International Marketing There Are Several Blunders That Essay

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  • Subject: Business
  • Type: Essay
  • Paper: #11521340

Excerpt from Essay :

International Marketing

There are several blunders that have occurred with respect to international marketing. Some come under the category of basic linguistic misunderstanding, but others are more catastrophic in nature, causing offense in addition to costing the company sales. In some cases, the blunder gets back to the home market and does damage there, as was the experience that Nestle had in Africa. This report will outline some of the blunders of the past and how international marketers can avoid these sorts of blunders in the future.

Blunders

Some international marketing blunders are simply issues of translation, or mistranslation. Google Translate does not get the job done -- languages vary from region to region, and international marketers can get caught by idioms and slang very easily. An obvious example was when Chevy launched the Nova in Mexico in the 70s. "No va," in Spanish, of course means "doesn't go," probably a bad thing for a car, and the sales of the Nova were in line with that. While modern marketers are unlikely to make such basic mistakes, they can make mistakes with slang or idiomatic expressions. When this occurs, the blunder is known to the people immediately, but not always known right away to the company. Slogans and advertising copy in particular can be a problem, when these are directly translated from the home language.

Another type of blunder made in international marketing is the marketing of a product for which a culture has no use. A company in Australia was seeking a market for its frozen fish sticks, and decided to sell them in Hong Kong. They had studied the market, including the ease of entry, they noted the lack of competitors and the appetite for fish in Hong Kong. What could possibly go wrong? Well, it turned out that nobody in Hong Kong has an oven. Apartments in Hong Kong lack the space and electrical hookups for such things, and baking is unusual in the city. So even if people could buy the fish sticks, nobody would be able to cook them at home. Thus, the venture was a dismal failure, because the Australian company simply assumed that people in Hong Kong have ovens, just like they do in Australia. This echoes the more tragic outcome for Nestle with its baby formula in Africa. This was marketed aggressively, but formula required mixing water. Nestle, apparently having never set foot in Africa, forgot that while tap water is safe in Switzerland, it usually is not in Africa. Babies died -- the formula was worse than their mother's milk. Further, the mothers were not using enough of the formula -- they cut the dose to stretch supply because they could not afford otherwise. Swiss people follow directions and can afford the full dose -- again, there was a failure to recognize local circumstances. Nestle lost a lot of goodwill in its core Western markets when these stories emerged, as Nestle's aggressive marketing was killing babies in Africa. The company is still known for this negative incident, long after the fact.

A third type of blunder when marketing internationally is to misread the local market conditions. This can even happen to smart companies. Starbucks was success in Japan and China because it saw nations full of tea drinkers and altered its products accordingly to emphasize its dessert drinks, teas, and to emphasize the role of the Starbucks store as a third place, away from home and work, something that resonated well in Asian cities where personal space is at a premium. So how did Starbucks flop so badly when it went to Australia? Surely a company that succeeded in Canada and the UK could do well in Australia. Not so. Australia has a much richer coffee tradition than other English-speaking countries. Its cafes have better atmosphere than Starbucks, better coffee by a wide margin and lower prices. Not surprisingly, Australians did not enjoy the Starbucks experience and the company was forced to close hundreds of stores, retreating to business districts and touristy areas. They had assumed their coffee and in-store experience would sell itself, not realizing that it was far below the local standards.

Avoiding blunders like these requires a number of steps. First, it requires a high standard of research. Companies generally take the time to understand their customers and markets, but clearly Starbucks did not with Australia, nor did the fish company in Hong Kong. In their rush to get into a market, they did not do nearly enough research. They didn't talk to locals, put enough people on the ground, or get to understand the competitive dynamics of these markets. Such failures could be avoided with more research but also with local partners. Mistakes that occur in advertising are easy to remedy -- the international marketer must work with a local agency. It cannot be assumed that what works in one country will work in another. The local agency will understand about translations, including those that do not appear on the Internet translator. They will understand what jokes will work, what scenarios and framing will make sense to the local audience, and can help the international marketer steer clear of local sensitivities.

Culture Risk

As some of the above examples highlight, culture risk can be very costly to a company. The company can lose the goodwill of a market forever, and if the mistake is big enough, the company can experience negative outcomes even in other markets. Thus, the risk is very high. Advertising and product choices are important, because these can cause offense to the very people the company is seeking for its business. Political risk carries with it the possibility of sanctions, being barred from a country or even nationalization. Commercial risk can also cause a company to exit a market, if it makes a misstep, as Starbucks experienced in Australia. Culture risk is just as dangerous, because of the damage that it does to the brand.

A brand is something that consumers identify with certain traits and sentiments. Brands have tremendous value, sometimes in the billions of dollars, depending on how they are viewed by consumers. As a consequence, international marketers spend millions of dollars to build a brand. Brand equity, however, is fragile and can very easily be damaged. One bad campaign or misstep can result in a brand being damaged, costing the company millions, as well as lost opportunities and market share.

South Asia

I do not know how well the first name thing would work. While I'm sure that they would appreciate my attempts to speak (whatever language it is), the business is going to be conducted in English because that is the language of business throughout the region. However, it is probably not good to insist on anything, as insistency is likely going to be perceived as arrogance. While our culture may be informal, most other business cultures are not. Until you have established a relationship that goes beyond formal, it is probably not a good idea to insist upon methods of greeting. They will probably just ignore the insistence, and chalk it up to me not understanding their culture. Nobody goes into a business meeting with a foreigner (me) expecting perfect knowledge of their culture -- I do not expect it of them either.

Jack Daniel's

Jack Daniels cannot necessary trade on the finer points of its American image in China, because the market will not understand them. Instead, Jack Daniels needs to adapt its strategy, taking elements of its core strategy, but changing them to make them relevant to the Chinese audience. Foreign goods, especially those that are presented as luxury goods, and generally received well in China and are seen as a sign of status. This is an approach that can work for Jack Daniels, trading on its…

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