1. 3 elements of the product or service
Standardisation
The core product Adaptation
benefit or service
Image Perceived
Benefits value
Performance
Quality
Brand name Features
Attributes
Design Packaging
Size and colour
variants
After-sales service
Marketing
Guarantees support services Installation
Adaptation Delivery

2. Fundamental Questions
 To what extent are our products suitable for
international markets?
 If we must change the product, what should these
changes be?

3. International product life cycle
Sales Domestic
Market
market
Market A
B
Market
C
Market
D
Time

4. International product strategies
(Van Mesdag)
 Sell What You have Got (SWYG)
 Sell What people Actually Buy (SWAB)
 Sell the same thing globally, disregarding national
frontiers (GLOB)

5. Global Product Strategies
 Extension—offering product virtually unchanged
in markets outside of home country
 Adaptation—changing elements of design,
function, and packaging according to needs of
different country markets
• Invention—developing new products for the
world market

6. Product/communication strategies
Product
Standard Adapt New
Straight
Product
Extension
Standard Adaptation
One product,
only
one message
Product
Promotion
invention
Promotion
Adaptation Dual
Adapt
only adaptation
Source: Source: adapted from Keegan, 1995.

7. STRATEGIC ALTERNATIVES AVAILABLE
 One product, One message worldwide
 Product Extension-Communications Adaptation
 Product Adaptation-Communications Extension
 Dual Adaptation
 Product Invention

8.  Standardized product with same communications
strategy across the globe. i.e Product Extension
 This strategy is Cost effective
 Allows for greater economies of scale
 Rarely used for consumer type products except soft
drink and some luxury type goods
 Used mainly for industrial type products

9. 2.Product Extension-Communications Adaptation
 Use conditions are similar or identical but the product
fulfills a different need or serves a different function.
 Cost effective because communications adaptation is less
expensive than the tailoring product to a local market.
 Can be used for consumer type products E.g Motorcycles &
Bicycles
 Serve the purpose of recreation in U.S but provide basic
transportation in many foreign countries.

10.  3.Product Adaptation-Communications Extension
 Changes made to the product, same communications
strategy across the globe
 To extend without changing the basic communication
strategy developed for home market.
 Assumes that the product will serve the same function in
foreign markets under different use conditions.
 Product formulations are changed without consumers
knowing it
 Electrical Appliances, Detergents

11.  4. Dual Adaptation - Changes made to the product,
changes made to communications strategy
 When there is difference in environmental conditions
of use and in the function which a product serves
 Combination of marketing conditions of strategies
2and 3.

12. *Kellogg’s ‘dual adaptation’
for Indian market

13.  5. Invention - Usually redesigning of an original
product at a lower level of complexity.
Recognizes the socio-cultural and economic
differences from country to country
 Leads to more purchases as a result of the reinvention
of the product

14. Standardization versus Adaptation
 Global Standardization: standardization of products
across markets and standardization of the marketing mix
worldwide
 Addresses needs of global consumers (homogeneous consumer groups
sharing similar interests and product/ brand preferences)
 Allows for global branding – using the same brand name, logo, image,
and positioning everywhere in the world

15. Standardization versus Adaptation,
 Mandatory Adaptation:
 Adapting products to local requirements so that they can
legally and physically operate in the respective countries –
for example: Left-hand driving in the United Kingdom
 Local Non-Mandatory Adaptation:
 Adapting a product to better meet the needs of the local
market, or developing new brands for individual local
markets, even though such adaptation is not required

16. Factors encouraging standardisation
 Economies of scale
 production
 R&D
 Marketing
 Reduced inventory costs
 Reduced component costs
 Cost of investment
 Reducing trade barriers
 Where ‘made in’/‘designed by’ is important

17. Reasons for adaptation
 Cultural factors
 Usage factors
 Differing consumer purchasing power
 Level of local technical skills
 Local taxation policies
 Effect of different market entry methods
 Legal standards
 Tariffs
 Technical Specifications
 Climate

18. How to Choose a Strategy
 Two errors that management makes in choosing a
strategy
 NIH (not invented here) syndrome means managers
ignore the advancements of subsidiaries overseas
 Managers impose policies upon subsidiaries because
they assume what is right for customers in one market is
right in every market
10-18

19. Failure of New Product Development
• Tariff and non-tariff barriers
• Subsidies given to local competitors
• Cultural insensitivity
• Poor planning
• Lack of unique selling proposition
• Product deficiencies
• Top management approach