Explain how the below key concept are linked to this case (i.e. how the key concepts you have learned in this topic is applied in this case study?)

Question 1 Case Specific Question from H&M: International Marketing Success Story

How does H&M strike a balance between standardisation and adaptation of its marketing program? What advantages does H&M gain from standardisation? From adaptation?






Question 2

Explain how the below key concept are linked to this case (i.e. how the key concepts you have learned in this topic is applied in this case study?)



  • Global market segmentation

Developing a marketing strategy requires managers to assess the unique foreign market environment and then make choices about market segments, targeting, and positioning. Global marketing strategy is a plan of action that guides the firm in how to position itself and its offerings in foreign markets, which customer segments to pursue, and to what degree its marketing program elements should be standardized and adapted. A global market segment is a group of customers who share common characteristics across many national markets.


  • Standardization and adaptation of international marketing

How management balances adaptation and standardization determines the extent to which the firm must modify a product and its marketing to suit foreign markets. On the whole, firms prefer to standardize their products to achieve scale economies and minimize complexity. A global market segment is a group of customers that shares common characteristics across many national markets. Positioning strategy involves using marketing to create a particular image of a product or service, especially relative to competitor offerings, among the firm’s customers worldwide.


  • Global branding and product development

A global brand is perceived similarly in all the firm’s markets and increases marketing strategy effectiveness, allowing the firm to charge higher prices and deal more effectively with channel members and competitors. In developing products with multicountry potential, managers emphasize the commonalities rather than the differences across countries. The development of global products facilitates economies of scale in R&D, production, and marketing. Innovation and design in international product development are increasingly performed by global teams—internationally distributed groups of people with a specific mandate to make or implement decisions that are international in scope.


  • International pricing

International prices are determined by factors both internal and external to the firm that often cause prices to inflate abroad. A special challenge for exporters in pricing is inter- national price escalation—the problem of end-user prices reaching exorbitant levels in the export market, caused by multilayered distribution channels, intermediary margins, tariffs, and other international customer costs. Transfer pricing is the practice of pricing intermediate or finished products exchanged among the subsidiaries and affiliates of the same corporate family located in different countries. Gray market activity, also known as parallel imports, refers to legal importation of genuine products into a country by intermediaries other than authorized distributors.


  • International marketing communications

International marketing communications involves the management of advertising and promotional activities across national borders. Managers are often compelled to adapt their inter- national communications due to unique legal, cultural, and socioeconomic factors in foreign markets. Firms must also accommodate literacy levels, language, and available media.


  • International distribution

Firms usually engage foreign intermediaries or foreign-based subsidiaries to reach customers in international markets. Some firms bypass traditional distribution systems by using direct marketing. Channel length refers to the number of distributors or other intermediaries it takes to get the product from the manufacturer to the market. Long channels are relatively costly. In working with key business customers, firms may undertake global account management (GAM)—ser- vicing key global customers in a consistent and standardized manner, regardless of where in the world they operate.





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