for medium, low, or homogeneous goods. This model is based on the premise that a person's image of a country and its product offerings influence buying intentions.

http://www.sbaer.uca.edu/research/swma/2000/13.pdf

Local, International or Global?Naming your product/brand

Alu-Fanny: French Foil wrap

Crapsy Fruit: French cereal

Kum Onit: German pencil sharpeners

Plopp: Scandinavian chocolate

Pschitt: French lemonade

Atum Bom: Portuguese tuna

Kack: Danish sweets

Mukk: Italian yogurt

Pocari Sweat: Japanese sport drink

Poo: Argentine curry powder

Local, International or Global?Naming your product/brand

Phonetic Problems with Brand Names- Bardok (Sounds like Brothel in Russian)- Misair (Sounds like Misery in French)

Translations

Intent Translation- Stepping Stone - Stumbling Block- Car Wash - Car Enema- Highly Rated - Over Rated

Symbols- Owl - Bad Luck in India

Other Countries make mistakes too- Zit (Chocolate from Germany)- Koff (Beer from Finland)

BAT Example - Offered in several markets in a particular regionhttp://www.bat.com/group/sites/uk__3mnfen.nsf/vwPagesWebLive/DO6Z2KVH?opendocument&SKN=1

Local, International or Global?

Global products meet the wants and needs of a global market and is offered in all world regions

Global brands have the same name and similar image and positioning throughout the world

Local, International or Global?

BAT - Our four Global Drive Brands - Dunhill, Kent, Lucky Strike and Pall Mall - cover the premium and value for money price segments. They grew by 7 per cent

in 2010, or 13 billion more cigarettes.

Local, International or Global?Holiday Inn £488m re-branding 2007-2010Just $30m cost to Intercontinental Hotel Group (IHG)

Smart choice

A multinational has operations in different countries. A global company views the world as a single country. We know Argentina and France are different, but we treat them the same.We sell them the same products, we use the same production methods, we have the same corporate policies. We even use thesame advertising—in a different language, of course.

Alfred Zeien Former Gillette CEO

Local, International or Global?

Questions to ask when management seeks to build a global brand:

◦Will anticipated scale economies materialize?

◦ How difficult will it be to develop a global brand team?

◦ Can a single brand be imposed on all markets successfully?

Global Brand Development

Global Brand Leadership◦ Using organizational structures, processes, and cultures to

allocate brand-building resources globally, to create global synergies, and to develop a global brand strategy that coordinates and leverages country brand strategies

Global Brand Development

Create a compelling value proposition Think about all elements of brand identity and

select names, marks, and symbols that have the potential for globalization

Research the alternatives of extending a national brand versus adopting a new brand identity globally

Develop a company-wide communication system

Global Brand Development

Develop a consistent planning process Assign specific responsibility for managing branding

issues Execute brand-building strategies Harmonize, unravel confusion, and eliminate

complexity

Global Brand Development

What is a Destination Brand?

A destination brand is:

A way to communicate a destination’s unique identity to visitors

A means of differentiating a destination from its competitors

A uniform “look” that all destination partners can consistently use

A symbol, name, term or design, or combination of these elements

IdentityPersonality

EssenceLook

Image

Destination branding

Suggested Reading Jobber, D. & Fahy, H. (2006) Foundations of Marketing (2nd edtn.), McGraw Hill: Chapter

6 – Product and Brand management - pages 137-160 Kotler, P., Armstrong, G., Wong, V. and Saunders, J. (2008) - Principles of Marketing (5 th

ednt.) , Prentice Hall: Chapter 11 – Product and brand strategy - pages 497-534

Other Davis.M (2009) Fundamentals of Branding, Thames & Hudson Melewar, T. C.(2008) Facets of Corporate Identity, Communication and Reputation,

Routledge. Melewar, T.C. and Karaosmanoglu, E. (2008) Contemporary Thoughts on Corporate

Branding and Corporate Identity Management, Palgrave Macmillan. Ries.A & Ries .L (2003) The 22 Immutable Laws of Branding,Profile Books Ltd

Branding in the Digital Age - You're spending more money in all the wrong places by David C. Edelman, Harvard Business Review, December 2010 page: 62-69

Just for fun: http://www.youtube.com/watch?v=Auw5TCB9pnM&feature=related

Exam preparation

10-42

Exam

What the Examiner wants

Evaluation 30%

Application 30%

Concept 30%

The Magic Formula

Pres

enta

tion

10%

Explaining the magic formula

Concept 30% (the theory bit)• the knowledge of marketing terms, ideas, theories, notions

and principles (as per your syllabus)

Application 30% (the practical bit)• relating marketing knowledge, models and frameworks to

different scenarios and business settings• requires making and demonstrating associations between

concepts according to set criteria

What do the terms mean?

Evaluation 30% (the “so what” bit)• assessment of a course of action against a standard or

set of objectives/making recommendations following analysis

• requires justifying actions/decisions, reviewing whether the course of action taken was the right one and assessing whether resources have been used effectively

Presentation 10% (the format bit)• Certificate : format, presentation, evidence of wider

reading, Harvard referencing

International Marketing Distribution Decisions

Looking Ahead