The world of business and marketing gets more competitive by the day (Crews, C. and Thierer, A. (2003) 272-285). Processes of change such as globalisation and technological advancements pit actors in the business world against each other even more confrontationally (Crews, C. and Thierer, A. (2003) 272-285), as time passes.
Various marketing strategies and mechanisms have evolved as a consequence (Crews, C. and Thierer, A. (2003) 272-285). The actors who employ such methods often hope that the competitive edge may be gained through these means. Among these methods are branding, standardisation and adaptation strategies. These have been employed to directly influence the purchasing behaviour of prospective customers and of customers. There is no question that all of these strategies have significant impact upon the customer mindset and the ultimate strategic and business environment (Crews, C. and Thierer, A. (2003) 272-285), and there is also no question, that without an understanding of these techniques, what they are and how they operate, any business actor who wishes to be successful will be at an acute disadvantage (Crews, C. and Thierer, A. (2003) 272-285). Markets and economies have been heavily influenced through branding and other business optimisation techniques (Crews, C. and Thierer, A. (2003) 272-285) (Cronin, A. (2000) 1-10).
Markets and the environment of business has also been heavily influenced and affected through processes which are termed corporate social responsibility ideas. These have invested the ethos of ethics at the core of many corporations and marketing strategies. They have proven both beneficial and counterproductive to corporate actors and we shall see these arguments made throughout the thesis. It is immutable that the course of business involves the solicitation of custom, and the satisfaction of the most essential gatekeeper of success, the satisfied customer. Yet, this ultimate objective of business and corporate actors is not easily gained.
The customer has changed in response to the changing world. The task for the corporate actor is often merely catch-up, sensitivity and understanding. These seem to be everyday characteristics, however they have proven elusive to many and their absence may spell catastrophic for even the well-resourced businesses. However, there remains a heated debate over which marketing strategies to employ and when, and what the strengths and weaknesses of each approach is. There is also an unresolved debate over which interpretations of how each method should be implemented should be regarded as the most beneficial. This thesis aims to investigate all of the above themes and issues, how they may be considered as abstractions, how they relate to one another, how they affect one another and how they may be integrated within successful marketing campaigns, within the context of global marketing strategies.
The ultimate aims of the thesis are to achieve a better understanding of the theoretical frameworks which govern the domain of business strategy. This will be considered alongside the field of marketing strategies. Various theoretical terms such as standardisation, adaptation will be looked at and defined, as part of the research. The process of globalisation and how it relates to the other theoretical concepts will also be considered as part of the thesis. These concepts will all be evaluated individually and in the context of global marketing strategies.
Using these concepts as a springboard, the thesis will ultimately aim to focus on particular international marketing issues such as branding, how best to market brands, the various trajectories of purchasing behaviour and customer perspective and how these concepts coalesce within appropriate marketing strategies. These concepts will be considered in terms of how they may assist with international market entry, market research and market mix decisions. The impacts of culture and the significance of culture and marketing communications is another important theme which will be considered both directly and indirectly as an underpinning of the thesis.
The measurement of success in the contemporary business environment is increasingly being denominated in global financial performance of companies. For this reason the thesis will involve six case studies of companies who employ various marketing and business strategies. The case studies will be evaluative and will be integrated throughout the thesis as past of the discussion about how each method of marketing strategy identified may be evaluated. Each case study will involve a multi national, internationally recognised corporate actor, for whom the replication of successful business and marketing strategies and models can yield heavy gains, or equally heavy losses.
The stakes are high for these types of companies and they typically go to huge lengths to ensure the success of marketing campaigns, and this is why these types of companies will be focused on as part of the research. In general terms, and by means of an introduction, the concept of a business strategy, the concept of a brand and how these concepts relate to one another will be given some consideration. These concepts will be discussed within the particular context of marketing strategy, and the global marketing environment will be assessed in these theoretical terms. The next section will explain the methodological background to the thesis.
The methodology which will be used to achieve the aims laid out in the introduction will be primarily qualitative in nature. The qualitative paradigm of research argues that research may be carried out using the researcher as a means of research, through which to gather data which is subjectively formulated and controlled (Darlington, Y. and Scott, D. (2002) 122-125). Conversely, quantitative research refers to methods of data collection which involve stricture and objectivity (Darlington, Y. and Scott, D. (2002) 122-125). The quantitative paradigm of research is therefore more rigid and ordered than its qualitative counterpart (Darlington, Y. and Scott, D. (2002) 122-125). This however, does not imply an absence of scientific veracity within the qualitative arm of research; it merely alludes to a variation in the processes which are used in data collection (Darlington, Y. and Scott, D. (2002) 122-125). The collection of qualitative data therefore may be influenced by subjective viewpoint (Darlington, Y. and Scott, D. (2002) 122-125), and thus the outcome of the research is always more open to question on the grounds of subjectivity (Darlington, Y. and Scott, D. (2002) 122-125).
Quantitative data, on the other hand seeks to exclude the possibility of error (Darlington, Y. and Scott, D. (2002) 122-125), and sees the introduction of subjectivity, at the research stage as a flaw in research design which detracts from the possibility of obtaining reliable and uniform results (Darlington, Y. and Scott, D. (2002) 122-125). In overall terms therefore the qualitative paradigm of research is more akin to an exercise of trail and error where concepts and attitudes are probed and a final conclusion drawn as a product of the researcher’s own opinion (Darlington, Y. and Scott, D. (2002) 122-125). In overall terms the quantitative paradigm of research seeks to hypothesis from the beginning of the investigation and then endeavours to prove or disprove the hypothesis using objective scientific means (Darlington, Y. and Scott, D. (2002) 122-125).
