Communicating with the World Customer Chapter 14 Kotabe

Communicating with the World Customer Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 1

Chapter Overview 1. Global Advertising and Culture 2. Setting the Global Advertising Budget 3. Creative Strategy 4. Global Media Decisions 5. Advertising Regulations 6. Choosing an Advertising Agency 7. Coordinating International Advertising Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 2

Chapter Overview (contd. ) 8. Other Forms of Communication 9. Globally Integrated Marketing Communications (GIMC) Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 3

Introduction n n There are many cultural challenges that advertisers face in global marketing. Global advertising encompasses areas such as advertising planning, budgeting, resource allocation issues, message strategy, and media decisions. Other areas include: local regulations, advertising agency selection, coordination of multi -country communication efforts and regional and global campaigns. Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 4

1. Global Advertising and Culture n n Language Barriers – Language is one of the most formidable barriers in global marketing. – Three types of translation errors can occur in international marketing: » Simple carelessness » Multiple-meaning words » Idioms Other Cultural Barriers – Religion Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 5

1. Global Advertising and Culture (contd. ) – Cultural traps/cultural dimensions » Geert Hofstede’s cultural grid can be used to assess the appropriateness of comparative advertising campaigns (see Exhibit 14 -2). The five cultural dimensions include: n Power distance n Uncertainty avoidance n Individualism n Masculinity n Long-termism Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 6

2. Setting the Global Advertising Budget n Companies rely on different kind of advertising budgeting methods which include: See Exhibit 143 – Percentage of Sales – Competitive Parity – Objective-and-Task Method – Resource Allocation Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 7

3. Creative Strategy n n n The “Standardization” versus “Adaptation Debate” Merits of Standardization: – Scale Economies – Consistent Image – Global Consumer Segments – Creative Talent – Cross-Fertilization Barriers to Standardization: – Cultural Differences Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 9

3. Creative Strategy (contd. ) n – Advertising Regulations – Market Maturity – “Not-Invented-Here” (NIH) Syndrome Approaches to Creating Advertising Copy: – “Laissez Faire” – Export Advertising – Global Prototype Advertising – Prototype Standardization Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 10

3. Creative Strategy (contd. ) – Regional Approach – Pattern Standardization » Modular Approach Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 11

4. Global Media Decisions n n n Media Infrastructure – Media infrastructure differs from country to country Media Limitations – The major limitation in many markets is media availability. Recent Developments in the Global Media Landscape: – Growing commercialization and deregulation of mass media Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 12

4. Global Media Decisions (contd. ) – Shift from radio and print to TV advertising – Rise of global and regional media – Growing spread of interactive marketing – Growing popularity of text messaging – Improved monitoring – Improved TV-viewership measurement Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 13

5. Advertising Regulations n The major types of advertising regulations include: – Advertising of “Vice Products” and Pharmaceuticals – Comparative Advertising – Content of Advertising Messages – Advertising Targeting Children – Other Advertising Regulations: Issues of local languages, tax issues, and advertising rates. Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 15

5. Advertising Regulations (contd. ) n Strategies to deal with advertising regulations: – Keep track of regulations and pending legislation – Screen the campaign early on – Lobbying activities – Challenge regulations in court – Adapt marketing mix strategy Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 16

6. Choosing an Advertising Agency n In selecting an ad agency, the international marketer has several options: 1. Work with the agency that handles the advertising in the firm’s home market. 2. Pick a purely local agency in the foreign market. 3. Choose the local office of a large international agency. 4. Select an international network of ad agencies that spans the globe. Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 17

6. Choosing an Advertising Agency (contd. ) n When screening ad agencies, the following set of criteria can be used: – Market coverage – Quality of coverage – Expertise with developing a central international campaign – Creative reputation – Scope and quality of support services Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 18

6. Choosing an Advertising Agency (contd. ) – Desirable image (“global” versus “local”) – Size of the agency – Conflicting accounts Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 19

7. Coordinating International Advertising n Global or pan-regional advertising approaches require a great deal of coordination. The following mechanisms can help: – Monetary Incentives (cooperative advertising) – Advertising Manuals (brand book) – Lead-Country Concept – Global or Pan-Regional Meetings: Six guidelines to implement a global or panregional advertising approach include: Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 20

7. Coordinating International Advertising (contd. ) » (1). Top management must be dedicated to going global. » (2). Use a third party (e. g. , the ad agency) to help sell key managers the benefits of a global advertising approach. » (3). A global brief based on cross-border consumer research can help persuade managers to think in terms of global consumers. Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 21

7. Coordinating International Advertising (contd. ) » (4). Find product champions and give them a charter for the success of the global marketing program. » (5). Convince local staff that they have an opportunity in developing a global campaign. » (6). Get local managers on the global marketing team -- have them do the job themselves. Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 22

8. Other Forms of Communication n Sales Promotions: Sales promotion refers to a collection of short-term incentive tools that lead to quicker and/or larger sales of a particular product by consumers or the trade. – Rationales explaining the local character of promotions: » Economic development » Market maturity » Cultural perceptions » Trade structure (pull vs. push promotions) Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 23

8. Other Forms of Communication (contd. ) n n n » Government regulations Direct Marketing Event Sponsorships Trade Shows: When attending an international trade show, the following guidelines might prove useful: – Decide on what trade shows to attend at least a year in advance. – Prepare translation of product materials, price lists, selling aids. Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 24

8. Other Forms of Communication (contd. ) – Bring plenty of literature. Bring someone who knows the language or have a translator. – Send out, ahead of time, direct-mail pieces to potential attendees. – Find out the best possible space, for instance, in terms of traffic. – Plan the best way to display your products and to tell your story. – Do your homework on potential buyers from other countries. Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 25

8. Other Forms of Communication (contd. ) – Assess the impact of trade show participation on the company’s bottom line. Performance benchmarks may need to be adjusted when evaluating trade show effectiveness in different countries since attendees might behave differently. Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 26

9. Globally Integrated Marketing Communications (GIMC) n n Integrated Marketing Communications (IMC): – IMC coordinates different communication vehicles – mass advertising, sponsorships, sales promotion, packaging, point-of-purchase displays, so forth. Globally Integrated Marketing Communications (GIMC): – GIMC is a system of active promotional management that strategically coordinates global communications in all of its component Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 27

9. Globally Integrated Marketing Communications (GIMC) parts. – Both horizontally (country-level) and vertically (promotion tools) are used in GIMC. Chapter 14 Kotabe & Helsen's Global Marketing Management, Third Edition, 2004 28