“How to win multi-market business” at global summit of Columbus, world’s leading independent media agency group?

Brand Growth in a Socially Transparent World- May 10, NY. Join Us!

New York, May 10 2012 – International brand owners now have the opportunity to communicate with their customers in a fluid and highly localized manner. But this freedom can also backfire and damage brand consistency, equity and sales.

Challenged to deliver a single coherent and impactful message to their customers around the world, brand managers are learning the hard way how to deal with embarrassing and costly local mishaps due to social media. The Internationalist 100, a global marketing think tank, has asked Textappeal’s Founder and CEO Elliot Polak to address this hot topic. Other speakers include VPs of Global Marketing from Dos Equis, Xerox Corporation, BNY Mellon, PepsiCo International.

News

Market localization for Starbucks means foie gras sandwiches in France and ‘bacon butties’ in the UK.

Following a recovery in the US market, Starbucks is looking to improve its performance in Europe. The region has proved elusive to the high street coffee chain. Some see this as a symptom of the dominance of European café culture.

In order to achieve a surge in sales Starbucks has decided to localize its services according to individual countries to tailor their services to different cultures.

Michelle Gass, Head of EMEA at Starbucks, underlined the need to adapt to markets where the espresso is king. “Europe is espresso territory,” she stated. “To compete, we must absolutely deliver the best latte on the High Street.”

Food will also play a major role in the changes to the European business plan. Localized menu options will include “bacon buttie” sandwiches in the UK and foie gras sandwiches in France.

Behind The News

Café culture in Europe has posed a challenge to Starbucks as it attempts to dominate the market. In the US the company was able to steer clear of the economic downturn by offering discounts for the first time in its history.

This willingness to adapt is extending to the European market. Starbucks are changing the recipe of their small lattes in the UK to include two shots of espresso rather than one. Gass told Reuters that selling more lattes will more than offset the cost of adding the extra espresso shot.

Like McDonald’s before them, who refitted their European restaurants for a chicer look, Starbucks have decided that you cannot roll out a global model but need to localize your services for different markets.

News

Last week’s post focused on Kraft’s risqué new name for their snack food spin off. This week, we decided to look at Kodak, who some claim might have survived if they had created new names for different markets.

People have been critical of Kraft’s ‘Mondelez’ as it has sexual connotations in Russian. However unlike Kraft who is trying to innovate, some believe Kodak failed as a result of lack of innovation. Al Ries, an American marketing expert, argues that Kodak ultimately failed because its name was unable to translate into a manufacturer of digital products.

In 1996, Kodak was the world’s fourth biggest brand, behind Disney, Coca-Cola and McDonald’s. How come the top three have survived whilst Kodak has fallen by the wayside?

If some have attributed Kodak’s decline to their inability to spot the trend for digital, Al maintains that this is not the case, citing the invention of the digital camera by Kodak in 1976. During the years 1985 to 1994, Kodak ploughed $5 billion dollars into research and development.

Behind the News

For Ries, the name Kodak was so rooted in film photography that consumers could not make the transition to digital photography with them.

Perhaps Kodak might have had more success if it had invested money into creating a new name for the digital branch of the company, separating themselves from the film photography branch.

Ries uses the example of Eveready, the market leader in batteries that was overtaken by Duracell. Although Eveready produced alkaline batteries, consumers expressed little interest in this new innovation. When Eveready finally realized the potential benefits of giving this new product a new name, they went with Energizer, but it was already too late to rival the power of Duracell.

The right name can make or break a product. Although Kraft’s name choice was risky, they should be commended for trying to innovate and expand their business across boundaries. A little more help from linguistic experts specializing in creating names for products entering foreign markets might have proved less controversial.

News

Kraft Foods announced the new name of their snack foods spin off last week. Kraft’s Chief marketing Officer described it as “interesting, unique and captur[ing] a big idea.”

‘Mondelez’ is said to evoke worldwide deliciousness. If we break the word down, monde means “world” in French, and delez, with a long E in the final syllable, is a play on “delish”. But according to Russian speakers, when pronounced “mohn-dah-LEEZ,” the name has different connotations.

Certain Russian speakers have claimed that the new name sounds like a term for an oral sex act in Russian.

Leading Russian professor, Irwin Weil, has confirmed that it’s a vulgar term. He states “There is a rather vulgar word, ‘manda’ (манда́). [Mondelez] includes the sound of that word.” The second half of the name roughly translates to the act of licking, say Russian speakers.

Behind The News

Kraft has a growing presence in Russia, targeting women with their products. This situation illustrates one of the challenges of applying a single name across numerous countries and cultures.

The name was suggested by Kraft employees and went through all the necessary procedures in testing; comprising two rounds of focus groups in 28 languages, including Russian. The results of the test concluded there was a low risk of misinterpretation in any language.