Case studies of six different companies will be looked at in an effort to apply the different theoretical frameworks which will be looked at throughout the thesis. These six companies are McDonald’s, Virgin, Aviva, EMI Records, Dell and Orange. The financial performance of these companies will be analysed qualitatively throughout the thesis and this will be accompanied with a detailed analysis of the strategies employed by each company and whether they are more aligned to the standardisation approach or the adaptation approach to business strategy. Therefore theoretical frameworks identified as part of the thesis will be contextualised with contemporary financial data.
Case studies will be used to gather information and assimilate all of the theoretical underpinning of the research within a contemporary business framework. Case studies have been chosen as it is felt that the ultimate aims of the thesis may be met through the focus on small-scale highly specific qualitative sources of information. The subjects of the case studies have been derived from the international business corporate environment. This focus was chosen as the writer felt that it would be more advantageous to select these sorts of organisations over smaller global companies, as it is arguable that more attention is given to business modelling within these organisations.
How Theoretical Frameworks can assist with international market entry, market research and marketing mix decisions.
A business and marketing strategy involves devising a systematic way of optimising the sales of a particular product and or service (Crews, C. and Thierer, A. (2003) 272-285). This involves the planning and research of how best to introduce a particular product and or service within a given context such as a country or a market. Strategy involves consideration of factors such as the quality, price and durability of a given product and or service and the identification of market cleavages containing those who may be the most interested or susceptible to targeted marketing strategies. As an abstract concept strategy also involves recognition of what the weaknesses of a business might be. Factors such as an ineffective method of communicating with customers, an ineffectual record of retaining customers, bad or ineffectual public relations, bad or ineffectual marketing relations, bad press, low staff morale, poor organisational capacity can represent weaknesses in these terms, and the list is far from exhaustive.
Devising a business strategy involves the compilation of detailed data about markets, customers, customer and prospective customer preferences and compiling a detailed plan as to how best to integrate both sets of data within a plan aimed at maximising sales, customer satisfaction, customer loyalty, amongst other factors and ultimately augmenting the profits of the company (Barrett, B. et al. (1998) 15 and 147).
Devising a business strategy also involves understanding the mindset of customers and prospective customers, so an understanding of human behaviours and how this impacts purchasing behaviour must form part of any effective marketing or business strategy (Barrett, B. et al. (1998) 15 and 147). The factors which may be seen to be very relevant within this context are human perceptions of beauty, youth, status, quality, good service, reliability and durability (Barrett, B. et al. (1998) 15 and 147). It may be argued that the adage ‘the customer is always right’ is appropriately married to the notion of an effective marketing or business strategy, since it is the perception which counts, not the ethics of the perception, its political correctness, its nobility or its veracity (Barrett, B. et al. (1998) 15 and 147).
Marketing and business strategies increasingly seek to align the strategic aims of a company, the aims in terms of profitability and functionality with the aims of specific marketing campaigns. Marketing strategies are often considered by groups of project managers who have a semi-autonomous role within the company and for whom, it is necessary to liaise with senior management about the ultimate resources and man-power which will be devoted to the business and marketing objectives. The marketing strategy is a complex phenomenon. It is difficult to define because it is difficult to replicate, or indeed encapsulate.
Rather marketing strategies are often conceived on a pragmatic basis, with the actors involved gaining perspective from others in the field, similarly piloted projects and how these have or have not been successful. The concept of a business strategy is very much shaped by the actors who are involved in the process. Conversely, as we shall see discussed in the thesis a marketing strategy may be conceived in a more prescriptive fashion. Actors may seek to follow a plan of action which has been used for example within another country and hope to reproduce the same benefits. These ideas may prove difficult to implement as, while the process of evaluation, in terms of the outcome of the project is probably more easy to ‘pin-down’ the process of evaluation as the project is ‘live’ is not something which is as open to evaluation, as the project is in many ways immutably drawn.
Marketing and business strategies are very competitor orientated and in many ways the contemporary business environment is predicated upon the knowledge of what direct competitors are working on. In this sense, the marketing strategy of any one company or corporate actor will rarely be singular; rather it will be exposed to other actors in the field who may seek to reproduce or to imitate it. This is very different from the situation where a product is considered within the same scenario, since a product may be copyrighted or protected with patenting processes. These principles may not apply in the same way to the idea of a marketing strategy. The world of marketing strategy is fast-paced and the disadvantages which may arise from competitors imitating the project implementation design often have to be accepted as part of the world of business. The disadvantages are of course; also offset within this context, since marketing strategists will rarely be in the situation where their inspirations and ideas are not augmented by those of others.
Globalisation refers to the idea that the world is more interconnected and cohesive than it has been historically (Gattiker, U. (2001) 3-4). The effects of this process may therefore be descried as a higher incidence of movement between particular cultures and more mixed populations. Concepts are more likely to have global resonance and significance in a globalise world. What used to be targeting of sectoral cleavages by necessity has been replaced by a choice which is available to business actors; and this choice involves global messaging or more localised efforts to communication business messages to prospective customers, and customers (Barrett, B. et al. (1998) 15 and 147) (Gattiker, U. (2001) 3-4).
A number of factors have influenced the development of this process. Perhaps the most significant of these is the rise of technological developments, one important example of this being the internet. The internet has been defined as follows: ‘The Internet is not one place or one company. It is a descriptive term for a web of thousands of interconnected broad- and narrow-band telephone, satellite, and wireless networks built on existing and planned communication technology. This infrastructure is a network of networks, reaching out and connecting separate islands of computer, telephone, and cable resources into a seamless web. It connects businesses, governments, institutions, and individuals to a wide range of information-based services, ranging from entertainment (e.g., pay-per-view movies, online music videos), education, and culture to data banks, cyberspace commerce, banking and other services… (Gattiker, U. (2001) 3-4)’.
