IB0011-Unit-06-International Product Policy and Planning

IB0011-Unit-06-International Product Policy and Planning Structure: 6.1 Introduction Objectives 6.2 Products: National and International National products International products 6.3 The New Product Development New product in international marketing 6.4 International Product Planning 6.5 Product Adoption and Standardization Product adoption Standardization 6.6 International Market Segmentation Geographic segmentation Demographic segmentation Psychographic segmentation Behavioural segmentation Benefit segmentation Vertical versus horizontal segmentation 6.7 Influences on Marketing Plan and Budget 6.8 International Product Marketing 6.9 Marketing of Services 6.10 Summary 6.11 Terminal Questions 6.12 Answers 6.1 Introduction After conducting adequate research on the product to be manufactured, companies move to the next important consideration-deciding the marketing mix. You learnt how marketing

research is carried out in global market, in previous unit. In this unit you will learn about the first P of marketing-Product. A product can be defined in terms of its tangible, physical attributes such things as weight, dimensions and materials. Thus, an automobile could be defined as 3,000 pounds of metal or plastic, measuring 190" long, 75" wide and 59" high. However, any description limited to physical attributes gives an incomplete account of the benefits a product provides. A product, then, can be defined as a collection of physical, psychological, service, and symbolic attributes that collectively yield satisfaction, or benefits, to a buyer or user. Objectives: After studying this unit, you will be able to: Differentiate between national and international products Discuss concepts of new product development, product planning and product adoption & standardization Identify the bases for international market segmentation State product influences on marketing plan and budget Compare international product and service marketing 6.2 Products: National and International Many countries find that, as result of expanding existing businesses or acquiring a new business, they have products for sale in a single national market. For example, Kraft Foods at one time found itself in the chewing gum business in France, the ice cream business in Brazil, and the pasta business in Italy. Although each of these unrelated businesses was, in isolation, quite profitable, the scale of each was too small to justify heavy expenditures on R & D, let alone marketing question regarding any products potential for expansion into other markets. The answer will depend on the companys goals and objectives and on perceptions of opportunity. 6.2.1 National products A national product is one that, in the context of a particular company, is offered in a single national market. Sometimes national products appear when a global company caters to the needs and preferences of particular country markets. For example, Coca-Cola developed a noncarbonated, ginseng-flavored beverage for sale only in Japan and a yellow, carbonated flavored drink called Pasturina to compete with Perus favorite soft drink, Inca Cola. Such examples notwithstanding there are several reasons why national products even those that are quite profitable may represent a substantial opportunity cost to a company. First, the existence of a single national business does not provide an opportunity to develop and utilize international leverage from headquarters in marketing, R & D, and production. Second, the local product does not allow for the transfer and application of experience gained in one market to other markets. A third shortcoming a single-country product is the lack of transferability of managerial expertise acquired in the single-product area. 6.2.2 International products International or regional products are offered in multinational, regional markets. The classic international product is the Euro product, offered throughout Europe but not in the rest of the world. The Renault is a Euro product: Offered in every EU market, it is clearly an international product; however, unlike the Toyota, for example, it is not an international product.

Note that a product is not a brand. For example, a portable personal sound or personal stereos are a category of international product; Sony is an international brand. An international brand, like a national or international brand, is a symbol about which customers have beliefs or perceptions. Self Assessment Questions 1. National products add to the opportunity cost of a company as it cant be used in any other country. (True/False) 2. International products and international brands are one of the same things. (True/False) 6.3 The New Product Development New product in international marketing In todays dynamic, competitive market environment, many companies realize that continuous development and introduction of new products are keys to survival and growth. What is a new product? Newness can be assessed in the context of the product itself, the organisation, and the market. The product may be an entirely new invention or innovation-for example, the Video Cassette Recorder (VCR) or the compact disc. It may be a line extension (a modification of an existing product) such as Diet Coke. Newness may also be organizational, as when a company acquires an already existing product with which it has no previous experience. Finally, an existing product that is not new to a company may be new to a particular market.

