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RAJEEV BATRA, Y. CHARLES ZHANG, NILÜFER Z. AYDINOĞLU, and FRED M.
FEINBERG*

Building on cultural values research, the authors identify specific image
attributes on which multicountry brands should position themselves consistently
across markets. Leveraging prior research, they identify three life values that are
most equal (benevolence, universalism, and self-direction) and two that are
leastequal(powerandhedonism)incross-nationalimportance.Theauthorslink
specific brand image attributes (e.g., friendly, social, elite style, arrogant) to
these life values through empirical data and semantic analysis. Using an
extensive field data set on consumer perceptions and preferences from 22
countries regarding more than 1,700 brands, the authors then show that greater
global consistency of a brand’s image decreases overall brand attitudes if the
specific image attribute is one that is not equally desired worldwide. They also
find that the attitudinal impact of a multicountry brand’s positioning consistency
on commonly valued image attributes is greater when the set of competitors the
brand faces across its markets is more homogeneous. The authors discuss
implications for global brand management theory and practice.

Keywords: cross-cultural values, global brands, international marketing strat-
egy, brand image

Online Supplement: http://dx.doi.org/10.1509/jmr.13.0058

Positioning Multicountry Brands: The Impact
of Variation in Cultural Values and
Competitive Set

“Some brands have established a strong, consistent
connection across cultures by tapping into fundamental
human truths: the commonalities that unite rather than

divide people across the globe, such as the desire for love …
and happiness. Such a platform opens up real opportunities
to make your marketing budget work more efficiently, but
finding the right idea can be a tough challenge.”

—Hollis (2008, p. 165)

A key challenge facing multinational marketers today is to
devise the best positioning strategy for global brands across
multiple national markets, which often vary in their cultural
values as well as in their competitive contexts (Torelli et al.
2012). These multicountry brands are typically marketed across
multiple countries in a very similar and coordinated way, uti-
lizing consistent associations and image positioning (Steenkamp,
Batra, and Alden 2003, p. 53). Such cross-national marketing
standardization can lower total global costs (through economies
of scale; Samiee and Roth 1992), speed up market rollout (Neff
1999), and improve consumer preference by creating a positive
perception of “globalness” (Steenkamp, Batra, and Alden 2003).
However, it can also decrease local market relevance (Craig and
Douglas 2000).

*Rajeev Batra is S.S. Kresge Professor of Marketing, University of Michigan
(email: rajeevba@umich.edu). Y. Charles Zhang is Assistant Professor of
Marketing, Anderson Graduate School of Management, University of California,
Riverside (email: charles.zhang@ucr.edu). Nilufer Z. Aydinoğlu is Associate
Professor of Marketing, Koç University (email: naydinoglu@ku.edu.tr). Fred M.
Feinberg is Joseph Handleman Professor of Marketing and Professor of Statistics,
University of Michigan (email: feinf@umich.edu). The authors gratefully ac-
knowledge the research assistance of Tanya Zhang. Mr. Ed Lebar of Young &
Rubicam Brands Knowledge Group was very kind in allowing use of these BAV
data, and the crucial help and comments of David Dyte, Emina Hrustic, and
StevenRootfromY&Rarealsomuchappreciated.Theauthorsalsoacknowledge
the comments and other help by colloquium attendees at the Nanyang Business
School, Singapore, and the University of California, Irvine, as well as Dana
Alden, Richard Gonzalez, Aradhna Krishna, Puneet Manchanda, Daphna Oyser-
man, Jan-Benedict Steenkamp, and Stefan Wuyts. Coeditor: Robert Meyer;
Associate Editor: Sanjay Sood.

© 2017, American Marketing Association Journal of Marketing Research
ISSN: 0022-2437 (print) Vol. LIV (December 2017), 914–931

1547-7193 (electronic) DOI: 10.1509/jmr.13.0058914

The literature on the standardization versus adaptation of
international marketing strategy has long argued that only a
high level of similarity in consumer needs and competitive
contexts should justify the kind of standardization that can lower
costs without hurting consumer preference (e.g., Zou and
Cavusgil 2002). However, the extent of homogeneity of markets
on consumer needs and wants and the degree of standardization
by brands on marketing strategy dimensions have not received
adequate attention in the literature, despite their centrality
to the focal research issue (Ryans, Griffith, and White 2003,
pp. 593–97). Nor has prior literature attempted to identify the
specific consumer needs that are similar enough across countries
to justify standardizing on them. It has also not empirically
tested the impact on standardization of competitive similarity,
using market data. In this article, we complete the aforemen-
tioned tasks, taking advantage of the unique and large multi-
country Brand Asset Valuator (BAV) database and building on
previous research on cross-country variations in cultural values.

Despite the recent growth of “global consumer culture”
(Alden, Steenkamp, and Batra 1999), studies still find very
significant differences across countries in their cultures and
values (e.g., Hofstede 2001; Schwartz 2004), suggesting
countervailing local or hybrid cultural affinities (Hannerz
1990). A review chapter by Gupta, Winkel, and Peracchio
(2009) provides a vivid example of how the standardized po-
sitioning of global brands can encounter problems as firms cross
cultural boundaries. Apple’s ad campaign showing opposing
Mac and PC personalities became widely liked in the United
States for depicting Macs asmore fun and play-oriented and PCs
as more efficiency-focused, rule-following, and work-oriented.
However, this brand positioning was received much more
negatively by consumers in Japan. Because of different cultural
values, “Japanese consumers indicated that the PC’s sacrifice
for group conformity, work ethic, and pride in the organization
were positive values, much more positive than the fun and
approachable benefits offered by the Mac” (Gupta, Winkel, and
Peracchio, p. 230).

Such differences in cultural values are a critical obstacle that
global marketers must overcome in their attempts to develop
economically viable, yet locally relevant, multicountry brands.
Several researchers have noted that many brands offer not just
functional benefits but also linkages to deeper cultural values
through their abstract qualities (e.g., Shavitt, Torelli, and Wong
2009; Torelli and Kaikati 2009). Global brands, in particular,
frequently are carriers and symbols of culture (Torelli et al.
2012).

Several prior cross-cultural studies have shown that brand
marketing strategies using culture-congruent appeals tend to
outperform those lacking such congruence (Yavas, Verhage,
and Green 1992; Zarantonello, Jedidi, and Schmitt 2013). For
instance, Aaker and Lee (2001, Experiment 2) showed that ads
using a more “promotion-focused” message (highlighting pos-
sibilities for advancement) do better in cultures where consumers
are higher in independent self-construal (e.g., North America),
whereas ads with a more “prevention-focused” message (high-
lighting security and safety) do better where consumers are
higher in interdependent self-construal (e.g., East Asia). Thus,
global brands that are highly symbolic of particular cultural
values could easilyevoke positive attitudes inmatching cultures,
but not in mismatched cultures (as in the previous Apple ex-
ample). Given the similarities and differences in cultural values
across their many national markets, the ideal solution for global

brands would be one in which they position themselves con-
sistently across markets on just those brand meanings that are
themselves highly valued in (almost) all markets and cultures.

In this article, we therefore contribute to the literature
streams on cross-cultural values and global brand strategy in
multiple ways. First, through a deep and novel integration of
multiple literatures on cross-cultural values, we identify which
specific values are considered uniformly more important across
more cultures, and for what functional and evolutionary rea-
sons. Second, we apply these conclusions to the substantive
domain of global brand management, proposing and showing
the differential impact on attitudes toward a global brand if it
is positioned consistently on consumer needs and values that
are more similar (vs. varied) in their importance across multiple
countries. Here, we analyze data on the extent of homogeneity
across markets on specific values, and the extent to which
specific brands are positioned consistently on these, which has
never been done before. We also explore for the first time the
moderating influence of competitive set heterogeneity on the
effectiveness of standardized global positioning strategy. Draw-
ingonourfindings,weshowhowglobalbrandscandoabetterjob
of balancing the economic and speed advantages of standardi-
zation with the need for local market relevance by strategically
positioning themselves consistently on only those specific, now-
identified attributes that consumers across the world desire more
(vs. less) uniformly.

From a competitive positioning perspective, a multicountry
brand that faces a more varied set of competitors across its
multiple markets is also likely to face a more varied set of
competitive brand positioning platforms to which it needs to
respond. The international marketing strategy literature has
therefore also discussed the importance of the similarity of the
competitive environment in driving standardization decisions
(Jain 1989; Samiee and Roth 1992; Zou and Cavusgil 2002),
proposing that standardization should be more appropriate if
the firm competes with the same rivals in different markets.
However, empirical examination of this proposition has not yet
appeared in the literature.

In this article, we therefore test the attitudinal impact of the
nature and consistency of the specific consumer values used
in a multicountry brand’s positioning, as well as that of the
competitive context it faces across markets. To do so, we take
advantage of the BAV database, arguably the most compre-
hensive global database of consumer perceptions on brands,
containing disaggregate perceptual and attitudinal data on multi-
country brands as well as data on their competitors worldwide.
Our analysis sample consists of field data from 64,790 consumers
on 1,723 brands competing cross-nationally in 22

countries.

Though not designed to test our research questions, data of this
scope provide a rare and valuable opportunity to conduct this
important academic investigation. We supplement these BAV
data by additional cross-national studies conducted at the con-
sumer level that enable us to match the BAV brand imagery data
to the types of consumer values they best represent.

In the following section, we develop the theoretical foun-
dations of our research. We first discuss how cross-cultural
brand positioning uses image attributes designed to symbolize
cultural values. Next, we present both theoretical arguments and
empirical results from the cross-cultural values literature
showing which specific values should and should not vary in
their cross-cultural importance, in line with their adaptive social
functions. We then describe in detail our proprietary BAV data

Positioning Multicountry Brands 915

set and the way in which we link specific brand image attributes
to particular cultural values using prior research and our own
multicountry consumer studies. After our analyses and results,
we conclude by discussing implications and our contributions.

LITERATURE REVIEW AND
CONCEPTUAL DEVELOPMENT

Cross-Cultural Brand Positioning: The Influence of Values

Before we examine how cross-cultural differences in con-
sumer values can hurt global brands, it is necessary to discuss
how brands are often chosen for their symbolic and image
attributes (Aaker 1997). By “image attributes,” we mean per-
ceptions of symbolic aspects of the brand that include its brand
personality (i.e., its human-like perceptions of being friendly,
honest, upper-class, exciting, etc.; Aaker 1997), perceptions
about the types of people who use it (Dichter 1985), and in-
tangible associations such as innovativeness and reliability.
Such abstract qualities are especially important in cross-cultural
research because of global brands’ ability to communicate
cultural meaning across markets (Aaker, Benet-Martı́nez, and
Garolera 2001; Torelli et al. 2012).

We follow prior literature (e.g., Torelli et al. 2012) in con-
ceptualizing these brand image attributes as being symbolic
of deeper cultural and societal values. Values are defined as
“desirable, trans-situational goals, varying in importance, that
serve as guiding principles in people’s lives” (Schwartz and
Bardi 2001, p. 4). They are conceptions of desirable end states
that reflect what people regard as important in life, including
preferences across brands and brand attributes (Torelli and
Kaikati 2009). Batra, Homer, and Kahle (2001) find that values
influence brand attitudes by prioritizing the importance of
product and image attributes to consumers. For example,
consumers higher on “other-directed values” (e.g., being well-
respected, having a sense of belonging) place a greater im-
portance weight on brand image attributes such as reputation
and style, whereas consumers higher on “self-directed values”
(e.g., self-fulfillment, self-respect) place a greater importance
weight on attributes such as care and product fit (Batra, Homer,
and Kahle 2001, p. 123). Other researchers (e.g., Aaker, Benet-
Martı́nez, and Garolera 2001, pp. 494–95) have identified
conceptual linkages between specific brand image attributes
(e.g., sincere, exciting, sophisticated) with specific types of life
values (e.g., security, excitement, status/prestige). Thus, varia-
tions across countries in the importance placed on particular life
values should lead to differences in the brand image attributes
these countries consider important. We next turn to research on
how societies differ in the importance they place on these un-
derlying values.

Cross-National Commonalities in the Importance of
Specific Values

Substantial prior research has documented variations in the
desirability (i.e., importance ratings) of life values across people
from different cultures (e.g., Hofstede 2001; Schwartz 1992,
2004). Value dimensions studied include individualism versus
collectivism, power distance, horizontal/equality versus vertical/
hierarchy orientations, masculinity/mastery versus femininity/
nurturance, uncertainty avoidance, and independent versus in-
terdependent self-construals (for reviews, see Gupta, Winkel,
and Peracchio [2009] and Shavitt et al. [2006]). Perhaps the
broadest examination of these cross-national value patterns is in

work by Schwartz (1992, 2004) and Schwartz and Bardi (2001).
They develop a cross-cultural values typology using data from
1988 to 1996 from over 60 nations. Data were collected on the
subjects’ rated importance of 57 individual values (e.g., social
status and prestige, safety, harmony and stability of society), and
45 of these were subsequently collapsed into ten multi-item
“value types” (Schwartz 2004).

