Chapter 20 international advertising and promotion

International Advertising and Promotion
International Advertising and Promotion
20
McGraw-Hill/Irwin
© 2004 The McGraw-Hill Companies, Inc., All Rights Reserved.
Reasons for the importance of international
markets
¾ Domestic markets for many products and
services are stagnant
¾ Many companies rely on foreign markets to
survive, particularly those with small domestic
markets
¾ International markets offer growth
opportunities for many companies
¾ Competition has become global and marketers
must be able to compete globally
Markets such as China offer strong growth
opportunities for many companies
International Advertising
¾ The U.S. accounts for over half of the world’s
advertising expenditures
¾ Advertising expenditures outside the U.S. are
growing more rapidly than inside
¾ Every country in the world has advertising of
one form or another
¾ The more affluent the country, the more
monies spent on advertising
The International Environment
International
Marketing
And

Promotional
Decisions
Cultural
Environment
Economic
Environment
Demographic
Environment
Political/Legal
Environment
Economic Environment
¾ Stage of economic development
¾ Economic infrastructure
¾ Standard of living
¾ Per capita income
¾ Distribution of wealth
¾ Currency stability
¾ Exchange rates
Demographic Environment
¾ Size of population
¾ Number of households
¾ Household size
¾ Age distribution
¾ Occupation distribution
¾ Education levels
¾ Employment rates
¾ Income levels
Cultural Environment
¾ Language
¾ Lifestyles

¾ Values
¾ Norms and customs
¾ Ethics and moral standards
¾ Taboos
Political/Legal Environment
¾ Government policies
¾ Laws and regulations
¾ Political stability
¾ Nationalism
¾ Attitudes toward multinationals
The Big Question . . .
Should the global marketer offer the
Should the global marketer offer the
same product, marketing, and
same product, marketing, and
advertising throughout the world?
advertising throughout the world?
OR…
OR…
Should the global marketer adapt the
Should the global marketer adapt the
product, marketing, and advertising to
product, marketing, and advertising to
individual markets throughout the
individual markets throughout the
world?
world?
Saab used a global campaign since its
customers are similar around the world
Source: Courtesy Lowe & Partners Worldwide

(The Martin Agency, Lowe Brindfars for SAAB
Automobile AB).
Global Marketing and Advertising
Advantages
¾ Economies of scale in production, distribution
¾ Lower costs with less in planning and control
¾ Lower advertising and production costs
¾ Ability to exploit good ideas worldwide
¾ Ability to introduce products quickly, worldwide
¾ Consistent international brand, company identity
¾ Simplification of coordination and control
When is Globalization Appropriate?
¾Brands can be adopted for a visual appeal,
avoiding the problems of trying to translate
words into different languages
¾Brands that are promoted with image
campaigns that play to universal appeals such
as sex or wealth
¾High-tech products and new products coming to
the world for the first time, not steeped in
cultural heritage of the country
¾Products with with a nationalistic flavor if the
country has a reputation in the field
¾Products that appeal to a market segment with
universally similar tastes, interests, needs, and
values
Young people are a global market segment
for many products
Global Products, Local Messages
¾

¾
An in
An in
-
-
between approach:
between approach:
 Standardizing products
 Localizing advertising messages
 “Think globally, act locally”
¾
¾
Adapt messages to respond to
Adapt messages to respond to
differences in language, cultural,
differences in language, cultural,
and market conditions.
and market conditions.
 Pattern advertising
Continental Airlines used pattern advertising
to promote its BusinessFirst class
Decision areas in international advertising
¾Organization
¾Agency Selection
¾Advertising and market research
¾Creative Decisions
¾Media Selection
¾Coordination of other IMC tools
International Ad Agencies
¾ Many large, American general agencies

operate internationally
¾ Foreign billings account for over a third
of total billings by the top 10 American
agencies
¾ Large multinational companies often deal
with large, international agencies
¾ Overseas offices are usually staffed with
multilingual, multinational personnel
Foreign Local Agencies
¾ Staffed with
local
local talent who
understand local attitudes, culture,
media, and conditions
¾ Especially effective for launching
consumer products in a
single,
single,
new
new geographic area
¾ Poses some
problems
problems if a product
is to be launched in multiple, local,
foreign markets
Criteria for Selecting an Agency
for International Advertising
¾ Ability of agency to cover relevant markets
¾ Quality of agency work
¾ Market research, PR, and other services offered

¾ Roles of company advertising department and agency
¾ Level of communication and control desired
¾ Ability of agency to coordinate internationally
¾ Size of company’s international business
¾ Company’s desire for local vs. international image
¾ Company organizational structure
¾ Centralized vs. decentralized
¾ Company level of involvement with international operations
Advertising and market research areas
¾Information on demographic characteristics of
markets
¾Information on cultural differences such as
norms, lifestyles and values
¾Information on consumers’ product usage,
brand attitudes, and media preferences
¾Information on media usage and audience size
¾Copy testing to determine reactions to different
types of advertising appeals and executions
¾Research on the effectiveness of advertising
and promotional programs in foreign markets
Creative Decisions
¾ Creative decisions should be based on
advertising and communication objectives
¾ Copy platforms must be developed that
include major selling ideas
¾ Specific appeals and execution styles
must be selected
¾ Appeals may have to be adapted for local
market conditions
Creative decisions involve determining the

appropriate advertising message for each market
and are similar in process and procedure to
those for domestic advertising
Media Selection Decisions
¾ Media differ in various countries with
respect to factors such as:
– availability
–cost
–usage
– quality
–restrictions
¾ Media options include use of local,
national or international media
Commercials Shown Per Hour in various
countries
57
40
38
36
34
33
30
16
0 102030405060
United Kingdom
Australia
Thailand
Mexico
France
China

Philippines
Turkey
Factor to consider in developing sales
promotion programs for foreign markets
¾ Economic development
¾ Market maturity
¾ Consumer perceptions
¾ Trade structure
¾ Regulations