Marketing Strategies available for a MNC firm
Product
Strategy
Standardized
product
Localized
product
Communication Strategy
Standardized
Communication
Global Strategy:
Uniform product /
Uniform Message
Localized
Communication
Glocal Strategy:
Uniform product /
Customized Message
Glocal Strategy:
Customized product /
Uniform Message
Local Strategy:
Customized product/
Customized Message
Glocal Strategy :
Customized Product / Customized Message
1. Building a Shared Vision
Clear & consistent long-term
corporate mission that guides
individuals wherever they work in
the organization. For example
Johnson & Johnson’s corporate
credo of customer focus;
Nestlé’s vision to make the
company the “reference for
nutrition, health and wellness” &
Samsung’s mission to “create
superior products & services,
thereby contributing to a better
society. Communicating visions
which employees understand.
Maxims of Global. Glocal
and Local
Local
Global
Glocal
Thinking
locally, acting
locally
Thinking
globally,
acting globally
Thinking
globally,
acting locally
4 Dimensions of Glocal
strategy adopted by brands
2. Broadening Perspectives
By developing a cooperative mindset
among
region
or
country
organizations to ensure the effective
implementation of global strategies.
For example Yum Brands has a
structure
that
emphasizes
its
individual, including KFC, Pizza Hut,
Taco Bell and Long John Silver’s, but it
also has three operational units: one
for the U.S. market, an international
division and a separate China division
covering mainland China, Thailand and
KFC Taiwan because of the size and
strategic importance of China.
‘Though The products are Global, the Markets are Local’
With Glocalization a global company’s goal isn’t to say “here
is a product.” Rather, the company asks, "How can we make a
product you'd like?“
The marketing, funding and infrastructure behind a product
may come from a global corporation, but the local level
dictates what finished form that product will take. Therefore
glocalization is a bottom-up system of governance for
globalization.
globalization
Many
Many of
of the
the most
most successful
successful global
global companies
companies have
have adopted
adopted
an
an organizational
organizational approach
approach that
that provides
provides clear
clear global
global
strategic
direction
along
with
the
flexibility
to
adapt
to
strategic direction along with the flexibility to adapt to local
local
opportunities
and
requirements.
opportunities and requirements. Therefore, Glocalization is
the adaptation of a product for a local audience.
3. Capable Managers
Representatives
from
different
countries, regions & Cultures. Emphasis
on the product dimension of the
product geography matrix, which
means that power has shifted at least
to some extent from country managers
to worldwide SBUs & product line
managers. To emphasize on the
global/regional dimension in the
country manager’s portfolio, many
companies have tied the country
manager’s
compensation
on
performance globally or regionally, not
just in the manager’s market
4. Internal Cooperation
By transmitting ideas & information
in real time or by the use of
international teams/councils of
managers to develop strategies.
While final direction comes from
headquarters, such direction is
informed of local conditions.
Implementation of the strategy is
enhanced since local managers
were involved. For example at P&G
all the top officers teach in the
company’s executive education
programs, and act as mentors and
coaches for younger managers.
1. Product
2. Price
3. People
5. Process
6. Promotion
7. Physicals
McDonald’s aims to create
standardized product that
taste same anywhere in
the world. The big Mac &
French
fries
are
international
features.
McDonald’s has in many
countries adapted the
product
because
of
religious laws and customs
in a country. In Israel many
McDonald’s are kosher—
they do not offer dairy
products and are closed on
Saturdays. In India where
Hindus don’t eat beef, it
has come up with
vegetable McNuggets &
mutton based Maharaja
Mac. In tropical markets
guava juice, in Germany
beer
as
well
as
McCroissant,
chilled
yoghurt drinks in Turkey,
espresso & cold coffee in
Italy form part of the
menu
Mac burgers in countries
Japan – Ebi fillet-O,
Hawaii- Spam McGriddle,
Asia
–Cheese
Katsu,
Indonesia & Phillipines–
McSpaghetti, England –
Bacon roll, India- McAloo
tiki, Turkey- McTurko,
New Zealand-Kiwi burger,
England
&
Canada:
McLobster, Asia- McRice
For
each
country
McDonald’s
adopts
a
rigorous pricing policy to
determine the price for a
particular market. The
process includes:
1) Selecting the price
objective 2) determining
demand 3) Estimating costs
4) Determining competitors
prices, costs & offers. Its
overall pricing strategy is to
increase market share. In
US the price of a big Mac
with fries is equivalent to a
Chicago
worker’s
14
minutes earnings.