Figure 6.1: Product Development Process The eight stages are illustrated in Figure 6.1, which begins with a statement of the new product development strategy. Identifying new product ideas The starting point for an effective worldwide new-product program is an information system that seeks new-product ideas from all potentially useful sources and channels. Those ideas relevant to the company undergo screening at decision centers within the organisation. There are many sources of new product ideas, including customers, suppliers, competitors, company salespeople, distributors and agents, subsidiary executives, headquarters executives, documentary sources ( for example, information service reports and publications), and finally, actual firsthand observation of the market environment. The international new product department As previously noted, a high volume of information flow is required to scan adequately for newproduct opportunities, and considerable effort is subsequently required to screen these opportunities to identify candidates for product development. An organizational design for addressing these requirements is a new product department. The function of such a department is fourfold: (1) to ensure that all relevant information sources are continuously tapped for new product ideas; (2) to screen these ideas to identify candidates for investigation; (3) to investigate and analyse selected new product ideas; (4) to ensure that the organisation commits resources to the most likely new product candidates and is continuously involved in an orderly program of new product introduction and development on a worldwide basis. Testing new products in national markets The major lesson of new product introduction outside the home market has been that whenever a product interacts with human, mechanical, or chemical elements, there is the potential for a surprising and unexpected incompatibility. Since virtually every product matches this description, it is important to test a product under actual market conditions before proceeding with full-scale introduction. A test does not necessarily involve a full scale test marketing effort. It may simply involve observing the actual use of the product in the target market.

Self Assessment Questions 3. 7up Lemon was an entirely new invention by 7up. (True/False) 4. It is imperative to test the product under standard conditions before launching it into the global market. (True/False) 6.4 International Product Planning International product planning involves determining which products to introduce into which countries; what modifications to make in the products; what new products to add; what brand names to use; what package designs to use; what guarantees and warranties to give; what after sales services to offer; and finally, when to enter the market. All these are crucial decisions requiring a variety of informational inputs. Basic to these decisions are three other considerations: (1) product objectives (2) coordination of product planning activities between headquarters and subsidiary, and (3) foreign collaboration.

A company interested in an international market should first define its business intent based on the objectives of both the corporation and the host country. The product objectives of a company would flow from the definition of its business. Ultimately, the offering should provide satisfaction to the customer, which would be reflected in the realization of the goals of both the corporation and the host country. Product objectives emerge from host country and corporate objectives combines via the business definition. The companys goals usually are stability, growth profits, and return on investment. Stated differently, the corporate objectives may be defined in terms of activities (the manufacture of a specific product, or export to a particular market), financial indicators (to achieve a targeted return on investment), desired position (its market share and relative market leadership) and all these in combination with each other. The parent company usually also has a series of objectives on behalf of the various stakeholders interests for which it is accountable. Host country objectives vary depending on the countrys economic, political and cultural environment. Obviously, the objectives of the host country and the company are poles apart. In any emerging market worldwide, however, no company can hope to succeed without aligning itself with the national concerns of the host country. There are no models to use in seeking a description of such an alignment. Conceptually, however, a macro analysis of a countrys socioeconomic perspectives should provide insights into its different concerns and problems. The company can then figure out if its business would help the country in any way, directly or indirectly. The business definition should then be developed accordingly. For example, shortage of foreign exchange might be a big problem for a country. A multinational marketers willingness to pursue a major effort of export promotion in the country would amount to an objective in line with the countrys need. On the other hand, a company simply interested in manufacturing and selling such consumer goods as toiletries and canned foods, in a nation that is interested in establishing a basic infrastructure for industrial development in the country, may not be serving the national interest. The definition of product objectives should emerge from the business definition. Product objectives can be defined in physical or marketing terms. We sell instant coffee is an example of defining objectives in physical terms. In marketing terms, the objective statement would emphasize the satisfaction of a customer need. The latter method is preferred because it reinforces the marketing concept. The perspectives of international product planning can be categorized between issues of day to day concern on the one hand and strategic issues on the other. The day-to-day issues arise in implementing decisions already made. Strategic issues require major commitments, which must be taken up with the parent corporation. In addition to ad hoc problems, which may be day to day or strategic, the parent may require a periodic review of the subsidiarys plants. Product planning for established product lines and plans for the development and marketing of new product lines would then be prepared by each host country/geographic area and separately submitted to corporate management for approval. Self Assessment Questions 5. It is very difficult to market a new product with little or no experience in the global market. (True/False) 6. Companies that wish to enter the global market should first define its business intent based on objectives of the host country only. (True/False)

