2. Literature Review
2.3 GIMC
2.3.2 Standardization vs. Adaptation
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Therefore, to fill out this gap, in the following section the research includes the discussion related to standardization versus adaptation in the past literatures.
2.3.2 Standardization vs. Adaptation 2.3.2.1 Advertising
The debate between standardization and adaptation in international marketing has been going on for more than four decades without a consensus. The issue of standardization was first raised by Elinder in 1961 with reference to adverting (Jain, 1989) and until now advertising continues to be the focus in this field. There are three basic approaches to global adverting—standardization, adaptation, and a combination of both (compromise school and contingency perspective) (Kanso, 1992; Onkvisit and Shaw, 1990). They are as follows:
1) Standardization
According to Levitt (1983), standardization is defined as “selling the same product the same way everywhere.” Advocates of standardization assume that markets are converging and consumers around the world are becoming homogenized due to technology and increased communication (Levitt, 1983). They believe the basic human physiological and psychological needs are still the same. Thus, advertising campaigns can be successfully transferred to another country and that standardized themes can create unified brand images worldwide.
The benefits of employing standardization in advertising are many. The two major ones are cost savings and consistent brand image (Melewar and Vermmervik, 2004).
By standardizing advertising worldwide, costs are reduced for economics of scale. It also helps convey consistent and uniform image worldwide so that brand recognition is built. Other advantages include sharing of successful experiences and simplified planning, coordination, and control for organizations (Buzzel, 1968; Kanya, 2000).
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Duncan and Ramparasad (1995) also found that single brand image is the main reason for multinational companies to employ standardized advertising.
2) Adaptation
Proponents of adaptation posses the opposite view to standardization, arguing that cultural differences do exist and contradicting Levitt’s (1983) propositions of
homogenization of markets and consumers. Other than cultural differences, there are still many factors that prevent standardization from working successfully and
effectively, such as different economic development, political and legal system, technological environment, and consumer values and lifestyles (e.g., Boddewyn et al., 1986; Cavusgi et al., 1993). Due to these differences, it is necessary develop adaptive advertising.
3) Compromise
Unlike the extreme approaches of standardization and adaption possess, compromise school propose a contingency point that views standardization versus adaptation as a continuum. Proponents of this school recognize local differences but also to some degree believe advertising standardization is possible and desirable (Onkvisit and Shaw, 1990). Thus, global advertising can fall anywhere on a spectrum form totally standardized to totally localized (Moriarty and Duncan, 1991).The degree to which the companies take standardized or adaptive approach depends on the
situation. Such strategy, somewhere between complete standardization and adaptation, makes this school a contingency approach to global advertising.
However, the definition of a standardized advertisement remains unresolved.
Some take more strict approach, saying that an advertisement is global only if it is unchanged in all countries except for translation (Onkvisit and Shaw, 1990). On the other hand, some take more flexible position like Harries and Attour (2003), who suggested that standardization can be adapted to market conditions. Melewar and
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Vemmervik (2004) reviewed the former literatures and concluded that the visual element (picture) seems to be the most important elements from a standardization perspective.
Melewar and Vemmervik (2004) also pointed out that a corporation can standardize the market strategy (i.e. advertising objectives, target segment and position, final market decision, etc.), but it doesn’t mean that tactics (i.e. advertising themes, market layout, media selection, etc.) must be standardized. This is similar to Duncan and Ramparasad’s (1995) definition of standardization, which is “keeping one or more than the three basic components of multinational advertising
campaign—strategy, execution, and language”—the same. In their study, strategy is the creative selling proposition, and execution refers to actual elements and their structure in ads. Language is considered a separate element because there are
situations when all executional elements of a multinational ad are standardized except the language. They found that creative strategy was often standardized in
multinational advertising campaigns, while execution was only sometimes standardized, and language and nationality were rarely standardized.
Based on Duncan and Ramaprasad’s work (1995), Wei and Jiang (2005)
proposed a model of international advertising strategies focusing on two dimensions of standardization: creative strategy and execution. Here creative strategy refers to “a policy or guiding principle that specifies the general nature and character of message to be designed.” On the other hand, execution is defined as “a selection of advertising appeals, copy, and illustrations to execute the chosen creative strategy.” Different combinations of strategies and execution suggest four categories: global strategy, glocal strategy, local/ country specific strategy, and single case strategy as shown in Figure 2.4.
