One of the most important tasks for the global marketer today are the decisions surrounding the product and service mix. There has never been a greater or more diverse demand for consumer products and services. Industrialized and emerging markets present challenges that companies must face to succeed internationally. Purchasing power is increasing, which indicates that the buyer has more sophistication and preference in how, when and why they spend money. The Internet has allowed consumers to access information on all available options, resulting in greater competition between firms. Below I will discuss what I believe to be the most important factors to consider when going global with a product or service.
Global Product/Service Mix for Consumer Goods (b2c):
For today’s consumer, purchasing decisions are driven by getting the best quality products for most affordable price. Consumers have a unprecedented level of knowledge concerning the products and services they pay for. Nowadays, companies compete more intensely to gain a prospects attention, which stresses the importance of innovation. For the global marketer, maintaining quality products may require physical or mandatory changes be made in order to adapt to the legal, economic, political, technological or climatic requirements of a local marketplace. These adjustments may be as minor as new packaging, or as complex as the total redesign of a core product. In many countries, this term is known as product homologation, describing mandated changes by local product and service standards. Green marketing, or the marketing of products in the most environmsentally-friendly way, is also a large concern for international product development. There are many guidelines issued by country that force companies to cooperate with environmental regulations. Overall, the global marketer must remember to have predetermined and specific processes for product adaptation in new markets.
Culture is the other factor that separates a standardized product from an adapted one. Although cultural influences may not cause a product to change by law, they certainly play a role in how customers perceive the value associated with goods and services. The challenges related to adapting your products to a new country or region are similar to introducing a new product in your home country. The product must be presented in a way that it meets the needs, tastes, and patterns life of the target market. Consumers must first accept the idea of the product, and then actually make use of it. For a global marketer, it is key to study the culture of your intended market. Develop and market the products or services your customer wants, not just what has worked for others in the past.
The use of innovation can be crucial to a global product mix. When entering a new market, innovative products must diffuse through a society; that is they must be communicated through a series of channels, over time, among members of social system, that establish them as desirable. Basically, the more innovative a product is, the more difficult it is to gain market acceptance. Truly innovative products may not catch on, and companies need to assess the risks involved in going global.
Lastly, it is essential to understand that a product or service is not just one “thing.” An organization must analyze all of the different components that may undergo change. When considering your global product mix, make sure you understand how each of the following components will perform in a new market. Always identify components that are potential weaknesses in your product.
- Product Platform
- Design Features
- Functional Features
- Brand name
- Repair and maintenance
- Spare parts
- Other related services