The international marketing mix

Environmental factors influencing

the balance between standardization

and adaptation

Standardization and adaptation

of the international marketing mix

The three levels of a product

functional features, performance,

perceived value, image,

technology

Delivery, installation, guarantees,

after-sales service,

spare parts

brand, quality, design, packaging, price,

country of origin, staff behaviour, size

Core product

benefits

Product

attributes

Support

services

Ability

to

standardize

product

elements

Low

High

The product life cycle

PLCs of different countries for a specific product

Product/ communication mode

Promotion

Product

Standard

Adapt

NewAdaptStandard

Straight

extension

Promotion

adaptation

Product

adaptation

Dual

adaptation

Product

invention

Source: Source: adapted from Keegan, 1995.

Kellogg’s dual adaption for Indian market

http://www.kelloggcompany.com

https://www.youtube.com/watch?v=z-te-

Oqetck

L’Oréal celebrity branding

International pricing framework

15-10

Firm-level factorsEnvironmental

factors

Product factors Market factors

Firm performance

Other

elementsPricing strategies

Terms

Internal factors affecting international pricing decisions

Firm-level factors

Corporate and marketing objectives

Competitive strategy

Firm positioning

Product development

Production location

Market entry modes

Product factors

Stage in PLC

Place in product line

Most important product features

Product positioning

Product cost structure

15-11

External factors affecting international pricing decisions

Environmental factors

Government influences and constraints

Inflation

Currency fluctuations

Business cycle stage

Market factors

Customers’ perceptions

Customers’ ability to pay

Nature of competition

Competitors’ objectives, strategies, strengths and weaknesses

Grey market appeal

15-12

Gillette relies on product line pricing

www.gillette.com/

The company created

a new customised

product. Gillette

Guard, the first

product created just

for the Indian market,

was introduced in

October 2010. It was

priced at just Rs15

per razor - less than

35 cents. At Rs5 for a

refill cartridge, Gillette

Guard met customer

expectations on

safety and ease of

use.

Basic approaches to pricing across countries

15-14

Price

standardization

Price

differentiation

Structural factors of standardized versus differentiated pricing

Source: Reprinted from European Management Journal, Vol. 12, No. 2, Diller. H. and Bukhari, I. (1994) ‘Pricing conditions in the European Common Market’, p. 168, Copyright 1994, with permission from Elsevier.

Japanese car parts distribution channels

Sources: Cateora (1993); Onkvisit and Shaw (1993); Pirog and Lancioni (1997).

US car parts distribution channels

Sources: Cateora (1993); Onkvisit and Shaw (1993); Pirog and Lancioni (1997).

Factors influencing channel width

Source: adapted from Lewison, 1996, p. 279.

Criteria for evaluating foreign distributors

Overall qualifications/ selection criteria

Financial

and company

strengths

Product

factors

Marketing

skills

Commitment

Facilitating

factors

Source: Adapted from Cavusgil et al. (1995).

Cathay Pacific chose standardized advertising

throughout its markets

http://www.cathaypacific.com

Courvoisier cognac used a localization strategy

http://www.courvoisier.com/