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Figure 2.4 A Model of Dynamics between Standardization in Creative Strategy and in ExecutionSource: Wei and Jiang (2005)
1) Global strategy
A global strategy refers to advertising which is highly standardized in both
creative strategy and execution in all markets. Advertising messages including themes, positioning, illustrations, and copy remain unchanged, except for the translation
needed. Simply put, this is “one voice, one look” for a global market. However, a research done by Hite and Fraser in 1988 indicated that only 10% of U.S. companies adopted this strategy worldwide (Wei and Jiang, 2005).
2) Glocal strategy
A glocal strategy highly standardizes the creative strategy but leaves room for adaptation in execution. The term “glocalization,” which combines globalization and localization, identifies the spirit of “think globally, act locally.” According to Hite and Fraser (1988), the majority (54%) of U.S. companies pursued a glocal strategy.
3) Local/ Country Specific Strategy
Local/ country specific strategy represents that both creative strategy and Type II: Glocal Strategy
Highly Standardized Strategy Type III: Local/ Country
Specific Strategy Adapted Strategy Adapted Execution
Type IV: Single Case Strategy
Adapted Strategy Highly Standardized Execution
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execution are adapted to the local market. This strategy, exactly the opposite of global strategy, employs “one voice for each market” and takes cross-cultural differences into considerations. In Hite and Feaser’s (1988) study, about 34% of U.S. companies used local/ country strategy.
4) Single Case Strategy
Single case strategy localized the creative strategy but standardized the execution.
Wei and Jiang (2005) pointed out that his strategy is a special case and rarely used in real practice. Thus, it was excluded from their study.
Wei and Jiang (2005) used this model of global advertising strategies to examine Nokia’s advertising campaigns in U.S. and China, and found a glocal strategy was employed. They pointed out that culture is a key external factor that influences the degrees of standardization at the strategy and execution levels.
Furthermore, the result also showed that culture seems to have a greater impact on execution than on creative strategies, which also echoes the former research proposing that strategic decisions are more likely to be standardized than tactical decisions (e.g., Duncan and Ramaprasad, 1995; Tai, 1997).
Johansson (2002) also suggested that the best strategy is often to start with a basic creative concept that has proved successful in a leading market, and then allow local managers to adapt the theme to local markets and local media. He divided international advertising into global advertising and multidomestic advertising.
According to Johansson, global advertising is more or less uniform across many countries, often, but not necessarily, in media vehicles with global reach while multidomestic advertising is international advertising deliberately adapted to particular markets and audiences in message and/or creative execution. He
specifically categorized global advertising into three types: 1) Identical ads, in which only language voiceover is changed and copy translation is added while the overall
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structure remains the same; 2) Prototype ads, in which the voiceover and the visual may be changed to avoid language and cultural problems; the ads may also be reshot with local spokespeople but still using the same visualization; 3) Pattern
standardization, in which the positioning theme is unified but the actual execution of the ads differs between markets.
Among the three types, Johansson (2002) suggested that pattern standardization has become the most common approach among practitioners since it employs a unified positioning theme but still allows creativity flexibility at the local level.
Creative Strategy
Figure 2.5 Combination of Wei and Jiang’s model and Johnssan’s typology of global advertising
Compared Wei and Jiang’s model of international advertising strategy with Johansson’s typology, we can see that the former focuses more on the structure of standardized strategy while the latter goes deeper to executions of standardization.
Both two help us develop a clearer picture toward what and how global advertising means and represents. As shown in Figure 2.5, identical ads fall into the quadrant of
Type II: Glocal Strategy Type I: Global Strategy
Type III: Local/ Country Type IV: Single Case Strategy
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global strategy; prototype ads and pattern standardization into the quadrant of glocal strategy, with prototype ads closer to the global strategy since they have the same visualization. What is in common is that they all view standardization versus adaptation as a continuum instead of an either/or question, and they determine the degrees of standardization based on the same criterion—strategy and execution (tactics). What’s more, the role of strategy seems more important than executions when distinguishing whether the ads are standardized or not. As long as the strategy remains the same, the ads can be viewed global, belonging to either global or glocal strategy.
