International Marketing - Effects of the Country of Origin on Consumer Perceptions - Assignment Example

? International Marketing Table of Contents Table of Contents Introduction The ‘internationalization’ is indefinite and variant definitions havebeen surfaced regarding the phenomenon. The name has been defined as ‘Point of view on a firm’s core competences and opportunities in the foreign environment’. It is also the process undertaken by a firm that can cause an increment in its involvements in international operations. Various scholars have defined it as the work out undertaken by organizations that lead to an increment in their knowledge of the impact of international deals on their future, set up, and undertake deals with other countries. We can also view it as “the action of acclimating a firm’s activities to international surroundings.” 1Strategy is the resolve of the fundamental long-standing goals of the business venture, and the embracing of courses of action and allotment of resources essential for carrying out these objectives. It consists of incorporated decisions, proceedings or tactics that will aid to realize goals. Brand strategy is used as a sunshade term to indicate the expansive range of strategic options open to the firm, together with both managerial and purposeful management strategies, product/market approaches, and diversification strategies. Main Body Step 1: Coca Cola brand topped in the 2010 list of Global Inter-brands and as the senior marketing consultant working for the brand, I hereby present a report that seeks to answer a digit of questions. Step 2: The Coca Cola brand has overtime played a vital role in the mother company’s international expansion. A coherent and viable global brand architecture is a vital constituent of the firm’s general worldwide marketing strategies because it provides structural basis for levering sturdy brands into foreign markets, ensuring assimilation of acquired brands in adding up to rationalizing the company’s adapted global strategies in branding. Market globalization and competition growth worldwide has seen Coca Cola brand expand its geographical operational scope by creating or acquiring other firms/brands that exist in foreign countries over and above initiating alliances across established boundaries. 2In addition, emergence and entrenchment of the global media, global retailing and outright movement of persons, goods and entities across international borders/territories has changed brand markets to constituents of emerging integrations that have not been in the picture before. Consequentially, a global firm like Coca Cola has concentrated on coordinating and integrating its existing strategies and methodologies in marketing across global markets. 3A vital element in Coca Cola’s International marketing strategy is the strategic branding policy that it has adopted overtime. A Strong brand like Coca Cola has helped the mother company to ascertain the firm's identity in the market, and develop an unyielding consumer franchise plus providing a weapon to defy growing retailer clout. The brand has also provided the root for other brand extensions, which further strengthen the firm's souk position and enhancement of value. 4In international markets arena, an important brand strategy for the firm is has been to use the same brand name in different countries, leveraging brand strength across these established boundaries and maintaining local brands that respond to variant customer preferences in the local setups. A related issue has been the branding level that needs maximum emphasis, that is, corporate/house or product-level brands or a jumble of both. The innermost responsibility of branding in defining the firm's distinctiveness and its pose in intercontinental markets means that it is decisive to expand explicit and formidable international brand structural designs. This is implying identifying the dissimilar echelons of branding contained by the firm, the actual number of manufactured brands at each level on top of their product market and geographical scope. A crucial element in this branding structure is the established level numbers, this is, house/product and corporate business and how they are worn in union with both. Correlated to this architectural development is brand management that spans variant geographic markets and lines/channels of products. 5The connotation of the diverse issues relies substantially on the firm’s expansion internationally, and the organization of its intercontinental operations. Coca Cola has stretched internationally through leveraging means of its local "power" brands in intercontinental markets. Accordingly, as the firm seeks to swell further, it has considered the prospect of developing brands that point to specific national and regional preferences. The company has also adopted national-centered strategies and methodologies, acquiring/building blends of national and intercontinental brands. Accordingly, the company has decided on the length of its movement towards greater synchronization of brands and amalgamation of their brand structural design across countries, and if that is the scenario, how to work on it. These vital issues are principally decisive in European markets where brand market structures-traditionally revolving around countries, are now flattering and more interlinked. This has created vital firm pressure to amalgamate their brand strategies athwart markets within intercontinental boundaries. 6First, contemporary perspectives on intercontinental branding and brand designs are examined. This precedes a debate of unconventional intercontinental brand structures and the causal drivers, this is, firm distinctiveness, product market formation and marketplace dynamics. 7The substance of designing viable and effectual brand architecture and administration of brands sequentially to uphold a harmonious equilibrium within this design is subsequently worthy to note. The work also by emphasizes the essence for annual audits of Coca Cola’s brand design and its position to deal with changes in the core drivers over and above an appraisal of strategic brands contained by this design. Most discussions in the Coca-Cola Company and research on its branding policies, whether domestic or intercontinental, focus on the justness or value allied with a brand name and the factors that fashion or are the fundamental sources of worth. This concentration has been enthused in part by the escalating market power and value related with a sturdy brand and in part by the exorbitant expenses of launching a flourishing new brand. While this spotlight is apposite for a soaring profile brand like Coca-Cola, it dismisses the issues encountered by majority of less multinational firms who possess varieties of home and international brands that diverge in their potency, target market and their alliances. 