Why is Global Branding Important?
- Improved effectiveness in products or services over time
- Greater advantage against competitors
- Increased customer awareness
Having a brand that is immediately recognizable has many benefits – especially if this is a favorable reputation. Increased revenue and loyal customers are some of the many benefits a firm may experience.
Being recognized globally also gives you an edge over competitors; this is especially true when new firms are trying to enter the market. A firm that is associated with stability, quality and success will have strong market share that would be hard to compete with.
Strategies to Build a Global Brand
- Differentiate yourself
- Understand your customers
- Know how your brand is perceived outside of the home country
- Build a team with consistent views and goals
It is important for a firm to differentiate themselves outside of price. If price is a basis of competition then customers will be fickle. Furthermore, differentiation will allow companies to form a deeper connection with customers as customers see that their needs are being attended to. Technology has made the world smaller. The ability to communicate with your customers and address their wants and needs is very crucial in this day and age.
Understanding the customer is also critical to the success of global branding. Factors such as culture and language are important. A company would not want certain terminology to be misinterpreted. For example, Chevrolet created the Nova. It is considered a classic car in the United States. However, when Chevrolet tried to introduce the car in Mexico it did not sell very well. This is because “no va” translates to “does not go” in Spanish. That is not a very effective name for a car.
Another instance of failure was Target's attempt to enter Canada. They assumed they could simply set up in shop in Canada. They thought that cultural similarities between Canada and the United States were good enough reasons. What they did not take into account was for language differences such as French. Target also failed to realize that there were already existing department stores that Canadians preferred. This case study shows how important it is to study consumer behavior and preferences.
Another element to global branding is consistency. Companies such as Apple, McDonald's and Starbucks have been able to create a standard that is consistent globally. This is achieved through having consistent views and goals at all levels of business.