Elsewhere it is perceived as
a luxury product, for ex: in
Nigeria it is equivalent to
11hours of work, In US &
Japan where they were
losing domestic shares,
they had to lower the prices
to
increase
revenues.
McDonald’s in its official
mission statement states
“Being in touch with our
competitors allows us to
price our products correctly
balancing qualities and
Values. In Delhi, India,
McDonald’s was looking at
market penetration in 1996
& set the price looking at
Nirula’s, a local food chain
to find what Indians would
perceive as acceptable price
Before
entering
a
country
McDonald
studies the labour laws,
part time & flexible
work schedules & then
adapts to individual
situations, this can be
described as Glocal.
McDonald’s is strongly
committed in staffing
locally & promoting
from within. It believes
the best way to stand
out of crowd is to
satisfy all customers, all
the time. This is
emphasized in the
recruitment advertising
& preliminary screening
& is same globally. The
Hamburger University
in US provides training
in 22 languages about
standard practices to be
used in restaurants
worldwide. Additional
training centers in
Munich, Tokyo, Sydney,
London & China which
teach managers details
of
how
to
give
performance reviews,
cook food & inspect
restaurant facilities to
ensure optimum quality
standards are met. They
in turn, pass the details
on to their staff
There are over 34000
restaurants
in
118
countries. The procedure
for making food is equal
everywhere.
This
epitomizes Globalization.
McDonald’s
standard
have to be met all over
the world. One in two
fries
must
measure
75mm, meat used in Big
Mac weighs 45 g & is 20%
fat, buns are 9.5-9.8cm in
diameter & 6 cm in
height. Suppliers have to
meet all specifications &
demand that McDonald’s
sets else it vertically
integrates. For example,
in Russia, the beef
available didn’t meet
standards, so it set up its
own source of supply. The
kitchen layout is same
everywhere. The point of
purchase is standardized
globally. To overcome
language problems it uses
pictographs that display
symbols of Big Mac,
French fries or colas,
instead of words or
numerals.
Corporate
goals include filling of
walk-in orders within 90
seconds & not more than
three-and-a-half minutes
at drive-through windows
Corporate trademarks and
brands
are
globally
uniform—including
the
golden arches logo and “I’m
lovin’ it” tag line. McDonald’s
localises
its
marketing
communication
strategy
considering the enormous
range of cultural and other
differences with in each
country.
Advertisement:
In
UK
footballer Allan Shearer, in
France footballer Fabien
Barthez, the image they try
to convey is same, just use
different personalities to get
the message across cultures.
In East Asia, they advertise
heavily on TV ads targeted
towards children. In Beijing
the mascot, Ronald was
paired with a female
companion known as Aunt
McDonald’s whose job is to
entertain children.
Public Relations: A feature
of localization in Beijing is
using Human workers as
substituted by technology in
US. Each restaurant employs
5-10 female receptionists to
take care of children & talk
to parents. This is in contrast
with UK where people would
be more happy to just eat
their meal & leave the
restaurant
“To focus on consistent
delivery of quality,
service & cleanliness
through excellence in
our restaurants”. This is
McDonald’s message in
every
franchise
throughout the world.
Almost
all
of
McDonald’s non-U.S.
outlets are franchised to
facilitate adaptation to
national environments
& access to local
knowhow. Customers
know
whatever
McDonald’s they enter,
the message of family
environment will still be
conveyed,
it
just
depends on which part
of the world as how the
message is conveyed.
The décor of restaurant
varies across different
cultures, like in China,
restaurant interiors are
covered with posters &
slogan
emphasizing
family values. The
traditional US value of
‘Service with a smile” is
embodied in the staff at
McDonald’s restaurant
throughout the world &
is now characterized as
an expectation of the
McDonald’s customer.
4. Place
34000 restaurant in
118
countries.
McDonald's
continues to focus
on managing capital
outlays
through
Strategic expansion.