The internet has facilitated communications (Gattiker, U. (2001) 3-4), as have inventions and innovations (Howes, D. (1996) Chapter One, Inge, M. 1-20, Jennings, B. and Heath, R. (2000) Chapters 1-5), such as the mobile telephone, video-messaging and conferencing, electronic mail, instant messaging, internet ‘blogs’ to name just a few (Gattiker, U. (2001) 3-4) (Crews, C. and Thierer, A. (2003) 272-285). The fact that travel is more readily available and more accessible than ever before has also facilitated the process of interconnection (Gattiker, U. (2001) 3-7). As a secondary result of this increased level of cohesion in terms of communication, it has become possible for different nationalities and cultures to operate more closely together particularly within the sphere of business (Crews, C. and Thierer, A. (2003) 272-285).
Globalisation has joined local communities, regional communities with the global economy and the rest of the world. The idea that business cannot be due simply due to physical separation, or that business may be thwarted due to physical separateness is slowly becoming a thing of the past. Globalisation has made the internet a source of income, and even in less direct logistical terms, the internet is a mode of business transaction. Various secure methods of transaction are now possible via the internet, and in a sense these functionalities of the internet represent another lifting of the barriers which were once imposed due to physical separation.
However, conversely the internet, and the globlised features and interconnectedness which it is married to are not full-proof. The globilised world is one which incorporates arguably higher degrees of risk. The dangers associated with systems failure, technological hitches or indeed the lack of internet security which can be problematic for business remain as features of the internet which suspend its effectiveness or trustworthiness somewhat. Nevertheless, Globalisation may be regarded as a process which has shaped and influenced many of the concepts which will be analysed as part of this thesis. Globalisation has enabled business targets to be realised more readily on a global scale (Crews, C. and Thierer, A. (2003) 272-285) (Gattiker, U. (2001) 3-4).
Standardisation and Adaptation are both theoretical frameworks which are used to describe the processes of strategic change within corporate organisations. This section will define and explain these concepts and will outline the approach which will be taken throughout the thesis in relation to the wider relationship between these two and business and marketing strategies. Quantitative data will be looked at but the main thrust of the analysis will be the qualitative extrapolation of any data, since this approach is arguably more compatible with the ultimate aims of the thesis. These results will be extrapolated to give a more in depth insight into the current debate about which approach to business strategy; adaptation or standardisation is the most effective method of advancing and realising business and marketing objectives within the ultimate parameters of business success.
Standardisation is the generic label given to extending and applying domestic standards relating to products to target markets, even where these are located in foreign markets. As a theory, it postulates that products sell more successfully when they are marketed uniformly in a targeted manner. This concept facilitates the process of branding since there will be little variation between the strategies employed in marketing strategies across different countries, thus the product which is targeted at the market is often basically uniform in terms of tangible and intangible features (Bergersen and Zierfuss (2004) 39). Many commentators including (Bergersen and Zierfuss (2004) 39) have highlighted the similarities between standardisation and globalisation, and have further argued that the process of market homogenisation facilitates market standardisation (Bergersen and Zierfuss (2004) 39).
The process of globalisation has been regarded by some as a vehicle for the standardisation model of business strategy. It may be argued that globalisation, by its very nature is denominated in similarities, and therefore the most effective way to take advantage of how globalisation has increased the marketability of products is to maximise their recognisability by adopting a uniform approach to the marketing strategy which introduces the product to the market in the first place (Barrett, B. et al. (1998) 15 and 147). However, this is an obvious rationale, and it is not one which offers a robust support of the standardisation model. Essentially the standardisation model presupposes that the strategy which introduces products into the global market is high risk and therefore it is advisable for costs to be kept down through preserving the uniform nature of the product itself.
This is the essence of how the standardisation model may be defended. However, this essential strength of standardisation is refutable by those who have argued that to assess risk is these terms is counterproductive, as economising in this way may thwart the actual availability of the product itself which is the mechanism through which the initial cost of the product research, development and marketing may be recovered. The main advantages of the standardisation model may be regarded as the pooling of knowledge and the reduction of costs within the promotion of the product at market level. It has also been argued that standardisation indirectly increases product visibility and recognition, and that it increases product safety thus stimulating customer loyalty (Bergersen and Zierfuss (2004) 39).
Adaptation refers to the local and domestic context of business and marketing strategy (Barrett, B. et al. (1998) 15 and 147) (Edgell Becker, P. (1999) 180), and is the direct opposite of the process of standardisation. The process of adaptation refers to the marketing of products within given cultural contexts (Barrett, B. et al. (1998) 15 and 147), where marketing strategy and other business processes tend to vary according to locality and domestic situations (Barrett, B. et al. (1998) 15 and 147) (Crews, C. and Thierer, A. (2003) 272-285).
The term adaptation is often taken to mean the same thing as customisation (Bergersen and Zierfuss (2004) 39), and the general approach within each concept advocates a variation of business process to suit foreign marketing environments and conditions (Barrett, B. et al. (1998) 15 and 147) (Bergersen and Zierfuss (2004) 39). This variation or process of adaptation naturally involves an attunement to local cultural conditions and well as environment and factors such as political conditions (Crews, C. and Thierer, A. (2003) 272-285) (Barrett, B. et al. (1998) 15 and 147).
Advocates of this approach to marketing strategy argue that the adaptation of business processes allows for a more targeted, more effective individual approach to the achievement of business objectives. This follows the argument that in order for a marketing strategy to be effective it must take into account the local context where marketing activities are targeted, and in doing so they are able to attune and bolster the performance of their products in competitive markets (Barrett, B. et al. (1998) 15 and 147).
Commentators such as Onkvist and Shaw ((1990) quoted by Bergersen and Zierfuss (2004) 40) have argued that the standardisation model is a false economy. This postulation is made on the basis that while standardisation may reduce expenditure in the first place, the deficits which adaptation causes are more than compensated for through increased revenue from responsive markets, which have been targeted effectively. In making this argument the arguments, relating to increased levels of homogeneity among customers (Bergersen and Zierfuss (2004) 40) (a process linked with globalisation) which have been advanced by advocates of standardisation are rejected. The contrary suggestion is that customers are becoming more interested in and motivated by diversity and that price is not the most influential factor which influences customer purchasing behaviour (Bergersen and Zierfuss (2004) 40).
