Marketing in Global Financial Crisis - Essay Example

?Running Head: Marketing in Global Financial Crisis Marketing in Global Financial Crisis [Institute’s Marketing in Global Financial Crisis Introduction The existing global financial crisis gives both major challenges as well as opportunities for businesses. A number of exporters are considering drop in overseas orders as a result of diminishing demand in global marketplaces or because overseas consumers are having trouble in acquiring suitable credit. On the other hand, the drop in the value of dollar is facilitating to make goods further cost competitive within global markets. There is a stress on uncomplicated, understandable marketing communication. During a crisis, people go back to brands they identify and trust - and trust will be a most important topic in addition to value for money. Funds for marketing are decreased and businesses will try to find more cost-effective methods to get in touch with their target customers. There is less indirect marketing; for instance, funding of costly sporting occasions along with other things where the direct sales advantage is not easy to observe (Munchau, p. 102, 2009). There will be more relocation of marketing from conventional print and broadcast media towards online advertising, where advertisers are able to assess immediate profits from little investments, which they can subsequently expand if they work fine. An exception is probably be radio marketing that is comparatively inexpensive and can be extremely successful in targeting particular groups. Strategies for Brands to Regain their Unique Value Proposition The long-term business outlooks for the global brands are positive, but in reaction to the alterations in front, businesses have to make several strategic options to adjust their models to the new realities. Global brands, with development objectives, need to commit to rising markets, where having a complete multi-shoring value proposition will be important for achievement. Companies manage brand by concentrating on the strong points that consumers value for the most part and by aiming for the objectives that will bring the maximum contribution. This is included in the business’s global value proposition. It directs marketing, as well as communications endeavours all over the world and reminds what the company has to deliver so consumers prefer its brand instead of competitors. The global value proposition reveals the insights achieved from extensive global research into consumers' existing, as well as potential requirements, in addition to the business's leadership statement. It explains the emotional and practical advantages to customers and motives why the company will deliver. The value proposition will help significantly in differentiating from the competitors. Rather than being identified as offering everything for everyone, the business will be identified as the world’s strongest economic society (Simchi-Levi, p. 183, 2010). The long-term brand policy, along with brand structural design, pursues a one-brand vision, and promoted by the brand communication and campaigns. Consumers gain knowledge from experience whether the assurance behind a brand is factual or bogus, especially in times of global financial crisis. The global financial crisis has called for a number of strong points that can assist to differentiate a company for its stakeholders. For this purpose, companies should implement an innovative communication approach that will meet the requirement to change the position and revitalize the brand. The innovative communication policy should leverages on this strength: it produces a new sort of discussion with the consumers and is even more open as well as transparent than before. Well-known brands keep developing their brand identity to progress with the times, constantly keeping the most identifiable components. That way they continue to look fresh and advanced, securing brand stability at the same time. The redesign reveals the brand policy with respect to the different prerequisites of the local businesses and is an obligatory framework for all claims across the entire media and channels (Simchi-Levi, p. 89, 2010). Potential for ‘Branding the Senses’ as a differentiation Strategy Differentiation is a brand’s capability to ‘stand apart from others’, and to achieve customer preference, liking and trustworthiness. It is the level to which customers consider a brand exclusive. A convincing and outstanding brand experience can draw customers’ attention and retain their interest, and as a result contribute to brand differentiation. Flagship shops are one way that companies can bond and interact with consumers to take part in experimental branding. They are as well the places to exhibit ‘limited edition products’ and exceptional service experiences, which can show the companies’ customs and brand values in methods conventional media cannot. Relevance means how important a brand is to its target customers. Relevant brands are both suitable as well as attractive. Niche and emerging brands may want to concentrate initially on differentiation and afterwards on relevance, but top brands will do extremely well on all four aspects (Lindstorm & Kotler, p. 84, 2010). Admiration determines the level to which the target customers regard and value a brand - to be precise, how well it is liked. When companies grow bigger and turn out to be more established, brand value turns out to be all the more essential. During the existing global financial crisis, companies often utilize indirect experimental branding techniques to build brand value. One method to achieve this is by means of the ‘Internet and social networking websites’. Awareness decides whether there is an accurate understanding of what a brand stands for. Brand awareness is a sub-factor of awareness. The level of brand awareness is a sign of the business’s previous performance, as well as a foundation for its additional growth. Positive and precise understanding of the brand among target customers creates brand trustworthiness. Nonetheless, it is not sufficient for a brand to tell customers what their brand signifies, they have to prove it to them, and the best way to do this is by means of brand experience. A creative branding procedure through customer experience, adds to brand differentiation, value, significance, and awareness, and consequently is an efficient method to build brands. As a result of interactive technologies, inventive retail places, and ‘indirect online brand communication methods, customers can now