8Such firms have to establish how to enlarge a solid and effectual brand arrangement, which brands to accentuate and build, whether to exploit the potency of the same brands transversely brand groups and across nations, and how dissimilar brands at diverse levels of the business should be interconnected so as to capitalize on their market force and efficiency. As Coca-Cola expands in intercontinental markets, issues relating to brand design or brand organization befall complexity. Adding up to considerations on the levels in the pecking order, another aspect, namely the grade of brand harmonization or homogeny across countries, desires to be determined. Irrespective of the spreading out process, Coca Cola has determined a fitting brand design that transcends countrywide boundaries and the extent branding is incorporated or standardized across other countries. The main designs of brand patterns are: first, one is dominant on corporate, the second is dominant on the product and the third is a combination of structures. There was, nevertheless substantial disparity within a given kind of structure depending to a huge extent on the firm's organizational legacy and international development approach over and above the measure of harmony among product outlines or product businesses. In addition, these structures were recurrently evolving in a rejoinder to the altering market configurations or as an upshot of Coca Cola’s expansion stratagem in international markets. A study conducted by the Coca Cola research team provides some insight into the driving forces that are causal to brand architecture/design. This recommended that brand design is essentially fashioned by three foremost factors: product market characteristics, firm-based characteristics, and underlying market dynamics. While the Coca cola’s history shapes its product design, market dynamics and intensification of monetary and political amalgamation as well as expanding media costs generate pressures to synchronize branding across countries to attain economies of scale and range. Consequently, brand design, like any existing mortal, is repetitively changing, both fashioned by and developing in reaction to these drivers. The design of an organization’s brand at any prearranged position in time is in large compute a heritage of past organizational decisions as well as the cutthroat realities it encounters in the markets. Coca Cola’s history creates 'brand baggage’ and has been seen as a strong brand with affluent traditions. 9Brand design unavoidably reflects the imprimatur of preceding generations of administrational directives. For a start, the Coca Cola’s administrative heritage and in particular, its supervisory structure, institute the stencil for its brand design and strategies. Secondly, the brand’s intercontinental expansion strategy and conspicuously the approach of expansion, this is, via organic growth influences how brand formation evolves over moment in time. This explains why firms like Coca Cola that has the arrangements of the organization central and has divisions of its product internationally have a possibility of having brands globally. Coca Cola has adopted a commercial branding approach emphasizing the superiority and reliability of its brand. Product outlines are characteristically standardized globally, with slight variations in styling and appearances for limited country markets. Expansion strategy: Intimately correlated to the Coca Cola’s administrative legacy is its intercontinental expansion approach. Of exacting significance in influencing the number and symphony of the brands owned by the Coca Cola Company is its method of expansion, this is, whether it has long-drawn-out through organic/Greenfield growth or through acquisitions and strategic alliances. Firms that enlarge globally by acquiring local firm entities, still where the primary goal is to gain right of entry to distribution channels, will characteristically also obtain local brands. Where these brands have elevated local acknowledgment or a strong consumer or dispenser franchise, the company will usually hold on to the brand. This is primarily likely if the brand does not reside in a similar positioning to that of another brand presently owned by the company. Importance of corporate identity: The comparative importance positioned by the firm on its corporate identity, also influences brand structure. Companies such as Coca Cola considerably emphasize on corporate identity. Internationalization Process Theory (IPT) The Coca Cola brand has adopted the Network theory whose basic argument is that modern firms do not embrace the process of increments; rather they achieve a faster internationalization through the experience and resources of network partners. All organizations in a market are taken to be connected in more than one network through links in various fields like their suppliers, subcontractors, clients and other actors in the market.10A network is a set of two or more connected business relationships, in which each exchange relation is between business firms that are conceptualized as collective actors. Theorists of networks view modification of a firm as a way of developing naturally from its ties with alien individuals and organizations. Networking is looked as a generator of market knowledge and information, which are found in longer terms when there is no affiliation with the host country. Hence, networks act as a bridge that allow for fast change. The reason behind insisting on the network approach is to bring the parties involved closer by applying the knowledge found by the firm hence launching a close affiliation with customers, suppliers, the industry, distributors, regulatory and public agencies as well as other actors in the market. Relationships are founded on mutual trust and comprehension as well as commitment towards each other. Organizations set up and develop positions in the market in reference to other actors in a new network. When firms go oversees they are involved in domestic network with the purpose of creating business affiliation in a new country. An organization’s position in the domestic network is a determining factor in its modification process since that position