Global Advertising Considerations

The two main concerns when selecting advertising media are reaching the appropriate target audience and doing so efficiently as measured by the cost per thousand (CPM). If the company is in a position to define a target audience clearly in terms of demographics or product-related variables, the media choice will be easier. The more targeted you can become when describing the most likely customer, the easier it is to identify what they read, watch, or listen  to or how to reach them through their key influencers.

Do not make decisions by CPM alone, though. With an integrated marketing communication mindset, media work synergistically. For example, advertisements in publications and directories might drive customers and prospects to a website, while publicity can educate about a product category and advertising provides brand-specific information.

As in the U.S., international advertising vehicles include business and trade journals, consumer magazines, broadcast media outlets, the Internet, and directories. Media availability and spending may vary dramatically around the world, with the U.S. spending more money on advertising than most other advertising nations combined. According to ZenithOptimedia, the fastest growing region includes Central and Eastern Europe while Latin America is seeing more moderate growth in advertising spending. China and Russia are moving up on the list of largest advertising markets, with China estimated at fifth place in 2008 and Russia expected to be in seventh place by the end of 2009.

How and where they money is spent varies, too. Some Latin American nations have the heaviest concentration of their advertising in television, while print media dominates in some Scandinavian lands. Cable and satellite enhance TV penetration in affluent markets, while radio remains a strong medium in many developing markets. Outdoor and transit advertising, cinema ads, and the Internet also compete for a share of the marketing communications budget in many global markets. Interactive telephone and TV are on the horizon, too.

One of the challenges for the international advertiser is the need for market-specific information. A medium popular in one country might well be significantly less important in another nearby, forcing the marketer to, for example, use radio in one market and print in another, which increases production costs. Currency exchange rate fluctuations also complicate media planning and budgeting.

Some of the regional regulations include limits on the amount of time available for ads. In Italy, for example, the state-owned and commercial TV channels have different maximum advertising limits. Other regulations affect how content is presented. In Italy, unlike the U.S., there is a strict separation between programs and commercials. Many countries restrict gender stereotypes and comparative claims.

Thanks to cable and satellite transmissions,  the media in neighboring countries is increasingly crossing global boundaries, generating significant implications for global marketers. The viewer’s choices have expanded, leading to competition among government-run public channels, state channels from neighboring nations, private channels, and pan-European channels. As a result, marketers must make certain that their advertising communicates effectively not only in the region where they make the buy but also across boundaries. This makes ad creation and media buying more challenging, frustrating marketers and their advertising agencies. Agencies often must produce several separate versions of a campaign to comply with various national regulations. As in the U.S., tobacco, alcohol, and pharmaceutical products are the most regulated in Europe.

This is an excerpt from Dr. Czinkota’s book Global Business: Positioning Ventures Ahead, co-authored by Dr. Ilkka Ronkainen.

Michael R Czinkota and Ilkka A Ronkainen, Global Business: Positioning Ventures Ahead (New York: Routledge, 2011), pg. 124-126.

If Only Global Firms Knew What They Know About Local Marketing

This article is from the Winter 2010 edition of Marketing Management. It is co-authored by Michael Czinkota and Marc Falco Schrader.

“Good marketing usually means that specific marketing knowledge is developed locally. Best local practices are required knowledge for a multinational firm. To make this knowledge transparent and accessible for colleagues in other countries is indispensible.”

Market Management Winter 2010 Czinkota Schrader