The name is yet to be fully approved. Shareholders will have the final word on the matter when they meet on 23rd May.

News

An attempt by Nike to pay homage to the Irish in the run up to St. Patrick’s Day has backfired.

The limited edition shoe launched in the US was inspired by a drink composed of stout and pale ale, two typically Irish ingredients. The concoction’s colour fades from dark to light brown, earning it the name the “black and tan”. Although it might seem like an Irish beverage, the drink is not served regularly in bars in Ireland. The name recalls the nickname given to the Royal Irish Constabulary Reserve Force. Active in the 1920s, the “Black and Tans” were notorious for brutality during the independence war.

Nike has apologized if the shoe’s name has caused offense. Nike officials stated that ‘Nike SB Dunk Low’ was the shoe’s official name and that the black and tan label was attributed by other sources.

Behind The News

To illustrate the degree of offense caused, Ciaran Staunton, president of the Irish Lobby for Immigration Reform, drew a modern day parallel. He claimed that the naming of the shoe “would be the American equivalent of calling a sneaker ‘the Al Qaeda.” Staunton seemed perplexed that no one at Nike had realized the connotations of the name. Other commentators on social media have pointed out that Nike only needed to search the term “black and tan” on the internet to discover its unsavory connotations.

Despite the negative publicity, it seems unlikely this misstep will damage the Nike brand in the long term due to its openness and quick corrective action.

Thinking World First. Elliot Polak looks at the success of brands from the Middle East with Mahsa Motamedi, Amer Bitar, Karam Annab and Matthew Willsher.

Dubai Lynx 2012

News

The removal of posters publicizing Jean Dujardin’s latest film may have been pivotal to his Oscar success.  

Jean Dujardin is the toast of Hollywood since winning the Best Male Actor Oscar for The Artist last week. His latest film, Les Infidèles, is a series of sketches on male infidelity directed by Dujardin among others. It has come to light since the Oscars that a controversial scene was cut from the film. The scene in question featured Dujardin’s character in a New York hotel room entertaining his mistress; as he reassures his wife on the telephone that everything is fine, a plane can be seen crashing into the World Trade Center through the window behind him. The potential to offend Americans and consequently jeopardize Dujardin’s chances of winning the Oscar may have led to the scene being withdrawn from the film.

The posters for the film also caused controversy as they showed a suited Dujardin from the waist up, holding onto a bare woman’s legs with the tagline, “I’m just heading into a meeting”. This poster, one of four that appeared on Parisian billboards, was removed last month after calls of sexism. The distributor issued an apology.

Behind the News

The removal of the scene from the film and the posters’ disappearance prove that if an actor is to win the coveted Oscar, he has to have an unblemished reputation.

The posters could have been removed due to an awareness of American sensibilities and especially those of Academy voters. The French newspaper Le Parisien hinted that the poster could be detrimental to Dujardin’s Oscar hopes as America “doesn’t joke about this kind of saucy picture”. Although the posters were made for French audiences, coverage of the posters went global, showing vigilance on the part of the film industry is necessary if the publicity in one country is not to have a negative effect on its success elsewhere.

In order to secure an Oscar for France’s hottest leading man the makers of Les Infidèles withdrew the posters and the World Trade Center scene. This action illustrates the need for the film makers to submit to US rules of political correctness to ensure the success of the film in foreign markets.

KitKat Flavour Variations, Japan

News

The Japanese food market can be particularly hard to crack for foreign brands. Ask Mars, who have finally managed to get M&Ms and Snickers onto Japanese shelves after thirty five years of hard work. This is only part of the battle though. The next step is competing with domestic brands that dominate the packaged food market in Japan thanks to their unrivalled insight.

A worthy rival has been found in the form of KitKat. So what is its secret to success?  KitKat’s popularity in the Japanese food market can be attributed to solid investment by Nestle since its launch in Japan in the 1970s. Consumers in Japan have a notoriously short attention span, with products battling to stay relevant in the market. KitKat has constantly been innovating new flavours, such as green tea and wasabi, to keep the Japanese public interested in the product. Nestle have produced over 200 limited edition flavours.

KitKat have been successful because they have been able to satisfy the exacting demands of Japanese consumers in terms of product quality and packaging. Luck may also have played a role in the product’s success. The name KitKat resembles the phrase “Kitto Katsu” meaning “surely win”, a term of good luck in Japan. This explains why the chocolate bars are so popular during exam time which runs from January to March in Japan.

Behind The News

Nestle have understood what it takes to be successful in the Japanese market and adapted their strategy accordingly. Instead of marketing KitKat primarily as a snack for people on the go, they are often sold as gifts due to the limited edition status of certain products.

Winning over Japanese consumers represented a challenge for Nestle but also an opportunity to make an inroad into the Asian market. Thanks to smart cultural and consumer insights, the chocolate coated wafer has come a long way from its humble origins in 1930s England, to its global success.