7.0 Introduction
Learning Objectives
After reading this section, students should be able to:
- Describe common consumer product categories.
- Describe the product life cycle.
- Explain marketing considerations through the product life cycle.
- Explain the stages of the new-product development process.
- Outline the trade-offs between standardized versus customized products.
- List the dimensions of value proposition adaptation.
- List the major drivers behind value proposition adaptation.
- Outline the significant advantages of a global innovation strategy.
- List the steps in the global innovation strategy of a firm.
- Outline the nature and size of BOP markets.
- Provide examples of firms pursuing BOP strategies.
The product is the most important element of a company’s marketing program. Global marketers face the challenge of formulating coherent product and brand strategies on a worldwide basis. A product can be viewed as a collection of tangible and intangible attributes that collectively provide benefits to a buyer or user. A brand is a complex bundle of images and experiences in the mind of the customer. In most countries, local brands compete with international brands and global brands. A local product is available in a single country; a global product meets the wants and needs of a global market.
Product and communications strategies can be viewed within a framework that allows for combinations of three strategies: extension strategy, adaptation strategy, and creation strategy. Five strategic alternatives are open to companies pursuing geographic expansion: product-communication extension; product extension-communication adaptation; product adaptation-communication extension; product-communication adaptation; and product invention (innovation). The strategic alternative(s) that a particular company chooses will depend on the product and the need it serves, customer preferences and purchasing power, and the costs of adaptation versus standardization. Product transformation occurs when a product that has been introduced into new country markets serves a different function or is used differently than originally intended. When choosing a strategy, management should consciously strive to avoid the “not invented here” syndrome.
Global competition has put pressure on companies to excel at developing standardized product platforms that can serve as a foundation for cost-efficient adaptation. New products can be classified as discontinuous, dynamically continuous, or continuous innovations. A successful product launch requires an understanding of how markets develop: sequentially over time or simultaneously. Today, many new products are launched in multiple national markets as product development cycles shorten and product development costs soar.
Core Principles of International Marketing – Chapter 8 by Babu John Mariadoss is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License, except where otherwise noted.