Critics of the standardisation and adaptations models have argued that the dichotomy between the two models is a false one. These critics (including Douglas and Wind (1987) quoted by Bergersen and Zierfuss (2004) 40) have argued that the most valuable way to take advantage of the market place in terms of strategy is to adopt a contingency approach which, very pragmatically combines the strengths and weaknesses of each approach and recommends that the approaches should be in a sense merged within one spectrum, with circumstances dictating which approach to lean more towards. Perhaps this argument may have its own weaknesses. It is arguably something of an extrication to critique two schools of thought by saying that they are best merged. Pragmatism is very pertinent to the idea of marketing strategy, however the idea of a strategy is to formulate a plan, and where one cannot see the theoretical parameters of a given plan, this makes it difficult to evaluate and critique it. It also makes it difficult to replicate or to attribute success to anything other that luck or circumstance.
This critique of standardisation and adaptation therefore has no parameters and while it is difficult to criticise an argument which is so abstracted, it is perhaps fair to say that the critiques of standardisation and adaptation, who advocate a replacement model which incorporates the two schools of thought have advanced a facile critique of the separateness of each school, which has not credibly addressed or isolated the weaknesses within each model. It is not therefore particularly credible to argue that the separation between standardisation and adaptation is an artificial one. In any event a theory should not be laid to rest simply because it has weaknesses.
It is acknowledged that perhaps some of these weaknesses would be ironed out with an amalgamation of the two approaches; however this is too abstracted a critique of the two models to really be credible. In any event to advocate an effective replacement of two schools of thought with one which is simply an aggregate version of the two which are the subject of the critique is a weak proposition. This is essentially to mount a critique by saying that one has a choice between the two schools of thought, however, this is an obvious proposition, and it fails to address the individual strengths and weaknesses of either model.
Perhaps a more credible analysis is advanced more persuasively by Jain (1999, quoted by Bergersen and Zierfuss (2004) 44) who has argued, in favour of the standardisation model. His argument is that there is a measurable relationship between strategy, organisational features, external environment and firm performance (Bergersen and Zierfuss (2004) 44). Jain (1999) advances this argument as a way to qualify the recommendation of Douglas and Wind (1987) as outlined above. Jain’s argument is in turn qualified by Theodosiou and Leonidou (1999) Bergersen and Zierfuss (2004) 45) who argue that the process of measurement is important, and they go further than Jain by proposing which factors would be best to have regard to during the measurement process; these factors include sociocultural (Cerulo, K. (2001) 26), political-legal, and the physical situation of foreign markets.
The idea of branding has become critically important in the contemporary world of marketing strategy. This section will deal with defining a brand in abstract terms and a discussion will follow as to how exactly the concept of branding relates to contemporary society and contemporary business and marketing processes within this society. The idea of the brand as it operates in relation to the challenges of the global market will also be considered in this section. A brand is an image or an amalgam of images and ideas which communicate business rationales about products and services to customers, and prospective customers (Barrett, B. et al. (1998) 15 and 147). Typical examples of branding are the Mc Donald’s logo, Nike and the mobile phone company Orange.
Business is a fast paced and highly competitive environment (Barrett, B. et al. (1998) 15 and 147), and in many ways the idea of branding has grown up around these characteristics of contemporary business practices. It is also the case that businesses almost universally need to built and maintain a solid customer base, which means that customer loyalty is routinely encouraged as a method of facilitating better business performance. These characteristics of marketing and business assist with a businesses’ entry into international markets as it augments the recognisability of products and services (Barrett, B. et al. (1998) 15 and 147), thus making the quality of the product or service synonymous with the brand and/or the company.
Branding has also been referred to as corporate advertising. Indeed this is how the company Aviva, have attempted to project their image on the global marketing stage. Here is how the Aviva brand in introduced on their corporate website: ‘The Aviva brand is about life and vitality – helping our 35 million customers worldwide to make the most of their lives.Aviva became the new name for the former CGNU in July 2002. The change represented part of the group’s planned journey towards being recognised as a world-class financial services provider.
The Aviva brand brought together more than 40 different trading names around the world and created further opportunities for the group to harness the benefits of its size and international capabilities. Today the Aviva brand is alive and trading in more than 20 countries with Aviva now the world’s fifth-largest insurance group (based on gross worldwide premiums for the year ended 31 December 2005). Group chief executive Richard Harvey said: “We are creating a new and powerful international financial services brand. “The benefits of this change are significant. We are able to make more of our corporate brand, to the benefit of our trading businesses. We are also making more effective use of our marketing spend, particularly in advertising and sponsorship
In 2005, and 2006, the company ran two successful corporate advertising campaigns, publicising two slogans, one ‘playing fair with your future’, and the other ‘forward thinking’. These advertising campaigns were targeted at through the adaptionist model of business and marketing formula.
The first campaign, ‘forward thinking’ was aimed at opinion formers, investors and the financial community. As a response to poor product performance in the UK (this is discussed in more detail below), Aviva needed to bolster investment from within the UK. The advertising campaign was therefore aimed at attracting the attention of readers of the Economist and the Financial Times with themed articles running in each of these publications. This was combined with billboard campaigns in London, at the Eurostar tunnel and in various underground stations
This may be contrasted with the ‘playing fair with your future’ campaign which was targeted to address concerns in Italy and Spain where industry instability and poor customer morale had been identified. This had essentially arisen from a take over of branches of the Commercial Union in these countries. The Aviva campaign was aimed primarily at grassroots customers, and hence the more customer focused mode of address (playing fair with your future). Aviva Spain won an industry award for their brand campaign, from the magazine Actualidad Economica , and this was seen as highly significant in terms of the overall success of their targeted campaign which aimed to adapt to commercial and economic conditions within local environments, following research into these factors.
