P&G Japan: The SK-II Globalization Project
When looking at the archetype of P&G it can be seen that it is an Multi Centred MNE. Which consists of a set of entrepreneurial subsidiaries abroad which are key to knowledge-based FSA development. National responsiveness is the foundation of the international strategy. The non-location bound FSAs that hold these firms together are minimal: common financial governance and the identity and specific business interest of the founders or main owners.
Later on a transformation can be seen. P&G tends to be a combination of a Multi Centred MNE with an international projector. This because an international projector is built upon a tradition of transferring its proprietary knowledge development
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Marketing plans and budgets had previously been developed locally, strongly debated with European managers, then rolled up. Now they were developed globally-or at least regionally-by new people who often did not understand the competitive and trade differences across markets.
The reality of international innovation, especially in large MNEs with large portfolios of foreign subsidiaries, is that corporate headquarters in the home country does not simply choose locations and assign roles to foreign sites in terms of R&D charters. In many cases, entrepreneurial managers in MNEs assume extended roles inconsistent with their unit’s formal charter.
Traces changes in P&G's international strategy and structure, culminating in Organization 2005, a reorganization that places strategic emphasis on product innovation rather than geographic expansion and shifts power from local subsidiary to global business management. In the context of these changes introduced by Durk Jager, P&G's new CEO, Paolo de Cesare is transferred to Japan, where he takes over the recently turned-around beauty care business. Within the familiar Max Factor portfolio he inherits is SK-II, a fast-growing, highly profitable skin care product developed in Japan. Priced at over $100 a bottle, this is not a typical P&G product, but its successful introduction in Taiwan and Hong Kong has de Cesare thinking the brand has global potential. As the
This looks at the possibility of how SK-II cosmectics product can be a booming brand in Japan for P&G company to grow their market share and have a profitable outcome to cover up for their loss in the last few years.
WWII crushed Japan (simply recall that regardless they are the main nation on the planet to have at any point been focus to not 1, but rather 2 atomic bombs). The Japanese Emperor was compelled to surrender to the partners (which was an incredible embarrassment in their way of life) and to surrender his God-like status. Likewise, the US possessed Japan quite a while after the war and modernized it much more, maybe it would be more precise to state that the US westernized it. According to Lau (2014) the Japanese-American internment amid World War II is one such purpose of inconvenience in United States history. The individual chronicles and internees' declarations epitomize the real part that social memory played in realizing an expression of
The third table is to outline some of the activities we might find at each stage of the marketing process; this is brief summary of the importance of the different stages.
Considerable time, effort and resource is put into developing the annual marketing plan and budget is split between branding, customer driven and sales driven strategies.
While many of the world’s economic powers seem similar, there is no doubt there are some very key differences. Many of these differences can be attributed to cultural differences within each of the countries. While many of these countries work together in global business efforts, cultural differences would certainly have a significant impact on management style, leadership and even work ethic of the employees. The United States and Japan are both strong economic powers that hold to a capitalistic economic system. Their management styles, however, are very different. This can often be explained through the differences in culture and management or leadership styles. Over the years, the two
P&G need to work hard and do more research and development in order to produce higher quality, more innovative, and more unique in products in order to answer consumer’s need and compete with those major world brand competitors.
Globalisation has had a profound impact on the Japanese economy influencing levels of international trade, business operations, financial flows, government policy, labour markets and even environment. This movement has been driven primarily by numerous TNCs, trade liberalization, and the deregulation of the financial system, and numerous strategies adopted by the Government and Economy, resulting in the creation of a 'new' Japan.
• We recommand P&G to directly invest in this market by focusing only on Marketing and Distribution to roll out SK-II (a special product) in a foreign market. It should not be an advantage for P&G to acquire subsidiaries, or to license or to franchise because resources and capabilities of SK-II are located in Japan. It would be difficult to find same raw materiels to produce SK-II in another country. Exporting SK-II in a foreign market will be better, for that they should emphasize on: • Differentiation advantage, • Changing customer behavior, • Product positionning, • Pricing policy, • Advertisement, • Counseler team…
P&G is an international supplier of consumer goods it is a "global leader in health and beauty care products, detergents, diapers and food . P&G's presence in the hair care market in the U.S has been strengthened by innovative technology BC-18 and the replacement of an old brand 'Pert' with 'Pert Plus'- a mild shampoo with a fully effective conditioner. P"G decided to introduce BC-18 in Europe. Traditionally, the European market is highly competitive the main rivals are Colgate, Unileaver, and L'Oreal. The European market is segmented (i.e. value based) and
This case describes how SK-II which is a fast-growing skin care product is becoming very popular with a price to match its performance. After being introduced in Hong Kong and in Taiwan, P&G believes that this brand has a strong global potential. At the conclusion of this case, the company is left thinking whether or not to grow into both the European and the Chinese market.
In the highly competitive Japanese skin-care market, P&G¡¦s new SK-II product has proven its success as a premium and prestige offering. P&G has gained significant knowledge transfers from SK-II development and further, has successfully tapped the fickle Japanese market and has devloped a loyal user-base in Taiwan and Hong Kong. With its phenomenal success, it is only logical that P&G consider rolling-out the SK-II product-line to the international market. However, while there is significant worldwide growth potential within the $9 billion prestige skin-care industry, based on recent organizational changes, new corporate priorities, and thorough market assessment, P&G must base its decision on current resources and capabilities to
The marketing plan habitually comprises time limits, budgets and allocations of staff and this can help the business identifying the definite marketing activities and specifications for the budget, setting and achieving marketing goals, bringing a marketing strategy in the company for life (Mcdonald et al, 2011)
Westwood, J., 2002, The Marketing Plan: A step-by-step Guide. 3rd ed., London, Kogan Page Limited, p
The objective of MNC to operate in other countries is to gain competitive advantage through several ways. Firstly, MNC is able to take advantage of difference in country-specific circumstances. For example, MNC may choose to locate its productions in less developed country like Vietnam to gain cheap labor cost. Secondly,