7. Usually the product objectives emerge from the _______________. 8. Wrangler-the jeans that built America is an example of defining objectives in _______________ terms. 6.5 Product Adoption and Standardization 6.5.1 Product adoption Before breaking into the foreign market, marketers must consider factors that influence product adoption. As explained by Diffusion Theory at least six factors have a bearing on the adoption process: relative advantage, compatibility, trialability/divisibility, observability, complexity and price. These factors are all perceptual and thus subjective in nature. For a product to gain acceptance it must demonstrate its relative advantage over existing alternatives. A product must also be compatible with local customs and habits. A freezer would not find a ready market in Asia where people prefer fresh food. A new product should also be compatible with consumers other belongings. If a new product requires replacement of those other items that are still usable, product adoption becomes a costly preposition. A new product has an advantage if it is being capable of divided and tested in small trial quantities to determine its suitability and benefits. This is a products trialability/divisibility factor. Disposable diapers and blue jeans lend themselves to trialability rather well. Observation of a product in public tends to encourage social acceptance and reinforcement resulting in the products being adopted more rapidly and with less resistance. Complexity of a product or difficulty in understanding the products quality tends to slow its market acceptance. This factor explains why ground coffee had a difficult time in making headway to replace instant coffee in many countries. 6.5.2 Standardization The strength of standardization in the production and distribution of products and services is in its simplicity and cost. It is an easy process for executives to understand and implement and it also is cost effective. If cost is the only factor being considered then standardization is clearly a logical choice because economies of scale can operate to reduce production costs. Yet minimizing production cost does not necessarily mean that profit increases will follow. Simplicity is not always beneficial and costs are often confused with profits. Cost reductions do not automatically lead to profit improvement and in fact the reverse may apply. By trying to control production costs through standardization the product may become unsuitable for alternative markets. The result may be that demand abroad will decline which leads to profit reduction. In some situations cost control can be achieved but at the expense of overall profits. It is, therefore, prudent to remember that cost should not be over emphasized. The main marketing goal is to maximize profits and production cost reductions should be considered as a secondary objective.

Self Assessment Questions 9. A new product is advantageous if it people can try it first in small quantity. This quality is referred to as ________________. 10. Cost reduction should be ______________ objective of business.

