Global marketing and the shifting balance of power

pharmafile | June 23, 2008 | Feature | Sales and Marketing |  US, global, marketing 

As a marketer in the international pharmaceutical world, it is very likely that the brand we are responsible for has a global presence, available and marketed in many different countries. But are global campaigns an increasing problem for marketers, or do they offer an opportunity to support local needs with significant resource, freeing you up to focus your energies on other key, local issues? When should we raise concerns about a global campaign, and should we in fact be rocking the boat at all?

In the world of pharmaceutical marketing, the experience of many is of a frequent conflict between the demands of global brand teams and the needs of local marketers. A common complaint is that a US voice in an international brand team generally prevails, and even continues to act independently regardless of global consensus. UK and European marketers often find themselves advised to implement the US brand format across their markets, and have to fight hard to make any changes, despite the very different market environment.

This means marketers need to consider if, and to what extent one should adapt a global brand and/or its campaign and also how we might better influence the development of the global brand. To illustrate this question, we will draw on some examples from FMCG highlighting why this could be a good environment to learn from, with its history, experience and expertise in global branding.

Why is this important now?

This area is particularly pertinent now because the geographical power balance in the sector is set to shift, thereby affecting how we view our global brand. The US market has been the bastion of pharma profit for decades, and now accounts for around 50% of total industry sales. But the American pharmaceutical payers and consumers, despite the latter continually swelling in numbers, are reassessing health spending and are beginning to resist mounting pharmacy bills. Add to this an apparently impending economic downturn/recession difficulty in the US, and 50 million American citizens being unable to afford medical insurance and essential drugs, it would seem likely that consumers and politicians will intensify their focus on the US drug spend, the single biggest source of pharma's profits.

For many years its size, liberal advertising rules and relatively free pricing system ensured the US market was the focus for brand development, with global brand aspirations fulfilled by a replication of the US campaign across the world.

But these changes in the US means the industry will soon need to re-think the global commercial balance, and reassess investment and mid-term strategies to support its marketing outside the US. Part of this restructuring will involve a greater need to develop and execute truly global pharmaceutical brands.

This shift in the commercial epicentre of the pharmaceutical world means the sector must optimise its results in other markets. As marketers we aspire to truly understand our customers and work closely with complex local issues, such as culture, attitudes, beliefs and complex healthcare structures. Using a single culture based brand execution is therefore highly unlikely to result in the necessary local competitiveness required to sustain a successful future for our product.

A quick review: Brands and how to develop them

A brand is the sum of all the characteristics, both tangible and intangible which make your offering differentiated or unique in the minds of target customers, adding value and developing a relationship over a simple functional interaction (how does popping a cork on a champagne bottle make us feel and why is it so different to drinking sparkling wine?).

So how do we go about developing our brand? First we develop the 'brand vision' which is the internal expression of the goals and aspirations for our brand, based on an insight about the future market that defines the brand's opportunity, and uses relevant and specific language which reflect our core values. We then consider the more practical aspects of the product, outlining the consequences and emotional implications of the functional product attributes and the particular unique selling proposition we defined.

Having considered both our aspirations for the brand and the emotional benefits derived from the functional attributes of the product, we then need to consider what is the best balance of functional benefits, emotional benefits and perceived value for money, ie the 'brand value equation' (why are we so much more particular about buying shoes rather than socks?). These processes then allow us to develop our brand positioning by considering what we want target customers to 'know', 'believe', 'do' and 'feel' about our brand and its opportunity for them.

Subsequently, our whole process is crystallised in the "core proposition" – a single consistent expression of the brand and its essence and finally the developed visualisation and imagery is termed the 'brand identification'.

Given an increasing acceptance of global communication, a greater focus on RoI by pharma companies with strained pipelines and a slowdown in the once fast-growing US market, our futures as marketers we will be increasingly driven by clear success and evidence of efficiency of our marketing. A global brand can therefore be highly attractive as it can deliver these efficiencies in cost as well as control and clarity of positioning,

However, there may be situations where adapting the global brand is likely to be the most successful and efficient option. Given the need for maximum efficiency and success at local level we should therefore be prepared to challenge the status quo, but on an objective, not a subjective basis. So, how can you identify that moment for your brand?

The first question you must ask yourself is "why do you want to change the global brand"? We often find the motivation for adaptation is based on a misconception that the core brand is wrong locally, when in reality it is the local execution that is causing the trouble – and in fact the core proposition has clear local relevance.

You must make sure you are not confusing global brand with global execution. If we do jump to such conclusions, we are in danger of missing the opportunities to profit from greater brand efficiencies and larger global brand resources. By working back to core branding principles and assessing the global proposition in our local market we could save ourselves much time, effort and unnecessary expense!

When considering if we need to adapt the global brand, we need to be clear and ask:

1. Have our international colleagues really developed a global brand?

If we are missing clarity on the brand vision, the brand positioning and the core proposition, then we must make it clear that we need more clarity on the global brand.

2. Is the global brand meaningful, credible, competitively differentiated, motivating and sustainable for our target customers?

If not, then we may need to go back to the drawing board to help tighten things up.

On the basis that we do have the clarity, differentiation and sustainability on the global brand, then we need to consider whether the 'brand drivers' or the 'market drivers' are different in our market to those on which the global brand is based.

