Product decisions - Standardisation v Adaptation Three levels of product Global products Advantages/disadvantages of standardisation Problems with standardisation

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  • Product decisions - Standardisation v AdaptationThree levels of productGlobal productsAdvantages/disadvantages of standardisationProblems with standardisationBrand globalisation potential

  • Corebenefitor serviceInstallationWarrantyAfter-salesserviceDeliveryandcredit

    PackagingQualityStylingBrandnameFeaturesAugmentedproductActualproductCoreproductThree levels of product

  • Global ProductsLocalisation of a product or service to fit local regulation and usage requirements e.g. local voltages and safety lawsAdaptation fits the product to buyer preferences e.g. Air-conditioning in USAStandardised global products are not adapted to local preferences, but must still be localised. E.g Coca-Cola obey local hygiene laws

  • Advantages of standardisationCost reduction - e.g. economies of scaleImproved quality - resources can be focussedEnhanced customer preference - positive experiences lead to global brand loyaltyGlobal customers - uniform quality and servicesGlobal segments - e.g. software, cameras.

  • Disadvantages of StandardisationLack of uniqueness - exclusivity may be behind purchase decisionOff-target - miss the customer target completelyVulnerable to trade barriers - local production may be necessary, so economy of scale benefits are lostStrong local competition - customisation by competitors, lack of local knowledge

  • Problems with global standardisationInsufficient market researchOverstandardisationPoor follow-upNarrow visionRigid implementation

  • Polaroid SX-70Insufficient market researchUsed US campaign/agency in European launchTV testimonials from unknown peoplehence local lack of awareness

  • Canon AE-1OverstandardisationFirst positioned as the experts choice in all marketsThen endorsed by John Newcombe (Tennis Champion)Created a much bigger market for single-lens reflex cameras world-wide

  • Henkel PrittPoor follow-upPritt stick launched as an umbrella brandfailed to capitalise on initial momentumlocal business units were under resourcedweak results had to be turned around

  • Unilever - DomestosNarrow VisionVision lead from HQUK took lead in promoting DomestosIn Germany positioned as dirt remover, not germ killerUK ignored this - consumers confused

  • Lego BucketsRigid implementationIn US, competitor Tyco offered plastic bucketsDanish HQ refused to actDenmark relented after market slideNow use buckets world-wide

  • Brand globalisation potentialDoes the brand name make sense outside of the country? Nokia from Finland is aware name sounds Japanese (same roots)Does the name have a positive, country specific image? E.g GMs Opel and ChevroletIs the name available legally in many countries? Dutch Philips, Phillips Oil registered in USA

  • Does the brand complement other global brands in the portfolio(or not)? E.g. Sony supports Aiwa at a lower priceShould the growth be limited to the creation of a regional brand? E.g. Strasbourg beer maker, Kronenbourg in global markets, as 1866 in S. Europe. Local brand can be difficult to remove.

    Johnny K. Johansson (1999)