INSIDE BUSINESS: Tread carefully in the global village

"THINK global, act local" has become the marketing director's mantra heard in boardrooms around the world. Yet much cross-border marketing activity has been premature and too sophisticated, and has overlooked the importance of detailed research into local differences in consumer attitudes, according to a report by Ogilvy & Mather, the advertising agency.

The growth of transnational media, from satellite television to the Internet, has persuaded many companies to establish global strategies. But it has also fostered a false sense of security, persuading some to believe in communities, or groups of consumers, that do not exist.

Transnational media are inevitably indiscriminate, the agency warns. The "footprint" of the satellite that covers Asia carrying Rupert Murdoch's Star TV spans more than 3 billion people in 43 countries.

But local differences in attitude and perception are critical. "People at different stages in the evolution of their understanding and attitudes to advertising and brands will interpret marketing messages in distinctly different ways," says Sheila Byfield, director of O&M Media. "It's not a question of avoiding transnational media, but of more carefully appreciating just who will receive your message, and ensuring the creative execution caters for this."

The growth of themed transnational channels, such as Eurosport and MTV, confirms that irrespective of location, people sharing a particular interest or way of life can have more in common with each other than their neighbours. This is underlined by the growth of the Internet, she says: " 'Virtual communities' are being created, composed of people with like interests, probably more so than can be found in their own home town." The Internet is a global medium, linking users around the world simultaneously. But it also offers opportunities to tap into many smaller collections of consumers, grouped together by common interest irrespective of location, culture or language. Current estimates predict 750 million regular Internet users by 2000.

But Ms Byfield warns that despite huge opportunities to reach "tribes of consumers" on the Internet, there are also many chances to get it wrong. "Internet users are more critical of messages they receive, and expectations of standards of creativity and innovation are high because the Internet is a relatively 'new' medium," she says.

The notion of tribes of consumers must also be acknowledged when evaluating the effectiveness of campaigns, says Linda Caller, international planning director at O&M. "It may be that a brand suddenly stops growing: it has only succeeded in penetrating a hitherto unforeseen island in that society." She says it will become less important to know that a company has a particular percentage share of a national market, more important to know it has achieved maximum growth among its core target group.

Research must be more finely honed. Where experience of consumer choice is limited, as in newer markets such as Eastern Europe or parts of Asia, conventional research into product preferences cannot be taken for granted. Findings can be distorted. Choice and brand loyalty may not yet have real meaning in markets where the imported alternative costs a month's wages. "Without greater understanding there is a danger of premature extrapolation, of seeking conceptual sophistication before the necessary groundwork has been laid," the report warns.

Misunderstanding local variations in consumer attitudes results in marketing activity that can damage by being out of step with a brand's core values, it concludes. This can only be overcome by identifying the core values of a brand, described by Ms Byfield as the brand's "DNA". She adds: "This, and only this, is what will travel."

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