Month: March 2019

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How to apply International Marketing concepts in the Brazilian market

Como aplicar conceitos de Marketing Internacional no mercado brasileiro

Every company has ever thought of selling its products and services outside Brazil, either for strategic reasons or even for financial growth purposes.

Today, Brazil's main export partners are China, the United States, Argentina and the Netherlands (Holland). In the case of the latter, we can analyze it more broadly, since the largest port in Europe is in Rotterdam. Without a doubt, commodities represent a large share of national exports, but an interesting fact that few people know is that micro and small companies are responsible for 40% of exports. This volume of products, however, when translated into monetary value, represents only 5% of market share. The major export center in Brazil is the southeast region, led by São Paulo, Minas Gerais and Rio de Janeiro. Out of this axis, Rio Grande do Sul stands out.

This internationalization usually takes place through some means, whether directly or indirectly: exports, licensing, franchising, consortia, joint ventures, acquisitions and strategic alliances. Each of these actions has a different degree of commitment, complexity and risks.

Without a doubt, one of the biggest challenges for a brand in the internationalization process is marketing. Often, companies start exporting to countries where they think entry will be easier, whether due to language, distance or any element that makes that country something more familiar to those who are exporting. But what many companies don't ask themselves is whether people in that country need their product, or even if they should make some adjustments to the product or the way they communicate about it.

Many of these ventured without a minimum study of the country they are entering. Some work out, some don't. Citing the case of China Inbox, a successful franchise that needs no introduction. When the company tried to plant its flag in Argentine lands, it did not have any kind of concern, it simply advanced and assembled its units. But what they didn't have in mind is that the Argentine public has a totally different habit from the Brazilian one – they have lunch and dinner much later than us, for example – not to mention that meals are always accompanied by a good wine. These habits, different from ours, had a consequence: when the Argentines were going out to dinner, the restaurant was almost closing, and even when they found it open, they didn't have an alcoholic beverage (wine) to drink. Result: bankruptcy of the units.

This shows that, no matter the size of the company or the degree of maturity, if it does not adapt to the market, if it does not try to understand what the people in that region really need, the probability of something going wrong is great.

Now place yourself, look at the size of the country we live in, of continental dimensions, states larger than many countries. A multicultural Brazil, a world of different ethnicities within a single place. Before trying to introduce your product to another market, you should ask yourself several questions.

Should I introduce the same product or do I need to make adjustments?

Should I adapt or standardize my communication?

Mixed, multiple or umbrella brand?

The biggest challenges for your company to sell nationally are the same as a company that wants to sell to another country: geographic, cultural and psychological.

1.1 Geographic – should be one of the easiest points, however, taxes and logistical problems in Brazil make it something more complex.

1.2 Cultural – this is certainly one of the biggest challenges and deserves a more technical analysis. A study by Geert Hofstede, which ended up becoming a book later, deals deeply with these “cultural dimensions”. Power distance, individualism versus collectivism, masculinity versus femininity, uncertainty avoidance, and long-term versus short-term orientation.

1.2.1 Distance from power – this factor itself exemplifies how society reacts to inequalities. This directly implies how a boss should deal with an employee, how a salesperson should act with the customer. Where people are more likely to accept such inequality, the easier they will accept hierarchical levels.

1.2.2 – Individualism versus collectivism – how these people act and how they are interconnected. Should I put individual goals or should I add collective goals for the team. Should I present advertisements with friendship and companionship?

1.2.3 – Masculinity versus femininity – it is worth emphasizing that this concept was developed in the late 1980s and early 1990s. The best-used translation would be “money versus values”. Are my employees more interested in earnings or benefits? Do my customers prefer a lower price or a value-added product?

1.2.4 – Aversion to uncertainty –  how much people are willing to take risks in their lives. Is this new wave of Start-ups not showing a new reality? Do these new generations have something to tell us?

1.2.5 – Long-term versus short-term orientation – here in Brazil short term is the rule. But since they are internationalization challenges, think about how a Japanese and a Brazilian company acts. Ask yourself this question, and understand how alliances and partnerships are made.  

2.3 Psychic – in short: psychic distance results from the perception and understanding of the existence of cultural and business differences between them. Here, returning to the beginning of the text where I commented that companies generally export to countries where they have more identification, but these decision-making can be due to environmental, individual or relationship factors.

Do research! Today the digital revolution and globalization have brought us more cost-effective means of getting more relevant data. Use them wisely in your decision making.

Think globally, act locally.

Renato Vincoletto Chief Creative Officer (CCO) at Alliance Comunicação. Graduated in Digital Communication, post-graduated in Advertising Creation, Master of Business Administration (MBA) in Marketing from USP. I have been in the Communication market for over 15 years, in which I have worked in several segments, with experience in directing and creating projects and campaigns, directing marketing and branding.

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The Evolution of Marketing 3.0 to Marketing 4.0

Marketing evolves at the same speed as generations, communication and the needs of consumers and the market evolve. If in marketing 3.0 Philip Kotler already preached the importance of values and sustainability for the success of an organization, these values gain more importance in what we can call marketing 4.0, which goes further, in an even more horizontal communication, strongly based on feelings human beings, social transformations and interactivity on the web – where anyone can be 'media' and everyone has the power of persuasion.

We cannot say that marketing 3.0 is outdated, as there are small differences in relation to the concept of marketing 4.0, with changes in the intensity and strength with which the message reaches the final public, and how it directly impacts the way companies are perceived . The means of communication, online or offline, are available today, for good or for bad, and that is why professionals and their organizations need to be prepared for this new media and information scenario, using these channels to your favor.

