RockWood Company’s International Marketing

Based on the information provided in the case study, how can someone describe RockWood’s segmentation and positioning strategy?

Market segmentation refers to dividing markets into segments or divisions based on demographic, psychographic, and geographic variables (Glowik & Smyczek, 2011). Marketers divide markets into divisions in order to produce goods and deliver services that satisfy the needs of consumers profitably. Based on the information provided in the case study, RockWood bases its segmentation strategy on the aforementioned variables. Through demographic strategy, the company has divided its markets into different nations such as Indonesia, the USA, and Canada. It sells its products to different consumers from different nations.

Geographically, Rockwood operates in different locations around the world. For instance, apart from operating in its home country, the company has branches in different locations. The company also bases its segmentation strategy on a behavioral segment. It understands that different countries have different cultures, which influence their tastes when it comes to buying furniture, or any other product. Therefore, it offers goods that correlate with the cultures of consumers from different cultural backgrounds. People in different countries have different lifestyles. RockWood makes different furniture products that suit the lifestyles of people in different parts of the world.

Product positioning refers to creating an appealing, or attractive image of a product in minds of consumers. Positioning helps marketers to put their brands as the best choice for consumers compared to the competing brands. Based on the information provided in the case study, RockWood bases its positioning strategy on brand differentiation. The company employs differentiation strategies that make it unique in its target markets. For instance, the company crafts brand characteristics that differentiate it from its competitors. It develops its unique logo, corporate color, typography, visual style, and imagery among other things.

Identify the target segments and elaborate on how the company appeals to them

As aforementioned, RockWood segments its markets in regards to demographic and psychographic variables. Demographically, it operates in different nations including Canada, U.S, and Indonesia. The company also understands that the target audiences in these nations have different cultures and lifestyles, and hence the need for psychographic or behavioral segmentation. The company has representatives from these nations who are part of the officials in its management. These people understand their countries’ cultures and lifestyles very well, and hence guide the company in producing furniture that suits different people in their countries. For instance, the representative of Indonesia presents to the management officials what consumers of his/her country like, or dislike. This way, they are able to formulate strategies that help the country to be successful in foreign markets. This helps the company to satisfy the needs of consumers profitably.

Can the company’s value proposition be employed efficiently from country to country?

No, the company’s value proposition cannot be efficiently employed from country to country. Customer’s preferences change from country to country. People living in different countries have different cultures, which shape their buying behavior. For instance, some furniture designs can be accepted in Canada but be rejected in Indonesia. Therefore, RockWood needs to make designs that are acceptable in different countries. In other words, the company’s value proposition should change from country to country. This can help it succeed in emerging markets across the globe.

Guided by the Product Component Model (Exhibit 11.3, p. 344), discuss the impact of the regional factors. These should include cultural and physical factors that the company has to take into account, in its international endeavors, to gain market acceptance in different countries.

Regional factors such as cultural and physical factors affect RockWood’s operations in international markets, especially when trying to develop their products. However, the company can employ several strategies to gain marketing acceptance. For instance, it should ensure that its core components such as product platform, design features, and functional features in furniture get aligned with the cultural beliefs, or lifestyles of consumers in different market segments (Keinonen, 2006). It can also differentiate its augmented product components from its competitors. This includes differentiating its trademark, brand name, styling, package, quality, and price among others to attract and influence consumer buying behavior in foreign countries. To overcome the physical factors from affecting its operations in the emerging markets, RockWill can align its support services component to help it gain market acceptance. For instance, it should ensure that it installs relevant technologies to coordinate communication between its departments, as well as to customers. It should also ensure that all tools receive repair and maintenance services. Spare parts should be made available at all times, and employees should be trained to follow instructions and focus their duties on meeting organizational goals. Moreover, RockWood can offer warranty services to customers to prove to them that what they offer is genuine.

Discuss the company’s brand language for products distributed internationally. Does RockWood build its brand on the basis of the physical product attributes or the emotional set that surrounds its products?

