1. LITERATURE ANALYSIS
  • international firms face challenge of finding optimal balance between standardising & adapting their marketing across national borders in order to be successful
  • 330 articles with titles including 1) “adaption synonyms” 2) standardisation/adaption across border

FRAMEWORK OF ANALYSIS

Studies 1: aim to describe how (1a) and/or why (1b) firms standardise/adapt in certain way → investigate strategic decisions made by managers concerning degree of international marketing standardisation/adaption based on situational factors that influence decisions

Studies 2: attempt providing recommendations regarding standardisation/adaption (2a) and/or to normative-theoretically ground recommendations → identify performance-enhancing fits between firm’s strategy of standardisation/adaption & specific situations

  • concept of fit can be modelled in 6 ways: moderation, mediation, profile deviation, matching, covariation, gestalts

RESULTS ANALYSIS STUDIES 2

  • 274 of 330 (83%) give recommendations on how to standardise/adapt to enhance performance, but only 32 of those draw on concept of situation-strategy fit → findings are fragmentary, some extent even contradictory and very heterogeneous
  • articles of recommendation built on 3 assumptions: 1) strategy’s performance outcome is situationally independent 2) markets are completely efficient & all strategies that can be observed in practice must have proved successful in past 3) managers always consider performance-relevant situational factors accurately (are rationally unbounded)
  • articles that theoretically ground recommendations (17 of 330): use eg humor theory, theory of profit maximisation, theory of friction, stakeholder theory  not “helpful” anyways as they do not integrate concept of situation-strategy fit
  1. THEORETICAL FRAMWORK & PROPOSITIONS

THEORETICAL FRAMEWORK

  • none of existing articles integrates both concept of fit & normative theory for systematically & comprehensively deriving performance-enhancing strategies of s/a in given situations

→ overcoming weakness of existing literature with normative-theoretical framework

  • framework will focus on international product strategy (international standardisation/adaption of product name, features, design, quality, packaging), not on marketing strategy & processes

REUIREMENTS

  • specific strategy of international s/a can be regarded as enhancing foreign profit, if two requirements are fulfilled:

1) leads to increase in profit if potential increase in total cost associated with strategy is smaller than possible increase in revenue or vice versa

2) leads to increase in profit if allows for relative increase in quantity of products sold that is larger than a possible relative decrease in profit margin or vice versa

PROPOSITIONS

Proposition 1: fit between a high cross-national homogeneity of demand for specific product and a high degree of international product standardisation enhances foreign product profit

markets with low culture difference, supranational laws, as for similar products

Proposition 2: fit between high potential for cross-national economies of scale for specific product and high degree of international product standardisation enhances foreign product profit

Proposition 3: fit between high cost of modification of a specific product and high degree of international product standardisation enhances foreign product profit

→ given the constant level of quantity produced, higher degree of standardisation can reduce cost = if modification is costly, adaption isn’t the wise choice

Proposition 4: fit between high foreign price elasticity of demand for specific product and high degree of international product standardisation enhances foreign product profit

firms should attempt to offer products at low prices abroad to increase revenue & profit, lower prices call for lower costs = realised most easily with standardisation

Proposition 5: the perceptual errors of firm’s managers with regard to the relevant situation of firm negatively moderate the product-profit enhancing effects of the situation-strategy fits

Proposition 6: the quality of execution with regard to pursued strategy of international product s/a positively moderates the product-profit enhancing effects of the situation-strategy fits