6.6 International Market Segmentation Market segmentation is the process of subdividing a market into distinct subsets of customers that behave in the same way or have similar needs. Each subset may conceivably be chosen as a market target to be reached with a distinctive marketing strategy. Some widely used bases of segmentation are discussed below in sub sections. 6.6.1 Geographic segmentation Geographic segmentation is dividing the world into geographic subsets. The advantage of geography is proximity: Markets in geographic segments are closer to each other and easier to visit on the same trip or to call on during the same time window. Geographic segmentation also has major limitations: The mere fact that markets are in the same world geographic region does not meant that they are similar. Japan and Vietnam are both in East Asia, but one is a high-income, post-industrial society and the other is an emerging, less developed, preindustrial society. The differences in the markets in these two countries overwhelm their similarities. 6.6.2 Demographic segmentation Demographic segmentation is based on measurable characteristics of population such as age, gender, income, education, and occupation. A number of demographic trends aging population, fewer children, more women working outside the home, and higher incomes and living standards suggest the emergence of international segments. For most consumer and industrial products, national income is the single most important segmentation variable and indicator of market potential. Annual per capita income varies widely in world markets, from a low of $81 in the Congo to a high of $38.587 in Luxemburg. The World Bank segments countries into high income, upper middle income, lower middle income, and low income. Age is another useful demographic variable. One international segment based on demographics is international teenagers young people between the age of 12 and 19. Teens, by virtue of their interest in fashion, music, and a youthful lifestyle, exhibit consumption behaviour that is remarkably consistent across borders. Young consumers may not yet have conformed to cultural norms indeed, they may be rebelling against them. This fact, combined with shared universal needs, desires, and fantasies (for name brands, novelty, entertainment, and trendy and image-oriented products), make it possible to reach the international teen segment with a unified marketing program. Another international segment is the so-called elite: older, more affluent consumers who are well traveled and have the money to spend on prestigious products with an image of exclusivity. This segments needs and wants are spread over various product categories: durable goods (luxury automobiles); nondurables (upscale beverages such as rare wines and champagne); and financial services (American Express gold and platinum cards). 6.6.3 Psychographic segmentation Psychographic segmentation involves grouping people in terms of their attitudes, values, and lifestyles. Data are obtained from questionnaires that require respondents to indicate the extent to which they agree or disagree with a series of statements. In the United States, psychographics is primarily associated with SRI International, a market research organization whose original VALS and updated VALS 2 analyses of U.S. consumers are widely known. 6.6.4 Behavioural segmentation Behavioural segmentation focuses on whether people buy and use a product, as well as how often and how much they use it. Consumers can be categorized in terms of usage rates for example, heavy, medium, light, and nonuser. Consumers can also be segmented according to user status: potential users, nonusers, ex-users, regulars, first-timers, and users of competitors products. Although bottled water may be considered a luxury product in some

high-income markets, Nestle is marketing bottled water in Pakistan where there is a huge market of nonusers who, despite their low income, are willing to pay 18 rupees a bottle for clean water because of the widespread presence of arsenic poisoning in well water and the pollution of surface water. Tobacco companies are targeting China because the Chinese are heavy smokers. 6.6.5 Benefit segmentation International benefit segmentation focuses on the numerator of the value equation the B in V=B/P. This approach can achieve excellent results by virtue of marketers superior understanding of the problem a product solves or the benefit it offers, regardless of geography. For example, Nestle discovered that cat owners attitudes toward feeding their pets are the same everywhere. In response, a pan-European campaign was created for Friskies dry cat food. The appeal was that dry cat food better suits a cats universally recognised independent nature. 6.6.6 Vertical versus horizontal segmentation Vertical segmentation is based on product category or modality and price points. For example, in medical imaging there is X-ray, Computed Axial Tomography (CAT) scan, Magnetic Resonance Imaging (MRI), and so on. Each modality has its own price points. These price points were the traditional way of segmenting the medical imaging market. One company decided to take a different approach and segment the same market by the health care delivery system: national research and teaching hospitals, government hospitals, and so on. It then rolled out a campaign that was regional, national, and finally International, which was tailored for each different types of health care delivery. This horizontal segmentation approach worked as well in markets outside the home-country launch market as it did in the home country. Self Assessment Questions 11. Segmenting the international market on the basis of age, culture, income etc. is known as ______________ segmentation. 12. Versace and Calvin Klein segment their market on the basis of ___________________. 6.7 Influences on Marketing Plan and Budget As you can imagine, many foreign markets differ significantly. Some differences include climatic and environmental factors, social and cultural factors, local availability of raw materials or product alternatives, lower wage costs, varying amounts of purchasing power, the availability of foreign exchange, and government import controls. Once you have decided that your company is able and committed to manufacture a product, the next step is to develop a marketing plan. A clearly written marketing strategy offers six immediate benefits: 1. Because written plans display strengths and weaknesses more readily, they are a great help in formulating and polishing an export strategy. 2. Written plans are not easily forgotten, overlooked, or ignored by those charged with executing them. If deviation from the original plan occurs, it is likely to be due to a deliberate and thoughtful choice. 3. Written plans are easier to communicate to others and are less likely to be misunderstood. 4. Written plans allocate responsibilities and provide for an evaluation of results.