Branding must therefore be thought about in the context of the challenges involved in the global marketing environment (Shaw Sailer, S. (1997) 1-15, Sibley, D. (1995) Chapters One and Two)(Smith, H. (1949) Chapters One and Two) (Smith, M. and Kollock, P. (1998) Chapter One, Staley, E. (1939) 1-20). The global marketing environment is a complex forum where there are many challenges for the aspiring business actor, as the aforementioned examples bear testimony to. Perhaps the most significant of these challenges could be the ideas of change, competition and market complexity which all affect the status and ultimate success of any business venture in a global context. So what is change? One might suspect the answer to be an obvious one, however the nature of change in a global environment; its rapidity and unpredictability necessitates a comprehensive understanding of how change may affect a corporate organisation that wishes to implement and sustain a successful marketing strategy.
Change can relate to much of the environment which intersects and affects the environment of the corporate actor (Shaw Sailer, S. (1997) 1-15, Sibley, D. (1995) Chapters One and Two). In the global marketing environmental change means that product development as well as production processes rapidly render the products of competitors obsolete. The corporate actor, operating within the global market must keep abreast of these product fluctuations if a given product is to remain credibly competitive. For this reason, the corporate actor who wishes to engage in global marketing strategies must invest a lot of resources in the research and development of products.
Take as just one example of many, the global market for printers, or laptop computers. Products within these markets are typically marketed on a global scale, Dell and HP being just two examples of global players in this regard (Steger, M. (2003) Chapters One, Two and Three) (Tinker, I. (1997) 1-25). These products quickly become obsolete as the technology which is involved in their design quickly becomes more sophisticated. An example of where product mix can dramatically affect sales is the company Aviva, an insurance group, which operates in the UK, France and Spain. While, in overall terms the company reported increased revenue for the 2006, financial year , a failure to secure overall profit from sales in the UK has been widely attributed to necessary changes in product mixes, available in the UK. At the same time the company actively endorses the identification of specific types of markets, where resources are targeted on the basis of adaptation business and marketing modelling.
In this sense it may be argued that processes of adaptation may be more beneficial in terms of ameliorating commercial challenges which arise from the rapidly changing global forum (Shaw Sailer, S. (1997) 1-15). Processes of adaptation may also provide advantages as they give better scope within which to measure the success of campaigns and for corporate actors to test which objectives are being met, and in what ways and with what levels of success. This point is particularly pertinent where product mix is concerned. As we have seen discussed above, products rapidly become obsolete. This may specifically be said to apply to companies within the technological field, such as Dell and HP. Dell’s revenue for 2006, was record, with revenues reaching $15.2 billion dollars in the first quarter of 2006. Within the manufacture of laptops industry, it is also the case that there is a high degree of product similarity across the spectrum of providers of these products.
This is perhaps another disadvantage which may be, and in many cases must be offset by more targeted research into customer preferences and market sensitivity (such as price sensitive markets). Processes of adaptation, which are practised by companies such as Dell therefore allow for these changes to be reacted to quickly, ensuring that the most resources are targeted most appropriately, in environments where the highest yields in terms of revenues may be gleamed. Standardisation therefore, while it may provide advantages, as has been discussed earlier, in terms of pooling of knowledge, reduced transaction expenses and product safety, may not provide a flexible enough business model for companies to predict and respond to change where change happens so rapidly and produces such significant consequences were it to go unnoticed.
The mobile telephone market is another example of how change has affected and challenged the global marketing industry (Gattiker, U. (2001) 3-4). Just ten-twenty years ago, the communications industry was mainly reliant on wires and cables, whereas now the communications industry to include internet and mobile telephone communication systems involves wireless technology. Product development within this sphere of industry has changes the entire foundation of what was traditionally a mainstream industry (Steger, M. (2003) Chapters One, Two and Three) (Tinker, I. (1997) 1-25), (Walters, G. (2000) 1-15). This fundamental change is redolent of the change which poses a challenge to product developers and marketing strategists in the contemporary marketing environment. This adds pressure to those who competent within the ranks of such changing global environments. Globalisation adds more pressure within this rubric of change. The following extract from Howes illustrates this point very well:
‘The ways in which coffee trees are located and cultivated on household farms in Kagera speak to the kinds of connections this particular commodity establishes between local, regional and international worlds. In order for Haya farmers and families to control the effects of this cash crop, there is, I have suggested, a simultaneous attempt made to incorporate the coffee trees into certain intimate dimensions of domesticity and sociality on the one hand and, on the other, to keep them removed from the centres of everyday productivity so as to ensure some sort of independence and integrity. Thus, just as coffee is situated in the lived world of Haya communities, coffee also situates those Haya communities with respect to the wider world of which they are a part. It is a medium that is intrinsically translocal. The coffee produced by Haya and other 'Third World' farmers also figures prominently in the social imagination of the Europeans and North Americans who are among its consumers. For these consumers it is also the case that coffee formulates and comments on experiences of the interconnections between regional worlds… Howes, D. (1996) 100)’.
Fashions and trends quickly spread from country to country; popularised through the internet and the interconnectedness of communication processes (Shaw Sailer, S. (1997) 1-15, Sibley, D. (1995) Chapters One and Two) (Smith, H. (1949) Chapters One and Two). This means that products are not the only features of the global marketing environment which are susceptible to becoming obsolete; product designs are also liable to become obsolete, and while the distinction between these two processes of change might on the surface appear to an insignificant one; it is well recognised that both processes product design and the actual physical characteristics of products are often equally important. A corporate actor who is not both receptive to change and responsive to it, will find themselves at a disadvantage (Steger, M. (2003) Chapters One, Two and Three) (Rojek, C. and Urry, J. (1997) Chap 1 and 2).
