products

Meaning of global products International product planning Brand names & trade marks Screening products for adaptation Analysis of product components

What is a Product?
Any thing that could be offered to a market to satisfy a need or want or Customers do not buy a physical product, but satisfaction or solution to a problem Price and quality of a product create the value which is the most important criteria by which purchases are made Products that are marketed include Goods Services Experiences Events Persons Places Properties Organizations Information Ideas

Analyzing Product Components for Adaptation

Insert Exhibit 12.1 Product Component Model

Exhibit 12.1

components
Core- basic product- platform contain essential technology- enough to satisfy core need and bear the design and functional features

Modifications in platform make radical changes- costly to change- standardize it Modifications in design & funtional features to local cultural needs could be added or eliminated without much cost

components of a product
(2) the packaging component- includes
the physical package in which the product is presented, the brand name, trademark, styling and design features, price and quality levelsneed adaptation- there could be mandatory requirements too;

(3) the support services component- include repair and maintenance services, Installation & delivery, warranty, spare parts, training and instructions, credit, and other services related to the use and purchase of the productneed 100% adaptation

Global products
One product for all markets It mean products preferred by world markets, as it is without any adaptation But adaptation for packaging and after sales support is must More global products but still localised products rule markets

International product planning

Companies need to decide their product strategy for international markets
Standardisation- Companies could offer an existing product meant for national markets (ethnocentrism) or Innovation- Altogether new product, developed exclusively for each new country and market- (polycentrism) Adaptation- Companies could adapt making appropriate changes to match requirements of overseas markets (geocentrism) or

While planning for international markets, the issue is not whether to adapt or standardize, but the real issue is how much of adaptation and up to what point a product can be standardized.

benefits of standardisation
projecting a global product image catering to customers globally cost savings in terms of economies of scale in production designing and monitoring various components of marketing mix economically facilitating the development of a product as a global brand high level of technology intensity formidable adaptation costs convergence of customer needs worldwide

benefits of adaptation
enables a firm to tap markets, which are not accessible due to mandatory requirements fulfils the needs and expectations of customers in varied cultures and environments helps in gaining market share increases sales leading to economies of scale

Adaptation and standardization

Customers buy satisfaction of a need or solution to a problem Needs and problems are global and basically similar Satisfiers and solutions could be different oil massage and pills for headache- but ones with speed, economy, ease of use and longevity in effects shall be more versatile

Adaptation and standardization

Core components of product could be standardized and accepted as it is globally. Packaging and support components shall require adaptation to local culture, preferences, styles, usage pattern- like
driving rules, electricity current, government rules, Language Veg/non veg contents

 Standardization suit companies.

Save cost, economy of scale,

adaptations Suit marketers- pro customer could be simple packing change to total redesign of core product

Adaptations are needed due to Mandatory requirements- must no option Geographical environments Cultural environments- specially material

Homologation or Mandatory
Homologation- term to describe mandatory changes of a country You must adapt- no option Studies show that mandatory requirements are main causes of adaptation. More binding than cultural adaptations Safety norms of country Environmental norms Quality standards Country practices- left or right hand drives, electric currents, local or multilingual labels, packaging,

non mandatory adaptations:

Economic- pack size, basic products to keep low prices in poor countries Technological- simple and less complex products in low technology countries- must to cope with after sales Political- a local brand name, low prices Changes based on climates, temperatures Climate- washing m/c in less sunny areas, Temperatures- GM cars felt problems and required different clutches and supplementary air filters in hot and dusty middle east

Brands in International Markets

Very important Most valuable resource a company has
A global brand is defined as the worldwide use of a name, term, sign, symbol, design, or combination thereof intended to identify goods or services of one seller and to differentiate them from those of competitors.

Benefits of branding
provides a marketing edge secure better margins

facilitate coping with market competition

increase the life of a product serve as an important tool in international marketing as

the image of the brand crosses national boundaries

facilitates the forging of an emotional relationship between consumers and products

Brands in international marketing

it is important to understand the cultural traits of the target markets

the failure to recognize the repercussions of the

brand name in international markets proved detrimental to brand image. carefully research the linguistic and cultural repercussions while extending brand name in international markets

Global Brands
The Internet and other technologies accelerate the pace of the globalization of brands Ideally gives the company a uniform worldwide image Balance Ability to translate

Country-of-Origin Effect and Global Brands

Countries stereotyped on the basis of being- industrialized, in the process of industrializing, or developing Consumers have broad but bit vague stereotypes about specific countries and specific product categories that they judge best. The more technical the product, the less positive is the perception of one manufactured in a lessdeveloped or newly industrializing country

Country-of-origin effect (COE) can be defined as any influence that the country of manufacture, assembly, or design has on a consumers positive or negative perception of a product.

Private Brands
Growing as challengers to manufacturers brands Private labels:
Provide the retailer with high margins Receive preferential shelf space and in-store promotion Are quality products at low prices

Must be competitively priced and provide real consumer value