RockWood builds its brand on the basis of the emotional set that surrounds its products. As aforementioned, the company looks at the culture surrounding its markets and offers products that suit it. It understands that people perceive their products differently. For instance, people in Canada have different attitudes towards their products compared to people in Indonesia. The company conducts researches which helps it to know how its products get perceived in different nations or cultures. After that, it makes and offers products that meet the specifications of these customers. It uses promotional tools that suit the cultures or perceptions of consumers. For instance, if people in Canada prefer printed media to social media, the company follows their preferences. All these confirm that it builds its Brandon on the basis of the emotional sets that surround its products.

Do people in different markets view the company’s offerings and value an investment in them in the same way?

No, people in different markets do not view the company’s offerings and value an investment in them in the same way. People in different international markets have different beliefs and attitudes due to differences in cultural backgrounds.

If so, what implications might these differences have on the company’s branding efforts in various international markets?

The differences in views between the company and people in different markets have several implications on the company’s branding efforts in international markets (Terpstra, Sarathy & Foley, 2012). The efforts can be wasted considering that people follow their own intuitions or advice from friends and family members when buying products. If the company assumes that its views and its views tally, it can find itself in a critical position of collapsing. Market researches are essential in such situations. Researches can help the company to know what consumers think or how they perceive its products. Without this knowledge, companies cannot tell what consumers want, and hence will offer products and deliver services that do not meet their needs. This can make them incur huge losses.

Can the same strategy work in markets ranging from Russia to India, and from China to Brazil?

No, the same strategy cannot work in markets ranging from Russia to India, and from China to Brazil. Markets around the world have different characteristics. Researches indicate that the most successful and established companies base their operations on cultural and institutional voids. The aforementioned countries are among the current potential emerging markets in the world. The strategies developed for doing business in Russia are different from those that marketers use at their home businesses in India. The same case applies to Brazil and China. Marketers should customize their strategies to fit the cultural or institutional contexts of each country. Understanding the cultural and institutional differences between countries helps marketers to make the best choices on the best markets for their businesses. It also helps them to make the best choices on the optimal strategies, and choices on how businesses should operate.

Which obstacles will the company face in emerging markets?

There are several obstacles that RockWood is likely to face in the emerging markets. These include protectionism, cultural barriers, protection of intellectual property, and government restrictions on trans-border data flows among others (Zou & Fu, 2011). Trade barriers restrict companies from operating in emerging markets. Cultural differences between an organization and an emerging market affect its performance or success. Some countries deny organizations to own rights to intellectual property. This affects them a lot. For instance, without the protection of intellectual property, firms are likely to lose their reputation and income. Other firms can easily copy from them and produce fake products. Laws protecting intellectual property vary from country to country (Glowik & Smyczek, 2011). The language barrier is also another obstacle. It affects the understanding between partners, and hence needs translators which are additional costs to the company. It also slows business operations.

Which alternatives might the company pursue?

The company can employ foreign workers and engage them in community activities, use local sales support centers, and design products specifically to satisfy the needs of the local consumers. It can also employ promotional activities to increase awareness (Zou & Fu, 2011). It should offer products that meet the ISO 900 standards of certification. They should pursue markets in nations that protect their intellectual property, and those that have no trade barriers. The company can also seek markets in countries without cross-border restrictions, and comply with foreign policies such as the go-green policy among others. It can conduct researches locally, differentiate value proposition for consumers, employ its own supply chain, and offer its prices at a lower price than its competitors. It can also form joint ventures, or partner with NGOs and local firms (Guillén & García-Canal, 2013). All these can help the company to succeed in the emerging markets easily.

References

Glowik, M., & Smyczek, S. (2011). International marketing management: Strategies, concepts and cases in Europe. München: Oldenbourg.

Guillén, M. F., & García-Canal, E. (2013). Emerging markets rule: Growth strategies of the new global giants. New York: McGraw-Hill.

Keinonen, T. (2006). Product concept design: A review of the conceptual design of products in industry. London: Springer.

Terpstra, V., Sarathy, R., & Foley, J. (2012). International marketing. Naperville, Ill.: Naper Publishing Group.

Zou, S., & Fu, H. (2011). International marketing: Emerging markets. Bingley: Emerald Jai.