Adapting Products for Foreign Markets

Topics: Marketing, Adaptation, International trade Pages: 10 (3039 words) Published: November 13, 2008
Nowadays, the market is becoming progressively globalized, it is therefore imperative for a company that wants to compete globally to have a strategy concerning the adaptation of its product to the needs of the foreign market. In fact, it is claimed how fundamentally important it is for a company to choose the correct product to plan the internationalization process (Valdani and Bertoli, 2006). The choice of the product it is extremely important because it can allow identified market areas, including the clients and the rivals. Actually, the product’s choice affects the way it enters into a foreign market as well as other decisions regarding the other variables of the marketing mix. This paper will present the factors that a company have to keep in mind when it wants to adapt a product to the needs of foreign markets, passing through the basic concepts of a product, the role played by the home country, and will try to give an answer to the important issues about adapting or standardising.

2.0Defining product
Generally speaking it is possible to say that a product is a mix of tangible and intangible attributes. These attributes do not give a product solely concrete dimension, but also have symbolic significance for people that buy this product. 2.1Product’s Attributes

According to Valdani et Bertoli (2006), these attributes can be distinguished in: structural elements (the materials of which it is made, ingredients and quality), external elements (for instance package, shape, design and colour), and auxiliary services (they can be divided in commercial services such as warranties and delivery quickness, financial services such as financial assistance, and support services such as pre and post selling assistance). 2.2Product’s constraints

However, in deciding its internationalization strategy, a company is subjected to a series of constraints that are originated by its own and by the market in which this firm wants to penetrate. Talking about internal constraints, Calvelli (1998) has highlighted the following: 2.2.1The objectives that inspire the internationalization process For instance, if the objective is to sell just a modest surplus of production abroad, it is particularly probable that a company will tend to sell this moderate amount of product without too many adaptations. 2.2.2The experience and the competence that a firm has in the international field That is a company that sells products abroad that are created in its own country will find more difficulties to adapt them in comparison to a firm that makes a product directly in the foreign country. 2.2.3The nature of the product that a firm offer

For instance, industrial goods are less sensible to cultural aspects than goods made for costumers. Therefore, the industrial products tend to be more standardized than consumers ones.

3.0Country of origin effect and “prism effect”
In defining a company’s international products strategy, it is necessary to consider that foreign consumers can judge the abilities that a product has to satisfy their needs based on the preconception that they have to the home country. 3.1“Prism effect”

This variation is called “prism effect” and it can determine a transparent effect (when the product is perceived and is positioned in the same way as the home country), an amplifying effect (when the product is perceived at a higher level than the home country), a deforming effect (when, in the foreign country, product concept is seen as a different way in comparison to the home country. In this case the product is used to satisfy different needs), and a reducing effect (when the product is perceived as a lower level than the home country). It is easy to understand that in the case of the first situation, a firm can be able to pursue the standardization technique with more effectiveness. The most troublesome effect for a company is the reducing one. In fact, it means that the product appears to be unable...

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