M4: Product Adaption

Standardized

Selling the product as is in the international marketplace

Adoption

Modifying products for different countries and/or regions

Adaption

Designing new products for foreign markets.

Products

Can be differentiated by their composition, country of origin, tangible features such as packaging or quality, or augmented features such as warranty.

Product Standardization

A product designed originally for a local market is exported to other countries with virtually no change, except perhaps for translation of words or minor comestic adjustments.

Factors encouraging standardization

 Economies of scale in production

 Economiesin product R&D

 Economiesin marketing

 “Shrinking” of the world marketplace/economic integration

 Global competition

Factors encouraging adaptation

 Differing use conditions

 Government and regulatory influences

 Differing consumer behavior patterns

 Local competition

 True to the marketing concept

Strategic Adaptation to Foreign Markets

 Industrial products such as steel, chemicals, and agricultural equipment tend to be less culturally grounded and require less adjustment than consumer goods.
 marketers in technology-intensive industries such as scientific instruments or medical equipment often find universal acceptability for their products.
 Within consumer products, luxury goods and personalcare products tend to have higher levels of standardization,while food products require greater adaptation.

Factors Affecting Adaptation

1. Target Market

2. Product characteristics

3. Company resource & policy

The Market Environment

1. Government Regulations

2. Non-tariff barriers

3. Customer Characteristics, expectations, and preferences.

4. Economic Development

5. Competitive Offerings

6. Climate and Geography

Global Brand Development

Create a compelling value proposition (warranty can also be a value proposition). Think about all elements of brand identity and select names, marks, symbols that have the potential for globalization. Research the alternative of extending a national brand versus adopting a new brand identity globally and develop a company-wide communication system.

Product Characteristics

1. Packaging

2. Appearance

3. Methods of Operation or Usage

4. Quality

5. Service

Packaging

1. Serves three major function: Protection, Promotion, User Convenience.

2. Varies depending on: Transportation Mode, Transit Conditions, Length of transit.

3. Promotion aspect: Mainly through labeling

4. User Convenience: Must be durable for logistcis, and easy to open or use

5. Package Aesthetics: Color and shape selection

6. Package size; Depends on purchasing patterns and market conditions
   
   
   

Appearance

Adaptations in product styling, color, size, and other appearance features are more common in consumer marketing than in industrial marketing. Color plays an important role in the way consumers perceive a product and marketers must be aware of the signal being sent by the products color.

Method of Operation or Usage

Some products may not be operable in the foreign market. E.g. appliances

Quality

Many western exporters may not compete with low priced Asian products,they must invest on research and development for new products as well as manufacturing methods.

Service

When a product is sold overseas it requires repairs, parts or services. If the the product breaks down and the repaire management are not up to standard, the image of the product will suffer.

Country of Origin Effect

The origin of a product may have a strong effect on consumer perceptions and biases about foreign products.

This effectreduces as:

 Customers become more informed.

 Countries develop the necessary bases to manufacture products

Counterfeit goods

Goods bearing an unauthorized representation of a trademark, patented invention, or copyrighted work that is legally protected in the countrywhere it is marketed.

Largest number of counterfeit goods are sourced from:

China, Brazil, Taiwan, Korea, and India.

Few acts, agreements, and alliances that help combat counterfeiting include:

The Omnibus Tariff and Trade Act of 1984

The Trademark Counterfeiting Act of1984

The Intellectual Property Rights Improvement Act

The Trade-Related Aspects ofIntellectual Property Rights (TRIPS) agreement

The International Anti-Counterfeiting Coalition (1978)

Counterfeit Intelligence and Investigating Bureau