International Marketer’s Blog

International agency network Freedman has opened a Singapore office as part of wider plans to service a number of truly international clients. Marc Nicolson, Freedman’s recently appointed Managing Director, APAC, will be running the Singapore office and Sharon Lee has been appointed Account Director. A number of other key appointments are to follow soon.

“Our clients are asking for a global partner which can provide a seamless process for the implementation of global marketing efforts,� says David Moody, Freedman’s VP Business Strategy. “Today, using new technologies, a brand can be relevant in numerous different markets using the same core materials.�

Freedman works with international brands such as Electronic Arts, InterContinental Hotels Group, Delta Airlines and Shell. Its new office in Singapore is designed to help streamline the marketing performance of its wide-ranging client base, at a time when Asia is playing an increasingly important role on the world stage.

Explains Moody: “We let creative agencies focus on what they do best. What we offer, in terms of project management, involves a different mindset and different skills sets. We provide expertise in terms of how to appeal to a target market, and the means to adapt creative concepts and to make them relevant to various cultures. So much digital content in particular runs across numerous markets these days – we are able to implement a consistent and efficient approach.â€� Read the rest of this entry »

Taiwanese smartphone maker HTC has moved into the Chinese market this week, with the introduction of a series of models under its own brand name and partnerships with two key Chinese firms.

In a bid to develop market share in the world’s largest mobile phone market, the company is joining forces with China’s largest mobile operator China Mobile and Gome Electrical Appliances Holding, China’s largest electronics retailer, to market HTC phones.

An article in the Financial Times yesterday, highlights the fact that despite Taiwan’s proximity to China and a shared language and culture, HTC chose to launch first as a brand in Europe, followed by the US, before introducing itself to Chinese consumers.

According to the FT, there are a number of reasons why the company has thought global first and local second. The challenge for Taiwanese tech players has been to find global brand solutions, in order to turn themselves from contract manufacturers, operating on slim margins, into global brands. Some Taiwanese companies have tried to operate all retail outlets themselves, or relied on national-level operators. In a country the size of China, provincial networks and outsourcing are more effective. Read the rest of this entry »

Kirin, one of Japan’s leading beer brands, has struck a deal with a south-east Asian beverage company, reflecting a broader trend for Japanese corporations seeking to expand international marketing activities in Asian growth markets.

Kirin is paying Y84.6bn ($972m) for a 14.7% stake in Fraser and Neave, the largest drinks company in Malaysia and Singapore and producer of Tiger and Anchor beers, according to the Financial Times report.

The deal highlights Japanese companies’ strategic effort to compensate for sluggish sales at home by turning to emerging markets in Asia. Kirin has made a number of acquisitions in the Asia-Pacific region over the past few years. The latest deal is expected to strengthen its currently weak position in the region.

The Japanese group, which also owns a food and beer group in Australia, has a goal to become a leading company in Asia and Oceania. Its aim is to increase its overseas sales ration from 25% this year to 29% by March 2013. Read the rest of this entry »

International agency network Freedman has opened an office in Atlanta as it continues to expand its international footprint. The opening of a base in Atlanta comes hand-in-hand with a recent contract win from international hotel group IHG, which is headquartered there.

David Moody, Freedman’s VP Business Strategy, explains that Freedman’s decision to open an office in the region is part of an ambitious growth plan. The move also follows the agency network’s recent repositioning under the strapline ‘Global Marketing Performance’ – which is designed to reflect the overall aim of its work with its international clients.

“Before, we were perceived as primarily European,â€� he says. “But in the face of rapid globalization, increasingly you’ve got to be able to provide a global solution. Our clients want a global partner – one which can offer an overarching process for marketing campaign implementation.

Account Director Neil Schrum will be working from the Atlanta base. Formerly at Digitas, and an American himself, he fully understands the market in which he will be operating. Read the rest of this entry »

Starbucks has seen its profits soar by more than a third in the last quarter, thanks to a major investment in its international marketing activities.

Store traffic increased by 6% in the US, and by 4% internationally, lifting quarterly profits by 37% to $207.9 million (£136 million) in the 13 weeks to June 27th.

Overseas growth is a high priority for the business, with the majority of new store openings (250 this year and 500 planned for 2011) happening outside of the US. Revenue rose by nearly 9% to $2.61 billion in Q3, despite 144 under-performing US stores being closed.

“Starbucks’ third quarter results reflect a continuation of the strong performance and momentum we have been driving across our businesses around the world,� said Howard Schultz, chairman, president and CEO of the group.

