1. Benefits and Drawbacks of Adaptation
Zebra Corporation is based in the United States and wants to begin selling its main product, laser printers for personal computers, in Russia. Generally, laser printers are made from standard parts. However, when sold internationally, some modifications are made to adapt the product's power supply (e.g., voltage requirements and shape of the plug for electrical outlets) and internal software to suit specific language requirements. Zebra management is developing an international marketing plan to decide on the design of the printers that it will sell in Russia, as well as their pricing, promotion and distribution, among other things.
(i) From Zebra's standpoint, what are the main advantage(s) of selling a standardized product in Russia?
(ii) What are the main advantage(s) of adapting the product for selling in Russia?
(iii) What are the market related factors that typically affect product adaptation decisions? (E.g., in the case of Zebra, language is a factor that necessitates adapting the product to the Russian market.) Please give several examples of how and why the most important of these factors can lead to product adaptation for the local market.
(iv) Zebra management is concerned that its pricing might be too high, given the lower income level of typical Russian consumers. What steps can Zebra take to help reduce the pricing on its laser printers for sale in Russia?
2. Identifying and Exploiting Opportunities
For sophisticated international firms, assessing global markets, opportunities and challenges is an ongoing process. Levi Strauss is the largest manufacturer of trousers, notably denim jeans. Countries differ in their tastes and fashions, which necessitates adapting products and services. Levi regularly seeks new opportunities to sell its products and reduce its worldwide operating costs. As it enters new foreign markets, Levi must surmount various challenges. For example, the firm had to substantially adapt its approach in Islamic countries, where women are discouraged from wearing tight-fitting attire and generally do not interact with male sales personnel. In Japan, local preferences and the smaller physique of many Japanese required Levi to make its blue jeans tighter and smaller. Levi does much of its manufacturing in low-cost countries, in order to reduce production costs. Levi sells its trousers in over 100 countries, and international shipping and logistics pose various challenges. Recently, in order to find new markets and cost-saving ideas, Levi managers decided to conduct a global market opportunity assessment.
(i) Summarize the process that Levi should undertake when performing such an assessment, and provide some examples of what Levi management might learn in the course of such an assessment.
(ii) Describe the screening methodologies that Levi could employ in order to find potential foreign markets.
(iii) Identify some key global macro trends that might affect Levi's international business, and how the firm could take advantage of these trends (e.g., Levi might find new customers in particular world regions). What are some of the lessons learned by other companies and how could Levi's take advantage of these lessons.