determines its competency to retrieve their resources in the network. There is a relationship between all firms in the market and other actors whether local or international. As operations take place in an organization interacting in the network, there should be coordination so as there is a realization of batter profit from those relations. This way a company can have a better comprehension with a supplier or other companies. Coordination in the market comes from the relationship between the firms involved in the network, with many factors influencing the decision and price is one of them. Ties that come from the firm’s network are not easy to copy. These ties have the following effects that are in three dimensions: a) availability of knowledge to the involved parties; b) timing, and referrals. Firms get educated from these ties created in the network, expertise about what is happening in the marketing s open to the networking itself. Hence some knowledge isn’t available for all. Ties also influence on timing when some information reaches a particular firm. In addition, referrals firms get interested on other firms, in the right time and place. Links can be viewed in terms of their strength; they can be strong or weak. For a link to be considered strong or defined as strong, various factors are looked at, this are; time, intensity of emotion, affinity and if the services of the links are reciprocal. They are weak when they are low, the relationships are distant. Links are strong if their interaction is very close; the parties are able to be independent and can acclimate to each other with ease. No link is permanent. With time, organizations can strengthen them or weaken them depending on their relationship. The first step a firm must follow in order to internationalize is the understanding of the market where it operates, its environmental conditions and the firm’s relationships. Theorists of network argue that as firms internationalize, it leads to bring up of relationships numbers and strength which assists their international expansion.11By using trust and increasing commitment in established foreign networks, the firm gains penetration. After having some penetration, firms can gain intercontinental integration by using the network and getting involved with other firms in various countries. When the firm follows these activities, relationships are formed, gaining access to the market and its resources. Resources in the network are controlled by the firms itself, as well as other actors involved. A firm requires resources that are controlled by other firms, which can be obtained depending on their position in the network. Coca cola brand is a brand categorized as an ‘International among others’ brand which focuses on a highly internationalized firm, where both market and the firm are highly internationalized. Knowledge and experience possession makes it easier for firms put subsidiaries of sales, as it requires coordination of activities in various markets. They are well attached to networks internationally that provide opportunities. Effects of the Country of Origin on Consumer Perceptions One definition of consumer behavior or perceptions-although not official but accepted- is the examination of persons, a cluster or entities and the processes used to opt for, acquire, employ and organize goods, services ,encounter or thoughts to gratify wants and the effects that these actions have on the society and consumers.12Although it is not essential to remember this description, it brings up some practical points: Behavior occurs either for the individual, or in the context of a group (e.g., friends influence what kinds of clothes a person wears) or an organization (people on the job make decisions as to which products the firm should use). Behavior of a consumer involves the usage and disposal of products also not forgetting looking on how the product is purchased. One of the greatest marketer interests is the product, this is because it affects the way the product is best placed or how one can stimulate increased usage. Most of the environmental problems arise from product disposal (e.g., oil form motors being released into sewerage systems in order to cut costs on recycling fee) is also an area that catches the eye. Services, ideas, and tangible product are involved in behavior of a consumer. The effect of behavior of a consumer to society in large is also of great importance. For instance, aggressive marketing of foods with high fat content on easy credit has a negative impact on national health and economy. There are four major applications of behavior of a consumer: first is marketing strategy that assists in making improved market campaigns. For instance having the comprehension that people pay attention to food advertisements when hungry, this will make one have a snack advertisements moved in the late afternoon. Having an understanding that new products have few consumers in the initial stage and only get more later one and gradually to everybody we get the knowledge that; (1) a company that introduces a new product must be well financed to stay afloat till the product succeed in the commercial field, (2) it is vital to make the first customers as they are ones that influence others. The second application is public policy. It should be noted that that you have to pay a premium size by buying a quantity that is larger. With this information, in this case will make you be keen to check the costs of unit labels to determine if you are getting a bargain. Many units are available for analyzing but major thrust in the course is the consumer. However, there is a great need for the analysis of our company’s strength, shortcomings and competing companies. Finally, we require doing a condition assessment (marketing surroundings). For instance, although we have a created a product offering great consumer appeal, in case of a recession, it may reduce want dramatically. One of the external influences that affect the consumer is culture. Culture acts as a presentation of influences that are subjected on the consumer by others. Culture can be defined as “awareness, belief, morals, customs other capabilities and habits which act as a complex whole acquired by man person as a member of society.” Information and beliefs are vital components. In the US, we believe and understand that a hardworking and skilled individual will get ahead. Take a note that what is moral in one country can be immoral by standards of another country. 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