The ten Schwartz value types (with sample items in parenthe-
ses), are POWER (status, prestige, authority), ACHIEVEMENT
(successful, ambitious, influential), HEDONISM (pleasure, enjoy-
ing life, sensuous gratification), STIMULATION (excitement,
daring, novelty), SELF-DIRECTION (independent thought, cre-
ativity, freedom), UNIVERSALISM (equality, unity with nature,
broadminded), BENEVOLENCE (helpful, honest, forgiving),
TRADITION (respect for tradition, devout, accepting my po-
sition in life), CONFORMITY (obedience, self-discipline, hon-
oring parents and elders), and SECURITY (safety, social order).
The value types found in Schwartz’s research have been shown
to map well onto the dimensions studied by other researchers
(Aaker, Benet-Martı́nez, and Garolera 2001; Inglehart and
Oyserman 2004). However, to our knowledge, they have never
been used in research on the positioning strategies of multi-
country brands.

Theoretical arguments for cross-national ranking of impor-
tance means. Schwartz (1992, 2004) and Schwartz and Bardi
(2001) find a striking degree of consensus across people in
different societies in the relative importance given to these ten
value types. As pointed out by Schwartz and Bardi, there are
strong reasons to expect this, given the “shared bases of values
in human nature and the adaptive functions of each value type
in maintaining societies” (p. 280). A basic social function of
values is to motivate and control group members to best
promote group survival and prosperity (Parsons 1951). Thus,
the relative importance societies place on these ten value types
should be driven by their differential utility in supporting
group welfare and interests.

Schwartz and Bardi (2001, pp. 280–82) theoretically propose
that societies use values to help meet three key requirements,
prioritized in this sequence of importance: (1) ensuring group
survival, by promoting cooperative and supportive relations
among members of primary groups; (2) seeking societal pros-
perity, by motivating people to invest time and effort to perform
productive work, solve problems, and generate new ideas;
and (3) allowing for (and legitimizing) the gratification of self-
oriented needs and desires, so that members do not get frustrated
and withdraw from investing in group goals. The theoretical
reason for this prioritization—and thus, for the relative impor-
tance of these ten value types—is that societal survival and se-
curity needs are naturally of primary concern, coming before
secondary and tertiary concerns about individual quality of life
and self-expression (Inglehart and Oyserman 2004). A growing
body of recent research (e.g., Gelfand et al. 2011; Henrich 2004;
Norenzayan and Shariff 2008; Norenzayan et al. 2016) has ar-
gued that less evolved societies that face more existential threats
logically give primacy to survival needs and the social values that
ensure survival before they begin to care about individual and
self-expressive needs.

Giventhissocietalroleofvaluesandthisprioritizationofsocietal
needs, it follows logically that the values of BENEVOLENCE
(toward one’s primary group members) are most critical for
group cooperation and survival, followed by UNIVERSALISM
(with its broader focus on all others). SELF-DIRECTION values

916 JOURNAL OF MARKETING RESEARCH, DECEMBER 2017

can also be expected to be highly ranked across cultures because
they motivate people to work productively, foster innovative
solutions to problems, contribute to prosperity in normal times,
and are especially “crucial to meeting the challenges posed by
change in times of crisis” (Schwartz and Bardi 2001, p. 282).
Schwartz and Bardi (2001) argue that because such self-direction
valuesprovideanintrinsicsourceofmotivation,their pursuitneed
not come at the expense of others in society; this value type thus
advances the second and third group priorities without under-
mining the first. Thus, in the Schwartz framework we adopt here,
SELF-DIRECTION values are very important in less evolved
societies as well, because rejecting them would create individual
frustrationandwithdrawalofinvestmentingrouptasks(Schwartz
and Bardi 2001, pp. 280–83).

SECURITY and CONFORMITY, which help avoid risk and
control forbidden impulses, serve to maintain the status quo and
thus come next in line in Schwartz and Bardi’s (2001) expla-
nation of the relative societal prioritization of these values.
These two value types are relatively less important than the first
group because they do interfere with people’s ability to find
innovative solutions to problems and gratify self-oriented
needs and desires. ACHIEVEMENT values are also placed
here (but not higher) in relative priority, because they can
motivate people to invest time and energy in tasks that serve
group interests but also have the potential to motivate self-
enhancing behaviors that can disrupt harmonious positive
social relations.

POWER, HEDONISM, and STIMULATION values, in con-
trast, should have the least relative societal importance for the
simple reason of “their irrelevance for the first two group re-
quirements” (i.e., societal priorities; Schwartz and Bardi 2001,
p. 282). Although these three value types are relevant to the
third-listed societal priority of helping meet self-oriented needs
(of physical gratification and optimal arousal), they are the most
likely to threaten positive social relations (POWER most of
all, as it implies dominance over people and resources, which
potentially entails harming or exploiting others).1 TRADITION
should also belong to this lowest-importance group, because
although it contributes to smooth group functioning, it pertains
to abstract beliefs more than it does to daily social behavior,
reducing its societal relevance.

Empirical support for cross-national ranking of impor-
tance means. Providing empirical support for this theoretically
developed importance prioritization, Schwartz and Bardi (2001)
show in their extensive cross-national data that values of
BENEVOLENCE, SELF-DIRECTION, and UNIVERSALISM
are observed to be (almost everywhere) much more highly
ranked (1, 2, and 3, respectively) than values of HEDONISM,
STIMULATION,TRADITION,andPOWER(ranked7,8,9,and
10, respectively), with values of SECURITY, CONFORMITY,
and ACHIEVEMENT being ranked in the middle (4, 5, and 6,
respectively). (For these importance means and ranks, taken from
Schwartz and Bardi [2001, Table 3, p. 275], see the Appendix.)

Variations in the Importance of Specific Values
Across Cultures

The previous discussion speaks to the universal logic for the
mean rankings that emerge when the Schwartz and Bardi
(2001) data are examined across nations. At the same time, we
also observe that in these data, although the consistency in
importance means is high for some value types, there is less
consistency for other types. The published data of Schwartz and
Bardi (see Appendix) also provide these variations (standard
deviations [SDs]) of the importance ratings of value types across
countries, not just the means. We first present this empirical
evidence, followed by a theoretical explanation.

Empirical evidence on variation in values’ importance.
Schwartz andBardi’s(2001) largest sample comesfrom teachers/
students from 56/54 countries. In these data, the degree of cross-
country consistency (SDs) of rated importance of value types
varies from roughly .25 at the low end to approximately .65 at the
high end, a range of .40 (on seven-point scales). Creating four
quartiles within this SD range enables us to put these ten value
types into four groups. Thus, national cultures seem to vary the
least in their rated desirability (i.e., have the lowest SDs) for the
life values of BENEVOLENCE (.28/.25), UNIVERSALISM
(.31/.29), SELF-DIRECTION (.31/.31), and ACHIEVEMENT
(.31/.30) and vary the most (i.e., have the highest SDs) for
POWER (.55/.43) and HEDONISM (.59/.65), with the rest
falling in the two middle quartiles.2

Theoretical explanation for cross-national variation in
values’ importance. Why might some value types be rated
higher in some countries than others, while other value types
stay relatively stable? Although there could be multiple ex-
planations, the literature has suggested that the natural evo-
lution of societies ought to lead to changes in the importance
placed on different values, in line with the adaptive functions
served by these values.

A growing body of multidisciplinary recent research has
argued that the values and norms that societies develop are an
evolutionary adaptation to the threats they face and the resources
they possess, with societies that develop the most ecologically
useful values and norms out-competing others in this process of
natural selection and advancement. Thus,Henrich (2004) argues
that prosociality values develop in order to restrain uncon-
trolled aggressive behavior, while Gelfand et al. (2011) show
empirically that, among 33 societies, those that face greater
threats (e.g., population pressure, resource scarcity, conflict,
natural disasters) tend to be “tighter” cultures, where social
norms and sanctions (i.e., “felt accountability”) are stronger.
According to Norenzayan and Shariff (2008) and Norenzayan
et al. (2016), when a society’s deities embody moral values and
are believed to reward/punish human behavior, its members are
less likely to freeload and more likely to show social solidarity
and cooperation.

Thus, less evolved societies facing more existential threats
logically give primacy to survival needs and the social values
that ensure survival. Societies where these first-order priorities
are met then begin to focus more on their secondary and tertiary

1Torelli and Shavitt (2010, p. 705) have argued that the meaning and
purpose of POWER values can differ across cultures, in some cases serving
nurturant goals. Here, we limit ourselves to the conceptualization and
measurement of POWER as “social status and prestige, dominance over
people and resources (social power, authority, wealth, preserving public
image)” (Schwartz and Bardi 2001, p. 270). Torelli and Shavitt (2010, p. 704)
note that Schwartz’s perspective has a strong relationship with authoritari-
anism and “is a good fit to a self-centered power concept.”

2We organize these data by quartiles because tests of the moderating effect
of a continuous variable are frequently performed by creating four quartiles
and testing for differences across the first and last quartiles, or by creating
thirds and testing for differences across the top and bottom thirds (e.g.,
Chandon and Wansink 2007). Issues with this “extreme groups approach” are
discussed by Preacher et al. (2005).

Positioning Multicountry Brands 917

societal needs (Inglehart and Oyserman 2004; Schwartz and
Bardi 2001). According to a time-series analysis discussed by
Inglehart and Oyserman (2004), as economies develop and
prosper, societies move from a focus on collective economic and
physical security, hard work, and shared societal goals toward
an emphasis on personal autonomy, self-fulfillment, and the
pursuit of individual pleasure and an exciting life. Accordingly,
as social structures evolve and mature, and after group survival
is ensured and societal prosperity is secured, the gratifi-
cation of self-oriented needs and desires gains importance.
Values serving secondary and tertiary functions thus gain in
importance in a sequential fashion, while the importance of
values that serve primary functions remains high (Schwartz
and Bardi 2001). Thus, it follows logically that societies
at different levels of development should evidence more
consensus on the importance of values serving first-order
functions (e.g., BENEVOLENCE) and be less consistent in
the importance they place on cultural values serving lower-
order functions (e.g., POWER).

3

These data from Schwartz and Bardi (2001), and the afore-
mentioned theoretical frameworks that account for them, thus
offer very useful insight into the specific nature of values that
vary in the degree to which they “unite” us (i.e., are more
uniformly desired) versus “divide” us (i.e., are less uniformly
desired). As Ryans, Griffith, and White (2003) point out, this
is a crucial variable that prior research in the standardization
(global marketing strategy) literature has not yet empirically
utilized. We contribute to this literature by drawing and testing
the implications for global brand management of these con-
sequent variations in the cross-national consistency of societal
values.

Combined, the theoretical explanations and data suggest the
following:

H1: Multicountry brands gain in overall cross-national attitudes
by being consistently positioned on image attributes (and
underlying values) that are themselves desired most equally
across markets. In contrast, multicountry brands lose in overall
attitudes by being consistently positioned on image attributes
that vary the most in desirability across markets.

This should happen because, as discussed previously, at-
titudinal responses to the brand should be positive everywhere
for universally important values, leading to high overall brand
attitudes. For values that vary in their cross-national impor-
tance, however, attitudinal responses should be high in some
countries but low in others, leading to relatively lower overall
cross-national brand attitudes.

For theory-testing purposes, we limit ourselves to the values
at the extreme first and fourth quartiles of the SD distribution:

H1a: High cross-national consistency of a brand on image
attributes reflecting consumer values of BENEVOLENCE,

UNIVERSALISM, SELF-DIRECTION, and ACHIEVEMENT
are positively associated with overall brand attitudes.4

H1b: High cross-national consistency of a brand on image attributes
reflecting consumer values of POWER and HEDONISM are
negatively associated with overall brand attitudes.