Long term markets
like India, China,
Italy and Mexico
represent a growing
population of the
restaurant’s
new
additions. This type
of
strategy
is
Globalization with
‘Glocal’ focus as
McDonald’s
can
now share ideas,
global practices and
human resources,
across
borders
further enhancing
its
competitive
advantage
Global
standardization
+
Local adaptation
= McDonald’s
glocal strategy
explained by 7Ps
of Marketing
P&G (Glocal pricing strategy)
P&G observed in China (P&G’s 6th largest
market) that 2/3rd of it’s population earns
less than $25 a month. P&G devised ‘tiered
pricing’ in order to serve different strata of
its market and competing the local players
while retaining its global brand value
unchanged. Company introduced 320 gm
of Tide Clean White for 23 cents as
compared to 350 gm of Tide Triple Action
costing 33 cents. Though Clean White
version didn’t have all the attributes of
Triple Action like fragrance, but its basic
stain removing formula & low price swept
every other brand playing in that segment.
P&G, smartly used ‘Glocal’ approach
which says think global but act local!
Nokia
Nokia in India responded to local customer
needs with the introduction of dustresistant keypad, antislip grip and an
inbuilt flash light for Indian rural
consumers (specifically targeting truck
drivers). Nokia failed to move with
important trends, such as the popular dual
Sim phones & stuck to its own OS while
competitors left their own OS & moved to
Android. It launched multi-SIM devices (C1
& C2 series) in India, after it realized its
potential. They were introduced late in the
market after competitors Micromax, LG
and Samsung also introduced similar
mobile phones. Nokia lost out on early
market share but planned to introduce it in
other emerging markets as well
Glocalization by MNCs in India
Piaggio
Piaggio, the iconic Italian two-wheeler
re-entered the Indian market in 2012. It
adapted its scooter the Vespa to suit
the Indian riders and road conditions.
E.g. the rear wheel structure was
redesigned to facilitate easier tyre
changes, the scooter is more efficient
than it is in Europe (62km per litre
compared to 35 in Europe), increased
ground clearance, slimmer design and
a lower footboard to give more
legroom to Indian women who ride
sitting side-saddle in the back seat
Whirlpool Corporation
Domestic appliance maker, Whirlpool
incorporated specially designed agitators
into its washing machines when it sold
them in India. This helped Indian women
wash saris without the five-foot long sari
getting tangled. Whirlpool formed a
joined venture with a local partner to
produce the redesigned washing machine
to suit local taste and culture. Whirlpool
also makes its refrigerators in bright
colours like red and blue as many Asian
consumers placed their refrigerator in
living rooms as a sign of status
Pizza Hut
The brand serving Italian delicacies has
introduced a biryani called Birizza
having a flavourful crust with masala
gravy aimed at leveraging the strong
presence of rice-eating consumer base
in India. As a part of their strategy ‘Amazing taste, astonishing value’, they
want to reach out to a wider consumer
base through great taste and variety at
very affordable prices.. The first step in
that direction was launching Magic Pan
last year at a sub 50 price point. With
Birizza Pizza hut aims to open doors
to a whole new set of consumers
KFC
KFC didn’t fare well initially, the reason
they didn’t offer food that suited the
Indian taste bud. However over the years
they have modified their menu. This
helped and people have slowly accepted
KFC now. KFC, a so called dedicated
Chicken Restaurant, serves vegetarian
food like Veg Zinger, KFC has a vegetarian
thali (a mixed meal with rice and cooked
vegetables) and Chana Snacker (burger
with chickpeas) to cater to vegetarians.
This is targeted towards the maturing
Indian consumer who doesn’t mind
eating vegetarian at a non veg restaurant
Thinking globally, acting locally
Hindustan Lever Limited (HLL)
Unilever has pioneered with products that
address local sensitivities. Its Indian subsidiary
HLL has been the leader in recognizing the
tremendous opportunity lying at the bottom
of the pyramid - customer base that aspires to
consume products but in smaller quantities &
at lesser prices. HLL literally invented the
shampoo sachets - small plastic packets of
shampoo for as less as INR 1/. This became
such a rage among the rural consumers that
many other brands started offering products
such as detergent, coffee & tea powder,
coconut oil & tooth paste in sachets. Even
though the unit price was higher, rural
consumers were able to afford to purchase
smaller quantities at their convenience
Facebook
Facebook approached the e-market with a
‘one-size-fits-all’ strategy, but now is facing
the realities of cultural difference. In the USthe country of origin – having lots of friends is
culturally acceptable and even encouraged. In
Japan however, having more than 50 friends
indicates that you are superficial. Therefore,
Facebook has lost its lead market position in
Japan due to the fact that it did not
understand and encapsulate culture into its
mass strategy. Facebook now plans a
defensive strategy and has now set up a team
in Japan. This shows that a glocal strategy may
be necessary even in the digital environment.