Although the discussion related to standardization and adaptation mainly focuses on advertising field, some scholars also tried to apply them to other marketing
communications like public relations, sales promotions and direct marketing. The following sections provide the summaries of these researches.
2.3.2.2 Public Relations (PR)
The role of public relations is to use communication to build relations with strategic publics that shape and constrain the mission of the organizations (Grunig et al., 1995). The debate on whether public relations can be global and practiced in different countries is similar to the debate between standardization and adaption in advertising. Public relations scholars who possess ethnocentric perspectives have argued that public relations practices should be no different from their own culture (e.g., Illman, 1980). On the other hand, scholars who maintain polycentric
perspectives have argued that public relations practice should vary from country to country (e.g., Botan 1992; Huang, 1997).
Therefore, some scholars proposed the middle-road approach suggesting that the ideal model for international PR lies somewhere in between (Vercic, J. Grunig, and L.
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Grunig, 1996). They argued that effective public relations share 10 generic principles4 across cultures even though the specific variables (e.g., political system, economic system, culture, extent of activism, level of development, and media system) should be taken into consideration when being applied in different nations (Rhee, 2002). The global public relations theory has been examined in the former researches and those generic principles are found to be applicable in other countries (e.g., L. Grunig, J Grunig, and Vercic, 1998; Kaur, 1997; and Huang, 1997). Similarly, Anderson (1989) took a flexible approach, defining global public relations as “an overall perspective on a program executed in two or more national markets and recognizes the
similarities among audiences while necessarily adapting to regional differences (p.413).”
Witnessing the wide discussion on advertising concerning globalization, Ovaitt (1988) suggested that PR people can learn from the experiences of global marketing and advertising, although PR is arguably more culturally bound than either two. One of the most important lessons stated by Ovaitt (1988) is that whether the company pursues a high degree of program standardization or not, the benefit of standardizing management process and planning systems around the world can be expected such as international transfer of skills or sharing of inspirations. He pointed out that there have been more and more PR managers recognize this concept and try to implement certain basics for their practices worldwide.
Although few researches have discussed the standardization and adaption of the
4 1. PR is involved in strategic management.
2. PR is empowered by dominant coalition or by a direct reporting relationship to senior management.
3. PR function is an integrated one.
4. PR is a management function separate from other functions.
5. PR unit is headed by a manager rather than a technician.
6. The two-way symmetrical model of PR is used.
7. A symmetrical system of internal communication is used.
8. Knowledge potential for managerial role and symmetrical PR.
9. Diversity is embodied in all roles.
10. An organization context exists for excellence.
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public relations, it is inferred that some principles can be standardized while some should be kept local. Ovaitt (1988) proposed that the public relations, like advertising, can also view standardization versus adaptation as a continuum and thus a global PR program needs not be highly controlled without any room for local creativity. He also pointed out that the strategies of the public relations can be shared and implemented in different ways in different cultures, which seems to correspond to the glocal strategy discussed in the previous section—standardization of strategy and the adaptation of execution. Therefore, the current research would suggest that public relations, similar to advertising context, can also be examined from two main aspects—strategy and execution. As long as the main theme of the PR program remains the same worldwide, it can be counted as a global PR activity despite how it is executed.
2.3.2.3 Sales Promotion
Traditionally sales promotion has been considered as a local activity because the purpose of sales promotion is to “motivate local consumers and members of the trade to act—to try the product, repurchase it, buy more, switch brands, and so forth (Kashani and Quelch, 1990, p. 38).” Economic development, market maturity, regulations and laws, and people’s perceptions toward promotional incentives vary from country to country and these are all factors that keep sales promotion a relatively local affair. However, with the increasing costs and complexity of sales promotions worldwide, and the trend of establishing uniform brand images, managers in
multinational corporations companies start to consider the possibility of employing a standardized strategy in all markets (Kashani and Quelch, 1990).
Despite the debate of keeping sales promotion either a local activity or a more standardized strategy, Kashain and Quelch (1990) proposed a contingency approach,
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suggesting that the degree of coordination across countries depends on whether the brand is local, regional, or global. As shown in Figure 2.6, three possible scenarios in international sales promotion are proposed.
