P&G India
1. Discuss the reasons for the initial failure of P&G in Japan.
In the year of 1973 Procter and Gamble (P&G) entered the Japanese market, until the 1987 P&G was losing a lot of money. Why? Mostly because they didn’t thought about cultural differences. A company just can’t apply everywhere in the world the same products, managers, sales methods and strategies. Companies have to adjust their ‘working culture’ to the country where they are cooperating.
In the case of P&G the following things went wrong: * American products * American managers * American sales methods and strategies
In our first assignment and in chapter 5 of the book ‘International business’ we learned a lot about cultural differences. If you compare the culture of American with the cultural of Japan you will see immediately that there are a lot of differences. Why? Because the population of Japan is totally different: the consumers have different expectations of certain product or services. As a company you should know that you have to adapt your strategy, you can do that by doing first a ‘international’ market assessment, then take a look at the product-, promotion-, pricing- and place strategies and when you have done this, than you know how to operate abroad and you can bring this into practice on the Japanese market.
A small example of how the changes of the Japanese strategy, could have been: * Product strategy: they should have at list some modification, like changing the language of how to use the products from English into the Japanese language. * Promotion strategy: they should check if they could use the same advertisements or if they have to make more use of personal selling. In the case of the advertisement they have to check if they could use the same message, does the message makes any sense when you directly translate it? Yes or no? * Pricing strategy: they should check the diversity offer of the market, and if they could compete
In the year of 1973 Procter and Gamble (P&G) entered the Japanese market, until the 1987 P&G was losing a lot of money. Why? Mostly because they didn’t thought about cultural differences. A company just can’t apply everywhere in the world the same products, managers, sales methods and strategies. Companies have to adjust their ‘working culture’ to the country where they are cooperating.
In the case of P&G the following things went wrong: * American products * American managers * American sales methods and strategies
In our first assignment and in chapter 5 of the book ‘International business’ we learned a lot about cultural differences. If you compare the culture of American with the cultural of Japan you will see immediately that there are a lot of differences. Why? Because the population of Japan is totally different: the consumers have different expectations of certain product or services. As a company you should know that you have to adapt your strategy, you can do that by doing first a ‘international’ market assessment, then take a look at the product-, promotion-, pricing- and place strategies and when you have done this, than you know how to operate abroad and you can bring this into practice on the Japanese market.
A small example of how the changes of the Japanese strategy, could have been: * Product strategy: they should have at list some modification, like changing the language of how to use the products from English into the Japanese language. * Promotion strategy: they should check if they could use the same advertisements or if they have to make more use of personal selling. In the case of the advertisement they have to check if they could use the same message, does the message makes any sense when you directly translate it? Yes or no? * Pricing strategy: they should check the diversity offer of the market, and if they could compete