Exploring the Moderating Influence of Competitive Context

The literature on international marketing strategy has em-
phasized the important impact of the competitive environ-
ment’s cross-market variation on standardization decisions,
arguing that when a multimarket brand faces a more varied set
of competitors, standardization of its own image-positioning
strategy may be detrimental for performance. Specifically, Jain
(1989, p. 74) cites theoretical arguments in the prior literature
(Copeland and Griggs 1985; Quelch and Hoff 1986) to pro-
pose that “if a firm competes with varying rivals in different
markets, it should lead to reduced standardization in the focal
firm’s marketing strategy.” Samiee and Roth (1992) list the
presence of similar standardized products marketed by the
firm’s major competitors as one of the external factors that
favors a more globalized marketing strategy. This is also in line
with the theoretical arguments in the economics and com-
petitive strategy literature streams on “multipoint competition”
(where firms compete in more than one market simultaneously;
Gimeno 1999; Karnani and Wernerfelt 1985).

The set of competitors a multicountry brand faces often
varies: the German chemical and consumer goods company
Henkel, for instance, has found that its set of top three com-
petitors is different in each of its six major European markets
(Arnold and Schroiff 2004). As an example from our BAV
data, we find that the consumer electronics brand Leica faces
mostly similar competitors in Germanyand Japan (e.g., Pentax,
Samsung, Sharp, Sony, Minolta), with only a few that differ
(Grundig, Practica, Schneider, and Nordmende are competitors
only in Germany). The number of varying competitors is much
greater in our data for the financial services brand BNP. Although
it faces some of the same competitors in France and Japan (e.g.,
AmericanExpress,Citibank,Mastercard/Eurocard,Visa), it faces
many more locally varying but still strong competitors in these
markets (e.g., Japan: Shinsei Bank, Saison, Nippon Shimpan;
France: Bank Populaire, Carte Bleue, Credit Lyonnaise).

It is a fundamental marketing strategy principle that a brand
that does not respond to competitive positioning platforms
likely loses out in terms of consumer attitudes (e.g., Carpenter,
Glazer, and Nakamoto 1994; Van der Lans, Van Everdingen, and
Valentyna 2016). Therefore, a multicountry brand that faces
greater competitive heterogeneity—and thus, a greater potential
range of competitive positioning platforms—should logically
vary its own brand positioning more across these markets. As an
example, Samsung mobile phones face lower-priced Chinese
competitors such as Huawei and ZTE in Nigeria but face premium
competitors such as the Apple iPhone in the United States. Using
an “affordable” image positioning in Nigeria but a “premium” one
in the United States—thus sacrificing global consistency—might
increase overall global attitudes more for Samsung than a strategy
that insists on a consistently premium position worldwide.

3We note that most of the specific values that have low importance SDs
also have high importance means (e.g., BENEVOLENCE), and that most of
the values that have high importance SDs also have low average importance
mean scores (e.g., POWER). This is theoretically reasonable: because values
such as POWER are relatively lower in the importance prioritization in less
evolved societies (Schwartz and Bardi 2001), and gain in importance only
with societal evolution, becoming higher-rated only in the smaller subset of
more evolved societies, they should naturally end up with both lower average
importance means and higher cross-national SDs. In our “Analysis” section,
we address the methodological implication of this near-confounding of SDs
with means.

4We include ACHIEVEMENT in H1a because it, along with the other three
values listed with it, falls within the lowest quartile of SDs in the Schwartz
and Bardi (2001) data that we use here (see footnote 3). Our data (discussed
subsequently), did not, however, allow us to test this hypothesized effect for
ACHIEVEMENT.

918 JOURNAL OF MARKETING RESEARCH, DECEMBER 2017

Despite this prior recognition of the importance of com-
petitive consistency as a determinant of the standardization
decision for multimarket brands (e.g., Jain 1989), it has not
been empirically tested with objective market/consumer data.
Nor has it been tested empirically with market data in the
“multipoint competition” literature (beyond some simulation
results). Given that the BAV data set provides us the opportunity
to empirically calibrate the degree of competitive set hetero-
geneity across markets, we thus explore in these data how
the relationship between the focal brand’s degree of overall
image consistency and its overall consumer attitudes varies
with the heterogeneity of its competitive set across its
markets. We also explore how this moderating effect of
competitive set heterogeneity might further vary with the
nature of the cross-cultural values (image attributes) on which
the focal brand is consistently positioned. (Because the de-
tails of these analyses cannot be accommodated within this
article, we provide a summary here and detail them in the
Web Appendix.)

DATA SETS AND PRELIMINARY ANALYSES

The main data that we use come from the Young &
Rubicam (Y&R’s) proprietary BAV database. These data
are collected for commercial use to track how consumers
in multiple countries perceive brands of interest, and they are
not designed to test hypotheses such as ours. Although this
creates several difficulties (described subsequently), these
BAV data nonetheless provide a rare and valuable oppor-
tunity to test our theory-based hypotheses, with important
potential implications for global brand management theory
and practice. Our portion of this field data consists of per-
ceptual (image) and attitudinal ratings from 64,790 consumers
in 22 representative countries on 1,723 brands competing
cross-nationally in more than 27 broadly defined product and
service categories. Next, we outline the details and charac-
teristics of the data set and describe the data-preparation
techniques. Then, we describe the additional research and data
we used to link these BAV brand attributes to the Schwartz
value types used in our theoretical development.

BAV Data

Countries, categories, and brands. We used BAV data
from 22 countries in our analyses5 to include countries at
different levels of economic development, from different re-
gions of the world, with different social contexts; these data sets
contained complete, comparable information on our variables.
Several are large and growing “emerging markets” (e.g., Brazil,
Mexico, India, China, Malaysia). We analyzed 1,723 brands
that were present in at least two countries (thus qualifying them
for the necessary “multicountry” status). Brand ratings were
collected from respondents with no indication of product cate-
gory. The BAV then classified the brands into (possibly several)
microcategories, 224 in all. To allow our analysis to account for
the category, we consolidated these into 27 macrocategories and

assigned every brand to the one category (e.g., personal hygiene)
in which it had the highest usage across all countries.

Sample and data collection instrument. It is important to
note that the same data were collected on each of these brands
with standardized questionnaires, using similar data collection
methods across the 22 countries. For example, in the United
States, the BAV survey is administered quarterly (covering
different brands); it uses 22 versions of a 24-page mail
questionnaire (each covering a subset of the complete brand
list), with response rates of 66% on average, resulting in
approximately 6,600 respondents per quarter from a panel
of about 10,000 respondents. In all countries, the samples
are balanced by the local data collection vendor to match
local census proportions on age, gender, and region. In
non-English-speaking countries, standard back-translation
procedures are employed to create the local-language ques-
tionnaire versions. Consumers rate multiple brands from
multiple product categories. Although the goal is to cover
all the major brands, not all brands in each category are rated;
this is an unavoidable limitation of the BAV data. (As we
explain further, we analyze the data at the level of brands,
not individuals.)

Variables and constructs. Our data contain consumer ratings
of these brands on various dimensions. In the BAV survey,
brands that fulfill the initial minimum knowledge (familiarity)
requisite (a nonzero level) are then rated on the variables we
describe next, as well as a few other BAV variables (regard/
esteem and relevance).6 The data we use contain 48 brand
attribute ratings, where consumers provide a “yes/no” response
to a checklist of attributes, indicating whether (1) or not (0) they
associate a certain characteristic with that particular brand. Some
of these variables assess consumer perceptions of a brand’s
overall attitude-like perceptions such as “best brand,” “worth
more,” “high performance,” and “high quality.” Others pertain
to brand personality/image (Aaker 1997), in which brands are
rated on selected personality adjectives such as “arrogant,”
“helpful,” and “stylish.” For a full list of constructs and variables
in our data, see Table 1, with noted links to Aaker’s (1997)
work.

Data preparation. Our hypotheses are stated at the level of
brands, which serve as our unit of analysis. Importantly,
they are not stated at the level of individuals, who provided
the binary (yes/no) responses. Furthermore, because these
individual-level ratings are binary, they do not assess the
degree to which consumers believe a brand possesses a
given attribute. Therefore, to obtain brand-level and non-
binary measures suitable for analysis, we computed the pro-
portion of respondents who associated a certain image attribute
with a given brand separately for each country (e.g., 22% of
Canadians rated Brand X as “rugged”). Some of the 48 at-
tributes were later combined into higher-order factors based on
factor analysis, and some were used to measure brand attitudes;
we describe these steps next.

Consistency of positioning for a given brand (our in-
dependent variable) could be assessed through the SD of
the within-country proportions across countries (e.g., 22% of
Canadians, but only 10% of Japanese, rate brand X as rugged). A
small SD would indicate that a brand is viewed similarly across5The countries from which we used BAV data included the United Kingdom

(3,614 respondents), France (2,327), Germany (4,388), Holland (1,501), Italy
(2,272), Poland (2,503), Spain (2,854), Sweden (1,579), Australia (3,841), New
Zealand (2,399), Brazil (2,982), Chile (2,481), Mexico (2,980), Peru (1,647),
Uruguay (1,879), India (3,016), China (5,033), Malaysia (1,464), Thailand
(1,897), Japan (2,219), Canada (2,587), and the United States (9,327).

6These variables are used by BAV for its own purposes and were included
in our analyses simply as control variables because we have no theory or
hypotheses concerning them.

Positioning Multicountry Brands 919

countries. Before calculating the cross-country SDs, however,
we first needed to correct the within-country proportions for
response style and scale-usage differences (i.e., differential
rates of usage of the “yes” response category, by country;
Baumgartner and Steenkamp 2001). Therefore, to make these
within-country proportions amenable for cross-country analysis
(Fischer 2004; Van de Vijver and Leung 1997), we performed
the specific type of within-country standardization (ipsatization)
recommended by Fischer (2004, p. 277; see Figure 1 and Web
Appendix A).7

Factor-analytic data reduction and attitudinal depen-
dent measure. As we have mentioned, the 48 original BAV
items were subjected to exploratory and confirmatory factor
analyses (EFAs and CFAs) to reduce possible collinearity and
suggest logical multi-item scales for our subsequent regression
analyses. These analyses yielded six CFA-validated factors,
which we used in the subsequent regression analyses as multiple-
item scales. (Possibly because of prior factor reduction by the
BAV, 17 of the 48 items did not load on multi-item factors and
were included in our analyses as single-item measures.) Details
of these factor analyses appear in Web Appendix B.

In the first of the six CFA-validated factors, seven of the
BAV items (best brand, high performance, high quality,
reliable, trustworthy, worth more, and leader) were found to
load together, capturing an overall “attitudinal positivity”
assessment. Although this measure did not include more
standard evaluative attitudinal items (e.g., good/bad), it
clearly captures an overall evaluation of the brand (best
brand, worth more, leader), which has been found to be a
strong predictor of subsequent purchase behaviors. It also
contains the kinds of summative assessments of underlying

attributes (high performance, high quality, trustworthy,
reliable) that attitude theory considers as contributing
to such overall evaluations (for a review, see Wilkie [1994,
pp. 280–307]). This brand attitudes scale (a = 0.88)
thus constitutes the dependent variable in our regression
analyses, subsequently regressed on our image consistency
data.

For brevity, we do not detail the five other multi-item
brand image factors created using the CFA (labeled F for
factor: F-Momentum, F-Elite style, F-Friendly, F-Rugged,
F-Helpful), but they appear in Table 2. The table also re-
ports, for each factor, the constituent items we used, as well
as the reliabilities, the Fornell and Larcker (1981) average
variance extracted measures of convergent validity, and
discriminant validity test statistics; all met conventional
criteria.

Matching the BAV Data to Schwartz’s Life Value Types

Our conceptual development relies on Schwartz’s life values.
However, the BAV image attribute data we are using to oper-
ationalize them (single-item and multi-item measures) did not
utilize Schwartz’s own measures. Thus, it is necessary to relate
these two sets of data prior to performing the regression-based
tests of our hypotheses. We do this in Web Appendix C, using
(1) definitions and adjectives used by the BAV, Schwartz (1992,
2004), and Schwartz and Bardi (2001); (2) conceptual linkages
made by others in the prior literature; (3) linguistic searches of
dictionaries and thesauri; and (4) primary data from consumers
through four “matching studies.”

We conducted these matching studies to serve as sup-
plementary data, aimed at uncovering the pattern of matching
relationships as perceived by consumers. In these four studies,
we directly asked respondents to “match” Schwartz’s ten value
types to our BAV image attributes after presenting descriptions
of each (as depicted in columns 1 and 2 of Table 3). Participants

Table 1
BAV VARIABLE DESCRIPTIONS

Variable Name/Variable Group Explanation Measurement

Knowledge/Familiaritya Consumers’ overall awareness of the brand; the extent of
understanding of what the brand stands for.

Seven-point scale question (“never heard of” to “extremely
familiar”)

Esteem/Regarda How highly consumers think and feel about the brand; the
extent to which consumers like a brand and hold it in high
regard.