Minimum Maximum
Subsidiary Headquarter
influence Influence
Maximum Minimum
Local Regional Global Low International Brand Uniformity High
Figure 2.6 Influence and Roles in International Sales Promotion Source: Kashain and Quelch (1990)
1. Global brands
When the brand is positioned as a global brand, the influence of headquarter is the largest and thus standardized strategy is often used. The headquarters here are
responsible for developing an overall promotional strategy to guide the general activities of local management. These guidelines help protect the integrity of the brand across different markets and convey a consistent message to consumers
worldwide. However, it is emphasized that the promotion designs and executions are still better left for the local government even though headquarter decides the strategy.
-Design -Execution Adoption + Adaptation
-strategy Strategy -design -Cross-Fertilization -execution -Information Transfer
-strategy Cross-Fertilization -design - information transfer -execution
Information transfer
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2. Regional brands
The overall objective of regional brands is to create brand harmonization instead of standardization, and thus it is more like adaptive approach. The role of center is to help cross-fertilization across countries while the country managers are responsible for handling adoption and adaption to see what should be adopted from the region and how they are adapted to local condition.
3. Local brands
With local brands the degree of local influence on promotional decisions is at its maximum, and the need for central coordination is nonexistent. The center’s task for the local brands is simply information transfer. All the promotion strategy and executions are left for the local government.
2.3.2.4 Direct Marketing
According to Direct Marketing Association (DMA), the definition of direct marketing is “an interactive system of marketing which uses one or more advertising media to affect a measurable response and/or transaction at any location.” The basics practices of direct marketing include catalogues, direct mails, telemarketing, and so on. Because of the nature of itself, direct marketing has been considered traditional and nationalistic (Shultz, 1994; Spiller and Cambell, 1994). Direct
marketing relies on lists, postal services, and some types of financial payments, which requires an understanding of local market and thus everything is supposed to be tailored to specific target audience. However, due to the development of technology like Internet databases, efficient postal services, growing use of credit cards, and quick transportation and delivery services, direct marketing is growing fast as a global market (Light and Somasundaram, 1994; Mehta, Grewal, Sivadas, 1996; Shultz, 1994).
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Topol and Sherman (1994) conducted a research on how firms developed their direct marketing strategy when entering another foreign country and found that the majority of firms (80%) would like to modify their direct marketing strategy, among which only 6% plan to launch a whole new strategy. Only 20% would like to follow the original strategy in another country. This suggests that international firms prefer adaptive strategy to standardized strategy when employing direct marketing in another country. Furthermore, the research also showed that catalogues (43%) and direct mails (41%) would be the most popular means when expending their businesses, followed by foreign distributors (33%), direct selling (23%), print (13%), telemarketing (11%), and magazines (10%). The emphasis on cooperating with foreign distributors also implied the need for direct marketers to understand the local market.
As what is mentioned above, communication technology has made direct marketing become a global business. Shultz (1994) called the new communication technology as “information superhighway,” built up by Internet, satellite, and cable system, and it has gradually changed direct marketing into a global concept as well as a global activity. He further suggested that the biggest change of direct marketing would be from “outbound to interactive.” In the past, direct marketers sent out the information by mails or telephones and then passively waited for the consumers to reply, which were one-way, outbound communication. However, technology like online databases can help direct marketer easier target the prospects, get consumer insights, and interact with them. In addition, products and services are available on the Internet so that consumers worldwide can have purchases whenever they want, not when the marketers want to sell. In this way, the process has become two-way and interactive communication. On the other hand, it also helps overcome the barriers for direct marketers like entering a foreign country (Mehta et al., 1996).
From the former literatures, we can see that communication technology has made
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direct marketing, which used to be local and national, to become global. However, the adaptive strategy seems to be more applicable because of the nature of direct
marketing itself. Since not many researchers have focused on the global strategy of direct marketing, it is not easy to specify what a standardized or adaptive direct marketing strategy is. Nevertheless, through the research done by Topol and Sherman (1994), one thing is sure that some parts of the direct marketing can be standardized
marketing itself. Since not many researchers have focused on the global strategy of direct marketing, it is not easy to specify what a standardized or adaptive direct marketing strategy is. Nevertheless, through the research done by Topol and Sherman (1994), one thing is sure that some parts of the direct marketing can be standardized