Global Marketing and R&D

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Global Marketing and R & D
Chapter Outline

OPENING CASE: Dove – Building a Global Brand

INTRODUCTION

THE GLOBALIZATION OF MARKETS AND BRANDS

MARKET SEGMENTATION

Management Focus: Marketing to Black Brazil

PRODUCT ATTRIBUTES

Cultural Differences
Economic Development
Product and Technical Standards

DISTRIBUTION STRATEGY

Differences between Countries
Choosing a Distribution Strategy

COMMUNICATION STRATEGY

Barriers to International Communication
Management Focus: Overcoming Cultural Barriers to Selling Tampons Push Versus Pull Strategies
Management Focus: Unilever—Selling to India’s Poor Global Advertising

PRICING STRATEGY

Price Discrimination
Strategic Pricing
Regulatory Influences on Prices

CONFIGURING THE MARKETING MIX

Management Focus: Castor Oil in Vietnam

NEW PRODUCT DEVELOPMENT

The Location of R&D
Integrating R&D, Marketing, and Production
Cross-Functional Teams
Building Global R&D Capabilities

SUMMARY

CRITICAL THINKING AND DISCUSSION QUESTIONS

CLOSING CASE: Levi Strauss Goes Local

Learning Objectives

1. Explain why it might make sense to vary the attributes of a product from country to country.

2. Articulate why and how a firm's distribution system might vary among countries.

3. Identify why and how advertising and promotional strategies might vary among countries.

4. Explain why and how a firm's pricing strategy might vary among countries.

5. Discuss how the globalization of the world economy is affecting new-product development within the international business firm

Chapter Summary

This chapter focuses on the marketing and R&D activities of global firms. The chapter begins with a review of the four elements that constitute a firm's marketing mix: product attributes, distribution strategy, communication strategy, and pricing strategy. A firm's marketing mix is the set of choice that if offers its customers. Many firms vary their marketing mix from country to country depending on differences in cultures, levels of economic development, product and technical standards, the availability of distribution channels, and so forth. The chapter discusses the strategic implications of each element of the marketing mix for an international firm. The link between marketing and R&D is also discussed. The author stresses the point that selling a product on a global scale may require that a firm vary its products from country to country to satisfy local preferences. This may require a firm to establish R&D centers in different parts of the world, and closely link R&D and marketing in each region to ensure that the company is producing products that its overseas customers will buy.

Opening Case: Dove – Building a Global Brand

Summary

The opening case explores how Unilever’s reconfigured its marketing mix for its Dove brand. Historically, Unilever had customized its products and marketing campaigns for each market, a strategy that not only resulted in duplication of effort, but also in organizational complexity. In 2003, Unilever shifted its strategy to develop a more globally standardized approach for Dove. The company now uses a basic message for the brand, and allows some customization at the local level. Discussion of the case can begin with the following questions:

QUESTION 1: How would you describe Unilever’s approach to international markets prior to 2003? What were the advantages of this strategy? What were the drawbacks of this approach?

ANSWER 1: Prior to 2003, Unilever more or less approached each market individually. The company often developed entirely different products and marketing campaigns for each market. In India for example, the company developed a shampoo designed to clean hair that had been oiled. But it also developed entirely different products for...
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