Seven-point scale question (“extremely low regard” to
“extremely high regard”)

Relevancea The breadth of a brand’s appeal; the extent to which a brand is
perceived to be appropriate for a respondent’s needs.

Seven-point scale question (“not at all relevant” to “extremely
relevant”)

Brand image attributes Arrogant, authentic,b carefree, cares about customers,
charming,b daring,b different,b distinctive, down to earth,b

dynamic, energetic,b friendly,b fun, gaining in popularity,
glamorous,b good valueb, healthy, helpful, independent,b

innovative, intelligent,b kind, obliging, original,b prestigious,b

progressive, restrained, rugged,b sensuous, simple,b social,
socially responsible, straightforward, stylish, tough,b

traditional, trendy,b unapproachable, unique,b up to date,b

upper classb

0 (no) or 1 (yes); checklist-type response style.
Items are treated individually or as multiple-item composites
(see text and Table 2 for details).

Brand attitudes Best brand, worth more, leader, high performance, reliable,
trustworthy, high quality

0 (No) or 1 (Yes).
Items are combined into a seven-item composite (see Table 2)

aWe did not use these variables to test our hypotheses but instead used them only as control variables because models using BAV data typically include them.
Their cross-country consistency did not significantly affect brand attitudes in our models either as a main effect or in their interaction with brand image consistency.

bItems appear in Aaker’s (1997) list (with exact or very similar wording).

7We also estimated those models using interquartile ranges as an alternative
measure of consistency, as well as SDs of arcsine-transformed proportions, with
substantively similar results, which can be obtained from the authors.

920 JOURNAL OF MARKETING RESEARCH, DECEMBER 2017

indicated the best match or selected as many matches as
they liked (including a “none of these is a good match”
option). The first two studies used English-speaking stu-
dents from a Midwestern U.S. university (Study 1: n = 115;

Study 2: n = 122). The other two studies (Study 3: n = 258;
Study 4: n = 198) used an international online panel from
countries that were among (or geographically close to) the
countries in our BAV data set. Those matching relationships

Figure 1
SCHEMATIC OF DATA TRANSFORMATIONS: RATIONALE AND PROCEDURE

Step Description
of Data

Problem to Be
Addressed

Resulting Transformation
Applied, Logic

Subsequent
Data Analysis
Procedures

1 Individual-level binary
data (yes/no) on
individual image

attributes.

Such binary data are not
suitable for factor

analyses, and
hypotheses are at brand

(not individual) level.

Compute brand-level
proportions per country for

each image attribute.

2
Brand-level

proportions within
each country
(precentage

responding “yes” for
that image attribute for

that country, per
brand).

Factor analyses
(EFA, CFA) use

brand-level
proportions.

3

4 Brand-level
proportions within

country on individual
image attributes.

Idiosyncratic response
style biases within each
country lead to variation
in means and standard

deviations for these
proportions across

countries.

Standardize the brand-level
proportions within country,

using the means and
standard deviations for that

country on that image
attribute, across all brands

there.

Regressions use
within-country

standardized brand-
level proportions in

calculations of
standard deviation.

5

Notes: In reviewing the statistical properties of different types of ipsatization procedures, Fischer (2004) concludes that ipsatization can yield spurious factors in
factor analyses (p. 273) but that regression analyses using data ipsatized (standardized) on within-group or within-culture adjustments (vs. within-subject
adjustments) yield meaningful estimates of effects at individual and group/culture levels (p. 277). Thus, this is the type of within-country ipsatization we
utilize. Web Appendix A provides details.

Positioning Multicountry Brands 921

that were consistently and unambiguously8 indicated as the
highest proportion in these data—as established through
likelihood ratio tests (see Table C-1 in Web Appendix C)—
were taken as representing a strong perceived match between
BAV attributes and Schwartz value types (column 5 in
Table 3).

We then used the findings of the empirical matching studies,
along with additional semantic and conceptual analyses (steps
1–3 as noted previously), to determine the final linkages be-
tween Schwartz value types and BAV items. For instance, in
describing the POWER value type, Schwartz and Bardi (2001)
themselves use words such as “social status,” “prestige,” and
“public image,” as well as “social power” and “authority.”
From the prior literature, Aaker, Benet-Mart́ınez, and Garolera
(2001, pp. 494–95) argue that brand image attributes of being
upper class and glamorous should relate well to values of status
and prestige, which Schwartz includes within his POWER
value type.Torelli andShavitt (2010,p. 704) note that Schwartz’s
conceptualization of POWER is closely linked to authoritari-
anism. Common adjectives for “power” include “domination,”
“might,” “force,” “strength,” “privilege,” “supremacy,” and “un-
approachable.” Our supplementary empirical matching studies
showed support for a match between Schwartz’s POWER value
and the BAV image items/factors of arrogant, unapproachable,
F-Elite Style (glamorous, prestigious, stylish, upper class),
F-Momentum (gaining in popularity), and F-Rugged (rugged,
tough).

Utilizing all the conceptual, semantic and empirical infor-
mation, the last column of Table 3 summarizes the linkages we
make between the Schwartz value types and the BAV image
attribute data. For the reasons detailed in Web Appendix C,
and summarized in Table 3, HEDONISM is captured best

by “sensuous” and “healthy”; POWER by “arrogant,” “un-
approachable,” F-Elite style, F-Momentum, and F-Rugged;
CONFORMITY by “restrained”; TRADITIONAL by “tra-
ditional”; and STIMULATION through the energetic com-
ponent of F-Momentum. SECURITY and ACHIEVEMENT
do not find good matches in the BAV data. SELF-DIRECTION
is best captured through “independent,” “unique,” and “origi-
nal,” while UNIVERSALISM and BENEVOLENCE (which
show high overlap) are best matched with the BAV adjectives
“down to earth” and “social” as well as F-Helpful (including
obliging) and F-Friendly, respectively.

Thus, our subsequent tests of H1a use the listed BAV attri-
butes linked to the Schwartz value types of BENEVOLENCE,
UNIVERSALISM, and SELF-DIRECTION (collectively, BUS),
omitting ACHIEVEMENT, which lacks good matches; our
tests of H1b use the BAV attributes linked to POWER and
HEDONISM (collectively, PH).

Competitive Set Consistency: Hellinger Indices

To enable us to explore the moderating influence of com-
petitive context, each brand requires a measure of consistency
for the set of competitors it faces in its category, taken across all
its markets. For each category in each country, the BAV data
set includes consumer-provided ratings for the many (but not
all) competitive brands in that category, including local ones,
that appeared in the BAV questionnaire. Using the list of com-
petitive brands in each country and category, one can compute
an index of competitive set consistency, called the Hellinger
index (HI), fully detailed in Web Appendix D. This index
measures, for a focal brand, the consistency of the competition
encountered across countries in two steps. First, for each brand
we computed the Hellinger affinity, a measure (see Lee 1999)
that quantifies the degree to which that brand’s competitors
overlap in exactly two target countries. We measured this
through the “usage” variable—the proportion of people who use
each brand (not only the focal one) in those two countries.
Second, we combine the Hellinger affinity scores for the focal
brand from these multiple countries into a weighted average,
the HI, with the weights being the gross domestic product of
each country (adjusted for purchasing power parity). (A detailed

Table 2
CFA: CONVERGENT AND DISCRIMINANT VALIDITY STATISTICS FOR FACTOR CONSTRUCTS

DV Brand Attitudes F-Momentum F-Elite Style F-Friendly F-Rugged F-Helpful

DV (Brand Attitudes) .52
Alpha = .88 (best brand, high performance, high quality,

reliable, trustworthy, worth more, leader)

F-Momentum .29 .55
Alpha = .90 (daring, dynamic, energetic, gaining in

popularity, innovative, progressive, up to date)

F-Elite Style .30 .17 .62
Alpha = .87 (glamorous, prestigious, stylish, upper class)

F-Friendly .34 .41 .08 .56
Alpha = .70 (friendly, carefree)

F-Rugged .01 .04 .01 .29 .56
Alpha = .71 (rugged, tough)

F-Helpful .29 .29 .17 .20 .01 .54
Alpha = .82 (helpful, socially responsible, cares about

customers, obliging)

Notes: Matrix shows phi squares in the main cells and column construct average variance extracted (in boldface) in the diagonal.

8When an image adjective cross-loaded highly on more than one Schwartz
value, it was excluded from further consideration as an indicator of those
Schwartz values, just as an item cross-loading highly on two factors in a
factor analysis would not be considered a valid indicator of either of those
factors. For example, the BAV image attribute “fun” loaded highly on both
the STIMULATION and HEDONISM Schwartz values (e.g., at 54%–55%
levels on both, in our empirical Study 4), and therefore we did not use it as an
image attribute indicator for either of those values.

922 JOURNAL OF MARKETING RESEARCH, DECEMBER 2017

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to
ry

Positioning Multicountry Brands 923

T
a
b
le

3
C
O
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T
IN
U
E
D

S
ch
w
a
rt
z
V
a
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efi
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it
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s
(I
te
m
s)
a
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p
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u
p
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a
ly
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sc
E
m
p
ir
ic
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l
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u
p
p
o
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in
a
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M
a
tc
h
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B
A
V
It
em
/F
a
ct
o
r
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el
ec
ti
o
n
s

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L
F
-D

IR
E
C
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IO

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In
d
ep
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t
th
o
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t
an
d
ac
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o
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–

ch
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ea
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pl
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g

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re
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s)

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n
iq
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(i
m
ag
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at
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e)

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au
th
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au
to
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u
n
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is
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(i
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R
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eb

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ch
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ic
ti
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ry
.

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R
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s
to

co
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m
at
ch
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g
st
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d
ie
s
(s
ee

W
eb

A
p
p
en
d
ix

T
ab
le

C
-1
).

924 JOURNAL OF MARKETING RESEARCH, DECEMBER 2017

example appears in Web Appendix D, and all calculations are
available in supplemental spreadsheet D-1.) In short, a higher HI
score thus means greater competitive set similarity, taking into
account differences in consumer usage and market size across
the countries in question. For our previous examples of Leica
and BNP, the HI for Leica was .73, showing greater competitive
set similarity than the .13 for BNP.

ANALYSES AND RESULTS

Tests of Hypotheses

Overview. We first examine the overall expectations of H1,
after which we present the tests for the specific predictions of H1a
and H1b (i.e., of consistent positioning on BUS vs. PH image
attributes). These formal statistical tests are followed by a de-
scriptive brand attitude analysis. We then provide a brief
summary of our exploratory analyses concerning the moderating
influence of competitive set consistency on the relationships
in H1.

Tests of H1: effect of image consistency on brand attitudes.
These tests employed a series of regression analyses. The
dependent variable in all was the brand attitudes composite
described previously (of seven performance-related attributes;
e.g., best brand), standardized within country. This overall
brand attitude score was regressed on (1) the cross-country
consistency (SDs) measures of 15 BAV brand image single
items (e.g., arrogant, unique) and five multi-item scales (e.g.,
F-Elite Style, F-Rugged) that had all shown adequately high
levels of matching with the Schwartz value types, (2) the HI
of competitive set consistency, (3) the three BAV control vari-
ables (knowledge, esteem, and relevance), and (4) a variable
to capture the mean levels of the Schwartz value types to
partially control for the potential confounding of means and
SDs mentioned in footnote 4.9 See Table 4.

The regression estimates we relied on in Table 4 were obtained
by using weighted ordinary least squares (WLS) regression, with
the weights being the number of countries in which the particular
brand appears (ranging from 2 to 22). In addition, because each of
our brands lies (for analytical purposes) in a single product
category, and because the effects of interest will likely vary across
categories, we repeated the H1 analyses using a (Bayesian)
hierarchical linear models (HLM) approach to account for such
potential “category heterogeneity” effects. For brevity, because
the HLM results were substantively very similar to the

WLS

results, we do not discuss the HLM results in the text; Table 4
presents both setsof results for easycomparison.Web Appendix
E describes the HLM technique, the models we estimated using
it, our HLM results, and our commentary on those results.

Omnibus test of H1. It is important to first determine whether
the overall pattern of all the attribute-linked regression co-
efficients in Table 4 is consistent with our core theory-based
expectations (H1). We have argued that brands should benefit
(vs. lose) from being consistently positioned across markets on
image attributes that match consumer values that are themselves
consistently important (vs. vary in importance). This implies that
inconsistency on a brand image variable (higher SD) should yield
positive impact on brand attitudes, reflected by a more positive
regression coefficient, when the image attribute corresponds to a
value that has higher cross-cultural variation in importance (a
higher Schwartz SD). Analogously, greater inconsistency (higher
SD) on an image attribute should yield negative (or less positive)
regression coefficients when the image attribute corresponds to
a Schwartz value with lower cross-cultural importance variation
(a lower Schwartz SD). In summary, our hypothesis predicts a
positive correlation between the Schwartz SDs of the matching
values and our regression coefficients.

