By Prema Nakra, Ph.D. email | bio

The year was 1997. The management at MasterCard (a credit card company) came to the rude awakening that their branding and positioning strategies left much to be desired. Their brand did not stand for any one thing nationally or globally. Over the years MasterCard had run through five different advertising campaigns without much marketing success.

The management team, in partnership with a global advertising agency, decided to develop an advertising campaign that would differentiate the brand in the national marketplace. The campaign with the unique selling proposition of “Priceless” was indeed successful. The positioning created by “Priceless” allowed MasterCard to integrate all of its campaigns and marketing practices within the U.S.

At that time, every country where MasterCard was marketed was using a different agency, a different campaign, and a different strategy. As the “Priceless” branding campaign succeeded in the U.S., it served as a platform that helped MasterCard persuade other countries to adopt a single approach. Over time, MasterCard’s “Priceless” became a consistent global positioning statement.

The “Priceless” campaign was adopted by 96 countries and was translated into 45 languages, and it now forms the framework for all of MasterCard’s total brand communications. The concept that started as an advertising strategy became a marketing platform on its way to becoming a successful global brand platform.

Welcome to the new world where global branding and positioning is being increasingly adopted in a world that Thomas Freidman considers to be “Flat.” Building local, regional or global brands with a clearly defined and understood target audience is a challenge of global proportions. In this article I will discuss the challenges of global branding and why it may not be the only branding strategy for success in the global market environment.

Power of Global Branding

As you move toward enhancing or solidifying your international presence, you will be faced with a tough decision: is global branding right for you? Before you make this decision, let’s first explore what it means to develop a global brand. Quite simply, a global brand can be defined as the worldwide use of a name, symbol, design or any combination of these elements to identify an organization or firm and to differentiate it from its competitors.

Global branding requires achieving a high degree of consistency in visual, verbal and tactical identity across multiple geographies. Global branding delivers a consistent customer experience worldwide and is often supported by a comprehensive and integrated global marketing effort.

McDonald’s is a brand that has returned to its roots by shedding distracting acquisitions, simplifying their core offering, and adhering to a shared message globally. At the same time, McDonald’s appropriately modifies its approaches for greater regional relevance. Restaurants in France are more café-like in appearance, and the menu is tailored to the local culture. Espresso is in quick supply, and the chairs are neither molded plastic nor bolted to the floor.

Over the past five decades there has been a remarkable change in determining a firm’s value. Fifty years ago, nearly 80% of a typical firm’s value was made up of tangible assets—for example, its plant, equipment, inventory, land and work in progress.

Today, nearly 50% of a firm’s value is determined by intangible assets; items that generally don’t appear directly on the books and are harder to measure. A successful brand is considered the most valuable resource or asset of a company or organization, and brand equity is an intangible asset that does not yet appear directly on the books.

According to the 2004 Business Week/Inter brand survey, Coca-Cola tops the list of the 10 most valuable global brands ($67.4 billion), followed by Microsoft ($65 billion), IBM ($53.8 billion), General Electric ($44.1 billion), Intel ($33.5 billion), Disney ($27.1 billion), McDonald's ($25 billion), Nokia ($24 billion), Toyota ($22.7 billion) and Marlboro ($22.1 billion). These brands have a consistent name that is easy to pronounce; corporate sales that are globally balanced with no dominant market; a brand essence and position that is the same the world over; products that address the same customer needs, or the same target segment, in every market; and a marketing mix that executes similarly across cultures.

Pre-Requisites to Global Branding

A global brand is one that is available in many nations. Though it may differ from country to country, the local versions of that brand have common values and a similar identity. The brand’s positioning, advertising strategy, personality, look and feel are, in most respects, the same but allow for regional customization.

