international marketing “toto, i don’t think we’re in kansas anymore” - dorothy gary burandt...
TRANSCRIPT
International Marketing
“Toto, I don’t think we’re in Kansas anymore”
- Dorothy
Gary Burandt
Executive DirectorICOM
Why market abroad?
To expand sales opportunitiesTo retain domestic clientsTo stay competitiveTo take advantage of low labor costs
The Americans are late
No trading traditionBig post-war domestic market Too hard:
Different languages/cultures Complicated taxes, tariffs and currencies Distribution worries Distance (12% of Americans own
passports)
Go to easiest markets first
Typically Europe/Australia firstProven product acceptanceRight target audience profileBegin with distributors Own sales force comes later
World is not smaller, but it is a lot closer
CNN, MTV, ESPN, BBC, NBA & Disney providing global shared experiences
Maradona, Madonna, Mandela, GodzillaThe “Universal Teenager”
American Levi’s jeans Italian Benetton sweater British Doc Martins shoes Swiss Swatch watch Japanese Sony Walkman
Trend is to global agency network assignments
Better control of strategy, message & budgets
Simpler administration for client with a single point of contact at the agency
Can leverage global assignment for lower agency compensation
Hard to do with distributors, needs own sales force
Multinational Networks
Same name everywhereKnown nameCase historiesSet policies and proceduresAuthority to “make it happen”Perhaps a safer choice, for the
insecure
ICOM Independent Network
Stable managementDeep market understandingConnections social, politicalLow overheads, fast responseSpirit of a volunteer networkSome creative great workNo politicsLonger history than many multinationals
International approach follows company’s culture
Firm -Company HQ controls brand strategy, creative execution & MC budget
Flexible - HQ controls brand strategy, but creative execution can be localized. MC Budget shared.
Free - HQ allows brand strategy & creative execution to be determined locally. MC locally funded.
Examples
Firm Flexible Free
RolexMarlboroSingapore AirMost corporatecampaigns
ColgateCokeMcDonald'sEricssonVolvo
SonyFrito-layFordMost food & personal care
Trend is to Flexible approach
Firm - Insensitive to local market conditions. Locals hate it.
Free - Doesn’t build brands, can be wasteful of resources. Locals love it.
Flexible - Builds brands with local sensitivity to message delivery. Allows sharing of best practices. Compromise management with good communications.
Agency structure typically reflects client organization
Client Client CEO Worldwide MarCom
Director Regional MarCom
Director Local MarCom
Director
Agency Agency CEO Worldwide Account
Director Regional Account
Director Local Account
Director
What agencies need to do
Commit to international standards of service, process & communication
Assign a Worldwide Account Director and perhaps Regional Accounts Directors
Pick local Account Directors based on related experience and “chemistry”
What agencies need to do
Set and communicate clear, simple policy and procedures for running the business
Require concise monthly report from fieldHave a global meeting at least annuallyEstablish a bi-lateral formal performance
review system that works for both sides
What clients need to do
Communicate to field why there will be a new agency
Involve agency in the upstream planning
Keep a handle on the MC budgets as a form of control
Keep agency informed and introduced
Picking an agency
Budget size determines agency sizeLook for related experience:
Consumer Business to business
IMC capabilitiesInternational connections for expansionGood people chemistryLocal Agency Association can help
Globalization is hard
When the Client HQ makes a global agency change without telling the locals
When the locals love their old agencyWhen client uses agency to do the dirty
workWhen the agency’s caught in the middle
of the inevitable HQ vs. the field conflicts When agency politics get in the way
Trend is to IMC
Uses all communications disciplines to a single strategy across all audiences
More ways to help: PR, Direct, Promo,etcBuilds brands fasterLonger relationshipsA new way of working, needs even more
communications/involvement
Public Relations is local
PR needs a local practitioner with contacts and understanding of the media
Agencies either have this capability in-house or have an ongoing relationship with a PR shop to meet client needs
In some countries publicity is “bought” like advertising space … with a resulting lack of credibility
Direct & Promotion also local
Should compliment advertising message
Needs cultural understandingPrivacy/sampling laws differ by
country As do postal infrastructureAlcohol and tobacco very regulated
Media is changingThe trend in many parts of the world is to
“un-bundle” the media functionMedia-only companies (CIA/ Media Edge,
Zenith, Carat, etc.) are serving agencies and clients directly
They offer leveraged media discounts and research resources based on volume
Sometime they replace the media department, sometime just the buying function in an agency
Internet must be considered
Most important commercial medium since television
Traffic doubles every 10 weeksBuyers can search, compare,
question and buy all in a matter of minutes…from home or office
Can reduce the sellers and buyers costs
Media issues
Media used determined by: Target audience interests Local cultural issues Media options available Seasonality Budget allocations
Budgeting considerations
Speed of market awareness generally determined by level of spending
Spending must reach a threshold of awareness to make something happen
Better to spend enough in a few markets than too little in a lot of markets
Global Creative concerns
Keep it simple and visual Humor is great but is hard to doExecution should fit market, but core
brand values should be consistentShare international work frequently to
see what is working … and notDon’t allow the “Not Invented Here”
attitude
Moving creative across borders
Look for similarities beyond geography: Target audience demographics Religious/cultural Competitive set Pricing structure Distribution channels Category perception
Where to go for help
World Trade Centers US Council for International Business American Association of Advertising
Agencies US Department of Commerce,
International Trade Administration Office of International Trade, US Small
Business Administration International Advertising Association ICOM www.icomagencies.com