We all know of brands that have different names at a local level due to legal or language restrictions. While that does not affect the overall brand value, it is a key consideration if it fails to communicate the fundamental brand values.

For example: Motorola is pronounced 'me de lou la' in Cantonese, meaning 'nothing to take'. In some southern Chinese dialects, the Peugeot 416 is pronounced 'si yi lu' meaning 'die all along the road'. The Coca-Cola name in China was first read as 'Kekoukela', meaning 'Bite the Wax Tadpole' or 'Female Horse Stuffed with Wax', depending on the dialect. Coke then researched 40,000 characters to find a phonetic equivalent 'kokoukole', translating into 'Happiness in the Mouth'. This is also culturally relevant, since the Chinese have a fondness for names that express goodwill. Far more in line with the core brand values but an example of local execution, not a fundamental change to the brand.

Another vital consideration is that not all markets are in a similar state of development; perhaps the treatment paradigm is different with an emphasis on different classes of drugs, or the unmet need on which the brand opportunity is based is just not recognised in a particular market. In which case there is work to do at local level to develop customer's thinking. The core brand may be valid but we will need to focus local communication more on establishing the 'know' of the brand positioning (ie that the unmet need is an issue) than the 'believe', 'do' or 'feel'. Yet again, execution not brand per se.

If we have looked at the drivers and found some inconsistencies, then we need to establish how far we need to adapt.

Is it just about execution?

When we work through the different drivers, what we often discover is that in most cases the vision, positioning and core proposition of our brands will stand up across international borders. This means the majority of work we have to undertake is to ensure that our brand proposition is clearly communicated in a locally acceptable manner.

FMCG companies have been considering how to maximise their global brand potential for many years and have found that although many global brands are highly successful, they do not always work. Many successful global brands express clear core values in a relevant and appropriate way which is adapted specifically for the local market: in the words of Intel, successful brands express a "global chassis, local body" or as we classified earlier, a global core proposition and local brand execution.

Despite working for many years on establishing as tight a global execution as possible, some FMCG brands have recognised the value of local execution but still want to achieve the efficiencies that result from centralised development. Coca-Cola replaced its global advertising and branding campaign with more tailored local and regional strategies. In one case a core selection of 10 adverts together with images and music was produced. Local managers could then put together and edit advertising packages that were most appropriate for their local consumers. In another case, Mercedes-Benz implemented a similar local adaptation strategy using a single ad agency to create a menu of five campaigns. Brand managers in each country were then able to choose the campaign which suited their local market the best. This halfway house ensures that campaigns are of suitable size to benefit from the economies of scale and central control, whilst at the same time delivering a more tailored and more locally efficient result.

Although FMCG doesn't reflect many of the complexities and technicalities of the complex pharmaceutical market we are all working in, these examples do illustrate the ongoing search for an ideal global/local brand mix. By considering the real drivers behind our local brand elements we can optimise our marketing efficiencies.

Conclusion

Global marketing in the pharma sector is here to stay, and indeed is becoming more and more commonplace. That means when, why and how we adapt the global brand is a continual area for heated debate. While some arguments for global brands seem spurious, there is no doubt that the drive for cost efficiencies global brands are here to stay. However, by working through the core developmental elements of a brand, and understanding their relevance, local brand teams can identify which parts of their brand need to be adapted, whether it is the brand vision, the core proposition or simply the local brand execution.

Given the shift in the commercial balance of power in pharma globally and an increasingly global communications platform for brands, we need to get to grips at a local level with achieving greater marketing efficiency. If we truly want to be successful, surely we are best placed by using the resource and efficiencies of our global brand and only adapting it where entirely necessary, to deliver local advantage.

However, it can be just as dangerous to assume it will work as it is to challenge the global brand. Be brave and do what's best for your market.

Box: When global brands have to adapt

Most marketers will be familiar with one or two examples of global brands which have failed to translate well into overseas markets – often with unintended comic results.

Motorola is pronounced 'me de lou la' in Cantonese, meaning 'nothing to take'. In some southern Chinese dialects, the Peugeot 416 is pronounced 'si yi lu' meaning 'die all along the road'.

The Coca-Cola name in China was first read as 'Kekoukela', meaning 'Bite the Wax Tadpole' or 'Female Horse Stuffed with Wax', depending on the dialect. Coke then researched 40,000 characters to find a phonetic equivalent 'kokoukole', translating into 'Happiness in the Mouth'.

This is also culturally relevant, since the Chinese have a fondness for names that express goodwill. Far more in line with the core brand values but an example of local execution not a fundamental change to the brand.

Experience and appreciation of cultural differences are especially important in the region, and HSBC (The Hong Kong and Shanghai Banking Corporation) has now promoted itself in these terms since 2002, when it coined the slogan "The World's Local Bank".

Nova goes on anyway: One of the best known stories of cross-cultural calamity is that concerning the Chevrolet Nova. In Spanish-speaking Latin America, 'no va' means 'doesn't go' and the story goes that the company had to hurriedly change the name once the mistake was noticed.

However, the story is too good to be true, and never happened. Despite its apparently unfortunate name, the car sold well in Latin American markets, and the manufacturer never had to consider changing its name.

Michael Craig is a consultant at the MSI Consultancy. He can be contacted at mcraig@msi.co.uk or visit www.msi.co.uk for further information