For a global brand to be a true global brand, it must also be consistent, not just in name, but in position and what it offers. Truly global brands are able to express a unique position to all internal and external audiences. The brand developers effectively use all elements in the communications mix to position within and across international markets:

Heavy Investment—Like any other asset, global branding and positioning requires heavy investment in establishing and communicating the brand name. For instance, in May 2005, Royal Philips Electronics kicked off the second wave of its global branding effort. The media plan included spending $100 million worldwide and $25 million in the U.S. on this phase of the campaign. In addition to being interactive, the company employed network and cable television, magazine and newspaper print ads, and airport ads in certain cities. The centerpiece micro-site, www.simplicity.philips.com, was designed to get the "Sense and Simplicity" brand message across to Philips' target audience.

Uniform Brand Associations—Global brands are developed with years of advertising, good will, beneficial attributes, customer experience and product quality improvement. Well-performing global brands enjoy strong awareness among consumers and opinion leaders, and, in many instances, lead an industry or multiple industries.

BMW has come to symbolize high performance in engineering and design for customers worldwide. It is also viewed as a status symbol for global customers who feel a sense of accomplishment at a personal and professional level as proud owners of this ultimate driving machine. The BMW brand’s association with prestige and quality are truly global.

By the same token Hyundai (a Korean automaker), sells two-thirds of its cars outside of Korea, has a multinational product portfolio, a worldwide slogan, and fairly consistent advertising. Despite all this, it is not a truly global brand because the Hyundai name carries very different associations and images in each of its country markets.

Targeting and Positioning—To have a global brand, it is necessary not only to use the same name in all markets, but also to have the same target and positioning strategies. Uniformity in targeting, branding and positioning is not always achievable given differences in competition. For example, Wal-Mart is renowned in North America as the prime low-price provider of branded goods and for always carrying fresh produce. However, in China it is difficult for Wal-Mart to position itself as the “guaranteed low-price” provider or even the supplier of the freshest produce, given the local farmers and vendors with whom it competes. The company’s position in the two markets is different.

Global Brands Demand Localization—Global brands should not claim to be American brands, European brands or Asian brands. They must respect local needs, wants and tastes and must adapt to the local marketplace while fulfilling a global mission. In other words, key to success in global market environment can be summed up in one word “Glocalization”

Is Global Branding Right For You?

Global adoption of a branding and positioning strategy that has worked well in your home country market does not guarantee that it will be successful in other countries as well. One must grant the local marketers sufficient flexibility to create a brand image that has resonance, while maintaining the core brand positioning.

Your product category may not be conducive to global branding.

There are certain product categories that do not lend themselves to global branding. Food is one such category where differences in tastes from culture to culture compel global companies to adapt to local conditions. At the other end of the globalization spectrum is a computer chip maker Intel, whose products and markets make it easier for executives to establish a truly global brand with a memorable catch-phrase: "Intel inside."

Businesses in the global semiconductor industry are more likely to adopt a global branding strategy than those in the food processing industry. Intel and its competitors, for example, market to original equipment manufacturers (OEM), which are using computer chips for the same purposes. Intel is a global brand that does not require much local adaptation and so is Disney, which stands for family entertainment in all cultures.

It is possible to have global, regional and local branding strategies at the same time.

Multiple brands marketed by multinationals with different brands for different market segments could result in different branding strategies for different country markets. The Nestle Company has a stable name of global and country specific national brands. Even though Nestle promotes its brand name globally, the brand extension strategy includes both national and global brands. Unilever also follows a similar strategy.

Final Words

In the final analysis global branding is a continuum along which you must decide how global you wish your brands to be. You may decide along one single global brand at one end of the spectrum and an assortment of nothing but local brands at the other.

Your branding strategy must be based on extensive consumer research and insights. Success will depend on the extent to which you take the insight you gain in your home country to a level where it actually cuts across every culture and country. Corporate self assessment is a prerequisite to a strategy development initiative. In developing the branding strategy for a global market such analysis will determine whether or not your firm has the culture, organization, processes and willingness to allocate the requisite financial and managerial resources to developing a truly global brand.

Top of Page