One of the bigger decisions a company faces when expanding internationally is how to structure their international brand architecture.
Some of the key questions to ask include:
- Does my current brand name have any resonance in the new target market?
- Does my company name have significant recognition in the new target market?
- Are there strong local competitors with strong brand names in the new target market?
- Does my home country have a good reputation in the new target market?
As Douglas, Craig, and Nijssen (2001) note, companies need to decide how brands are extended across countries and how brands should be coordinated across national boundaries.
Power branding, or the idea that a brand needs to present a visibly consistent message across all markets and to all stakeholders, is a uniquely US-centric concept. Marketers elsewhere are much more comfortable with the idea that a product can carry different names and messages in each non-home-country market.
Essentially, companies need to decide between the following brand architecture models:
- Monolithic – one name, worldwide. For example, in my current company, this would mean all products would be branded as Nordco, with product names used as a way to designate models.
- Endorsed – the use of the corporate name in conjunction with the product brand. Again, using my current company as an example, this would mean a product could be branded as the Nordco SE Hammer, with the corporate name and the product name carrying equal weight.
- Branded – focuses on the product line. Using the Nordco example again, a spike driver would just be called a SE Hammer with no reference to Nordco.
Normally, the monolithic and endorsed options are used when there is a need to reassure customers, i.e. the company is reliable and stands behind its products.
Conversely, the branded option is often used when a product brand is so strong that it can hold its own in the international marketplace without the corporate backing. The branded option is also useful if a company wants to minimize its country of origin background.
Also, the strength of local and global competitors in the new target market play a part in the brand architecture decision process. If your company is already positioning itself through specific branding against global competitors in other markets, it would make sense to carry forward the same positioning (and brand architecture) in the new market, particularly if you are dealing with multinational buyers. However, if you are battling an entrenched and well-liked local competitor, you may be better off creating a new brand identity that appears more local in nature.
Finally, it is important to consider that customer mobility increases potential exposure to your brand in other markets – a familiarity that could prove useful in that customer’s home market.
Douglas, Susan, Craig, C. Samuel, and Nijssen, Edwin (2001), “Executive Insights: Integrating Brand Strategy Across Markets: Building International Brand Architecture,” Journal of International Marketing, 9 (2), 97-114.