1. Management Orientation of Companies
Ethnocentric
– Rocks on the domestic market
– Relies heavily on home knowledge base and develops
– Seeks similarity internationally as per home knowledge
Polycentric
– Every country is different market
– Federal structure with profit centre heads
Regiocentric
– World is broken into regions with region hubs
– Polycentric with shared knowledge of regions
Geocentric
– Extremely worldwide view of market
– Shared knowledge base with integrated management

2. Develpoment Stages of Companies
Domestic
– Markets product in home country
– Ethnocentric
– Single layer organisation structure
Multinational/Multi Regional
– Multiple Office organisation with matrix structure
– Ethnocentric and Polycentric
Global/Transnational
– Federal Structure
– Typically geocentric organisations

3. Product Variables
The Core Product
• a product or services that is essentially the same
as that of competitors
The Tangible Product
• a product or service that is differentiated
composition, origin, or tangible features from
competing products
The Augmented Product
• a product or service which is serviced after the
sale and carries a warrantee from the producer,
producing a continuing relationship with the seller.

4. Product Variables
Augmented
Product
Installation
Tangible
Packaging Product
Core
Core
Product
Delivery Brand Benefit
or
Styling After
Name
and Service Sale
Credit Service
Quality Features
Warranty

5. Standardization versus Adaptation
The fundamental international product
decision after the decision to internationalize.
International market approach alternatives to
adaptation
• Sell the product as it is internationally.
• Modify product for different countries or regions.
• Design new products for foreign markets.
• Incorporate all differences into one product and
introduce it globally.

6. Factors Encouraging Standardization
Economies of scale in production
Economies in product R&D
Economies in marketing
“Shrinking” of the world marketplace and
increasing economic integration
Global competition

7. Factors Encouraging Adaptation
Differing use conditions
Government and regulatory influences
Differing consumer behavior patterns
Local competition
True to the marketing concept

8. Strategic Alternatives
Different
Product extension, Dual Adaptation
Differentiated
branding
Communication
Dual Extension Communication
Extension, Product
Adaptation
Same
Same Different
Product

9. Factors Affecting Adaptation
Market Product Company
Environment Characteristics Considerations
Decision to Alter the Domestic Product

10. The Market Environment
Government Regulations
• Political and social agendas often dictate
regulatory requirements
Nontariff Barriers
• Product standards, testing, subsidized local
products
Customer Characteristics, Expectations, and
Preferences
• Physical size, local behaviors, tastes, attitudes,
and traditions
• Consumption patterns, psychosocial
characteristics, and general cultural criteria

11. The Market Environment
Economic Development
• The stage of economic development affects the
market size and demand characteristics.
Competitive offerings
• Monitoring competing local products is critical in
adjusting the product for competitive advantage.
Climate and geography
• Local climatic conditions and terrain features can
make products vulnerable to damage.

12. Product Characteristics
Product Constituents
Branding
Packaging
Appearance
Method of Operation or Usage
Quality
Service
Country-of-Origin Effects

13. Product Constituents and Branding
Product ingredients must not violate local
legal regulations and social or religious
customs
Care must be taken that the brand in name.
term, symbol, sign, or design does not offend
the local customer. Trademarks are
especially vulnerable to counterfeiters.
Selecting the global brand name
• Translation
• Transliteration
• Transparency
• Transculture

14. Packaging and Appearance
Packaging serves three major functions:
• Protection
– Improper handling and pilferage
• Promotion
– Language and symbols
• User convenience
– Packaging aesthetics- color and shape, overall size, and
purchase quantity
Adaptations in styling, color, size, and other
appearance features play an importance role
in how a consumer perceives a product.

15. Method of Operation or Usage
Physical Operability of product as per markets
Electrical voltages and connectors vary around the world.
English and metric standards are not comparable.
Software may have to be translated into the local language.
Quality and Service
Quality is essential to marketing products internationally,
especially in markets where price is an important competitive
factor.
International Certifications may be required by buyers. (ISO/CE
etc)
Servicing products in international markets requires producers
to develop local repair staffs.

16. Country-of-Origin Effects
The origin of a product may have a strong
effect on consumer perceptions and biases
about foreign products.
a) COO effects are not stable; perceptions change over time
b) In general, consumers prefer domestic products over imports
c) place of manufacture v/s company’s headquarters
e) COO effects depend on the product category France
Swiss

17. ROLE OF BRANDS: CULTURAL
DIFFERENCES
JAPAN US EUROPE
IMAGE RISK REDUCTION RECOGNITION/ENVY
“FEEL GOOD” TIME SAVER ACHIEVEMENT
EMOTIONAL PEER DOMINATION HIGH ASPIRATIONS
“BELONGING” DISTINCT INDIVIDUAL
PEER RECOGNITION

18. Company Considerations
Organizational capabilities?
Is it worth it?
Can we afford not to do it?
Can a specific return-on-investment (ROI) be
attained?
Warranties?
Managerial talent?

19. Product Counterfeiting
Costs U.S. firms over $60 billion a year
Counterfeiting is estimated at 2% to 5% of
total world trade annually.
The largest number of counterfeit goods
come from:
• Brazil
• Taiwan
• Korea
• India