International Marketer’s Blog

When Tata Consultancy Services (TCS) – which now ranks amongst the world’s biggest IT companies – first ventured out of India, its international marketing campaigns faced some difficult challenges. “Initially, there was a prejudice about TCS that being a brand from India it will be low cost, low model and with poor quality,” admitted TCS’ global brand manager, Vishal Jhungjhunwala, at the annual convention of ‘in’ global marketing communications’ – a network of 95 independent agencies from across 90 countries – in New Delhi earlier this month.

Now boasting a presence in 183 countries, TCS initially looked at partnering with clients that had a global presence and offered opportunities for growth. The strategy clearly worked. Today, TCS is considered as one of the biggest brands out of India, as well as in its domestic market.

According to a report in India’s Financial Express – entitled Brands Beyond Borders – in order to counteract prejudice and to create global brand consistency, TCS took the decision to use a consistent logo in all markets. The multinational IT firm has also focused on sports sponsorships with an international audience in order to raise visibility, such as Formula 1 and the New York marathon. (more…)

A special report in this week’s Economist, entitled, ‘The new masters of management’, stresses the fact that the world’s emerging markets are now a hotbed of business innovation. These burgeoning economies are no longer content to be sources of cheap hands and low-cost brains. “Instead,� says the report, they are “producing breakthroughs in everything from telecoms to car-making to healthcare.�

You need only take a few examples to see this point clearly illustrated – and there are many to choose from. Mexico’s CEMEX is now the largest cement company in America and the third largest in the world; Acer of Taiwan is vying to become the world’s second-biggest manufacturer of personal computers; South Korea’s Samsung is one of the world’s best known makers of electronic goods. The list goes on… and on.

These brands are redesigning business processes in order to do things better and faster than their rivals in the West. And this does not mean simply reducing costs, but also employing new technologies.

In marketing terms, too, both Western and emerging-country companies are waking up to the fact that they need to try harder if they are to prosper in these booming markets: “It is not enough to concentrate on the Gucci and Mercedes crowd; they have to learn how to appeal to the billions of people who live outside Shanghai and Bangalore, from the rising middle classes in second-tier cities to the farmers in isolated villages.â€� (more…)

BrandRepublic reported last month that Gap is planning to boost revenues by starting an e-commerce business from a distribution base in the UK, which will serve the UK and other western European countries. Adding to the challenge, Gap is planning to open a store in Milan later this year, the hometown for high end fashion brands. Will Gap be able to find its position in the global fashion capital and rub shoulders with the likes of Armani and Dolce & Gabbana? Will the understated casual style of Gap be appealing to the power dressing Milanese?

Many people think that fashion has become ‘global’. Designer brands run pretty much the identical print ads all over the world. Back in 2004, in the book celebrating the 10th Anniversary of Tom Ford’s reign in Gucci, he wrote ‘We are one culture now. The world drinks Coke, watches the same films, listens to the same music and wants to look the same. When I first came to Gucci, we used to design a different product for the Asian market. Now our customers want the same things – whether in New York, Tokyo or Hong Kong.’

What Mr. Ford didn’t realise is that even though consumers in different countries wear the same clothes, the motivations behind being related to the brand is different. In fact, fashion and beauty is an area that has such intrinsic differences between cultures that global brands often have problems marketing the same product in different countries. (more…)

According to a recent report in Business Week, developing nations are catching up fast in terms of “tech readiness� – meaning that international marketing agencies need to keep up-to-date with evolving digital trends if their campaigns are to succeed in key country markets.

The World Economic Forum (WEF)’s annual ranking of the best-networked countries is still dominated by Europe, but this is unlikely to remain the case for much longer. Take China, for example. According to the International Telecommunications Union, it had an estimated 641 million mobile subscribers at the end of 2008 – twice the number recorded five years earlier. And China isn’t alone. India, Malaysia and Vietnam are all amongst the fastest growing centres for IT anywhere in the world.

In Vietnam, local policy makers have prioritised IT education and spent billions upgrading the country’s broadband and mobile phone infrastructure. As a result, Vietnam jumped 16 spots in this year’s WEF ranking. (more…)

“Many of us can’t imagine a life without Google … until you head East,â€� says a report in Advertising Age this week.

Search has always been an “entirely different affair� in markets like South Korea, it says, which has the world’s deepest penetration of internet users.

Naver and Daum are Korea’s equivalents of Google and Bing. A quick look at these sites serves to illustrate the fact that, to the majority of Koreans, search-engine sites are similar to portal websites where results are integrated with images, video, music and user Q&As.

The concept of a simple text search, in fact, is alien to Koreans. It is gradually becoming rarer in other markets too, such as the US and the UK, where users weren’t necessarily blessed with high-speed internet access from day one, so had to start off by inputting text. Yet, according to the report, “this is only part of the reason Google has had a hard time way out East.�

First let’s consider the fact that Korea and Japan are the leaders in 3G adoption across mobile devices. Marketers need to move to mobile pretty quickly, especially in key Asian markets There is an accelerating global trend to use mobile devices more frequently than PCs, to check social network status updates, for instance. (more…)

Google has started redirecting users visiting Google.cn, in China, to servers based in Hong Kong, and the site Google.com.hk. The politics of this move aside, the difficulties which Google is facing in this key global market serve to illustrate the importance of in-depth research and genuine understanding when looking to expand internationally.

