Exam 14: Developing and Marketing Products

Correct Answer:

Verified

Laws and Regulations-Companies must often adapt their products to satisfy laws and regulations in a target market.The fact that many developing countries have fewer consumer protection laws creates an ethical issue for some companies.Ironically,lower levels of education and less buying experience mean that consumers in developing countries are more likely to need protection.However,many governments impose fewer regulations in order to hold down production costs and consumer prices.Unfortunately,this can be an invitation for international distributors to withhold full information about products and their potential dangers.
Cultural Differences-Companies also adapt their products to suit local buyers' product preferences that are rooted in culture.Not all companies need to modify their product to the culture;instead,they may need to identify a different cultural need that it satisfies.
Brand and Product Names-Several issues related to a company's brand name are important concerns for the day-to-day activities of international managers.A brand name is the name of one or more items in a product line that identifies the source or character of the items.When an individual sees a product labeled with a particular brand name,he/she assigns to that product a certain value based on his/her past experiences with that brand.That is why a brand name is central to a product's personality and the image that it presents to buyers.It informs buyers about a product's source and protects both customer and producer from copycat products.Brand names help consumers to select,recommend,or reject products.They also function as legal property that owners can protect from trespass by competitors.
Indeed,a strong brand can become a company's most valuable asset and primary source of competitive advantage.A consistent worldwide brand image is increasingly important as more consumers and business people travel internationally than ever before.An inconsistent brand name can confuse existing and potential customers.Although companies normally keep their brand names consistent across markets,they can create new product names or modify existing ones to suit local preferences.Companies also need to review the image of their brand from time to time and update it if it seems old-fashioned.
National Image-The value customers obtain from a product is heavily influenced by the image of the country in which it is designed,manufactured,or assembled.Individuals consider the influence of a country's name when they think of Italian shoes,German luxury cars,and Japanese electronics.This image can be positive for some products but negative for others.
Because it affects buyers' perceptions of quality and reliability,national image is an important element of product policy.Yet national image can and does change slowly over long periods of time.