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International Advertising and Promotion
McGraw-Hill/Irwin
© 2004 The McGraw-Hill Companies, Inc., All Rights Reserved.
Reasons for the importance of international
markets
¾ Domestic markets for many products and
services are stagnant
¾ Many companies rely on foreign markets to
survive, particularly those with small domestic
markets
¾ International markets offer growth
opportunities for many companies
¾ Competition has become global and marketers
must be able to compete globally
Markets such as China offer strong growth
opportunities for many companies
International Advertising
¾ The U.S. accounts for over half of the world’s
advertising expenditures
¾ Advertising expenditures outside the U.S. are
growing more rapidly than inside
¾ Every country in the world has advertising of
one form or another
¾ The more affluent the country, the more
monies spent on advertising
The International Environment
Economic
Environment
Political/Legal
Environment
International
Marketing
And
Promotional
Decisions
Cultural
Environment
Demographic
Environment
Economic Environment
¾ Stage of economic development
¾ Economic infrastructure
¾ Standard of living
¾ Per capita income
¾ Distribution of wealth
¾ Currency stability
¾ Exchange rates
Demographic Environment
¾ Size of population
¾ Number of households
¾ Household size
¾ Age distribution
¾ Occupation distribution
¾ Education levels
¾ Employment rates
¾ Income levels
Cultural Environment
¾ Language
¾ Lifestyles
¾ Values
¾ Norms and customs
¾ Ethics and moral standards
¾ Taboos
Political/Legal Environment
¾ Government policies
¾ Laws and regulations
¾ Political stability
¾ Nationalism
¾ Attitudes toward multinationals
The Big Question . . .
Should the global marketer offer the
same product, marketing, and
advertising throughout the world?
OR…
Should the global marketer adapt the
product, marketing, and advertising to
individual markets throughout the
world?
Saab used a global campaign since its
customers are similar around the world
Source: Courtesy Lowe & Partners Worldwide
(The Martin Agency, Lowe Brindfars for SAAB
Automobile AB).
Global Marketing and Advertising
Advantages
¾ Economies of scale in production, distribution
¾ Lower costs with less in planning and control
¾ Lower advertising and production costs
¾ Ability to exploit good ideas worldwide
¾ Ability to introduce products quickly, worldwide
¾ Consistent international brand, company identity
¾ Simplification of coordination and control
When is Globalization Appropriate?
¾Brands can be adopted for a visual appeal,
avoiding the problems of trying to translate
words into different languages
¾Brands that are promoted with image
campaigns that play to universal appeals such
as sex or wealth
¾High-tech products and new products coming to
the world for the first time, not steeped in
cultural heritage of the country
¾Products with with a nationalistic flavor if the
country has a reputation in the field
¾Products that appeal to a market segment with
universally similar tastes, interests, needs, and
values
Young people are a global market segment
for many products
Global Products, Local Messages
¾ An in-between approach:
Standardizing products
Localizing advertising messages
“Think globally, act locally”
¾ Adapt messages to respond to
differences in language, cultural,
and market conditions.
Pattern advertising
Continental Airlines used pattern advertising
to promote its BusinessFirst class
Decision areas in international advertising
¾Organization
¾Agency Selection
¾Advertising and market research
¾Creative Decisions
¾Media Selection
¾Coordination of other IMC tools
International Ad Agencies
¾ Many large, American general agencies
operate internationally
¾ Foreign billings account for over a third
of total billings by the top 10 American
agencies
¾ Large multinational companies often deal
with large, international agencies
¾ Overseas offices are usually staffed with
multilingual, multinational personnel
Foreign Local Agencies
¾ Staffed with local talent who
understand local attitudes, culture,
media, and conditions
¾ Especially effective for launching
consumer products in a single,
new geographic area
¾ Poses some problems if a product
is to be launched in multiple, local,
foreign markets
Criteria for Selecting an Agency
for International Advertising
¾ Ability of agency to cover relevant markets
¾ Quality of agency work
¾ Market research, PR, and other services offered
¾ Roles of company advertising department and agency
¾ Level of communication and control desired
¾ Ability of agency to coordinate internationally
¾ Size of company’s international business
¾ Company’s desire for local vs. international image
¾ Company organizational structure
¾ Centralized vs. decentralized
¾ Company level of involvement with international operations
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