Managing brands in global markets

Abstract

Should you create a uniform global brand or a set of independent local brands? While the world has moved closer to the idea of monolithic global brands envisioned by Ted Levitt more than two decades ago, not all brands have moved in that direction nor is it likely that they will. Some companies such as Coca-Cola or Starbucks have developed valuable global brands. Other companies such as Campbell Soup have many brands that are unique to local markets. Many companies such as Procter & Gamble, Unilever, or Toyota have a diverse mix of global and local brands. The authors point out that this diversity of approaches is the result of competing forces affecting branding strategy. The forces of increasing homogenization of customer requirements, globalizing competitors, and global marketing effectiveness are driving increased globalization; however, inherent market differences, entrenched local brands, growing channel power, and opposition to global brands are pushing companies toward local identity and adaptation. Decisions to use global and local brands are complex and depend upon a mix of factors, including products, industry, cultures, and competition. The authors discuss choices about developing brands along this spectrum and also examine the key strategies for managing brands globally using coordinating mechanisms that include global business teams, research-based brand planning processes, and metrics and incentives for encouraging collaboration. A s mentioned in the previous chapter, in 1983 Ted Levitt took a strong and controversial position – that “the globalization of markets is at hand.”