Learn Strategic Brand Management
Brand Equity In Question
Strategic Implications Of Branding
Brand And Business Building
From Private Labels To Store Brands
Brand Diversity: The Types Of Brands
The New Rules Of Brand Management
Brand Identity And Positioning
Launching The Brand
The Challenge Of Growth In Mature Markets
Sustaining A Brand Long Term
Adapting To The Market: Identity And Change
Growth Through Brand Extensions
Handling Name Changes And Brand Transfers
Brand Turnaround And Rejuvenation
Managing Global Brands
Financial Valuation And Accounting For Brands
How do global brands integrate the true diversity of the world, economic, legislative and cultural? How do they build a global brand in such heterogeneous conditions? Can the brand be in fact truly global?
Coping with economic heterogeneity
How should the global brand cope with the reality of widely differing levels of development of markets? This certainly concerns emerging countries, but also the very advanced countries when a new category is concerned.
The first approach is, of course, by adapting the product lines to the markets. One does not sell the same cars in China and in Europe. Car manufacturers use more entry-level models in China. Interestingly, since they want to build a global brand, which means a global perception and not only a global name, care must be taken in launching these models under the same brand values as any upper model of the range sold elsewhere in the world. This causes difficulties in creating a homogeneous concept.
For instance Wyborowa, probably the most exquisite vodka (made in Poland, the homeland of vodka), has to expand in two widely different markets: the most advanced and largest market for international brands (the United States), where there already exists a premium and super premium segment, with very sophisticated brands as Skyy, Belvedere, Grey Goose and Ketel One, well above the prices set by Finlandia and Absolut, not to speak of Smirnoff; and Europe, which is just discovering the category, and in comparison many consumers hardly know what vodka is and why they should drink it.
Clearly, to succeed in the United States the brand needs to launch a super premium version, used as the prototype of the brand, but this is not needed in Europe. How then can a brand present a united concept with two different prototypes?
A second approach is by segmenting the product line. For instance Arc International, the leading group in the world for glass tableware, has recently rationalised its brand portfolio, concentrating on four brands, along a double market segmentation by channel of distribution and by price level. Luminarc is to be the unique mass market brand.
The whole range has been subdivided into three subsets, casual, modern and formal, and each of these families has a positive name. In developed countries, many people would not consider buying products from the ‘casual ‘family, but these same products are used as gifts in many developing countries.
The third approach is by a phased introduction of innovations. Thus, Danone as a group is totally positioned on ‘active health’. However, this concept is a broad one, and cannot mean the same thing in India and in Scandinavia. As a matter of fact, Danone distinguishes three stages of development corresponding to three levels of market maturity: quality /security, health and nutrition, and active health. Markets at each of these stages will see the launch of products that correspond to their meaning of this large concept, ‘health’.
Interestingly, although it is very much centralised, Absolut adapts its advertising to the level of maturity in relation to its category of each country. Thus the consumer benefit used in advertising varies according to a fixed ladder of market development and sophistication, from purity (Absolut Perfection ads) to closeness, topicality, taste variety (such as Absolut Lemon) during the growth phase, and creativity/originality in the maturity phase.
A fourth approach is to stick firmly to the brand values through different levels of operationalisation. The best example is Connex. This world brand of public ground transportation was launched in 2000. Its market comes from the growth in the privatisation of former public transport services. Connex has been promoted on a number of added values – regularity, safety, comfort – but because of wide differences in the level of economic development and cost constraints, it is impossible to operationalise each value the same way all over the world.
Expectations of service regularity are not the same in Lagos (Nigeria) and Perth (Australia), for instance. Connex could have decided to restrict use of its name to circumstances that met the highest service delivery standards, but this would have created a very elitist and restricted brand, and would have been contrary to its global strategy: Connex’s future growth potential is mostly found in countries that want to accelerate the level of satisfaction attached to public services by outsourcing them.
As a consequence, it was decided to stick to the brand values but to define locally how they are operationalised. In addition, since a brand represents a permanent search for added values, in each city or region where Connex operates, these operational standards must be upgraded year after year, and the result made public.