5. Written plans are helpful when seeking financial assistance. They indicate to lenders that you have a serious approach to the export venture. 6. Written plans give management a clear understanding of what will be required of them and thus help to ensure a commitment to exporting. Actually, a written plan signals that the decision to export has already been made. This last advantage is especially noteworthy. Building an international business takes time. It usually takes months, sometimes even several years, before an exporting company begins to see a return on its investment of time and money. By committing to the specifics of a written plan, top management can make sure that the firm will finish what it begins and that the hopes that prompted its export efforts will be fulfilled. There are a few ways to determine what your marketing budget should be. The effectiveness of these will be determined by the type of business and the desired outcomes of marketing. If you are a new business owner it is a good idea to start your budget with all the money you can afford. This amount, even if it is small, will give the company a start in a positive direction. Another way to go about deciding a marketing budget is a percentage of companys sales. This works great for an established company that can look back over records and see how effective their budgets have been in the past. One more way that the company can look at your budget is simply by matching the competition. They must be sure that they are not being out done by keeping up with the competitors. All of these ways will give a company a good place to start. There are many factors to keep in mind that will also help in determining companys budget. Here are some things to think about when doing budget planning: You have to spend money to make money, it has been said before. If you feel like you have made the smallest budget, it may not be an effective budget. Marketing is not the best place to be cutting corners. If you are a new company or you just have a new product, there needs to be more advertising. When there is something new it requires extra attention in the marketing department. Add a little bit more to your budget to start your new product off right. Put your dollars where you get the best results. This will vary from company to company. There are many different ways to advertise, trial and error may be the way to find the best. Another idea is looking at a competitor, how are they advertising? They may have already endured the pains of trial and error! With a new product you will need more money initially. But remember that that product will only be new for part of your budgeting term. So you need to calculate how to taper off marketing for that product, and possibly factor in a new one. When you are working on your budget you should coincidentally be working on your whole marketing plan. They are so co-dependent that to finalize one without having the other in the works is going to end tragically. Let them work together and maximize each other. There are two ways to advertise and both need to be budgeted for, just another spoonful of food for thought.

Product Advertising: This consists of advertising your product. It may be the launching of a new product or service, or it could be remind consumers what you have to offer. This will differ throughout the year as well. Christmas is usually a huge time for toys and gifts, tax time requires more ads at the beginning of the year. Depending on the time span the budget covers these things will have to be kept in mind. Self Assessment Questions 13. For ____________ it is a good idea to start the budget with all the money they can afford. 14. It is better for firms if the marketing plan is in ___________ form. 6.8 International Product Marketing Product standardization and modification may give the impression that a marketer must choose between the two processes and that one approach is better than other. In many instances, a compromise between the two is more practical than selecting either process exclusively. Black and Decker have stopped customizing products for every country in favour of a few global products that can be sold everywhere. Such US publisher Prentice Hall and Harper Collins also have adopted the World Book concept, which makes it possible for English language book to have world copy writes. Publishers change, if necessary, only the title page cover and the jacket. World product and standardized product may some time be confused with each other. A world product is designed for the international market. A standardized product is product developed for one national market and then exported with no change to international market. A move towards a world product by a company is logical and healthy move. If a company has to adapt a product for each market, this can be very expensive proposition. But without the necessary adaptation a product might not sell at all. Committing to the design of a world product can provide the solution to these two major concern faces by most firms dealing with the international market place. It is a misnomer to think that a world product would be more expensive than a national or a local product since the world product may need multipurpose parts. Actually, the world product should result in greater savings for two reasons. First, costly downtime in production is not needed to adjust or convert equipment to produce different national versions. Second, a world product greatly simplifies inventory control, because only one universal part, not many individual parts have to be stopped. A world product may also be able to lower certain production costs by anticipating necessary local adaptation. As an example, the Japanese ministry requires 32 changes on most US built cars and the changes include: replacing of headlamps, because of left hand drive, dip in the wrong direction; changing sharp edged door handles; replacing outside rearview mirror, and filling the space between the body and the rear bumper to prevent catching the sleeves of Kimono-clad women. Honda is able to sell its US made cars in Japan at relatively low prices because it produces the cars ready for sale in Japan. Because cars manufactured by GM, Ford and Chrysler are built for the American market, they must undergo expensive alterations to meet Japanese regulations. The world products have some inherent problems also. A large number of manufacturers of cars in India do not have Euro-I and Euro-II modifications to check pollution. Hence, the cars, which are not having these modifications, cannot be registered in New Delhi (NCR). Similarly, Ford Escort car was designed in Europe as Fords world car. Self Assessment Questions 15. A __________ product leads to great savings due to cost reductions.

