MBA International Program

Course:
International Marketing
Professor A. Bhatnagar

Assignment

by

Giannis Klavdianos, PT19

1/07/2017
Q1. This is the image of a typical fridge sold in USA. It has two doors. Please research it
online.

How would you modify this fridge for selling to

a. Mass market in Europe
b. Mass Market in Japan
c. The super-rich segment in India.
d. Mass market in Korea (Hint: Google for the most common feature in fridges in
Korea)

(a)
One of the main component of the American culture is consumption. They live in spacious
houses / apartments, equipped with the most up to date appliances, of the highest standards and
biggest size. Their shopping culture favors big shopping malls, mainly outside of the city where
they usually go once per week and buy large quantities of products (dry or fresh food and other
products for the house). To this end, having big storage room, refrigerators and fridges is of
outmost importance. A king-sized fridge in the US is quite common and it is usually consisted of
two columns and several doors.

Europeans on the contrary live in compact urban centers like Paris, Rome or Athens, and they
favor shopping smaller quantities, several times per week in small specialized shops in the
neighborhood. In this way they have more access to fresh food and are less keen on storing or
wasting food; this is the reason why Europeans buy smaller refrigerators. American style (also
called French style) refrigerators in Europe target usually the upper class of customers, leaving in
bigger apartments or houses.

Following the above, and considering the consumer culture in Europe which is based on fresh
food and selected products I would modify this fridge as follows.

I would place two main doors; the wider side for the fridge, and the other one for the freezer
which could also produce ice cubes. The freezer would comprise two stand- alone shelves (for
dairy products) and three drawers to store separately meat, fish and other products. The fridge,
would allow for more storage and conservation room – at least two closed drawers - for fresh
products (fruit and vegetables) where the temperature would be regulated, and one cooling
drawer of zero temperature for fresh products ready to be consumed. The doors would also
provide for adequate shelves for fresh milk and juices.
Finally, European regulation promotes consumer awareness. To this end that assumes stricter
rules regarding energy classification for electric appliances, I would pay a lot of attention as for
the fridge to qualify for the higher energy classes, since EU customers are more aware.
(b)
Similarly to Europeans, Japanese consumers are very conscious regarding energy efficiency and
saving, while favor innovation, design1. Nevertheless at the same time, differences in culture and
living standards (crowded cities, smaller houses, consumption of fresh fish products) affect
consumer preferences.
To this end, adapting the fridge to the Japanese culture, tastes, habits and standards would require
the following modifications:

 A wide range of colors with attention to external appearance.

 Extra space for fresh vegetables.
 An extra cold (-1O C) refrigerated compartment for storing fresh fish.
 A special place in the door for quick access to soft drinks.
 Warning lights for incorrect temperature.
 Reduced noise via reduced compressor sizes for minimizing interior noises.
 Hinges that allow the door to open when the refrigerator is in contact with a side wall (for
small houses).

c)
The Indian culture and customs require different specifications regarding electric appliances and
in particular refrigerators. To this end, for a fridge to be marketable in India it would require the
following additional characteristics: i) confinement of smells from cooked spicy food stored in
the fridge ii) storage of dry food which requires a temperature of -5 C o and iii) preservation of a
good temperature inside the fridge, especially due to the high external temperature.
Following the above, and considering the consumer culture in India, I would modify this fridge
as follows:

Split the fridge into three different zones according to temperature with four doors. The two
doors on the upper side would be for conservation of fresh food with two big drawers for
vegetables and meat. Ideally, access to beverages (bottles of water etc) would be possible from
an additional external door (as to keep the temperature stable for the rest parts of the fridge)
designed exclusively for this purpose. The freezer would have two separate doors; one for deep
freezing at -18Co and the second one with separate drawers with temperatures from 0 C o to -5 Co.
This option would allow storing goods for longer periods.

1
The local brands have introduced the shelf defrosting system since 1970, while they keep upgrading it until today.
(d)

Korean’s most famous food is “kimchi”, while special kimchi refrigerators have been considered
as the most valuable home appliances. A Kimchi refrigerator is a refrigerator designed
specifically to meet the storage requirements of “kimchi” products produced under different
fermentation processes. Kimchi usually becomes too sour when stored in a conventional
refrigerator for about a week. In contrast, kimchi can be stored up to 4 months without losing its
qualities in a kimchi refrigerator. The kimchi refrigerator aims to be colder, with more consistent
temperature, more humidity, and less moving air than a conventional refrigerator, providing the
ideal environment for fermentation of kimchi.