To test this omnibus expectation, we computed the corre-
lation between the WLS regression coefficients estimated and
their corresponding Schwartz SDs across our 20 brand image
variables/factors listed as independent variables in Table 4.
This correlation coefficient between the Schwartz SDs and the
WLS regression coefficients is .60 (p < .005).10 To check the robustness of this analysis to scaling assumptions, we repeated it by retaining only the signs of the regression coefficients and estimating a binary logistic regression with the Schwartz means’ principal factor as the sole covariate. Results were substantively identical (c2(1) = 6.9, p < .01).11 Thus, our core theoretical expectation in H1 finds support at this overall level.

We next turn to the individual regression coefficients in
Table 4 to determine whether they support the directional
subhypotheses H1a and H1b. We test for such support at two
levels: at the most disaggregate level (of individual variables/
factors) and at a more aggregate level (with relevant variables/
factors pooled together).

Disaggregate test of H1a: negatively significant relations.
Table 4 contains our disaggregated regression coefficients,
with the variables and factors ordered to match the following
results presentation. We first use the WLS estimates to test H1a,
the hypothesis that multicountry brands should have higher
overall brand attitudes if they are more consistently positioned
across their markets (with smaller cross-country SDs) on
image attributes that match the Schwartz values that are desired
most similarly across our BAV markets (i.e., BUS). Thus, we
hypothesize a negative relationship for these three value types,
such that a higher SD (more inconsistency) should reduce

9As mentioned in footnote 4, value types that are most consistently
preferred, such as BENEVOLENCE, are also rated highly on average im-
portance levels. Thus, the consistency with which brands communicate
certain value types is necessarily confounded with the mean importance of
those same values. To partially control for this potential confound, we
therefore include in our analyses the first principal factor for the importance
means of these values, as measured through the matched BAV attribute data.
That is, for each brand, just as we computed its SD across countries on each
attribute proportion, we also computed its mean across countries on each
attribute. We then entered these attribute means (on each of the BAV single
items and multi-item factors) into a principal components factor analysis,
with brands as the unit of observation (the rows of the data matrix). The first
principal factor alone accounted for approximately one-quarter of the var-
iance in the entire set of means, further underscoring the degree of collin-
earity. The factor score on the first principal factor for that brand was then
calculated and retained as another brand-level measure. The included
principal factor improves fit slightly: weighted least squares analysis without
this factor achieves an adjusted R2 of .78; including it raises it to .80 (d.f. =
1,697). Note that all these models also include the three BAV control
variables.

10Note that the r = .60 value translates into a t = .6/sqrt[(1–.62)/(n − 2)],
where n = 20, so t = 3.182 (d.f. = 18), implying a p-value of approximately
.0026.

11Note that we included the full set of regressors in these two prior an-
alyses, as theory dictates, but did not systematically account for their varying
significance levels. To guard against this, we next took 1 million samples
from the joint posterior distribution of all the (standardized, WLS) regression
coefficients and computed r and p-values for each. The median r is .573,
median p-value is .0078, and the histogram of r (not included, for brevity) is
extremely strongly bounded away from zero. (Details of all these tests appear
in Web Appendix E.).

Positioning Multicountry Brands 925

attitudes. Of the nine variables/factors that represent these three
BUS Schwartz value types (F-Friendly, F-Helpful, social, down-
to-earth, distinctive, authentic, original, unique, and independent),
three are significant (F-Friendly, social, and original; p < .05) and one is marginally significant (unique; p < .09) in the predicted negative direction. Two (down-to-earth and F-Helpful) are significant in the opposite (positive) direction. Three others (authentic, independent, distinctive) are nonsignificant. Thus, we do not find support for H1a in Table 4 at this most disaggregate level (only three of nine variables support it).

Disaggregate test of H1b: positively significant relations.
H1b, however, does find substantial support even at this most
disaggregate level (in Table 4). This hypothesis argued that
brands that are more consistent across their markets (smaller
SDs), on those image attributes that vary the most in de-
sirability across markets per Schwartz’s values typology (PH),
should have lower overall brand attitudes. Accordingly, we
hypothesize a positive relationship, such that a higher SD (more
inconsistency) should increase brand attitudes.

Of the seven variables/factors that represent these two PH
Schwartz value types (sensuous, healthy, arrogant, unap-
proachable, F-Elite Style, F-Momentum/gaining in popularity,
F-Rugged), five are significant at p < .05 in the predictedpositive direction (healthy, unapproachable, F-Elite Style, F-Momentum, and F-Rugged). One attribute approaches significance (arrogant;

p < .10) in the predicted positive direction, and one approaches significance in the opposite direction (sensuous; p < .08). Thus, five of seven coefficients support H1b. In addition, though this finding is not part of a hypothesis test, we note that of the other BAV items in the regression estimates that operationalize the Schwartz value types that appear in the middle of the SDs range, only one is marginally significant, in a negative direction (tra- ditional; p < .08).

Test of H1a and H1b at a pooled level. We also performed
a test of these directional subhypotheses at a pooled level,
estimating a second WLS regression model in which we used
the SDs of only the individual image factors/variables that are
relevant to H1a and H1b, aggregating these into two com-
posites, SD_BUS and SD_PH. We computed SD_BUS using
the square root of the sum of the variances of its nine com-
ponents, and SD_PH as the square root of the sum of the
variances of its seven components (all listed previously with
the disaggregate tests). Such aggregation of the image factors
and variables should increase the power of our test (Gelman
and Hill 2006, chapter 4.6), albeit at the expense of a disag-
gregate account.

The same control variables listed in Table 4 were used in this
second WLS regression model (knowledge, esteem, and rele-
vance; the first factor of means; and the HI), and all independent
variables were mean-centered. In this model estimate, SD_BUS
had a significant negative effect on brand attitudes (−.047, p < .001), indicating that a higher SD (i.e., reduced consistency) of the BUS composite relates negatively to brand attitudes, in support of H1a. However, SD_PH had a significant positive effect on brand attitudes (.129, p < .001), indicating that a higher SD (reduced consistency) on the PH attributes relates positively to brand attitudes, in support of H1b. Thus, these pooled analyses show support for both H1a and H1b.

Discussion of H1 results. Thus, summarizing these results,
we find that the attitudinal payoff for brands that pursue a high-
consistency strategy in their positioning worldwide does in-
deed depend on whether the specific image attributes on which
they are consistently positioned are themselves desired uni-
formly across those markets (support for H1 in the omnibus
test). For our directional subhypotheses, the empirical evi-
dence is stronger for H1b—supported at both the pooled and
disaggregate levels of analysis—showing that if those image
attributes represent values that vary most in their global appeal
(e.g., PH), it is wiser for multicountry brands to vary their use
rather than deploy them consistently.

The empirical evidence in our data are somewhat less sup-
portive for the relationship in the opposite direction (H1a), which
argued that for brand image attributes that represent values that
vary less in their global appeal (e.g., BUS), global brands are
better served by a strategy of consistent worldwide positioning.
For H1a, we do not find support at the most disaggregate level,
but support does exist at the pooled level. In our “Discussion”
section, we review several possibilities for why we find a rel-
atively weaker level of support of H1a.

Descriptive Brand Attitude Analysis of the Danger from
PH Consistency

The significant results for H1b suggest that brands positioned
consistently across countries on PH values run the real risk of
generating less positive attitudes in countries where these two
values are not rated as important. (In our BAV data, for instance,
PH values have their relatively highest mean importance ratings

Table 4
TEST OF H1: WLS AND HLM ESTIMATES (STANDARDIZED

COEFFICIENTS)

WLS

HLM

Variable Fixed Effects Fixed Effects
Random Effects:

Variances

Intercept −4.307** (.149) −3.790** (.169) .919 (.020)
HI .658** (.053) .681** (.065) .398 (.075)
Arrogant .040* (.025) .044 (.031) .043 (.018)
Authentic −.041 (.026) −.011 (.028) .070 (.031)
Distinctive .025 (.025) .029 (.027) .025 (.025)
Down to earth .062** (.026) .049* (.029) .062 (.016)
Fun −.357** (.030) −.308** (.035) .092 (.034)
Healthy .141** (.022) .088** (.028) .118 (.026)
Independent .018 (.023) −.005 (.028) .127 (.020)
Original −.054** (.025) −.035 (.030) .095 (.017)
Restrained .010 (.022) .020 (.026) .066 (.018)
Sensuous −.039* (.022) −.012 (.025) .009 (.013)
Social −.089** (.026) −.119** (.029) .046 (.023)
Traditional −.043* (.025) −.001 (.030) .102 (.026)
Trendy .000 (.026) −.005 (.028) .071 (.014)
Unapproachable .102** (.023) .064** (.027) .046 (.012)
Unique −.042* (.024) −.039 (.026) .052 (.016)
F-Elite Style .137** (.034) .154** (.039) .090 (.048)
F-Friendly −.082** (.032) −.078** (.035) .049 (.024)
F-Helpful .112** (.036) .144** (.040) .102 (.039)
F-Momentum .174** (.041) .118** (.048) .037 (.055)
F-Rugged .204** (.027) .192** (.031) .100 (.022)
First factor of

means
.219** (.020) .251** (.021) .004 (.006)

Knowledge −.112** (.015) −.106** (.017) .024 (.001)
Esteem 1.371** (.046) 1.216** (.057) .015 (.001)
Relevance −.509** (.030) −.473** (.035) .018 (.001)

*p < .01. **p < .05. Notes: Standard errors in parentheses. n = 1,723 brands. WLS R2 = .80

with 1,697 d.f., HLM 1,346 d.f.

926 JOURNAL OF MARKETING RESEARCH, DECEMBER 2017

in China and Japan, and their lowest ratings in Chile and Italy).
We tested this implication directly, again at the pooled PH levels
for greater power and ease of analysis. First, we calculated the
means of each brand on the pooled PH attributes for each country.
We then calculated each brand’s cross-country SD (consistency)
on these pooled PH attributes. Next, we conducted a median split
on these brand-level PH SDs to find the 50% of the brands (half-
sample n = 860 brands) that were relatively lower (vs. higher) in
their cross-country SDs (consistency) on these PH attributes.

We then tested whether, for this half-sample of brands posi-
tionedmoreconsistentlyacrosscountriesonPHvalues(i.e., inthe
lower half of the PH SDs), such uniform positioning helped or
hurt them in countries that were either relatively high or low on
the importance they gave to PH values. To test this, we regressed
our brand attitude dependent variable (1) on the importance
ratings for the combined PH values in that country (dummy-
coded as 1 = above-average importance and 0 = below-average
importance, using country-level data that we obtained from
Shalom Schwartz) and(2) usingthebrand’smeanlevel onpooled
PH attributes across these countries as a covariate to control for
the possible SD-mean confound (as in our Table 4 test).

This regression (using ordinary least squares, because it is
on a country level and not a brand level) showed a significant
positive coefficient for the country-level PH importance dummy
variable (b = .040, p < .037) on that brand’s attitudinal ratings, with the significant positive coefficient indicating a higher brand attitude in countries that value PH versus not. However, this difference in brand attitudes across countries where PH values are highly rated (vs. not) is significant only for PH-consistent brands (MHigh_PH_Imp = .098, MLow_PH_Imp = .059; p < .043); it is insignificant for PH-inconsistent brands (MHigh_PH_Imp = .05, MLow_PH_Imp = .028; p > .2). Thus, brands that are positioned
more uniformly on PH values have statistically higher consumer
attitudinal ratings in countries that themselves give greater
importance to PH values than in countries that give lower im-
portance to them, but brands positioned less uniformly on PH-
values do not have higher attitudinal ratings. This result shows
the significant attitudinal implications of H1b; we present some
examples from our BAV data in the “Discussion” section.

We then conducted a similar regression analysis for the 50%
of brands positioned more consistently on combined BUS
attributes (H1a). Recall that the theory predicts that BUS values
should be rated uniformly high in importance across most
countries, whereas PH values should show greater variation
across countries in these importance ratings. Thus, we should
see a greater range (variance) in cross-country importance
ratings for PH versus BUS, and this is borne out in our sample
of test countries (PH range [variance] = 1.06 [.0676]; BUS
range [variance] = .68 [.0361]; p < .04). With the smaller variance in BUS importance ratings across our test countries, the median split technique produces countries that value BUS only slightly less than others and so provides less meaningful variation for carrying out the analysis. As a result, the anal- ogous country dummy variable for BUS in this regression test (for high vs. low BUS importance) was not significant (b = .001, p = .972). Thus, again, the attitudinal implications of H1b have more statistical support than those for H1a.

