Author Topic: International Branding Strategies  (Read 1395 times)

Md. Anikuzzaman

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International Branding Strategies
« on: May 17, 2018, 03:39:59 PM »
Closely linked to product positioning and communication issues in international marketing are decisions on international branding strategies. The main purpose of branding is to differentiate the company's offerings and to create brand identification and awareness. Branding strategies can be distinguished according to the brand architecture into single brand strategies or family (or umbrella) brand strategies (for a number of products). Companies may also choose to market several brands in a single market.

The company needs to decide which general branding strategy, in terms of the brand architecture, is to be applied for each country market. The main problem in international branding strategies is whether to choose an integrated, global branding approach, which employs a uniform branding approach for all markets, or to use differentiated, regional or local branding strategies. In this context, decisions about the geographic extension of brands are necessary.

The basic strategies are global brands, i.e. establishing a single brand for all markets (“universal brand”) and local brands, implying the use of individual brands on each country market. Mixed strategies are also possible, for example by establishing several regional brands with a focus on several country markets.

Many companies strive for global brands because of the advantages associated with this strategy. Global brands offer the highest possibility of achieving a consistent image across the world and are also a necessary requirement for global advertising campaigns. Global brands have much higher visibility than local brands and their global nature often adds to the image of a brand, and global brands reach the highest (overall) brand equity (Kotabe/Helsen 2014, p. 367). Also, economies of scale are associated with global branding. For example, the cost of creating and strengthening the brand can be spread over large sales volumes.

However, there are limitations to global branding. For example, if companies offer a diverse product range in international markets, the product offer in the host country does not always fit the global brand's image, thus limiting its applicability. Local brand names might also be easier to understand, and not all global brand names are suitable for internationalisation. Also, if other elements of the international marketing mix are adapted to local conditions, local branding might be more appropriate. For example, if advertising messages are adapted to each market or if products are changed through customisation, product design or recipes to meet local requirements, these strategies are easier to implement under different local brand names.

This also applies to price differentiation, which is easier with different brand names. Thus, brand differentiation can be used as a strategy to limit parallel or grey markets. In this context, companies can also implement mixed strategies, in which a global corporate brand is used in all markets but product brand names are adapted to the local requirements.

International Distribution Strategies
The international distribution strategy is closely connected to the foreign operation modes the MNC applies in the diverse markets. It mainly relates to decisions on the structure of the marketing channels and to marketing logistics:

■ International channel structure and channel design: e.g. types of intermediaries (alternative distribution channels), coverage (intensive, selective, exclusive), length (number of levels), control resources and degree of integration

■ International marketing logistics: physical movement of goods through the international channel systems, e.g. order handling, transportation, inventory, storage, warehousing.

International channel configuration is highly dependent on the availability of marketing channels on each country market and on customer characteristics and culture that determine channel use. Additionally, factors relating to channel costs, channel control or continuity of channel relationships are important.

Channels can vary from direct channels to multilevel channels, employing many types of intermediaries that each serve a particular purpose (Doole/Lowe 2012, p. 327). International channel relationships are complicated by many factors such as those relating to product ownership, geographic, cultural and economic distance and different rules of law.