2. Global Product Strategies
Local and International
Environment
Product Firm’s
Competitive Internal
Situation Strategies
Situation
Customer Needs &
Price
Elasticity
RAYMOND R. KOH
3. What Is a Product ?
Product: A bundle of attributes
The Total Product
Tangible attributes: materials, size, weight,
design, packaging, performance, comfort
Intangibles: brand image, styling, other benefits
(installation, delivery, credit, warranty, after-sale
service, return policy)
RAYMOND R. KOH
4. Product Related Global Drivers
Demand Drivers
Higher expectations
More information
Higher switching costs
Full-service expectations
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5. Product Related Global Drivers
Supply Drivers
Fast-paced innovations
Frequent product modifications
Manufacturing rationalization
Outsourcing coordination
Strategic Alliances
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6. Global Product Decisions
Existing Products
Product phase-out
Product modification
Product introduction into new markets
Product performance management
New Product
Product development
Product introduction
Product performance management
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7. Global Product Development
Standardization- developing same product
for multiple countries
Premise-- consumes share some
common values, beliefs, and
consumption patterns
Advantages: economies of scale and
scope, price competitiveness, uniform
image
RAYMOND R. KOH
8. Global Product Development
Product Adaptation- modifying product
to reflect characteristics of a market
Premise-- consumers are not the same
Advantages: improved fit between
product and consumer, expanded
penetration
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9. Global Product Development
Mandatory product adaptations
Governmental regulations
Technological considerations (e.g., voltage,
infrastructure)
Cultural imperatives - is it acceptable to
consumers
Measurement standards: volume, length, weight,
quantity
RAYMOND R. KOH
10. A Testable Framework of Product and Promotion
Adaptation
Product and Industry
Technology
Cultural Specificity
Orientation of Product Uniqueness Type of Product
of Product
Industry
EXPORT MARKET
COMPANY
Similarity of Legal
Firms International
Experience Regulations
Product Adaptation
- Upon Entry
Export Sales Goal Competitiveness Of
- After Entry
for the Venture Product Adaptation Export Market
- Upon Entry
Promotion Adaptation
- After Entry
- Positioning
Promotion Adaptation
Entry Scope - Packaging/Labeling Product Familiarity Of
Positioning
- Promotional Approachh Export Customers
Packaging/Labeling
RAYMOND R. KOH
Source: S.T. Cavusgil, Shaoming Zou, and G.M. Naidu. “ Product and Promotion Adaptation in Export Venturs: An Empirical Investigation,”
Journal of International Business Studies 24, no 3, (1993,485.
11. A Framework to Integrate Markets, Platforms and Competencies
Markets
Segments 1 through N …...
Tiers of Price-
T
Performance
1 through N ….
Derivative Products or Services
with Development Time/Cost Efficiency and Attractive Price-Performance Positioning
Product or Service Platform
Subsystem A Interface i….n Subsystem C
Subsystem B
Common design Rules and Tools
Common Design Rules and Tools
Competencies
Organizational
Product Technologies Production Processes
Market Insights Capabilities and
and Design Processes and Technologies
RAYMOND R. KOH Infrastructure
Source: Mark Meyer, personal communication
12. Globalizing Palmolive Soap
Combination of competitive
packages
fragrances
shapes
25
After
20
Before
15
10
5
0
Shapes Fragrances Packages
RAYMOND R. KOH
13. The View from Toyota
Our global strategy used to center on
“world cars,” which we would modify
slightly to accommodate demand in
different markets. Today our focus is
shifting to models that we develop and
manufacture especially for selected
regional markets.
RAYMOND R. KOH
14. The View from Honda
“We are the most international of the Japanese
companies. At the moment we are the most
diversified, and we will be more diversified in the
future. Still, I think it would be very hard to build a
one-type world car. In the end, I don’t think it would
be very efficient.”
---Nobuhiko Kawamoto
President and CEO, Honda Motor Company
RAYMOND R. KOH
16. Global Product Issues
Country Region Global
Customer
Needs
Competition
Marketing
Infrastructure
Internal
Resources
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17. Global Product Issues
Country Region Global
Segmenting
Targeting
Positioning
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18. Brands
Global brand
Tiered branding
Cobranding
Brand extensions
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19. Brand Positioning
Perceived fit Positioning is
between a defined relative
particular product to:
offering and the competitive
needs of target offerings
market consumer needs
RAYMOND R. KOH
20. Brand Positioning
Physical Positioning
How a firm’s product compares to the
competition’s on some set of objective
physical characteristics
Perceptual Positioning
How a firm’s product compares to the
competition’s on some set of subjective
characteristics
RAYMOND R. KOH