Exploratory Test of the Moderating Influence of Competitive
Set Consistency

As we stated in our conceptual development, we also aim to
explore how the attitudinal effects of a brand’s consistency of

image positioning across countries may change with varying
levels of competitive set consistency (measured by the HI,
described previously). Specifically, for the reasons we have
provided, we expect that if the brand facesa more heterogeneous
set of competitors across its markets (lower HI), greater overall
image consistency by the focal brand should relate negatively to
overall consumer attitudes.

Because this expectation is stated without reference to any
specific Schwartz value types, we explored this in terms of a
brand’s overall image positioning consistency on all 41 BAV
image attributes (i.e., all except the ones used to measure brand
attitudes). We estimated a WLS regression model with the
same attitudinal dependent variable as in our H1 tests, and four
independent variables: the total brand image positioning
consistency measure (SD41), the HI, the interaction term be-
tween the two, and the scores on the first factor for the means on
all 41 image attribute items (as a control). These WLS results
(detailed in Web Appendix F) showed that the interaction
between the HI and the SD41 index was significant in a negative
direction. A plot of this interaction (in Web Appendix F) shows
that higher overall image consistency by the brand (a lower
SD41) does relate more positively to consumer attitudes if the
brand faces a homogeneous (vs. heterogeneous) set of com-
petitors (higher HI), consistent with the prior theorizing of Jain
(1989), Samiee and Roth (1992), and Zou and Cavusgil (2002).

Might the influence of competitive context on the effective-
ness of standardization further depend on whether the stan-
dardization (brand positioning consistency) under consideration
is on the uniformly important BUS attributes versus on the less
uniformly important PH attributes? To explore this possibility,
we repeated the WLS and interaction plots analyses reported
previously, but instead of using our overall image consistency
SD41 variable, we used separate measures of the brand’s con-
sistency on the BUS and PH image attributes (SD-BUS and
SD-PH). Recall that we had found that a consistently positioned
multicountry brand’s attitudes become lower when facing het-
erogeneous (vs. homogeneous) competitors across its various
markets. Our exploratory analysis showed that this decrease in
attitudes is larger if the brand is more (vs. less) consistent in its
own BUS attributes positioning as well as if the brand is less (vs.
more) consistent in its own positioning on PH attributes. Web
Appendix F presents details of these exploratory analyses (WLS
and descriptive plots) as well as interpretive commentary.

DISCUSSION

Results and Theoretical Contributions

Our results make multiple contributions to the literature on
cross-cultural values and the theory of global brand manage-
ment. First, through our integration and analysis of the literature
on cross-cultural values, we identify which specific values are
considered uniformly more important across more cultures, and
for what functional and evolutionary reasons. Second, we apply
the conclusions of this cross-cultural values analysis to the
substantive domain of global brand management, proposing
and showing the differential impact on attitudes toward a
global brand if it is positioned consistently on consumer needs
and values that are more similar (vs. varied) in their importance
across multiple countries. We thus add to the work by Torelli
et al. (2012). We also explore for the first time the moderating
influence of competitive set heterogeneity on the effectiveness
of standardized global positioning strategy.

Positioning Multicountry Brands 927

Contribution to the cross-cultural values literature. Our
use of life values allowed us to tap into the rich theoretical and
empirical streams of prior work on the existence and evolution
of the adaptive societal functions of cultural values (Parsons
1951; Schwartz 1992, 2004). This gave us a strong basis for
developing expectations regarding the specific values for
which there is more (vs. less) cross-cultural variation in im-
portance (Schwartz and Bardi 2001) and for what theoretical
reason (the shifting societal priorities served by these specific
cultural values; Gelfand et al. 2011; Henrich 2004; Inglehart and
Oyserman 2004; Norenzayan and Shariff 2008; Norenzayan
et al. 2016). Through this integration and analysis of the lit-
erature on how societies evolve in the relative importance they
place on specific cultural values over time, we show why there is
relatively more equality in the cross-national importance of BUS
values (i.e., BENEVOLENCE, UNIVERSALISM, and SELF-
DIRECTION) and less equality in importance for PH values
(i.e., POWER and HEDONISM). This theoretically developed
specific identification makes an important contribution to the
literature on cross-national cultural differences.

Standardized versus localized positioning strategies for
global brands. We then apply our theoretical conclusions to
international marketing strategy. The extant view in this lit-
erature is that there is typically a trade-off between the op-
posing advantages of standardization and localization in brand
positioning, and that standardization makes sense only if there
is enough homogeneity in consumer wants and needs relative
to those standardized elements (Jain 1989; Samiee and Roth
1992; Zou and Cavusgil 2002). However, as Ryans, Griffith,
and White (2003) point out, this literature typically treats the
presence or absence of adequate homogenization of consumer
needs in a binary fashion rather than examining the extent of
homogenization of markets on these different needs; nor does
it provide a theory-based articulation of which specific brand
positioning attributes or messages face relatively more ho-
mogeneity (vs. heterogeneity) in consumer response across
markets. We address both these gaps in this article.

We then suggest and show that global brands can do a better
job in managing this trade-off—between the cost and launch-
speed advantages of standardization versus the need for localized
relevance—if they strategically standardize less on those specific
image attributes with significant cross-market variation in im-
portance ratings. To do this, we use new conceptual and em-
pirical analyses to match specific BAV data image attributes to
these underlying life values to test our hypothesized relationships
within our BAV data set. Thus, we argue that multicountry
brands in our data set that are positioned consistently on BAV
image attributes reflecting BUS values gain in brand attitudes
(e.g., friendly, social, original), whereas those positioned con-
sistently on PH values suffer (e.g., unapproachable, momentum,
rugged). Importantly, instead of treating consistent versus in-
consistent positioning ontheseimageattributesasabinaryeither/
or choice, we quantify the degree of positioning consistency on
these attributes, meeting a documented gap in the literature
(Ryans, Griffith, and White 2003) and drawing conclusions that
managers can implement (by adjusting the degree of cross-
market consistency for their brands, by attribute).

Our unique BAV global field data set enabled us to put this
key hypothesis to an empirical test, and it found substantial
support, especially for the part dealing with values that vary
more (PH values). While the fact that this BAV data set was
not originally designed and formulated to test our specific

propositions created several challenges for our analyses, it
nonetheless provided a rare opportunity to test our theory-
based hypotheses through our extensive data preparation
work and our supplementary “variable matching” data and
analysis. Despite remaining limitations (discussed next), the
fact that our data set uses perception and preference data from
over 64,000 consumers, in 22 widely dispersed countries, on
1,723 multicountry brands in 27 product categories, adds
considerable empirical weight to these findings. Thus, our
results add a vital new qualification to the common managerial
belief that global brands marketed in a more consistent,
standardized way also ought to reap the benefits of higher
consumer attitudes (in addition to possible cost efficiencies).
We show that this is less likely if the specific type of brand
attribute on which the brand is more consistently positioned is
the kind of attribute that consumers across the world desire less
uniformly (PH values).

Interestingly, the evidence for an increase in brand attitudes
from consistent positioning on image attributes that are uni-
formly valued everywhere (BUS values) is somewhat less
strong. Several possibilities can explain this finding. First, it
may indeed be the case that H1a does not uniformly apply for
all the value types within it, but rather only for some (e.g.,
more for BENEVOLENCE and UNIVERSALISM than SELF-
DIRECTION). Second, it may be that even if brands are less
consistent globally in their deployment of BUS-related appeals,
they can still find other local positioning platforms that resonate
with local consumers so that their inconsistent use of BUS
positioning does not end up hurting them attitudinally in our
data. Third, it could be that if many brands choose to compete on
these consistently highly valued image attributes, a brand po-
sitioning platform that relies on these attributes may simply be
less differentiating or compelling. Just as consumers consider
brand information that seems negative to be more diagnostic
because it is less common (compared with positive information)
and thus overweigh it in their brand judgments (Skowronski
and Carlston 1989), it may be that equally liked but commonly
used BUS attributes may become less important in consumer
judgments.

Fourth, it may be that for certain types of brands that pursue a
segmented (vs. mass-market) strategy, greater market success
may accrue from positioning their brand on narrower, non–BUS
segment–relevant appeals rather than following a BUS posi-
tioning that may be optimal for a broad market. In particular,
because luxury brands usually appeal to consumers who care
more about “self-enhancement” (dominance over other people,
status, power, etc.) than about “self-transcendence” (helping
other people and society rather than oneself), globally consistent
positioning on PH could logically be a more successful strategy
for luxury brands than positioning on BUS (Torelli, Monga, and
Kaikati 2012). Future research is needed to explore all these
possibilities.

Our other contribution concerns the impact of a varying
competitive environment, which has not yet been empiri-
cally examined in the global marketing literature. Using the HI
measure of competitive set similarity, we provide the first direct
evidence that a global brand facing dissimilar major competitors
in its many markets benefits more from responsively custom-
izing (localizing) its competitive positioning, rather than pur-
suing the same one. Although our measures utilize only the
degree of consistency in the focal brand’s positioning across
markets (and not the strength of this positioning), we find that

928 JOURNAL OF MARKETING RESEARCH, DECEMBER 2017

when facing heterogeneous competitors across many markets,
brand attitudes are higher if the focal brand’s own positioning
consistency is low rather than high. Furthermore, when the
competitive context is more homogeneous, brands benefit from
their own image consistency more on BUS than on PH values.
Our results suggest that the variable of competitive simi-
larity deserves more attention in the international marketing
strategy literature. We note here that in our BAV data it seemed
that the degree of competitive set homogeneity might be a
function of the nature of the industry/category—that is, there may
be more variation in a service industry such as banking than in a
capital-intensive durables product such as automobiles. Thus, the
ability of managers to vary the degree of their overall positioning
consistency, as a function of competitive set heterogeneity, may
be constrained by the nature of their industry sector.

Managerial Implications

In a world that is characterized both by the sweeping forces
of globalization (e.g., Alden et al. 1999) and by consumer
desires for localization (e.g., Hannerz 1990), multicountry
marketers must find a way to combine local appeal with global
efficiency. Hollis (2008) writes, “Today’s global brands must
leverage their advantages of scale and adapt their offering to
ensure local relevance” (p. 82). The only way to do both of
these, he adds, “is to identify a promise that works across
countries” (pp. 165–66). Citing Simon Clift, the chief mar-
keting officer of Unilever, he stresses that it is much more
critical to find a brand appeal that works across borders, so that
brand assets can be created on a one-size-fits-all basis, than it is
to use a common brand name. “A global promise is the most
important global brand asset, way more important than the
same name or formulation or graphics,” he writes (p. 174).

Consistent with Hollis’s (2008) urging, our work also shows
that brands that intend to become global need to incorporate as
many universally desired needs and values as possible (or at
least find a key value that they can best satisfy). Finding such
globally appealing brand promises requires clever consumer
market research because “the real trick lies in looking for
commonalities, not differences” (Hollis 2008, p. 156). Our
research has focused precisely on this issue—that is, of
avoiding life values that represent the differences rather than the
commonalities—to facilitate the consistent cross-market po-
sitioning by global brands on image attributes that will yield
economies of scale without jeopardizing local market appeal.

In this context, our finding that brand appeals to POWER and
HEDONISM can vary in their cross-market payoff merits par-
ticular attention. Evidence does exist (in our BAV data and in
Hollis [2008]) that national attitudes about luxury and status—
or even to prestigious brands—vary enormously across countries
(e.g., more favorable in Russia and China than in Western
Europe, the United States, and Australia). Thus, the egalitarian
“Campaign for Real Beauty” for Dove soap was much more
successful in the more egalitarian set of countries than in the
former countries (Hollis 2008, pp. 62, 223). (In our BAV data,
Dove’s attitude ratings were 1.11 in Chile, the country that gave
the lowest importance to PH, but −.05 in Japan, the country that
gave the highest importance to PH.) This example suggests that
a multicountry, mass-market brand consistently positioned on
status will do well in some markets but not in others, yielding
scale economies of consistency but sacrificing share in some
markets. Alternatively, such a mass-market brand could instead
prioritize local market relevance, using a status appeal in some

markets but not others. This would grow overall demand but
sacrifice economies of scale from consistency.

