AM 65

International Marketing

PREGRADO - UPC

International marketing adaptation versus standardisation of multinational

companies

Members:

Omar Perea
Vargas Vega, Arn
Frank Pantoja
Arlhey Zamora
Pedro Santillana
Giovanni Noratto

Teacher: Carlos Alcocer

Section: AM65

Cycle: 2017-02
August, 2017
1. Most important facts

An investigation was conducted based on UK multinational companies,

belonging to five industrial sectors: manufacturing, services, transport and
communication, construction and sales.

The research consisted of a questionnaire with open and closing questions,

these were designed to obtain the tactical level of adaptation of the
multinational companies and the standardization when emigrating to other
markets. This research work combines two methodologies to address the
proposed objectives, the first is the RASCH model and the second the SEM.
The RASCH model is mainly used to develop and validate attitude scales and
to measure respondents' attitudes to questionnaires. On the other hand, the
SEM method was used to model equations.

As a general result of the models used to measure the tendency of

multinational companies towards the adaptation of their international marketing
practices, it can be said that there is a greater need to adapt to different
markets compared to the need to standardize. The research found that it is
irrational to attempt to homogenize the mix of their marketing, except in certain
categories of product, however, it is true that the world market is increasingly
homogenized, so that they can market their products in the same way in the
different international markets.

2. Most important findings

As the most important findings we start from the importance and necessity of
adaptation and standardization simultaneously. However, there are some
extreme stocks of both sides (adaptation and standardization) that defend their
position.

Supporters of standardization affirm the existence of increasingly homogenous

and global markets in scope and scale. Because of this they assert that the key
to survival and growth is the ability of multinational corporations to standardize
their goods and services.

On the other hand, proponents of adaptation claim that even in countries with
similar cultures or regions of the same country there are insurmountable
differences due to many factors. Some of them are: macro environmental,
social, technological, cultural, among others. Other authors expand this list by
mentioning factors such as: income, taxes, labor costs, levels of education,
among others.

If something is true, it is what some scholars suggest; Certain tactics must be

standardized but it is also necessary to know how to adapt to different and
changing market conditions.

There is no an all or nothing, but heterogeneous markets in many aspects

which do not allow a complete standardization and entail implementing models
that incorporate both approaches. In this way you can obtain the effectiveness
and benefits of both concepts.

3. Limitations

That the study was performed in companies headquartered in UK, for that
reason, we can't generalize the results.

The studies only were brought by the the directors of Marketing. This gives us
a shorter idea about the study.

The sample that we used wasn't probabilistic.

The survey's questions weren't appropriated for all companies for the diversity
of its activities.

4. Additional Information

First, its important to relate to the strategies of standardization and adaptation,

depending on the popularity of the brand and the specific place. That is, it is
good to use both concepts but it depends on the situation. For example, the
entry of MC Donalds to India with an exclusive Salad Bar, there is a clear
example of adaptation. However, brands like Coca Cola include the two
processes according to their convenience.

The international strategy of this brand includes standardizations, for example

in aspects of design and communication, etc., but at the same time there are
adaptations in the creation of products for specific markets.
On the other hand it is important to take into account the franchise model,
since it is one of the most used and profitable in the world. In this way, both
standardization and adaptation will have to be used

In conclusion, the internationalization strategies of companies must know how

to understand parts of the marketing mix should standardize models across
relevant markets, and in which cases they should be tailored to local needs.

5. Who could use this information?

Firstly, we have such information will be so relevant for companies working

locally and want expand through a global strategy to other countries and also,
to those that working with these now.

In this way, evaluate and consider what aspects of standardization and

adaptation consider doing 15 the marketing strategies convenient for the given
situation. Even though, we know that both have some benefits, like scale
economics to the first one and consideration of culture to the swcond one, both
are determined and specific.

In the other hand, we have this information is useful for marketing pracritioners
and marketers, as these investigations give to these people an ubication of the
international marketing contex and complications. Besides, is important to say
that such investigations are relevant for locations where companies want
expan, because in 15this position they can evaluate, make deals, sell, rent,
etc.

Eventually, it's important for all consumers to determinated in what condition is

their nation and if their culture will affect companies that want to incorporate
with a measure of standardization.