Adapting Global Brands To Succeed In India and China

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Adapting Global Brands To Succeed In India and China

What should a company do when none of its customers understand the term office supplies? How does a coffee brewer sell its primary product to a nation where tea is the national drink? These are some of the questions multi-nationals face when trying to tap into the world’s two largest markets, India and China.
Adapting to local tastes is a part of any company’s strategy, but this tends to complicate global logistics. It can be done, but needs close management and can lead to growth and make money. Take Starbucks for example. Since homes in China tend to be small, Starbucks positioned its cafes as an attractive place to spend time between home and work, becoming a critical meeting place and social nexus. In addition, the company focuses very heavily on customer service in China and offers a variety of green tea-based beverages as well as food and other products. But it is not easy to convert consumers. Company employees note that customers come in, buy a cup of coffee, keep the cup and refill it with other brands of coffee through the day. To increase brand visibility and foster more loyalty, Starbucks has engaged in a number of marketing programs in the country, even remaining true to its U.S. image as an advocate of sustainable practices.
Experts say that in China, since the current generation is experiencing brands like Starbucks for the first time, they want to experiment, which makes generating loyalty really tough. It is ultimately what happens inside a retail location that will determine what brand a customer chooses. Also, a customer in these countries is more interested in what a product can do, not by the brand name alone. Also, lineage and heritage is important, so brand ambassadors have a strong role to play.
Tweaking a brand slightly to adapt it to different countries is something that office supply retailer Staples is very familiar with, according to Lukas Ruecker, the company’s vice president for emerging economies. Ruecker presented a case illustration demonstrating how the company branded itself in both China and India. Instead of trying to stick to the exact product offering they have in other markets, Staples has altered its mix to suit each culture. To market their offerings in China, the company uses catalogs, direct marketing, billboards and other outdoor ads. Staples also tapped into the growing desire for credit among Chinese consumers. A large part of the revenues also come from office furniture and furnishings.
In India, restrictions on FDI in the retail sector make it necessary for multinationals to partner with Indian firms for opening stores in the country. Staples tied up with the Future Group and its product mix leans heavily towards electronics and appliances like printers and computers. The concept of office supplies is alien to the Indian mindset and the name conveyed a meaning of a grocery store, which the company worked hard to overcome.
 The picture is yet not clear on how much impact the big box retailers will have on a market largely dominated overwhelmingly by the small ‘mom-and-pop’ stores. Maturity may be as far away as ten to fifteen years, according to some experts.

Source: Testfunda.com
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