Factors Affecting Advertising Approach in Asia

Abstract

The adoption of a regional advertising strategy in the Asian market is becoming popular due to rising living standards and the growing similarity of consumer tastes in the region. The main objectives of this paper are to: (1) investigate the advertising approach adopted by the multinationals, and (2) identify the factors affecting the extent of advertising standardization in The People's Republic of China, Taiwan, Hong Kong and Singapore. The multinationals using a “Global” approach appear to adopt a standardized strategy with a higher degree of centralization, while those using a “Local” approach are more likely to adopt a differentiated strategy with a more decentralized advertising process. However, a firm using a “Regional” approach will tend to adopt a regional approach with a more centralized structure. A “Decentralized/Global” approach, on the other hand, is a global advertising strategy with a more decentralized advertising process. The findings of this study show that the major approach pursued by the multinationals in Chinese markets tends to be “Regional.” As “Regionalization of advertising” is becoming a significant trend, it is, therefore, important for multinationals to rethink their Asian strategies. The nine variables affecting the extent of advertising standardization—product type, country-of-origin of the firms, competitive situation, political risk, advertising regulation, target segment, stage of product life cycle, organization experience and control, and market infrastructure—are also discussed in an Asian context.