Coping with differences in legislation and norms
Best practice seminars and books are replete with examples of globalised brands such as Coca-Cola, Mars and Microsoft. Certainly they are interesting examples. However, they also have their limits, imposed not least by differences in taste, in legislation, in norms. Thus none of the yoghurts sold by Dannon USA could be described as yoghurts in the EU, because they contain too high a proportion of starch and stabilising agents, and their taste too is unlikely to meet with public acceptance in Europe. Why? Because Dannon USA, since its creation in 1942, has tried to build its business in the United States.
In the United States there was no custom of eating yoghurt when Dannon began, unlike in Holland, Germany and France. Moreover, the fact that it is eaten with a spoon gave a childish personality to the category. As a result, the whole market started as a niche market, mostly aimed at women, promoting the health benefits, a little like Slimfast. Also, unlike in Europe, Dannon yoghurts actually compete in the snack market, and US consumers typically drink a cola (diet or otherwise) while consuming the product. As a consequence, the yoghurts needed to be sweeter and thicker.
Coping with category differences
Although products may have the same name, they do not mean the same thing from one country to another. Thus, the same apparent product needs to be positioned in accordance with the significance of the category in the different countries.
The example of yoghurt is relevant. At first glance it would seem possible to sell plain Danone yoghurt to everyone in Europe in the same way, whether it be flavoured Danone Kid or Danone Activia. However, despite appearances, yoghurt is a typical case of non-transversality because of the different circumstances in each of the markets when yoghurt was first introduced.
In France, the market is still influenced by the fact that yoghurt was first introduced as a health product and therefore was sold exclusively in pharmacies (in much the same way as mineral water). Though this is no longer the case and most younger consumers would not be aware of it, this has a deep and unconscious impact on attitudes in the market. Thus, in France the product reference is a plain yoghurt, a symbol of good health, while fruit and flavourings were only added a long time afterwards.
In Anglo-Saxon countries, on the other hand, where there weren’t any pharmacies in the French sense, yoghurt was first introduced as a low-fat product containing fruit for enjoyment, and in this sense it was a product for adults. The motivation to purchase in the yoghurt market therefore comes from very different impulses in different countries because of the way the market was first created in those countries. Moreover, as a result of these differing motivations, the same product will be regarded in a different light in the various countries involved.
For example, in the UK, the origins of the yoghurt market mean that the product is regarded as being one for pleasure, for the enjoyable experience of eating. Flavoured yoghurt, ie yoghurt without the fruit, is therefore a lesser product, and also means it cannot be positioned in the market for children.
Moreover, plain yoghurt without either flavouring or fruit – and therefore without pleasure in the eating – is thus a boring product only for those on a diet. In Spain and Portugal, on the other hand, where fruit is abundant, the fruit yoghurt does not have the position of product reference in the market.
Indeed, there, where the standard of living is lower than in other European countries, flavoured yoghurt constitutes the main segment, and is eaten as much by children as it is by adults: it is a family product and does not need a first name (such as Kid). Again, in Italy, the reference is blended yoghurt with a different texture, and flavoured yoghurt is positioned for very young children.
Yet again, in France, flavoured yoghurt is regarded simply as a plain yoghurt with added flavouring, so the logic of the health benefit prevails, as testified by the slogan ‘Petit à petit on devient moins petit’ (literally ‘Little by little we become less little’). To emphasise this promise and to differentiate it from competitors, Danone chose to give the first name ‘Kid’ to this type of yoghurt, thus identifying it with a child reaching a later stage of development.
In a similar way the reaction to Activia is different depending on the country. In France Activia is perceived as the rebirth of plain yoghurt, conveying health and pleasure. In the UK Activia was the first to introduce the health aspect of the product to the market.
In Italy, on the other hand, cultural morality frowns upon the taking of pleasure in the taste of food and it is not considered possible to taste good and and be healthy at the same time. This is reflected in the related commercials – the internal body clock of the UK commercial instead of the nude woman chosen in France.