Change can also be extraneous within the context of the global marketing environment (Crews, C. and Thierer, A. (2003) 272-285) (Edelstein, A. (1997) 316-327). Even what is ostensibly tangential can make a real difference in the world of business and marketing strategy. To take stock of an historical example, let us look at the break-up of the Soviet Union, which thwarted the rates at which foreign investors could invest in the Soviet economy . This meant that many corporate actors had to look for new markets fro the products which had previously been received in the Soviet Union. It also meant that raw materials had to be sourced differently.
It is important to emphasise however, that changes which involve political events and ideological transition aren’t necessarily counterproductive. The war in Iraq for example has opened up what had previously been a very insular market in Iraq to more foreign investment. The most significant feature of global markets in terms of change is that change manifests itself in more unpredictable ways, and the process of change itself is more rapid. This requires faster, more astute responses from corporate actors who wish to mount credible marketing campaigns in the contemporary, global business environment.
To turn to another major challenge within the global market economy we can look at the concept of complexity. Again, ostensibly the definition of this concept seems to be straightforward, but the terminology takes on a more specific meaning when it is referred to within the context of the global market environment. In terms of complexity, the physical and logistical features of marketing strategy have themselves become more cumbersome. While the internet has revolutionised the world of communications, the globalised world which is more accessible now, also must be accessed by corporate actors who wish to mount successful marketing strategies (Steger, M. (2003) Chapters One, Two and Three) (Tinker, I. (1997) 1-25).
This brings into play other communication barriers which involve high levels of geographical separation and language barriers. Therefore while it is important to recognise that globalisation has in many ways facilitated communication, and in many ways made it faster and easier, the process of globalisation has presented new more complex barriers to the physical process of communication. These barriers, in the context of global markets may be referred to within the parameters of complexity.
Communication barriers may affect organisations operating within the global context in a pervasive manner (Steger, M. (2003) Chapters One, Two and Three). They may take effect, for example at organisational and inter-organisational level. This is exacerbated by the point which was made earlier about the complexity of geographical and logistical features of corporate enterprise. A manager within a marketing organisation may find themselves directing major logistical operations in hugely diverse environmental and cultural circumstances. Dell has attempted to lessen the effects of this particular problem through the innovative idea of conducting all of their customer services and sales over the internet.
It is a well known fact that Dell laptops cannot be bought through the shops. Dell has conducted advertising campaigns therefore to publicise this marketing innovative, which has had the effect of streamlining their customer service. It this sense this may be regarded as a standardisation business model, which has marketed the customer service and sales components of their brands (although not their products) in a uniform fashion. There is also the secondary effect which has meant that the logistical features of their product distribution are more predictable and uniform. Dell therefore is a good example of a company which has used both standardisation and adaptation marketing modelling to ensure that where necessary change may be evaluated and responded to whereas at the same time logistical elements of their business and marketing strategies have been made more uniform where it has been advantageous to make this the case.
Another result of the increasing complexity which goes hand in hand with the processes of change which have been previously described is the idea that customers experience the same barriers in terms of logistical and physical barriers to communication (Steger, M. (2003) Chapters One, Two and Three) (Tinker, I. (1997) 1-25), (Walters, G. (2000) 1-15). This is a difficult problem to ameliorate more so where it effects the customer base, in comparison to how the problem manifests itself at organisational level. Customers have so much choice that these barriers, once encountered are as easy to circumvent as they are to overcome.
The problem for corporate actors is that they depend upon the customer to overcome and not to circumvent communication problems, or barriers to communication. The customer who does not choose to do so is one whose customer may be easily solicited by a competitor. A major example is the marketing strategies of mobile phone operators in the UK, where customer services is outsourced to call centres, where English may not be the first language of the customer service officer. In this scenario the organisation and the brand would benefit from the provision of training to ensure that call centre operators have an appropriate level of English.
Another factor which poses a global challenge to the global marketing environment are the levels of competition which are increasing rapidly as new markets emerge and globalisation makes these markets more accessible to more corporate actors (Steger, M. (2003) Chapters One, Two and Three) (Tinker, I. (1997) 1-25), (Walters, G. (2000) 1-15), (Watkins, J. (1998) Chapter 1). New sources of competition have taken the form of recently industrialised countries for which the global marketing environment was inaccessible historically due to a relative lack of industrialisation within their countries. Examples are such countries are primarily China and India, although Korea and Taiwan are other examples. Traditionally these countries were not usually international competitors in the global market; however increased investment has stimulated their entry. This has increased the pool of actors within competitive markets (Steger, M. (2003) Chapters One, Two and Three).
The cumulative effect of these three factors makes the importance of information systems and the targeted use of resources highly important (Steger, M. (2003) Chapters One, Two and Three) (Tinker, I. (1997) 1-25), (Walters, G. (2000) 1-15), (Watkins, J. (1998) Chapter 1). In a sense these may be used to achieve the competitive edge in situations where competitors are otherwise on a par. The use of research resources such as databases, market research and other forms of competitor analysis can for example enable the identification of price sensitive markets where the distribution of low cost products are more likely to sell better.
Two factors; information systems and the targeted use of resources are arguably the main components in the skeleton on an adaptation approach to business. These arguably represent the barometers of the variables which affect the success of particular products within local contexts (Steger, M. (2003) Chapters One, Two and Three), and therefore it may be argued that they facilitate the model of adaptation more aptly than they facilitate standardisation models, which tend to be more prescriptive and anticipatory. There is arguably a greater level of inert-organisational autonomy where local markets are being surveyed in anticipation of a decision as to resources allocation. In this context the identification of growth and mature markets will possibly be more associated with the adaptation model of business and marketing strategy.
Conversely, in terms of standardisation, the challenge of ethical issues is a significant one, and approaches to ethical issues are often approached in a standardised manner by corporate actors. The earlier example of Mc Donald’s where the introduction of more healthy foods led as a reaction to negative publicity relating to issues of obesity and the health of children and adults who consume too much ‘fast food’, is a prime indicator that acting in a more socially responsible way can be approached uniformly.