observe, feel, taste, smell and listen to brands in ways they never could before’ (Lindstorm & Kotler, p. 101, 2010). Colorful marketing and cost-cutting product endorsements are mostly not sustainable techniques for brand building. Experimental branding, with the purpose of creating brand equity, has appeared as a capable and feasible substitute. Counter Action for Global and National Brand Premium generic brands turn out to be more susceptible to low cost imports from developing nations. In this framework, a number of market analysts suggested that company should modify its manufacturing and distribution strategies to come up with cost effective approaches on an extremely fast rate. At the same time, the business can get away from of ‘low-priced’ struggle by coming up with well differentiated styles, in conjunction with excellent quality and pricing, in an attempt to establish its brand standing. Prospects are realistically fine for value brand fundamentals sold to consumers, who will give up premium brands in support of lesser prices. Global brands can as well successfully reached out to customers who earlier bought higher-end brands, a strategy global and national businesses insistently apply with their ‘daily low prices’ strategy during global financial crisis. Global brands have opportunities with ‘postponable products’, as well (Taylor & Weerapana, p. 303, 2009). At the same time as premium brand market heads should not shift their brands down-market, they can launch a ‘fighter brand’, a lesser priced edition of the premium offering, put up for sale under a different name and supported by minimum marketing. In addition to giving momentary price endorsements or list-price changes, businesses can improve affordability by lessening the thresholds for quantity concessions, extending acknowledgment to their clientele, or having layaway strategies. “Reducing item or serving sizes, and after that pricing them accordingly, is another effective tactic” (Foster, p. 49, 2009). For global services businesses, lowering customers’ upfront adoption charges and dropping penalty charges can facilitate in attracting cost-conscious as well as cash-poor consumers. Relying on whether consumers are looking for the absolute cost or the most bang for money, “global services businesses can unbundle offerings, or fold more services into the bundle - or offer both options” (Foster, p. 88, 2009). Encouraging messages that strengthen an emotional link with the brand and show understanding are very important. Encouraging messages should be supported up by actions indicating that the business is on the consumer’s side. If sales are going down, “the last thing to do is to take the problem out on consumers by reducing quality while raising prices” (Foster, p. 123, 2009). To what Extent Customer will Switch Back from Generic Brands to Global and National Brands Once the Global Financial Crisis is Over The global financial crisis caused markets to contract and a number of major alterations emerged within their formation. The customers adjusted their buying behaviour. They started to be alarmed about their professions and do not take pleasure in spending their cash any longer. They delayed or condensed a huge quantity of purchases associated to leisure and amusement. Individuals may start purchasing less quantities, or switch to ‘larger size items’ to stay away from recurring purchases. They as well began to switch brands, and started to concentrate on price instead of quality and they have also started to strengthen the search on the internet trying to find valuable bargains. People turn out to be more ‘money minded’. “They do not want to spend money on premium products anymore, even if they still could afford to do so. They only buy necessities, switch to cheaper brands and have a more rational view on promotion. They start to compare different products and select based on price compromising quality. The buying process in this situation can be transformed from a programmed behaviour or a limited decision-making buying behaviour to the extensive decision-making buying behaviour” (Sheng, 392, 2009). In other words, extensive decision-making and information gathering did not support the buying activities prior to the global financial crisis but following the crisis, the procedure became more complex. Traders are increasingly launching low cost ranges into their superstore’s shelves. The private-label merchandise is turning out to be a smart substitute to the cost responsive customer in times of global financial crisis. In a recent survey, 61 percent of customers said they were switching to inexpensive grocery brands in the financial crisis and approximately one-third of them said that they would carry on to buy low-priced grocery items even when the financial recession is finished (Sheng, p. 244, 2009). The global financial crisis has a considerable impact on the way customers shop for groceries. With the purpose of getting the best value for their condensed earnings, customers are shopping around for the top bargains and increasingly dividing their grocery spending across at least four different sellers. For businesses, long-term policies may be the most important factor to brand success. When customers come out of the tough times, they may intentionally choose not to change all of their new practices and revert. An increasing number of customers are looking around for a bargain to shop, and this was obvious in a number of studies. Conclusion Marketing is struggling to meet the challenge of different communities. The majority of customers rely on the opinion of acquaintances and strangers more than official marketing. One can key in the name of a hotel into Google, and if the remarks by people who stayed recently are poor, then customers are not likely to consider the claims on the hotel’s personal website. References Foster, John B. 2009. The Great Financial Crisis: Causes and Consequences. Monthly Review Press. Lindstorm, Martin and Kotler, Philip. 2010. Brand Sense: Sensory Secrets Behind the Stuff We Buy. Free Press. Munchau, Wolfgang. 2009. The Meltdown Years: The Unfolding of the Global Economic Crisis. McGraw-Hill. Sheng, Andrew. 2009. From Asian to Global Financial Crisis: An Asian Regulator's View of Unfettered Finance in the 1990s and 2000s. Cambridge University Press. Simchi-Levi, David. 2010. Operations Rules: Delivering Customer Value through Flexible Operations. The MIT Press. Taylor, John B. and Weerapana, Aklia. 2009. Principles of Microeconomics: Global Financial Crisis Edition. South-Western College. Read More