Thus by considering one of the few food markets that does not have a long history but is actually an industrial product, we can clearly see that the conditions under which the market was created in each country have determined the long-term perception of that product in each specific market. Only Yop crosses these borders.
Positioned for teenagers like a soft drink around the concept of freedom, Yop has a European commercial that works well in all countries, provided of course the market understands the concept of a drinkable yoghurt.
Coping with differences of segment
The same product may belong to different segments in different countries. It then faces different competition and aims at different targets. In the car industry, the small car segment represents 38 per cent of cars on average in Europe, with extremes reaching 59 per cent in Portugal and 18 per cent in Austria or Germany. In Italy, the small household car is nevertheless the main car, in which the whole family fits.
This determines a stream of structural expectations (five doors for example) very different from France where the segment corresponds to the second or even the third car. Another problem arises when Germany is considered: in this country the segment simply does not exist. Here it is the Golf that is considered the small car, when it is in the middle range segment everywhere else in Europe.
It was, therefore, difficult to speak of the Peugeot 106, for instance, in the same way in all countries. In France, in order to compete with the Renault Clio and not to poach sales from the Peugeot 206, the amount of interior space was emphasised, despite the small size of the car (hence the slogan ‘la surprise de taille’ – ‘the size surprise’).
In Germany, the 106 was positioned like the Austin Mini, as a second car, small, feminine and urban, and after that as the most environmentally friendly because it was the smallest.
In the countries of Southern Europe the interior space was again emphasised to make it a good first family car. In the UK the 106 was positioned as a feminine car which was small but which allowed escape through its comfortable and dynamic aspects – two qualities that make Peugeot a valued brand in this country.
Coping with differences in meaning
The danger with international communication is that there may seems to be a common understanding of words, where in fact there is not. Simple words as ‘ nature’ and ‘well-being’ do not mean the same thing across countries. If they did, it still remains to be proven that the best way to communicate the concept is similar across countries. Often it is not.
According to the country, the same idea must be expressed through different symbols. This established fact has the paradoxical consequence that it is not by using the same brand name from one country to another that one stays closest to the initial brand concept. The concept behind Jif is better expressed by Viss in Germany and Cif in France. One can change a local name to a global name when the former has little intrinsic meaning and the name precisely encompasses the concept of the product.
Otherwise, a fundamental element of the identity is shattered. The diversity of names draws the product closer to its consumers in each market. This is why Playtex applies a modular policy: the Playtex name is worldwide. On the other hand, the company adapts the names of individual products to the markets. Indeed, Playtex only launches new product concepts if they are international.
The marketing strategy is homogeneous within large geographic areas (Europe for example): thus the ‘Cross Your Heart’ range has the same positioning, the same consumer benefit, the same advertising theme and the same execution in all countries.
Cross Your Heart adapts to local markets in terms of fabric (cotton in Italy for instance) or of packaging (to take into account differences in distribution circuits). As for the name, it is ‘Coeur Croisé’ in France (a direct translation), but ‘Crusado Magico’ in Spain (a slight shift to a ‘magic cross’). To stick to the common concept and convey it as best it can, Playtex does not hesitate to change the name of the products if necessary, to provide a more appropriate translation.
Despite the legitimate willingness to globalise, we must not overlook real cultural differences and differences in perception. This is why Procter & Gamble has created different versions according to the country for the Mr Clean brand, while nevertheless remaining within the limits of a common strategy (shine). Indeed, the symbols of ‘shine’ change with the culture.
In France, it is expressed by the idea of the mirror (‘You can see yourself in it’), while in the USA, the emphasis is on reflection off water (‘Is it water? No it’s the shine!’). Throughout the world, Camay is the soap which implies ‘seduction’. This is the line which Procter & Gamble have always taken. However, though customer habits and expectations are the same the world over where soap is concerned, cultural blocks call for different approaches when speaking to a woman about intimate moments.
Flexibility at the creative stage not only satisfies local cultural requirements, but also allows Camay to establish its own status in different countries.
All rights reserved © 2018 Wisdom IT Services India Pvt. Ltd
Wisdomjobs.com is one of the best job search sites in India.