In this sense, perhaps it is arguable that if we are to regard the notion of corporate social responsibility as a major challenge to marketing strategies, the adaptation model is perhaps of less use to the corporate actor who wishes to gain a competitive edge by deploying resources where he/she thinks they will work best. Notions of corporate social responsibility tend to be more uniform and thus lend themselves better, arguably to the standardisation model of business. Also, there are negligible gains to be had from adapting and adjusting ethical approaches to ethical questions in different areas of a globalised market. This could even be counterproductive, since it may lead to a cynical response from the public.
Branding is a way to accelerate the marketability of particular products, in a society where the generic customer is bombarded with so much choice. The brand has grown to be a way of building continuity into the relationships between business actors, companies and their customers and prospective customers-a customer who associates particular positive characteristics with a particular brand will generally attempt to stay faithful to that particular type of brand. Branding therefore creates and sustains a relationship of trust between business actors and their customers and prospective customers, and the quality of what precipitates this bond is arguably as important as the quality of the merchandise itself. Branding is a representation of the product, and also of those who market it.
The brand signifies the characteristics a customer may expect from dealing, not just with the branded merchandise but with the entire interface of the branded merchandise and the actors who have created it, the actors who have marketed it and all those who seek to profit from being associated with it. This branding process therefore enables business actors to gain a competitive edge even where there is no real difference between branded products and their unbranded, generic counterparts. The brand therefore is a tool of signification, which builds trust in a unique manner between customers and those who solicit their custom.
Branding also functions as a way for a company to establish itself and differentiate itself from other competitors. So what is the relationship between a product and a brand? In short, branding provides an endorsement of the product and communicates this guarantee to the public. The product forms a key component in the equation; however, as is often the case in contemporary business environments, there will often be many products with relatively little separating them in terms of quality. The saleability of the product will depend on factors such as levels of customer loyalty, the ability to capture and hold on to market segments, the length of customer repurchase decision cycles and the ability to successfully launch other products (Le Pla and Parker (1999) 5).
A brand takes an idea, concept or a strategy into the homes of ordinary people, and is often embedded within a person’s mind (Cerulo, K. (2001) 26) (Barrett, B. et al. (1998) 15 and 147) (Aitchison, J. and Lewis, D. (2003) 34-39). In this sense the cross-over between branding and culture can be very important. Brands generally are intended to communicate with customers in a globalised world (Barrett, B. et al. (1998) 15 and 147) (Aitchison, J. and Lewis, D. (2003) 34-39). Culture becomes important within the brand as, the brand image is often being disseminated to a huge cultural interface within a given country (Aitchison, J. and Lewis, D. (2003) 34-39) (Cerulo, K. (2001) 26) (Edgell Becker, P. (1999) 180), and this is one of the reasons why the brand must be accessible to those people. Branding in this sense transcends generic cultural boundaries such as language (Aitchison, J. and Lewis, D. (2003) 34-39), in many ways, and it must be capable of transcending these cultural boundaries in order to be successful (Aitchison, J. and Lewis, D. (2003) 34-39) (Cerulo, K. (2001) 26).
If we think about the Mc Donald’s logo, this brand is recognisable whether one is Chinese and living in England, with very little knowledge of the English language, or whether one is living in China, with little knowledge of the Chinese language. The colours of the logo, the characters and the consistency with which this brand is disseminated can be so powerful therefore that cultural boundaries such as language (Aitchison, J. and Lewis, D. (2003) 34-39) (Barrett, B. et al. (1998) 15 and 147) which oftentimes represent such a significant barrier to communication, and integration can be overcome by the powerful mode of communication which the modern day brand has become (Aitchison, J. and Lewis, D. (2003) 34-39).
The effects of branding, once successful may be seen as iterative, as the brand itself lays the bedrock of the marketing strategy. Let us have a look at the Virgin brand as an example. Here is how the Virgin brand is introduced on their website: Virgin - one of the most respected brands in Britain - is now becoming the first global brand name of the 21st century. We are involved in planes, trains, finance, soft drinks, music, mobile phones, holidays, wines, publishing, space tourism, cosmetics - the lot! What tie all these businesses together are the values of our brand and the attitude of our people.
We have created over 200 companies worldwide, employing over 25,000 people. Our total revenues around the world in 2002 exceeded £4 billion (US$7.2 billion). We believe in making a difference. In our customers' eyes, Virgin stands for value for money, quality, innovation, fun and a sense of competitive challenge. We deliver a quality service by empowering our employees and we facilitate and monitor customer feedback to continually improve the customer's experience through innovation.
The Virgin brand is arguably most synonymous with its distinctive colour and the charisma of Richard Branson, its founder. This has made it possible for the same Virgin brand, which was originally used within the music/entertainment industry to be modified slightly and transposed into other areas of the sales market, such as Virgin trains and the new Virgin credit card. In this sense once an effective brand has been piloted, it may be altered slightly, for the purposes of targeting different markets and still retain the essence of what makes it effective. The communication processes within the sphere of branding are therefore arguably principally cognitive in visual terms, with any lingual signification being secondary or dispensable (Aitchison, J. and Lewis, D. (2003) 34-39) (Cerulo, K. (2001) 26) (Barrett, B. et al. (1998) 15 and 147).
While it is possible to describe the process of branding as intangible, this alludes to the lack of rigidity in the process, rather than a lack of structure or cogency as to what the constituent parts of a successful brand is. It is well accepted that the process of branding must produce a brand which is accessible, simple, memorable, powerful and evocative. There are many replications of the process of branding and the success of the brand itself is not a measure of anything other than recognisability. This concept is what occupies the intangible characteristics which may be associated with the process of branding (Barrett, B. et al. (1998) 15 and 147). Perhaps it is more arguable to postulate that what is intangible manifests itself more so in terms of the outcomes of the process of branding rather than within the process itself.