In the book “Marketing 3.0. The forces that are defining the new human-centered marketing”, Kotler showed the transition from the basic concept of marketing – which is to clearly define the identity of a brand and strengthen it in building an image – to marketing 3.0 – with meaning embedded in a company's vision and values. Marketing, already at the time of the book, also preaches a consonance of three concepts: identity, integrity and image.

The brand needs to have identity, integrity and image. The result is not achieved completely without these three points – the 3Is. The brand is useless if it only articulates a positioning. She may have a clear image, but not necessarily a good one. And positioning may just be a claim to consumers. Actions are worthless if the '3Is' are not complete and in tune.

Years later, this concept was not only consolidated, but also expanded, with the increase in people's communication power and the importance they give to sustainability and social correctness, added to the dissemination and persuasion capacity of social media - in what we are calling of marketing 4.0.

Companies with an established image, which prove to people that they are concerned about the environment around them, will certainly be better seen, better publicized and better accepted by their consumers, which will directly impact the financial results. Marketing cannot be considered synonymous with sales or a demand generation tool. It needs to be seen as the main way to gain and keep a consumer's trust.

In marketing 3.0, companies must see consumers as full human beings: with a physical body, a mind capable of independent thinking and analysis, and a heart capable of feeling the soul. This means that the product idea needs to be uniquely positioned in the minds of consumers. Concepts must be conveyed in a way that touches the heart, showing people why they need a certain product or service, and how it can change their lives. You have to differentiate yourself from others to succeed. And this is only possible with efforts focused on emotions and feelings.

Marketing 3.0 shows that there is more trust in horizontal relationships. Consumers trust each other more than the companies themselves. When Kotler, in his book, analyzed the rise of social media as a reflection of the migration of consumer trust to other consumers, he saw the importance that these channels would have.

In the case of marketing 4.0, this horizontal relationship not only materialized but also became the basis of communication and marketing today. Consumers have turned to word of mouth as a more reliable form of advertising. According to a survey by Nielsen Global Survey, about 90% of consumers surveyed trust recommendations from acquaintances, 70% of consumers believe in the opinion of other customers, posted on the internet – they trust strangers in their social networks more than experts.

In addition to consumers talking about companies and opining about them on the network, influencing each other, companies themselves were forced to position themselves on social media. This is a reality. Not just a dissemination channel, social media have gained ground in marketing and communication as means of information and advertising, and are directly related to the concept of marketing 4.0.

This occurs precisely because the new reality of the internet, with all the strength of its relationship networks, proves the importance of thinking about consumers' feelings as a way to consolidate image, reputation and, consequently, results. The impact is direct on the decisions of a company's communication areas, for example, including the way they use their funds – today they are much more directed at social media than conventional channels.

Marketers need to identify anxieties and desires and then target the minds, hearts and spirits of their consumers. These are increasingly concerned with issues such as social well-being, health, education, sustainability. This interferes with choosing a product. Companies that want to be recognized, therefore, must share the same dream as consumers, and make a difference in the environment in which they operate. But to achieve this feat, the changes must be incorporated into the DNA, in addition to embedding the good deeds in the corporate culture and remaining firm to this commitment. The change has to be rooted in your organization's mission, vision and values.

Kotler demonstrates that commitment has to start at the corporate level and all employees must take it seriously. Successful companies do not start their planning with the financial return, but with the accomplishment of their mission. Positive returns will then be the result of your actions.

In this way, a really effective planning must bring a matrix based on values:

The mission must be more permanent. It is a company's raison d'être and should reflect the basic purpose of its very existence. Your mission will determine your sustainability. It is represented by a 'donut', but inverted (the hole on the outside and the mass in the middle) – the core is fixed and the space around it is flexible, because the company's mission is the medium, it cannot be modified, and the business scope is flexible, but it must be in sync with the core.

The vision can be defined as what the company wants to be seen in the future, what it intends to accomplish, based on the corporate mission. The compass is the symbol that represents the orientation to the future state.

Values can be considered institutional behavior standards, what are the company's priorities, behaviors that benefit it and the communities inside and outside it. They are represented by a wheel, as it is expected that by strengthening communities, values will also be strengthened.

But how to use the values matrix in the company?

In one of the axes, the company must strive to occupy the hearts and minds of customers, whether current or future. On the other are mission, vision and values.

Although the product has to satisfy customers, the brand must be perceived as a performer of emotional aspirations, with practices that touch feelings. That is, the company must not only promise profitability and financial return, but also long-term sustainability. The brand needs to be better, different, make a difference.

For example, a company may have a mission to promote wellness and sustainability. It must offer products in concomitance with environmental protection, in addition to promoting actions based on compassion. Furthermore, she must encourage her customers to do the same. The manufacture of its products must follow sustainable standards, so that it can be an example and inspiration for consumers. The company's attitudes must, without fail, follow these precepts, if it wants to be recognized for its mission. This includes actions at the factory, with employees, with surrounding communities, with the country, among others.

Why applicability?

Putting on paper – or in the matrix – what are the paths (mission, vision and values) to be followed is a way of rooting the necessary concepts for the company to reach its image objectives. Rooting the concepts, the company becomes more recognized by consumers and, consequently, better spoken and seen by them. Considering the concepts of marketing 3.0 and 4.0, touched by the good image of the company, consumers will identify with it (feelings) and will be able to share good references and experiences, and will serve as propagators of the corporate image, products and services offered – mainly on the web .

Monica Giacomini – Journalist by training and postgraduate student in public relations at Faculdade Cásper Líbero, where he is studying Marketing and Persuasive Communication.