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Reading – week 7 Global Branding Strategies For many firms, the brands they own are the more valuable assets. A brand can be defined as “ a name, term, sign, symbol or combination of them which is intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of competitors.” Linked to a brand name is a collection of assets and liabilities – the brand equity tied to the brand name. Global branding A key strategic issue that appears on international marketers’ agenda is whether or not there should be a global brand . A truly global brand is one that has a consistent identity with consumers across the world. One advantage of having a global brand name is obvious: economies of scale. Parts of the task of brand managers is building up brand awareness. By its nature, a global brand has much more visibility than a local brand. Prestige factor  being global adds to the allure of the brand. One important question here is also how consumers value global brands: 1. Quality signal: Consumers perceive global brands as high in quality. 2. Global myth: Consumers look at global brands as cultural ideas (sense of belonging) 3. Social responsibility: Consumers also expect global brands to have a special duty to address social issues, to act as good citizens. Cross-country gaps in brand equity may be due to any of the following factors: 1. History: by necessity, brands that have been around for a long time tend to have much more familiarity among consumers than latecomers. 2. Competitive climate: the battlefield varies from country to country. In some countries, the brand faces only a few competitors. 3. Marketing support: Especially in decentralized organizations, the communication strategy used to back up the brand can vary a great deal. 4. Cultural receptivity to brands: Another factor is the cultural receptivity toward brands. Brand receptivity is largely driven by risk aversion. 5. Product Category penetration: A final factor Is the salience of the product category in which the brand competes. The higher the product usage, the more solid will be the brand equity.

Local Branding A local linkage can also prove helpful in countries where patriotism and buy-local attitudes matter. In many emerging markets, once the novelty and curiosity value of Western brands wears off, consumers switch back to local brands. This is partly a matter of affordability. McDO is an extensive luxury in most developing countries. When choosing between the local and foreign product, consumers may also prefer the local alternative because of animosity toward the foreign country. If the local brand name stems from an acquisition, keeping the local brand can be preferable to changing it into a global brand name. The brand equity build up over the years for the local brand can often be a tremendous asset The local brands are positioned at the bottom or medium end while the global brands cover the upper end of the market. Branding Local brands have often humbled global brands in EMs. Assuming that consumers in EMs even the affluent ones, will pay a premium for global brands can be a fatal mistake. Preferences for local versus global brands vary by category. Ex : shampoo and oil in india.

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