Adapting the fridge to the Korean culture, tastes, habits and standards would require modifying
the left part of a conventional refrigerator into a “kimchi” refrigerator, keeping the right hand
side as a European style fridge and freezer. Furthermore, similarly to the Japanese, Korean
houses are small and the requirement for smart appliances to accommodate the needs of the
families is of outmost importance. To this end, the fridge could allow for hinges similar to the
Japanese style for small houses or they could be narrower.

Q2. Sometimes companies have to do extreme customization, where they make adaptations
for only one region or city. Dishwashers sold in Munich have a special attachment that you
will not find anywhere else. What is its function?

Glasses of beer in Germany are usually big, particularly tall with respect to common glasses of
beer (Steins Beer glasses), while they can have different shapes. To this end, for
dishwashers to be marketable in Munich they need to adopt to local specificities.
Producers, follow the approach of “thinking global while acting local” and provide an
additional accessory to accommodate these glasses while containing them in a specific
spot in the drawer on the bottom of the appliance.
Q3. Gillette is a more than a 100 year old US company that has been focused on improving
razors. Every few years they come out with a new innovation that revolutionizes the
shaving industry. Their current razor is called Gillette Fusion Proglide. Please research it
and then suggest four modifications that you will make to it to target the emerging
markets.

Gillette’s Fusion ProGlide is battery operated razor. It has five improved blades, a micro comb,
an updated lubricating strip which lasts longer and even mineral oil for the perfect shave.

To successfully sell the specific razors overseas the producer must make the necessary
modifications to adjust it to the culture, the habits and standards of living of the local people.
Particularly in the case the target market are developing countries, the producer should “rethink”
and adjust both the design as well as the price/cost of the product.

Following the above, adapting the razor to developing markets could assume:

 A lighter and cheaper handle though with a nice design;

 Fewer number of blades;
 100% manual use (with no battery);
 Selling only one spare part (thus reducing the final price of the product) since most of
people in emerging markets get shaved less often and actually their income is not
periodic.

When launching new products, Gilletette tries to ensure a big coverage (markets and countries).
Fusion ProGlide is unique due to its “flex ball” feature. The latter might have increased the initial
production cost, but increased the standards of the product which mainly targets middle class
customers. The risk of reducing its price through cost reduction measures to increase its
marketability in the developing markets would alter significantly the final product. This is why
Gillette decided to produce a totally different cheap razor named “Guard” to market in India. In
this case, even the name of the product was adjusted to the local culture.
Q4. You normally do not see credit cards being used in emerging market countries, and
therefore they are not an attractive market for Mastercard, etc. Mastercard recently
launched 2KUZE platform in Africa. Research Mastercard’s 2KUZE platform on the
Internet, and then relate it to the Bottom of Pyramid concept discussed in today’s class.

Globalisation forced private sector to seek new ways to promote their products worldwide.
Mastercard’s 2KUZE is such an example of how societies, governments, and the private sector
can work together to accelerate economic growth and improve the standards of living even for
societies at the bottom of the pyramid; the developing world.

The use of mobile phones and banking applications has grown substantially in the past decade in
East African countries, and particularly in Kenya, allowing consumers living in rural farming
communities to participate in the new digital economy. MasterCard succeeded in offering its
services to developing countries by introducing “2Kuze”, a new platform that digitizes
transactions between the small farmers and their buyers. Without this digital platform, many
farmers were required to travel hours to small wholesale markets to sell their goods.

Having ensured $11mn funding from the Bill & Melinda Gates Foundation in 2015, this service
allows farmers to reach new markets for the distribution of their products, build their credit
history, and apply for small loans, once seemed impossible. The application is currently used by
about 2,000 farmers in Kenya, and the company hopes to expand adoption of the application to at
least 40 million small agricultural merchants in East Africa over the next five years.

Furthermore, 2Kuze also allows certain organizations to act as mediators and submit orders from
wholesale suppliers directly to farmers. In turn, the small farmers can work together to fulfill
larger orders, opening up a whole new market to individual growers. Farmers are paid
electronically as soon as goods are delivered to the buyer and of course don’t need to travel
anymore to find a buyer.

2Kuze is an example of where the future growth may come from, opening up new markets,
utilizing new technologies, contributing to social welfare to the lower income countries and
increasing the market size by inclusion of poor people living at the bottom of the pyramid.