16. A ____________.product is made for the national market but later introduced in the international market. 6.9 Marketing of Services Internationally, the invisible trade is responsible for one fifty of the value of exports. The share of commercial services in the world trade has risen from 17% in 1980 to about 22% in 1993. Between 1980 and 1993 the average annual growth in trade in commercial services was 7.7% outpacing the merchandise trade. Due to information technology, communication costs will further decline. As a result, trade in services is very likely to continue to expand rapidly. The services sector has become very important. In the service oriented society on the earth it represents almost 60-70% of the GNP and employs about 70-75% labour force. The United States is the worlds leading producer and exporter of services. Services account for half of US production as well as about 80% of non firm private employment. US export of services has increased significantly from $86 billion in 1987 to $ 173 billion in 1993. The top services in exports are: tourism, transportation, financial, education and training, business, telecommunication, equipment (installation, maintenance and repair), entertainment, information and health care. Conceptual framework of market entry strategies is given in Figure 6.2.

Figure 6.2 In this, a service firms unique characteristics (e.g. low capital intensity and the inseparability of production and consumption) may have some impact on entry mode choice. In general, service firms prefer full control modes. But firms with low asset specificity in responding to the rising costs of integration or the diminishing ability to integrate may have to relinquish control and seek shared control avenues. In practice service firms can use virtually all market entry strategies when they are appropriate. In the financial services industry, American firms have entered into partnerships and joint venture agreements with European and Japanese firms. Wells, Fargo and Nikko Securities have formed a joint venture to operate a Global Investment Management Firm. Merrill Lynch and Societe Generale have discussed a partnership to develop a French asset backed securities market.

Self assessment questions 17. Generally it is seen that service firms prefer _____________ control mode of entry. 18. The choice of mode of entry depends on the service firms _________.