But why choose status at all? Could the multicountry brand
not position itself on a different image attribute altogether,
something less divisive, to avoid being negatively affected in
its search for global scale? Thus, to return to the example of
Apple’s Mac versus PC ad campaign: Apple’s ads might have
been received equally well in Japan and the United States if
they had, in both countries, downplayed Mac’s hedonistic
benefits (of pleasure, enjoyment, etc.)—something not equally
desired everywhere—and focused instead on its greater ability
to facilitate self-direction (creativity and independent thought),
which is more universally sought.

The findings and implications in this article thus ought to be
of considerable value in the strategy development processes for
global brands. Although in some cases there may be natural
limits on which image attributes a multicountry brand can po-
sition itself in its many markets (as pointed out by Torelli et al.
[2012]), most often brands do have the flexibility to modify their
brand image positioning in different countries. McDonald’s, for
instance, is able to position itself on convenience and value in
developed countries, while emphasizing an aspirational and up-
market brand image in many developing countries. Multicountry
brands thus can undergo reinterpretation of their promises and
values as they seek success in different cultures. However, they
have not previously been provided evidence of how the im-
portance of specific cross-cultural values might affect the success
of their positioning decisions, as done here.

Limitations and Future Research

In this article, we were unable to systematically study the
variations in results across product categories (varying on
perceived risk, social signaling value, etc.), because we had no
external data on these variations. Furthermore, given that we
were studying 27 product categories at once, we were limited
to brand image attributes as opposed to functional/utilitarian
attributes; future research needs to study the latter as well. In
addition, although we attempted in our regression analyses to
control for the near confound of values importance cross-
cultural SDs and their means by using the first factor of these
means, superior methods need to be found to control for this.

Endogeneity concerns also exist, because our field data
necessarily result from decisions by firms rather than from an
experimental design. For us to draw strategic inferences from
our regression coefficients, we need to assume that the data
include a mixture of smart firms that know that a consistent
global image should be positioned on dimensions that con-
sumers universally like (as we identified in H1) and some less
astute firms that lack this knowledge or are unable to position
themselves on universally liked dimensions because of con-
straints in information, resources, channels, and so on. This is,
in our view, a reasonable set of assumptions.

The alternative causal possibility is that consumers everywhere
know well the brands they like and thus rate them highly on the
image dimensions they like, even if they never actually thought of
the brands in terms of such imagery. Such a possibility is not
supported by our data. When we calculated for each brand the SD
across the mean levels of its 48 BAV raw attribute ratings and
compared these between the brands that were higher versus lower
in brand attitudes (using a median split), we found no difference
(.64 vs. .64, p > .5). Therefore, although we do not believe that
endogeneity concerns threaten the validity of our analyses, future

Positioning Multicountry Brands 929

researchshould examine causalsequencesmorethoroughly(such
as by using cross-lagged panel data or controlled laboratory
experiments). Future studies might also delve more deeply into
how societal values—and thus, a preference for more consistent
multicountry brands—evolve over time. Our cross-sectional data
did not allow for such analysis.

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DOI: 10.2478/stcb-2013-0003 ISSN 1337-7493

136

Changes in International Marketing Strategies of Companies
Operating in the Global Luxury Industry due to the Financial

and Economic Crisis

Otília Zorkóciová1 – Erika Mária Jamborová2

Abstract

The goal of our contribution is the international marketing strategy of luxury goods
manufacturers worldwide due to the financial and economic crisis. The current crisis
hit many countries of the world, European continent as well. It contributed to the more
prominent role of BRIC countries in the global economy, particularly because of their
growing economic power. These factors resulted to the increase in affluent customers
for luxury industry in these countries. The sector quickly and successfully responded to
this situation. Our paper aims to identify the essential elements of the successful inter-
national marketing strategy in the global luxury industry, with reference to the most
important elements of the marketing mix.

Key words

Marketing mix, brand strategy, luxury industry, financial and economic crisis, interna-
tional marketing strategies

JEL Classification: M31, M39

Introduction

The financial and economic crisis has significantly affected all sectors of the world

economy and it influenced the national economies of all countries. Globalisation
brought on one hand the liberalization of trade, deregulation of business and on the
other hand, the increased interdependence of economies and increased risks. In 2009,
China is becoming the most important export economy even despite the fact that al-
most the whole world at that time had to fight with the fallout from the financial and
economic crisis. With the active trade balance, China has seen significant economic
growth compared with the deficit, debt stricken economies. The world’s most im-
portant producers of branded luxury goods responded to this fact and began to focus
its international marketing policy towards the major emerging economies such as Chi-
na, Russia, Brazil and India. With the increasing purchasing power of the population of
those states, increases the number of wealthy citizens who represent a huge potential
for growth in trade with luxury branded goods. Luxury for them means not only fel-
lowship to a so-called upper class of society, thus achieving a higher social status, but
also expression of their lifestyle. The aim of this paper is to point out modifications to
the international marketing strategies of major world producers of luxury goods brands
in fashion apparel, accessories, jewellery and watches, as well as their response to

1 doc. Ing. Otília Zorkóciová, PhD.; University of Economics in Bratislava, Faculty of Commerce, Department

of International Trade, Dolnozemská cesta 1, 852 35 Bratislava; E-mail: ozorkoci@hotmail.com,
2 Ing. Erika Mária Jamborová; University of Economics in Bratislava, Faculty of Commerce, Department of

International Trade, Dolnozemská cesta 1, 852 35 Bratislava; E-mail: erika.jamborova@gmail.com

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changes in the macro and micro conditions in international markets, arising due to the
socio-economic crisis.

1 International marketing strategy and international marketing mix

Company’s marketing strategy is a reflection of the business strategy and objec-

tives into its business activities. According to D. Lesáková marketing strategy describes
methods to achieve marketing goals (Lesáková, 2007). In contrast to domestic market-
ing, international marketing is more complex and must take into account several fac-
tors associated with an increased risk of international environment. P. Kotler and K. L.
Keller define the major decisions in international marketing as a decision on whether to
enter the market, forms and methods of market entry, decisions regarding the market-
ing program and marketing organization (Kotler & Keller, 2007). Majority of companies
go through the process of internationalization through different phases and activities of
irregular export, selling directly or through agents, through the establishment of sales
offices to the eventual establishment of companies abroad. Costs of market entry are
high. Companies face the decision whether and how to adapt their product or service
to new market conditions as well as choosing the method of communication abroad.
Multinational corporations often tend to apply the method of standardization, with the
expected benefits of product policy and product brand. The essence of perception is a
global business strategy orientation in terms of the similarities of countries and to
achieve economies of scale (Zorkóciová, 2010). According to P. Kotler and K. L. Keller
entry strategy can be implemented in two ways and that is in a way of waterfall when
the company enters into foreign markets gradually and in a way of sprayer, when the
company enters into a number of markets within a short period of time (Kotler & Kel-
ler, 2007). Business in international markets is associated with prolongation of the life
cycle of the product as well as with the search for new resources and markets. Taking
into consideration the attractiveness of the market, K. Backhaus, J. Bueschken and M.
Voeth divided countries into four groups – key markets, potential markets, occasional
markets and abstinent market (Anderie, 2010). L.R. Anderie provides two approaches
of international strategic management – market-oriented method and the method es-
tablished on the resources. While market-oriented approach takes into account the
business strategy and market environment, the method based on the resources is
based on the unique resources and capabilities of firms (Anderie, 2010). The most fa-
mous representative of the first routing strategy is Michael E. Porter. The second
method is based on the relevant skills, such as competitive advantages that are diffi-
cult to immitate, substitute and in the value chain they bring greater utility to the cli-
ent. The main motive for expansion into international markets is profit, whereas the
key factors of profit are presented as: achieving a unique competitive advantage or
obtaining exclusive information, economies of scale, tax benefits and the location of
production sites with the effective costs of production and distribution (Zorkóciová,
2010). Prerequisite for the competitiveness of the company is its need to respond to all
the changes in the economy, major customers changes as well as the ability to antici-
pate developments. Demand for products and services are governed by their useful-
ness to the consumer. The role of products and services provider is to ensure their
quality through specific marketing mix as well as the long-term competitiveness. The
role of the company is to develop specific instruments to influence the target group in

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terms of business and marketing objectives (Busch, Fuchs & Unger, 2008). Classic
marketing mix is made of 4 P: Price (Price), Product (product or service), Promotion
(Communication) and Place (distribution). In the services sector to these 4 P, P. Kotler
and K. L. Keller added another P’s for Personnel (Human Resources), Processes (pro-
cesses) and Physical Evidence (physical presence) (Kotler & Keller, 2007). Marketing
mix is all business activities, which may influence the demand for products or services.
Product policy is related to decisions in the compilation of the product program and
product offer. It is closely linked with the quality policy, service or brand. The brand
policy marks a significant role in the marketing of products and services. The quality of
the product is based on customer requirements, while at the time it should not change
or lets say worsen. According to R. Busch, W. Fuchs and F. Unger international product
policy addresses the question of whether the product meets the requirements of for-
eign customers, or it needs to be changed or given additional services (Busch, Fuchs &
Unger, 2008). Part of the pricing policy is a policy of discounts, payment as well as
credit terms. According to S. Haller current price is influenced by factors such as use-
fulness of products, cost of total production, competition (Busch, Fuchs & Unger,
2008). In the services sector and also in the price of branded products it is also an in-
dicator of product quality. The distribution policy is to provide a product or service and
ensures the availability of mediation of offer to clients. International distribution policy
is in international markets significantly differentiated, whether it is by the choice of
channels of distribution, acquisition or actual physical distribution. P. Ghauri and P.
Cateora listed six factors (6C’s of channel strategy) that determine the choice of inter-
national sales channel (Busch, Fuchs & Unger, 2008):

– “Character” (sales channel must correspond to the product line, related con-
sulting and services)

– “Capital” ( includes the necessary funds to build a sales channel)
– “Cost” (includes the cost of maintaining the sales channel-salaries, commis-

sion, customer acquisition, etc.).
– “Coverage” (for “coverage” intensive distribution requires a high degree of

centralization, all products are easily reachable, selective distribution by con-
trast, focuses more on the overall quality)

– “Control” (plays an important role especially in those markets where is de-
mand of unity of the institution)

– “Continuity” (is linked to the continuing ability to provide uninterrupted and
continuous service)

Communication policy includes area of external communication towards clients
(customers, institutions, local community) and area of internal communications (to-
wards employees – the company’s internal environment). Management of international
communication strategy is related to its high complexity and interconnectedness with
other elements of the international marketing mix as well as the element of interactivi-
ty to its internal and external environment. It depends on the global business strategy
of the company (standardized or differentiated communication strategy) and business
organizations (the degree of centralization – decentralization). When considering the
possibility of the transmission of the communication concept to international markets,
it is necessary to consider object of communication policy as well as the environment
of the consumers. Conditional factors of transmission of the communication concept
are eg. culture and its essential elements (language, values, religion …), market po-

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tential, behavior of competition, legislation, age, income, lifestyle of the population,
price sensitivity of the clientele, etc. Personnel and procedural policy and the policy
of physical presence are typical parts of the marketing mix especially for services.
Company operating in the international context will attempt to maintain consistency
between national affiliates and ensure the implementation of strategies and policies
based on the parent company. Facilities policy affects readiness of the place to offer a
service or product, service personnel, as well as material support funds. Facilities poli-
cy can be divided into capacity management (permanent disposition of human and
material resources for the provision of service) and transfer of the image (external
manifestation of a quality of service). Process policy addresses the appropriate compo-
sition of business processes taking into consideration the process of quality and quality
of service. W. Pfoertsch and M. Schmidt consider the policy of branding the service as
very important. Existing client therefore contributes to the increased importance of the
brand, affecting brand perception by other clients (Busch, Fuchs & Unger, 2008). The
client sees a strong brand as a basis of confidence and reduction of the risk of pur-
chasing. The brand is attributed the function of trust, guidance and information func-
tion, identity function, the function to minimize the risk and prestige. On the other
hand the firm expects from the brand performance of the function in the communica-
tion area – image building, promotion of the marketing mix. The brand contributes to
the permanent differentiation in the market both in terms of competition as well as for
the prevention of product interchangeability. One of the challenges is to ensure con-
tinuous quality of the brand position that is strongly influenced by consumer demands
individuality, as well as all the activities of the company, contributing to customer sat-
isfaction with the purchase or acquisition of specificaly branded products.