It now has ‘global pages’ which allows
international brands to maintain a single fan
page with localized content for different users
Glocalization by Gillette in India
Duster success story in India
An estimated 400 million customers not
happy with existing market offerings
provided a promising growth opportunity
for Gillette. So, it focused on
understanding its customers and the
challenges they faced, which required
spending hours visiting and interviewing
consumers in order to understand the role
of grooming in their lives and their needs.
Gillette realised that apart from
affordability, Indian customers also valued
safety and ease of use. These customers'
needs wouldn't be satisfied by Gillette's
existing offering - most lacked running
water, had to manage longer facial hair
and sit on the floor while shaving. Nor
were they satisfied with the existing
double-razor solution as they caused
frequent cuts
Gillette understood
Indian consumers'
needs, culture and attitude towards shaving
were different from those of Western
consumers.
Rather
than
lowering
performance, Gillette kept the valued
customer at the core of its strategy and
introduced an innovative value proposition
for the value-for-money customers. After
failing to gain significant market share in
India by selling its lower and mid-tier
American razors in different packaging, It
went back to the source by making
significant investments in market research to
better understand the needs and preferences
of target consumers Gillette in India
innovated by tailoring advertising and
inventing a new product development
process to reflect local shaving habits.
Renault entered India through a joint
venture with Mahindra & Mahindra, it
placed high hopes on its maiden product
offering Logan - a mid-sized sedan
launched in 2007. But the car with its
dated looks and high pricing failed in the
Indian Market. Finally, Renault identified
a gap in the SUV segment. They saw that
there were SUVs costing Rs 20 lakh &
above manufactured by global players &
those priced from Rs 6 lakh to Rs 10 lakh
produced by Indian companies. The
company launched the Duster priced
between Rs 8 lakh & Rs 12 lakh in July
2012. 24 months before launching the car
they surveyed 200 families across 5
different cities in India
for an
ethnographic study for two months
In India cars remain an aspirational product
bought more for their image. This is more
so with an SUV.SUVs are big, unwieldy,
difficult to manoeuvre in cities, high on
maintenance, and less fuel efficient. It is
psychology and not economics that drives
SUV buying. SUVs do provide functional
benefits such as more space, off roading
capabilities, more power, and flexibility of
use. But many customers never go off
road. Renault understood this consumer
psychology. The Duster is designed with
flared wheel arches, muscular body, roof
rails, raised suspension and big tyres - all
visual indicators to create the right image.
Also, being small, it removes many
limitations of a typical large SUV
Understanding this segment Gillette
introduced the Gillette Guard priced at
just Rs15 per razor - less than 35 cents &
three per cent of the top-of the-range
Fusion ProGlide’s price. At Rs5 for a refill
cartridge, Gillette Guard met customer
expectations on safety and ease of use.
Small touches like a textured handle for a
firm grip to deal with thicker-than-average
hair, large safety comb to reduce nicks and
cuts, easy-rinse cartridges for better
cleaning without running water and a hang
hole for convenient storage catered to
unique Indian needs
P&G, Gillette’s parent brand also built an
India-tailored
business
model.
All
manufacturing is done locally to further
control production & supply chain costs. Only
six months after launch in October 2010, the
Guard crossed 50% of razor market share by
volume. To distribute the product, P&G had
to strengthen its network of millions of Indian
kiranas, or local shops. Finally, unlike
developed markets where the focus is more
on digital marketing, P&G instead invested in
traditional ads featuring Bollywood actors.
(Glocal Product, Promotion & Distribution)
The study enabled the company to
understand what a car should have to
meet an Indian customer's needs & threw
up 41 modifications that the European
Duster needed. Several changes in the car
included reinforcing the suspension &
offering a higher ground clearance,
adding more brackets to the car's doors
as they tended to be used roughly. Tuning
the engine to meet the quality of the fuel
in India & deliver high efficiency of at least
20 km per litre. They made the
modifications with the help of a local team
within 12 months
Before launching, Renault’s HQ in Paris
discouraged certain modification & termed
the proposed budget too low. The Indian
team convinced them that this was needed
to offer the best SUV to customers. Within
months of its launch, Renault had to triple
production from 7 /hour to 20 /hour. In
October 2013, 1/3 cars produced at the
Oragadam plant was a Duster. The Duster
accounted for 86 % of Renault India's
production, 81 % of its sales and 100 % of
its exports. It has been able to grab 23%
market share in the compact SUV segment
within a year
International
Adaptation of
American TV Shows
1. Metastasis (Columbia)
from Breaking Bad (US)
2. Homeland (US) from
Hatufim (Israel)
3. Stromberg (Germany)
from US & UK’s The
Office
4.Planet Homebuddies
(China) from Friends
(US)
5. The Theorist (Belarus)
from The Big Bang
Theory (US)
6.
