Global Branding Essay
When corporations market a product globally choosing a brand name is a major factor in the success of that product. Handi-Wrap is a very well known brand in the United States, but in other parts of the world like the United Kingdom and Australia, the brand’s name is considered funny but still effective, but what about in other countries like: Germany, Sweden or Japan? The brand “Handi-Wrap” works in the United States because English is the official language of the nation; it works in the United Kingdom and Australia for the same reason, but does the brand name lose its effectiveness in nations where languages other than English are routinely spoken or does the brand remain effective even there? Should multinational corporations market a single brand internationally or change their brand names to the local cultures? Studies have shown that brands can be as effective internationally as they are in the US (Shoham and Kropp 114).
Coca-Cola and Handi-Wrap are common brands in the US; people all over the world understand the name of Coke, but what of Bayer Aspirin or Ford Motor Company should multinational companys market their products as a nation-specific product, a single brand or choose a middle route?
There is an obvious advantage when using multiple names in different nations.
Handi-Wrap may be a slang term in English; however, its meaning can be clear in all English-speaking nations. In China, or in other countries, its meaning could be considered vulgar or rude, if understandable at all. It can be advantageous to use names specific to chosen languages, and that has been the way that many have chosen in the past. Their marketing and advertising efforts have been targeted to a specific language, though the culture of the nation must also be taken into account. For example, like a play on words that works well in the United States may be completely worthless and meaningless in the United Kingdom. However, those brands using the same names for their products regardless of the nation or culture in which they are being marketed, still appear to have greater success today. For example the success of L’Oreal cosmetics has been built on promoting different brands in different nations, choosing which to promote were based on views of the local cultures (Anonymous 24). For people interested in finding the most “American” product possible, the French company uses the name Maybelline. Those preferring the most French are given the L’Oreal brand, there are even Italian brands for other preferences. All the different lines are sold in all of the markets, but only one is excessively promoted. The result of this is L’Oreal has been able to maintain double-digit growth for more than a decade. “L’Oreal’s net profits rose 15% in 1998, to $768 million, while its stock has soared 900% in the late 90s. Whether it’s selling Italian elegance, New York street smarts, or French beauty through its brands, L’Oreal is expanding out globally to millions of people across a larger range of incomes and cultures. This is what sets L’Oreal apart from one brand marketers such as Coca-Cola Co., which sells one brand globally to all cultures” (Anonymous 24).Single brand corporations like “McDonalds” sell to all nations of the world, regardless of the language spoken in each their brand is recognized. The people in the local markets, in which McDonald’s burgers and fries are sold, understand just what to expect when ordering any number of choices available on their menu (Green 34). Similarly, Wal-Mart is understood in all nations containing a Wal-Mart store; whatever the words may or may not mean, the quality of the brand is known worldwide. Though the term “Wal-Mart” may have no meaning in the language of the country it is located in; the local people understand exactly what to expect from any store they enter seeing the “Wal-Mart” name and logo on the front of the store. One major advantage of using a single global brand name is that language is not so ignorant now. While it was not always possible to promote a successful single brand name in the past, it is common now to see articles written in a specific language referring to business enterprises that carry these names completely foreign to these cultures, expressed in terms of the words they use in their everyday life. “McDonalds” is a highly foreign-sounding collection of characters and symbols in China, yet the McDonalds’ locations there perform well and are very profitable. Aaker and Joachimsthaler (1999) write, “Brand builders everywhere think they want global brands; however, global brand leadership, not global brands, should be the priority” (137). This is not saying that a global brand must be exactly the same in every market. For example “Visa changes its logo in some countries; Heineken means something different in the Netherlands than it does abroad” (Aaker and Joachimsthaler 137). A major consideration in building a global brand is how advertising will be received in specific markets. “Advertising generally reflects cultural characteristics in a given country’s values, beliefs, and trends. These need to be clearly understood and recognized to make sure that the specific message is heard and understood in the way a company wants it to be” (Inso Corporation int00006). Advertising that can be fun and effective in the United states can be seen as highly vulgar and looked down upon in the United Kingdom or Japan. Yet Proctor & Gamble keep its brands and its promotions identical throughout the world. IBM spends much less in advertising by creating “a single global advertising campaign than it would to create different campaigns for all its markets” (Aaker and Joachimsthaler 137). The approach is much easier to manage than many country specific strategies, but it is also harder to succeed. In addition, any poor choice in advertising is much more costly in that it is not contained in a single market, but is spread to all markets all over the world. Their is a difference in creating a global brand and creating a global advertising campaign. Aaker and Joachimsthaler (1999) write that advertising often is the “cornerstone” of the global brand-building effort, when focus instead should be concentrated on making the brand the leader in each market it competes. This was the approach of Coca-Cola in the early days. Today it is able to consolidate its advertising internationally because it is a leader in each of its markets, not because it is trying to become one. Developing a global strategy also can work against the effort to create economies of scale through consolidating global advertising. No campaign is suitable for all markets of the world, and adjustments usually are needed to be made either for each market or type of market even when the general advertising message remains consistent. “It is sometimes cheaper and more effective for companies to create ads locally than to import ads and then adapt them for each market” (Aaker and Joachimsthaler 137).Several companies have chosen a middle route to
international marketing. For example, in Europe, Audi uses the best of both ways; it selects one agency from a group of five chosen to compete for its international marketing efforts. The winning agency develops campaigns and directs the course they will take, but the four agencies not winning the top slot are still able to manage the campaigns in their own countries. The result is all advertising is controlled, but there are five company’s involved instead of only one. Each company is still able to compete in the future with each other and each maintain a relationship with Audi (Aaker and Joachimsthaler 137). Smirnoff Vodka has an effective middle-road approach to international marketing and brands. With the theme of “pure thrill,” all of Smirnoff’s worldly advertising is distorted pictures that become visible when viewed through the Smirnoff bottle. This way the local market culture is in the scene that appears: the scenes change from country to country, in order to appeal to the market in that country. For example in Rio de Janeiro, the ad shows the city’s statue of Christ with a soccer ball, and in Hollywood, the ‘W’ in the hillside sign is created with the legs. (Aaker and Joachimsthaler 137).No method of brand marketing works for all markets of the world, and there are not any specific formulas for deciding what is the best way for corporations to approach a certain market. Corporations must take into consideration the specific cultures, the products they are promoting, and the impact they wish to gain form advertising. The decision should be made on the desired results that the corporation wishes to achieve.
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