He added that the recent success is largely down to the “most significant marketing investment in the company’s history�.

Much of this was ploughed into launching Starbucks Via, an instant coffee variety, in US grocery outlets. Since its September debut, the product has performed strongly and is now on track to hit $100 million in sales in its first year. Read the rest of this entry »

Polo Ralph Lauren has regained direct control of its operations in South Korea amid Asian expansion plans.

In a move that will enable the homewear and clothing company to operate more efficiently and consistently across Asia, it has agreed to buy back wholesale and retail distribution from its South Korean licensee, Doosan Corp. The deal, worth $47 million, will be effective from December 31, 2010,

Chief Operating Officer Roger Farah said that assuming control of South Korea would make the company’s Asian operations “more closely aligned with our global brand positioning and objectives�. He also explained that the company’s fully integrated Asian strategy will “optimise the unique opportunities of each country�.

CEO Ralph Lauren added that international expansion was of highest strategic priority for the brand, and that South Korea is one of its largest markets. The move suggests implications for the company’s international retail marketing strategy. Read the rest of this entry »

An article in the Financial Times this week describes the approach taken by a number of global brands seeking to develop business opportunities in emerging markets. The report’s author Emma Jacobs looks at international marketing strategies employed by established global players such as HSBC, McDonald’s and Starbucks.

HSBC, which has for many years been branding itself as ‘The World’s Local Bank’ is pursuing a strategy promoting the understanding of different cultures as key to developing successful business relations. The company has sponsored this summer’s ‘Festival Brazil’, a programme of cultural activities at London’s South Bank Centre. Running alongside the cultural event is a series of business seminars and conferences about operating in Brazil designed to help people, including foreign journalists and trade representatives to engage with the festival.

Key to successful expansion in new markets for companies such as Starbucks and McDonald’s has been research and investment in products adapted to local tastes.

Starbucks has until recently pursued a strategy trading on its all American image. However, the company is now subtly adapting products to local tastes at the same time as tailoring some outlets more closely to the local environment. The company hope to reconnect with local communities whilst maintaining its core American image. Read the rest of this entry »

French high fashion house Hermès is rolling out a new luxury brand in China in September, with the aim of increasing market share in the world’s second largest luxury goods market.

The new brand, Shang Xia which means “up and down� in English, has been developed in China with the Hermès Chinese team, in an effort to appeal to more Chinese consumers with localized products. A new Shang Xia shop is due to open in Shanghai selling tableware and furniture.

However there has been concern amongst commentators that Shang Xia will dilute the Hermès brand and discussion about whether designing products specifically for the Chinese market will be a success.

Quoted in an article in the Financial Times this week, Shaun Rein of China Market Researchgroup in Shanghai, said “Foreign brands want to say: ‘We are foreign’â€�. He said “most Chinese consumers did not want made-for-China products.â€� Sun Yimin, an expert on luxury consumption at Shanghai’s Fudan University commented, “shoes, handbags and jewellery that are obviously of foreign design sell much better than such products designed for the local marketâ€� Read the rest of this entry »

Global brands often struggle to succeed in local markets, while local brands meet consumer needs better, according to new research.

Brands with a centralised structure (with brands managed centrally, rather than locally), can lose track of consumer needs and shopper insights, according to the study by Roland Berger and Ipsos.

As a result, centralised product launches suffer significantly higher flop rates (80%) than decentralised ones (50%) posing the question whether companies should opt for global corporate branding or localization.

According to a study conducted by Nielsen, flop rates in the German FMCG market are as high as 85%. Another study found that out of 24,000 new products, only half survived their first year in the market (Source: GfK/Madakom,1998).

In 2001, 32,000 new products were launched, and only 30% survived the first year. Roland Berger and Ipsos cite relevance and differentiation in the market as two top criteria for global brand marketing success. Read the rest of this entry »

The global marketing industry is likely to benefit from a new set of standards on the back of an alliance between two professional bodies.

The American Marketing Association (North America’s largest marketing association) and the Global Marketing Network (the marketing professionals worldwide membership group) have joined forces to co-develop a range of measures. The idea is to create a new set of global standards for the marketing profession.

The report, on utalkmarketing.com, says it’s hoped that the partnership will boost the profession with ‘the most comprehensive and widespread support’ for the international marketing community.

The measures include jointly developed branded membership offerings, new globally-accredited certification programmes, and the AMA being appointed as a GMV Professional Development Centre and distributor for GMN’s Global Marketer Programme in North America. Read the rest of this entry »