In what way and on what level do global brands compete?
The text mentioned three dimensions that were found as the characteristics of a global brand, used by the consumers around the world in making purchase decision.
The first one is the quality signal. Consumers associate brands with quality. And the producer/brand holder uses this to charge premium price on the products bearing their brand. This in turn making the consumers to associate high price brand with quality. Consumers also believe that global brands are more dedicated in improving quality by the fierce competition among the brands.
The second one is the global myth, basically a device used by the consumers that they can feel that certain brand as a cultural symbolism, and fulfilling their needs to connect globally, to be identified as a global citizen. Global brand is perceived to bring the cultural myths with global appeal.
Social responsibility is about the global companies behind the global brands responsiveness towards the society, be it negativve or positive. Consumers expect firms to be engaged in society by actively supporting the well-being of the society.
Another dimension was inputted in the research, the "american value" dimension. However, the results of the research indicated that the american value no longer holds an importance towards consumer perception of a global brand.
Global brands compete against another global brand. Coke vs Pepsi, Nike vs Adidas, and so on. They also compete with local brand. While global brands have their own appeal in quality, global myth, and social responsibility, they also need to come face-to-face with local brands which are not-so-global, yet may have significant loyal followers in a certain geographical area.
What problems do multinationals face in branding a product internationally?
The most important thing to consider in branding a product internationally is that people in different countries are different....