Transcript No Slide Title

International Marketing
“Toto, I don’t think we’re in
Kansas anymore”
- Dorothy
Gary Burandt
Executive Director
ICOM
Why market abroad?
To
To
To
To
expand sales opportunities
retain domestic clients
stay competitive
take advantage of low labor costs
The Americans are late
No trading tradition
Big post-war domestic market
Too hard:
Different languages/cultures
Complicated taxes, tariffs and currencies
Distribution worries
Distance (12% of Americans own passports)
Go to easiest markets first
Typically Europe/Australia first
Proven product acceptance
Right target audience profile
Begin with distributors
Own sales force comes later
World is not smaller,
but it is a lot closer
CNN, MTV, ESPN, BBC, NBA & Disney
providing global shared experiences
Maradona, Madonna, Mandela, Godzilla
The “Universal Teenager”
American Levi’s jeans
Italian Benetton sweater
British Doc Martins shoes
Swiss Swatch watch
Japanese Sony Walkman
Trend is to global agency
network assignments
Better control of strategy, message &
budgets
Simpler administration for client with a
single point of contact at the agency
Can leverage global assignment for lower
agency compensation
Hard to do with distributors, needs own
sales force
Multinational Networks
Same name everywhere
Known name
Case histories
Set policies and procedures
Authority to “make it happen”
Perhaps a safer choice, for the insecure
ICOM Independent Network
Stable management
Deep market understanding
Connections social, political
Low overheads, fast response
Spirit of a volunteer network
Some creative great work
No politics
Longer history than many multinationals
International approach
follows company’s culture
Firm -Company HQ controls brand
strategy, creative execution & MC budget
Flexible - HQ controls brand strategy, but
creative execution can be localized.
MC Budget shared.
Free - HQ allows brand strategy &
creative execution to be determined
locally. MC locally funded.
Examples
Firm
Rolex
Marlboro
Singapore Air
Most corporate
campaigns
Flexible
Colgate
Coke
McDonald's
Ericsson
Volvo
Free
Sony
Frito-lay
Ford
Most food
& personal
care
Trend is to Flexible approach
Firm - Insensitive to local market
conditions. Locals hate it.
Free - Doesn’t build brands, can be
wasteful of resources. Locals love it.
Flexible - Builds brands with local
sensitivity to message delivery. Allows
sharing of best practices. Compromise
management with good communications.
Agency structure typically
reflects client organization
Client
Client CEO
Worldwide MarCom
Director
Regional MarCom
Director
Local MarCom
Director
Agency
Agency CEO
Worldwide Account
Director
Regional Account
Director
Local Account
Director
What agencies need to do
Commit to international standards of
service, process & communication
Assign a Worldwide Account Director and
perhaps Regional Accounts Directors
Pick local Account Directors based on
related experience and “chemistry”
What agencies need to do
Set and communicate clear, simple policy
and procedures for running the business
Require concise monthly report from field
Have a global meeting at least annually
Establish a bi-lateral formal performance
review system that works for both sides
What clients need to do
Communicate to field why there will be a
new agency
Involve agency in the upstream planning
Keep a handle on the MC budgets as a
form of control
Keep agency informed and introduced
Picking an agency
Budget size determines agency size
Look for related experience:
Consumer
Business to business
IMC capabilities
International connections for expansion
Good people chemistry
Local Agency Association can help
Globalization is hard
When the Client HQ makes a global
agency change without telling the locals
When the locals love their old agency
When client uses agency to do the dirty
work
When the agency’s caught in the middle
of the inevitable HQ vs. the field conflicts
When agency politics get in the way
Trend is to IMC
Uses all communications disciplines to a
single strategy across all audiences
More ways to help: PR, Direct, Promo,etc
Builds brands faster
Longer relationships
A new way of working, needs even more
communications/involvement
Public Relations is local
PR needs a local practitioner with contacts
and understanding of the media
Agencies either have this capability inhouse or have an ongoing relationship
with a PR shop to meet client needs
In some countries publicity is “bought”
like advertising space … with a resulting
lack of credibility
Direct & Promotion also local
Should compliment advertising message
Needs cultural understanding
Privacy/sampling laws differ by country
As do postal infrastructure
Alcohol and tobacco very regulated
Media is changing
The trend in many parts of the world is to
“un-bundle” the media function
Media-only companies (CIA/ Media Edge,
Zenith, Carat, etc.) are serving agencies
and clients directly
They offer leveraged media discounts and
research resources based on volume
Sometime they replace the media
department, sometime just the buying
function in an agency
Internet must be considered
Most important commercial medium since
television
Traffic doubles every 10 weeks
Buyers can search, compare, question and
buy all in a matter of minutes…from home
or office
Can reduce the sellers and buyers costs
Media issues
Media used determined by:
Target audience interests
Local cultural issues
Media options available
Seasonality
Budget allocations
Budgeting considerations
Speed of market awareness generally
determined by level of spending
Spending must reach a threshold of
awareness to make something happen
Better to spend enough in a few markets
than too little in a lot of markets
Global Creative concerns
Keep it simple and visual
Humor is great but is hard to do
Execution should fit market, but core
brand values should be consistent
Share international work frequently to see
what is working … and not
Don’t allow the “Not Invented Here”
attitude
Moving creative across borders
Look for similarities beyond geography:
Target audience demographics
Religious/cultural
Competitive set
Pricing structure
Distribution channels
Category perception
Where to go for help
World Trade Centers
US Council for International Business
American Association of Advertising Agencies
US Department of Commerce, International
Trade Administration
Office of International Trade, US Small
Business Administration
International Advertising Association
ICOM www.icomagencies.com