Monday, February 11, 2008

Global Markets-What you sell defines how you sell

Allright, I admit my interest in Global marketing arose from a work requirement, but heck, McKinsey articles are not always my bedtime read [I know, biz school is supposed to make me think deep thoughts 24/7 but I refuse to fill my bedside table with research articles by consultant as yet]. My personal interest in companies reaching out to Global markets arose from the fact that I used to live in India when McDonalds made its entry [yep, i am not ashamed to say I made my weekly trek and stood in line for 45 minutes for a McDonalds meal]. Much as the advent of a Global company caused excitement, I believe its strong success arose from the fact that McDonalds customized. There was not a single McMenu in the country that served hamburgers--nope! there were pizza pies, and veggie pies and Veggie burgers.

Cut to 2007, opportunities in global markets for clothing retailers are described thus in the McKinsey article [subscription required]

""China: Small budgets, small wardrobes" shows how the country’s fickle consumers and strong local competitors threaten to undermine the multinationals’ efforts.
"India: Shopping with the family" explains the different roles that Indian women, men, and children play in making decisions about apparel and the way the market there is evolving.
"Brazil: Fashion conscious, credit ready" describes that country’s enthusiastic shoppers, as well as the efforts of banks and retailers racing to meet their credit needs. "

I related the most to the description of the Indian families, but note how differently the multinational retail chains, for example, would need to customize their offerings based on spending patterns. Last I checked, about 10% of India's retail sales came from 'chain' stores-yes, urbanization is changing all that. But remember, rural population and semi-urban cities are still strong.

So in effect, if a Macy's were to think of inroads into global markets given the sinking numbers in US, they could not carry forth their US marketing tactics to each of these countries. How different would the products need to be? How different should marketing and service be? [altering is a BIG necessity in Indian clothing biz] and how would loyalty programs change? Hardly any retail store in India offer 'credit cards' [there wouldnt be many takers anyway]. They do, however, have redeemable point cards [a HUGE hit]

The store to watch out for , I believe, is Wal-Mart. This is the only truly diverse brand I have seen so far, even in how it communicates to its audience in US. I see regular ads for Wal-mart on Indian channels. And their entry into countries like China includes customized offerings like 'bazaar like' fish markets and in India, they plan for a 'market-like spice stall'.

Yep, there are a lotta crazy things going on with Wal-Mart. But they get the idea of 'diversified marketing' and 'customized offering' in a way no other retail store has, so far.

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