GLOBAL PRODUCT POLICY 1 DEVELOPING NEW PRODUCTS FOR

GLOBAL PRODUCT POLICY 1: DEVELOPING NEW PRODUCTS FOR GLOBAL MARKETS Chapter Eleven John Wiley & Sons, Inc c 1998 1

Global Product Policy Decisions 1: Developing New Products for Global Markets Chapter Eleven • • • Overview 1. Global Product Strategies 2. Standardization versus Customization 3. Multinational Diffusion 4. Developing New Products for Global markets 5. Global NPD and Culture John Wiley & Sons, Inc c 1998 2

Overview • • • Ikea in the United States Procter & Gamble in Australia and Japan Wal-Mart in Hong Kong U. S. carmakers in Japan Ford in Brazil John Wiley & Sons, Inc c 1998 3

1. Global Product Strategies – Exhibit 11 -1 Global Expansion Strategies • Strategic Option 1: Product and Communication Extension - Dual Extension • Strategic Option 2: Product Extension Communications Adaptation • Strategic Option 3: Product Adaptation Communications Extension John Wiley & Sons, Inc c 1998 4

1. Global Product Strategies (cont) • Strategic Option 4: Product and Communications Adaptation - Dual Adaptation • Strategic Option 5: Product Invention John Wiley & Sons, Inc c 1998 5

2. Standardization versus Customization • 1. Common Customer Needs – Exhibit 11 -2 Convergence in Drinking Patterns – Exhibit 11 -3 Comparison of Recognitions Around Car Value Between Europe, USA, and Japan – Exhibit 11 -4 Differences in Car Requirements for Various European Countries John Wiley & Sons, Inc c 1998 6

2. Standardization versus Customization (cont) • • 2. Global Customers 3. Scale Economies 4. Time-to-Market 5. Europe 1992 and Other Regional Market Agreements • Modular Approach • Core-Product Approach John Wiley & Sons, Inc c 1998 7

3. Multinational Diffusion – Exhibit 11 -5 VCR Sales in Various Countries • Five Product Characteristics – Relative advantage, Compatibility, Complexity, Trialability, Observability – Exhibit 11 -6 National Innovativeness vs Individualism John Wiley & Sons, Inc c 1998 8

4. Developing New Product for Global Markets – Exhibit 11 -7 Global NPD Process • Identifying New Product Ideas • Screening – Exhibit 11 -8 New. Prod Screening Model • Concept Testing – Exhibit 11 -9 Salient Attributes and Attribute Levels for Satellite Dishes – Exhibit 11 -10 Example of a Product Profile John Wiley & Sons, Inc c 1998 9

4. Developing New Products for Global Markets (cont) • Concept Testing (cont) – Exhibit 11 -11 Results of Conjoint Analysis for Satellite Dishes – To standardize or not to standardize – Exhibit 11 -12 Utilities for Respective Alternatives Derived via Conjoint Study John Wiley & Sons, Inc c 1998 10

4. Developing New Products for Global Markets (cont) • Test Marketing – Exhibit 11 -13 Examples of Test Market Countries • Timing of Entry: Waterfall vs Sprinkler Strategies – Exhibit 11 -14 “Waterfall” vs “Sprinkler” Model John Wiley & Sons, Inc c 1998 11

5. Global NPD and Culture John Wiley & Sons, Inc c 1998 12