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Chapter 13

Chapter 13 International Marketing

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MRKT 483
Hamid Etemad

Chapter 13: Communicating With the World Consumer Global Advertising and Culture Advertising shapes a countrys culture, but a countrys culture influences ad campaigns and their effectiveness o Worst-case scenario: an ad might stymie a products sales or damage brand image Effective ad campaigns leverage local cultural phenomena (example: Vaseline ad that plays on Indian womens embarrassment of having crack feet and not being able to afford servants) Language Barriers One of the most daunting barriers that international advertisers need to surmount Translation, proper interpretation of ideas 3 types of translation errors: o Simple carelessness o Multiple-meaning words o Idioms Solutions to overcoming language barriers: o Involve local advertising agencies feedback/suggestions often very helpful/useful o Dont translate the slogan into the local language (i.e. leave it in English) For TV commercials, local language subtitles can be added For radio/TV commercials, voice-overs with local slang often become necessary, but not everywhere Meticulous copy research and testing should enable advertisers to pick up translation glitches Other Cultural Barriers Many promotional issues occur in the domain of religion (i.e.: Saudi Arabia, only veiled women can be shown in commercials, except from the back problem for haircare advertisers) Political sensitivities must also be taken into consideration Communication and Cultural Values Effectiveness of a campaign depends on the extent to which values evoked in the campaign match cultural values of the target audience Hofstedes cultural grid (ch. 4) can be brought in here. o When consumers values match values expressed by the advertising, brand liking increases o Smoking ads framed in a negative manner more effective for high uncertainty avoidance countries. Positively framed anti-smoking ads more effective in low-UA countries (Denmark, Russia, US) This schema can also be used to assess the effectiveness of comparative advertising (favorably comparing the promoted brand against competing brands) o Forbidden/restricted in many countries, comp. adv. Legal in US and Japan o Some countries avoid comparisons with competing brands since it may cause others to lost face (group-oriented cultures) or may be too aggressive (feminine cultures) Scandinavia, Thailand o Comp. adv. most effective in masculine, individualistic societies Setting the Global Advertising Budget Multinational supplier goods companies are the biggest spenders on global advertising (automotive, personal goods, food, entertainment & drugs categories) Most spending in the US, followed by Europe Two key spending questions: o How much should we spend? Percentage of sales: Overall advertising budget as a % of sales revenue (past or expected sales values) Simple, but how to choose %? In this case, sales revenue drives advertising spending, but purpose of advertising is to impact sales not a sound strategy for markets that were recently entered Competitive parity: Use competitors advertising spending as benchmark (match lead competitors spending to get similar share-of-voice) Rationale: use competitors collective wisdom to signal optimal spending amount Shortcomings: collective wisdom is not always given, and marketers having recently entered a new market must spend much more than competitors Objective-and-task most popular budgeting rule Treats promotional efforts as a means to achieve the advertisers stated objectives Usst by 2/3 of co.s in a survey widespread use 1 : draw out goals of communication strategy 2 : determine the tasks needed to achieve the desired objectives planned budget then becomes the overall cost of the completion of these tasks necessitates a solid understanding of the relationship btwn adv. spending and stated objectives (i.e. mrkt share, brand awareness) o How should we allocate our resources across our different markets? Bottom-up budgeting: each company subsidiary independently determines how much to be spent within its market and requests it from HQ (ex: Microsoft/FedEx) Top-down budgeting: HQ sets overall budget and splits the pie among diff. affiliates. Advertising budgets allocated proportionally to rev. contribution of different regions OR Budget allocated based on regional/local needs (Motorola) OR Regional up: Each region decides the amount needed to achieve objectives and proposes budget to HQ (bottom-up but getting it approved in top-down) Most favored approaches are bottom-up and regional-up (28% each) Creative Strategy the Standardization vs. Adaptation debate One of the difficult issues marketers face when developing a communication strategy is the choice of the proper advertising theme. Companies must establish the degree of standardization of their marketing campaign Standardization: 1 or more of the elements of the communication campaign are kept the same Major elements of a campaign are the message (strategy, selling proposition, platform) and the execution A truly global campaign is uniform in message and often also in execution, at least in terms of visuals, and rely on global/pan-regional media channels they are still relatively rare. Minor changes must often be made in the execution to comply with local regulations/make more appealing. Merits of standardization: o Scale economies: most appealing is the positive impact that it has on the advertisers bottom line o Consistent image: message consistency matters a great deal
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