Clearly, local regulations can cause big business challenges – even for an organisation as powerful as Google. The bottom line is that – if you’re planning on making a significant investment or expansion in any country market you are not yet fully familiar with – then you’ll need to gather a team of experts around you.

A blog post on searchengineland.com, entitled Even if Google leaves China, You Shouldn’t, by Andy Atkins-Krüger, offers some strategies for success in China, claiming that, since there is a greater need for support relating to China and the market is so significant, it’s actually easier to find assistance for international marketing and business than in just about any other non-US or European market.

But Atkins-Krüger also challenges the assumption that the largest markets will offer the greatest rewards. “The first rule of international expansion is always to start with your strongest market (more…)

Despite Google’s likely shutdown of its Chinese-language Google.cn search engine, marketers and their agencies should not disregard the significant business opportunities available on the mainland.

Negotiations between the international search giant and Chinese officials to allow Google.cn to both remain in China and stop censoring search results for sensitive topics such as human rights appear deadlocked. Yet, even in the light of this digital crackdown, many brands are still recognising the potential in China.

Yes, Google’s departure will likely lower the competitiveness of China’s search industry – even if temporarily – and will certainly affect the search site’s partners. The prospect of higher search ad rates will no doubt worry marketers too. But, for both Baidu’s and Google’s rivals in China, the development will represent a strong call-to-action. Baidu is unlikely to remain unchallenged for very long.

China’s internet is also at a far earlier stage of development that in the US, meaning that online habits are still in their formative stages. Beyond search, there are plenty of opportunities for advertisers looking to leverage digital media. Even now, according to a report in Advertising Age this week, “few focus on search ads, veering instead toward Tencent’s QQ.com portal, social-networking sites such as Renren.com and online retail stores connected with Alibaba Corp.’s Taobao.com e-commerce platform.â€� (more…)

A report published in AdWeek this week, entitled ‘Going for the Gold in Global Marketing’, has highlighted the importance of thinking local in global marketing campaigns – using by way of illustration the various subtleties international marketers need to be aware of when planning campaigns due to roll out in the key BRIC economies.

Despite the inherent potential of these markets, for any marketer unfamiliar with the terrain, there are challenges to overcome. It is wise, for example, to avoid depictions of violence and corruption within ads in Brazil, since, we are told, Brazilians “wish for the media, to express alternatives to the social problems of poverty, street crime, and corporate and government corruption.”

In order to make a positive impression in China, it is important to emphasize your brand’s history or prestige. The country places a high value on tradition and longevity.

Meanwhile, what sells in Moscow may not impress buyers in St Petersburg, while Russian consumers have grown increasingly savvy, and the market is so dynamic that they “appreciate advertising that is as sophisticated, witty and subtle as they consider themselves to be…â€� (more…)

Now, more than ever, we live in a procurement-led world. The Financial Times reports that US advertising agency TBWA/Chiat/Day has appointed a new “chief compensation officer� to lead its negotiations on the fees it charges clients. “It is a sign that this agency has had enough of being squeezed by its clients’ procurement officers,� says the report. “Marketing is fighting back.�

At least it’s trying to. Yes, it’s common knowledge that chief executives can have a tough time knowing exactly what value has been derived from marketing spend. Add to this ongoing and international economic woes, and the job of selling products and services isn’t easy. Sadly, some would say, the world portrayed in Mad Men, doesn’t exist any more. We’ve moved on.

But have we really? The report in the FT is correct when it suggests that experimenting with new approaches, new business models, can lead to the interests of customers falling between the cracks of organizational silos. All too often, silos don’t work. As a consequence, many a structural change – client and agency-side – has failed to meet the demands of international marketers and their procurement departments.

Harvard Business School’s Ranjay Gulati claims that too many marketing departments describe themselves as “customer-centric� when in fact, “They look at customers only through the lens of existing products.�

True, but what compounds the problem is that international marketers must learn to look through the lens of the country markets they operate in. (more…)

Advertising Age took a worldwide look at the state of digital marketing this week, having surveyed executives at ICOM, a global network of independent ad agencies, about the top digital trends and issues facing their markets in 2010.

The findings underscore the importance of understanding local trends and behaviours as marketers worldwide seek to leverage the growing power of digital marketing. They also highlight the opportunities available to those marketers who do grasp regional peculiarities and differences – and harness these – as internet use continues to increase and evolve in key country markets.

For example, we are told that in Brazil and Estonia Google-owned social networking site Orkut is proving popular. Social media is a hot topic in both markets.

Take global restaurant chain T.G.I. Friday’s in Brazil. It used Orkut, Twitter, Facebook and YouTube to launch (more…)