6.10 Summary Actually intangible products are a significant part of the export market. In many situations both tangible and intangible products must be combined to create a single total product. There are six distinct steps in new product development. The first step is the generation of new product ideas. The second step involves the screening of ideas. The third step is business analysis, the fourth is product development. Fifth step involves test marketing to determine potential marketing problems and the optimal marketing mix. In the sixth step assuming that things go well, the company is ready for full scale commercialization by actually going through with full scale production and marketing. In the product segmentation, the product cannot be marketed in a big way without it. Starting at the low end of product spectrum a Japanese firm establishes a reputation for product excellence and eventually gets customers to trade up over time. Before breaking into the foreign market, marketers must consider factors that influence product adaptation. Wool coats are not needed in a hot country and products reducing static cling (Cling Free) are useless in a humid country. World product and standardized product may some time be confused with each other. A world product is designed for the international market. A standardized product is product developed for one national market and then exported with no change to international market. A world product may also be able to lower certain production costs by anticipating necessary local adaptation. The world products have some inherent problems also. The countrys American Executives proceeded to redesign for the US Market. Glossary National Products: products that are offered in a single national market. International Products: products that are offered in multinational, regional markets Demographic Segmentation: it is based on measurable characteristics of population such as age, gender, income, education, and occupation Psychographic Segmentation: it involves grouping people in terms of their attitudes, values, and lifestyles Behavioural segmentation: it focuses on whether people buy and use a product, as well as how often and how much they use it 6.11 Terminal Questions 1. Differentiate between national and international products. Give examples. 2. How important is product testing, while preparing to launch a new product in the international market? 3. What are product objectives and how should they be decided? 4. What do you mean by product standardization? How is it useful? 5. How can the market be segmented on the basis of demographics and consumer behavior? 6. Is there a difference between product and service marketing? Justify your answer.

6.12 Answers Answers to Self Assessment Questions 1. True 2. False 3. False 4. False 5. True 6. False 7. Host Country 8. Marketing 9. Triability/Divisibility 10. Secondary 11. Demographics 12. Psychographics 13. New 14. Written 15. World 16. Standardised 17. Full 18. Characteristics Answers to Terminal Questions 1. Refer to 6.2 National products are made for a specific national market whereas international products are made for regional and multinational markets. 2. Refer to 6.3 Product testing is very important as it can indicate how the product is used in the target market. 3. Refer to 6.4 Product objectives define the intent of launching a product and should emerge from the host country. 4. Refer to 6.5 Product standardization is offering similar products to regional and international markets. 5. Refer to 6.6 Markets can be segmented on the basis of demographic variables like age, sex, income etc. and also on the basis of consumer uses and purchase time.

6. Refer to 6.8 and 6.9 The differences in marketing of products and services emerge from the difference in their characteristics. Mini-Case Tinker with Care Dabur tinkered with the product proposition for Lemoneez even after test marketing had cleared it. The reason lay in the choice of the city for test marketing: Bangalore. Sourcing the extract from a Bangalore-based plant, Dabur chose to test the product in the city in 1996. The test marketing ran for a year in which Dabur saw good institutional sales. Some 15,000 bottles were sold in just three months. The product was extended nationally by April 1998. It took off well. But by late 1998, the sales graph took a deep dive. Unlike Bangalore, the north has sharp winters and summers. As winter approached, prices of lemons dropped sharply. So did the buying, since consumers in the north bought it not so much for convenience as price. Also unlike Bangalore, other centres did not witness high institutional sales. It was then that Dabur thought of altering the brand positioning from pure convenience to a more value-for-money platform. Ads released in late 1998 stressed on the per-unit price of a glass of lemon juice. Also, the lower seasonality, Dabur planned combinations like gingerlemon or honey-lemon. That is still being debated upon but smaller packs 50 ml and 100 ml did make an appearance last winter. They are working, to an extent. Then deviating too much from test marketing mix can be disastrous too. Parles novel gelatinbased drink, Jolly Jely, is one such case. Three years back, it was test marketed in glass containers. The contents, as could be viewed in the container, had striking colours which went down well with kids who glugged the jelly from the wide mouthed containers. But the product that hit the market in April 1996 came in 200-ml tetra packs. The company found that handling glass containers was not so easy. But that meant that the target audience could not longer appreciate the colour. Nor could he or she consume it easily through a straw provided, since the formulation was thick and contained globules. The tetra packs killed the market for jolly jelly. More often than not, the marketers enthusiasm to launch rides on impatience, agrees a marketer. Speed to market seems to have become an over-riding concern in these hyper competitive times. Question Why did the above given situation arise? What went wrong? Hint answer: Too many alterations in the set marketing mix can prove to be fatal for the brand as an be seen in the case. Source: International Marketing-3rd Edition, PK Vasudeva, Excel Books

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