Wisteria
Lane
(Nigeria)
from US
Desperate Housewives
7. Everybody loves
Kostya (Russia) from
Everybody
loves
Raymond (US )
8. Teach Sean (Ireland)
from Cheers (US)
9. Al Shamsoon (Arab)
from The Simpsons (US)
10. Pobeg (Russia) from
Prison Break (US)
11. 24 India from 24 (US)
12. The Nanny (Russia)
from My Wonderful
Nanny (US)
Indian Adaptation of foreign TV shows
1.) Comedy nights with Kapil from the British show The
Kumars at No. 42 2) Life OK’s Bachelorette India from US
dating show Bachelorette America 3) Jhalak Dikhla Jaa
from ABC’s Dancing with the stars 4) India’s Got Talent
from the Global ‘Got Talent’ format 5) Indian Idol from
American Idol 6) Kaun Banega Crorepati from US Who
wants to be a Millionaire 5) Big Boss from Big Brother
Good Luck Charlie
(Disney Channel-US)
The Disney Channel sitcom Good Luck
Charlie has been remade into Best of
Luck Nikki by Disney Channel India.
Basically, it's just a Cultural Translation
of the original, with not much difference
form the original plots
For the Chinese “High School Musical” project, Disney
emphasized that the overall spirit and themes of the
American original would be maintained, but new (Chinese)
actors were to be used and new scripts were to be written.
Similarly, images and cultural references had to be adjusted
so that the Chinese “High School Musical” would be properly
localized for a Chinese viewership
Glocalization of
Media
Overspel (Adultery) (Holland) was
remade as Betrayal (USA). Execs went
with "Betrayal" over "Adultery" due to
fears that female viewers would get
turned-off by the latter while the former
sounds more enticing, and plot-wise
there's many ways to betray someone
besides adultery
Marvel Films had great interest in making Iron Man 3 a
success in China, Robert Downey Junior signed up for the
Chinese equivalent of Twitter called Sina Weibo. In china
where many foreign websites are blocked, Robert Downey
Junior Used localization to market himself & his film Iron Man
3. Downey Jr., for example, was aided by Fanstang, a
company that helps celebrities and businesses to build a
social presence in China
Yo Soy Betty La Fea (Columbia)went all the
way to the US (Ugly Betty). Later, it even
got to Russia and the rest of the CIS, where
fans are convinced that it is a re-make of an
original ''American'' show. Ugly Betty is the
inspiration for a Bosnian variant, and
possibly an Arabic version as well. There was
also a quite successful German adaptation.
For Married... with Children, the Russian
remake is notable because the entire show
was remade (except for some of the less
good episodes and some that couldn't be
remade for various reasons) , but the show
now continues with completely new
episodes, some of which are co-written by
writers from the original show's staff
The very-Japanese-style-horror PS2 game Siren was remade
as Siren Blood Curse on PS3, along with all the changes that
normally get applied to Hollywood remakes of Japanese
horror (though the original Siren and its sequel did both get
English releases first time round). While Siren Blood Curse is
still set in a Japanese village, the all-Japanese cast of the
original has been replaced with an American TV crew sent
to do a documentary about the legends surrounding the area
•Sometimes, when there
are significant cultural
differences
between
audiences, reversioning
a TV show through
translation & localization
of the dialogue isn’t quite
enough because literal
translation does not
always work when it
comes to humor and
music.
•In such cases, another
option is the adaptation
of the TV show is to
remake or redo it entirely
with a new cast in the
target language. They are
tricky, often requiring a
delicate
balance
of
cultural localization while
preserving the basic
framework of the original
show.
•In India, Remake is
done internally: Because
different parts of India
have different official
languages,
successful
movies in one language
will often be remade in
one or several other
languages, for the benefit
of a different audience