The speed of the processes involved in communications has influenced the modality of branding (Gattiker, U. (2001) 3-4). Brands have to fit into the communication rubric of the high speed technological communication era (Gattiker, U. (2001) 3-4). This has imbibed the processes associated with branding with certain characteristics which enable the process of branding to be supported by the globalised technological interfaces through which the branded messages are disseminated (Gattiker, U. (2001) 3-4). If one thinks about branding itself; as a process it has been prevalent within society for many decades.
The concept of soap powder and the series of soap commercials which were used to sell and advertise the soap powder during the early half of the twentieth century provide one example. However, branding has had to evolve as the technology used to disseminate the essential message of the branding process has evolved in line with technological advancements. Let us take an example of this. If we can contrast the process of soap powder commercials with a more modern day mode of communication of a brand, let us take the example of a pop-up advertisement we can see how this argument stands to reasons. The advertisement of a brand over the internet must adapt to the fact that individuals in contemporary terms may often regard the advertisement of a brand as an unwelcome imposition on their everyday lives.
This has become an all too common feature of internet advertisement (Gattiker, U. (2001) 3-4), and it is one which may be contrasted with life when the radio soap powder commercial was seen as a more legitimate and acceptable mode of communication. The persons who devised the soap powder commercials, due to this perceived acceptability did not have to make as much effort to have their brand recognised. The modern day creator of brands is aware that the brand may easily go unnoticed if it does not stand out by communicating a clear message in what is often realistically only a few moments where it can access its target; the person who sees a pop-up image on their computer screen for example. Therefore the messages or the underlying goal of the branding therefore arguably has not changed as much as the means by which this must be achieved. The influence of technological advancement may be imputed as one of the reasons for this.
Branding has therefore become a vehicle for business and marketing strategy, with the most successful branding efforts often being the ones which produce the most memorable and effective branding concept. The techniques used to embed these images within the cultural awareness of customers (Cronin, A. (2000) 1-10) (Barrett, B. et al. (1998) 15 and 147) revolve around the used of colour significations, musical compositions, memorable symbols or pictures or clever combinations of these methods (Barrett, B. et al. (1998) 15 and 147) (Cronin, A. (2000) 1-10) which create a memorable and simple message which may be digested and retained by those who are targeted with the information (customers and prospective customers) (Aitchison, J. and Lewis, D. (2003) 34-39). Branding, it may also be argued, has fallen into particular niches which use particular modes of address to targeted groups of customers and prospective customers (Aitchison, J. and Lewis, D. (2003) 34-39). Some brand images are built up around an appeal to modalities of status and perception which in turn influence the purchasing behaviour of particular types of customers (Aitchison, J. and Lewis, D. (2003) 34-39) (Cerulo, K. (2001) 26) (Cronin, A. (2000) 1-10).
Examples of this type of branding typically involve images of youth, attractiveness and comfortable lifestyle. This type of representation is rooted in local and cultural modalities (Cronin, A. (2000) 1-10), and therefore the brand process is combined with an appeal to the cultural sensibilities of another (Aitchison, J. and Lewis, D. (2003) 34-39) (Cronin, A. (2000) 1-10). Perhaps these types of brands may be associated more with ideas of culture, and therefore one may observe a greater variation in terms of what is represented (Aitchison, J. and Lewis, D. (2003) 34-39). This in turn creates particular sub-groups within the targeted group (Barrett, B. et al. (1998) 15 and 147) (Aitchison, J. and Lewis, D. (2003) 34-39).
These brand processes may be described as immutable and quite different from the brands which centre on abstractions, such as the earlier example of the Virgin brand. For this reason for these types of brands to operate within the globalised society, it must be possible to change what is often the centrepiece of the brand; a person, or perhaps even an image of a particular lifestyle. In a sense, these types of brands which appeal to one’s cultural position and or one’s status may be more associated with local adaptation processes (Aitchison, J. and Lewis, D. (2003) 34-39) (Cerulo, K. (2001) 26).
Branding therefore solicits customer recognition arguably more than anything else. What matters is how powerful the brand image is; that it creates and sustains a link between the product or service and the customer or prospective customer. The brand will not be visible if it is not easily understood and decoded by those who are the target of the branding process (Aitchison, J. and Lewis, D. (2003) 34-39). Branding as a mechanism, in abstracted terms therefore often traverses the spheres of marketing, business, advertising, public relations and strategy, and branding has swiftly become a universally accepted mode of communicating and disseminating business concepts and merchandising ideas (Barrett, B. et al. (1998) 15 and 147).
Branding is almost a prerequisite to successful marketing strategies in contemporary business circles. Branding may also be described as a way of cementing and establishing relationships between business actors and their customers. Integrating with the concept of globalisation, branding is also a mechanism of communication and endorsement, a further buttress to the relationships between business actors and their customers.
Integrated branding is a way is describe the relationship between the brand, the product and the company itself, and some have argued that this is the best way to approach the idea of branding; to acknowledge that the brand is representative of a composite which communicates to the customer on many levels (Barrett, B. et al. (1998) 15 and 147) (Cerulo, K. (2001) 26). One level is about the product and the guarantees about what it does.
Another, arguably more significant one is the dissemination of information about the company itself; its corporate culture; its strategic vision; its organisational ethos and structure and its approach to customer relations. It has been argued that this approach to branding is significantly more effective than the more streamlined product orientated methods, some of which are described in more detail above. It has also been argued that this approach facilitates growth as the company image forms a brand in itself which then may be used to endorse other branding processes specifically attuned to the advertisement of products. Conversely this approach has been critiqued as requiring too much pre-planned and prescriptive product design, and corporate ethos.
When the company brand is pivoted on a certain vision or representation of such, this makes any change or direction within the company itself quite high risk, since there is a risk that any new direction of the company may become diametrically opposed to the brand and what this represents about the company, necessitating a new branding tec
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