2 Financial and economic crisis and its impact on the international mar-

keting strategies of companies operating in global luxury industry

World recession significantly affected the relations of national economies and

their industries, forcing companies to look for optimal and diversified portfolio of assets
to ensure adequate profitability, competitiveness, efficiency and flexibility of its activi-
ties. E. Giacosa and A. Mazzoleni recognize that the current crisis has not got the
character of rarely occurring phases in the life cycle of the company. According to the
authors, these crises are common events being a result of damaged corporate “vitali-
ty”, where the company’s life cycle is characterized by alternating phases of success
and failure (Giacosa & Mazzoleni, 2011). Fast and frequently changing market condi-
tions have required full and timely information, which is essential for reducing the risk
of running a business abroad. In recent decades, the riskiness on international scales
was exacerbated particularly in relation to economic, political and technological devel-
opments. Diversification of markets brings reduction of business risk for their business
activities in different markets, which may be at a different level of cyclical develop-
ments. Their international activities may extend the product life cycle or reduce the
risk of seasonality and also allow better planning and utilization of financial flows. The
goal of international business is to succeed in international environment. This repre-
sents steps towards maximizing revenue while minimizing costs. The financial and
economic crisis and its consequences significantly undersigned to many unpopular
measures that worsened the international business environment settings and by

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changes in their international marketing strategies to which companies had to adapt in
order to remain on the market. During the two years (2009, 2010) of socio-economic
crisis, the world’s most important companies operating in the so-called luxury market
become also vulnerable. For the first time its global sales fell by 10% to € 153 milliard
at the end of 2009, representing the worst result in the crisis period (Chabert, 2011).
The impacts of the crisis immediately intervened not only with the corporate environ-
ment (macro and micro environment) and reflected the changes in their international
marketing strategies, specifically changes in the various elements of marketing mix,
but also interfered with the consumers themselves, which is reflected in modifications
of consumer behavior. To buy luxury goods at the time when neighbour lost his job
was regarded as immoral – insensitive. An interesting finding is that companies cur-
rently operating in the luxury industry are recovering from the crisis relatively quickly.
The year 2010 was already better in their management, resulting in the increase in
sales during the first six months of this year, in selected world producers of luxury
goods as follows: 17% in the company LVMH, by 21% in the company Burberry and
by 23% in the company Hermès (Chabert, 2011). A breakthrough milestone in this pe-
riod, for the French luxury industry is considered in October 2010, when Bernard Ar-
nalult, owner of LVMH bought 17.1% shares of Hermes. It was an investment of 1.45
billion euros (Chabert, 2011). French companies operating in the luxury sector are for
foreign trade a major player in France, their share of the global luxury industry is
around 40%. Table 1 shows the turnover and net profit achieved by producing the
world’s famous brands of luxury goods in 2010 (for Chanel these data were not availa-
ble). The only loss reported was by Bulgari. Although the crisis has significantly affect-
ed almost all sectors of the global economy, no other sector in this period was so at-
tractive to investors than luxury goods industry. It benefited primarily from higher
growth of boutiques as well as from the development of high-income clients in emerg-
ing economies, unaffected by the crisis as yet.

Table 1 The world famous producers of luxury goods brands by volume of turnover

and net profit in 2010

Company
Country of

origin
Brands

Turnover
milliard eur

Profit million
eur

LVMH France Louis Vuitton, Moet, Henessy, Dior… 17,1 1 755

Richemont Switzerland Cartier, Lancel, Montblanc, Chloé,…. 5,2 609

Gucci Group
France Gucci, YSL, Boucheron, Alexander

McQueen,…. 3,4 692

Chanel
France

Chanel 2,2 –

Hermés
France

Hermes, Shang Xia…. 1,9 288

Tiffany & Co. USA Tiffany 1,9 198

Armani Italy G. Armani, Armani, Collezioni, Casa…. 1,6 218

Prada Italy Prada, Church’s, Jil Sander,…. 1,5 100
Burberry
Group UK Burberry,…. 1,4 95

Bulgari Italy Bulgari 0,9 -47
Source: Chabert, P. (2011). L’argent fou de l’industrie de luxe. Capital, 232 (01/2011), 44-46.

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Publicity and chosen way of communication was behind the success of the com-
panies that invested into their most precious capital – building a positive corporate im-
age. They approached many influential personalities in the show – business who have
signed contracts with them, focusing on different forms of communication of their lux-
ury brands. This marketing strategy has brought a high return on investment. Budgets
for marketing communications of famous perfumes alone rose between 2009 and 2010
by 16%. Communication channels were mainly television, selected magazines and of
course the internet. To involve a major global “celebrity” in marketing communication
campaigne, it increases sales of communicated luxury product by about 15%. On one
hand it increases the company’s expenses, but it greatly contributes to the visibility of
the brand and building of a positive image (Wattez, 2011). “The hunt for celebrity” is
of course reflected in the price level of the products. Table 2 shows the cost of the
world’s luxury sector that companies paid for their international marketing brand
communication, with the number of advertising messages published in the world press
and the approximate cost incurred to make the advertising message. As can be seen
from the table, the leading company is Armani with the number of 7274 published
communication messages, at the same time with significantly lower costs incurred to
publish one message than the rest of its competitors.

Table 2 Annual costs paid by luxury industry companies for their international market-
ing communication of their brand, represented by the world famous “celebrity”, with

the number of advertising messages published in the world press and the cost per ad-
vertising message

Company
Number of advertising

messages in world press
Price per advertising

message in Euro
Armani 7 274 550

Lancome 4 799 938

L oréal 3 521 994

YSL 3 467 260

Helena Rubinstein 2 248 778

Dolce & Gabbana 2 201 1 590

Dior 1 456 1 717

Dolce & Gabbana 1 230 650

Thierry Mugler 1 045 1 914

Dior 983 2 543

Givenchy 929 356

Balenciaga 748 1470

Chanel 698 3 581

Lancome 527 1 518

Chanel 203 4 926
Source: Wattez, E. (2011). Les grandes marques font flamber leur budget de communication. Capital, 232

(01/2011), 48-50.

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In response to the high demands of the world “celebrities” to communicate luxury
brand Luis Vuitton Company has found an alternative solution. They involved in their
marketing communications campaign outstanding personalities of the world outside
the show business, people who in certain area and the history of their time were or
became prominent representatives of their field like Mikhail Gorbachev, Keith Richards,
Pele, Maradona, Zidane (Wattez, 2011). Another large volume of investment of com-
panies in worldwide luxury industry was shown by the most expensive purchases of
land to build new luxury business premises (Chabert, 2011). Leaders in luxury market
can afford to build imaginative “superdisplay cabinets” that provide them with excep-
tional visibility. In the competitive struggle this way they displace smaller brands from
the market that can not afford such huge investments for their retention in the market.
Communications budget in the world of luxury business rose to a record high already
in the second year of the crisis. Amongst the most important customers, who buy lux-
ury brand products are Americans. Established in the most expensive and most im-
portant arteries of the planet shops with luxury goods are in huge space, with no ap-
parent need of the viability of a square meter. They are designed to let customers
dream (event marketing) – offer luxury brand selling products with added value. In
2009 standalone – specialized stores focused on selling luxury branded products sold
over 27% of all luxury goods. 73% were sold in multi-branded network. In the luxury
industry rent for selling spaces represents around 20% of the total trade turnover,
which is double in comparison with the cost of so-called trade with mass merchandise
(Beghin, 2011). The effects of globalization have not gone around the luxury industry
either, mainly due to the ever-growing global demand for luxury branded goods that
crisis did not hit so painfully, as well as important internationally active companies op-
erating in the sector, capitalising on economies of scale and sale of luxury branded
goods. Many producers of luxury branded goods benefit from the fact that in their
production it is expected of them to use high-quality materials, meticulous detailed fin-
ishing and specific product quality. The effort to implement the greatest economies of
scale lead producers of products of luxury brands to relocation of their manufacturing
operations. Many have partially withdrawn from the Mediterranean area and pro-
gressed more towards Asia. Large French and also Italian producers of luxury brands
boast in perfection of their own goods and the know-how of their processing, their un-
paralleled quality, which make them different to any other competing products. De-
spite the relocation of many manufacturing centers of luxury products, their quality is
excellent, but sometimes the cost of production for one such product decreases
fivetimes (Torgemen, 2011). The third largest Vuitton brand manufacturing site was
launched in Spain. Other producers of luxury branded goods opened its production
sites in India, Romania and Turkey. The producers of luxury branded goods are very
anxiously trying to conceal their relocation productions. They agree that the potential
savings gained from this effective production are invested in creative projects to fur-
ther improve the quality and design of products, as well as the previously mentioned
added value for its customers related to the sale of the product. Relocation of their
production to less developed countries they admit only a part of it to the operations
irrelevant and unrelated to their perceptions of quality and branded products. In this
context it should be noted that the industry of luxury goods is one of few sectors
where production relocation is not accompanied by a decrease in product prices.

Production of luxury products today may not even move out of the local market,
the cost is saved by using cheap labour in place (Beghin, 2011). As mentioned earlier,

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the market of emerging countries, with an increase in solvent clientele, longing for so-
cial status or represented by wearing or owning luxury branded products, significantly
contributed to mitigating the impact of the crisis in the luxury and continuously con-
tributes to its further development. Returns of the market leaders of luxury products
market are exceptional. Their newly opened stores, in this territory, are able to earn
for themselves in an average of three years. Stores of luxury goods opened in Russia,
even earlier in a single year (Chabert, 2011). Russia, Brazil and India are the true
global markets for luxury brands, with many wealthy clients. The most important mar-
ket is however China. Luxury is an essential image of China for the past ten years. A
quarter of the most important brands of the world’s luxury industry opened 533 outlets
here in the early 2011 (Wattez, 2011). During recent years, the number of millionairs
(in dollars) in China more than doubled. According to estimates by Boston Consulting
Group in 2008 was 1.6 million of wealthy people in China, in 2015 it should be 4 mil-
lion. The local market of luxury is here, in size, the fourth largest market in the world
with a turnover of € 13.6 milliard (in 2010) and an increase of 20-30% per annum
(Wattez, 2011). Table 3 shows the emerging economies, in order according to the vol-
ume of expenditure on consumption of luxury products for 2010, as well as by-year
change in this indicator for the period 2010/2009.

Table 3 Emerging economies, according to achieved volume of purchasing of luxury

products in 2010 and the annual growth rate of spending on luxury products
2010/2009

Country
Market in 2010 in milliard

eur
Increase 2010/2009

China 13,6 20-30%

Russia 4,5 5-10%

Brasil 1,5 15-20%

India 0,8 4-5%
Source: Torgemen, E. (2011). La conquête de L’eldorado chinois mobilise d’énormes moyens. Capital, 232

(01/2011), 51-52.

Table 4 shows the most significant number of sales offices, opened by represent-
atives of global luxury brands in China. Sale of luxury goods in China is accompanied
by certain specifics. For example it is very masculine. A typical representative of this
group is professionally well-situated male, aged between 25-35 years, who has the
greatest joy from a gift of a luxury brand of men’s watches. Chinese senior managers
own on an average of 4.4 pieces (Beghin, 2011).

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Table 4 Opened sales outlets of worldwide luxury brands in China, ranked fom the
highest number in 2010

Brand of luxury products Number of opened sales points

Dunhill 93

Burberry Group 50

Gucci Group 37

L. Vuitton 34

Cartier 33

Hermes 20

Versace 19

Dior 19

Prada 15

Chanel 6
Source: Torgemen, E. (2011). La conquête de L’eldorado chinois mobilise d’énormes moyens. Capital, 232

(01/2011), 51-52.

The luxury brand is a symbol of success for the Chinese, therefore, even on their
foreign trips, they purchase luxury brands with pleasure. Tourists in recent years con-
tribute to 40% of the volume of purchases of products of luxury brands in the world.
The Chinese, who, thanks to relaxed visa policy travel around the world more and
more, they also have leadership in this cathegory. For example, in 2011 luxury
brands sold products (lingerie, clothing, jewelry, cosmetics, watches) in a volume of
192 billion euros, where the Chinese achieved part of this global sales of 25% share,
compared to Europeans with 24% market share, with 20% of Americans and Japa-
nese 14% share. The location of the shops – point of sale in China is relatively inex-
pensive. It costs around 100 000 Euros per year (compared to 1 million Euros cost of
rent for commercial space on the Place Vendome in Paris). Rent is designed to consist
of the price, which is fixed for two years, the next three years the price is determined
by the market conditions. Certain obsession of the Chinese with shopping or owning
branded products is also reflected in the work of stylists, producers of branded luxury
products who begin to adapt their design to local tastes. Hermes company made a fur-
ther step in this direction by creating a brand “Shang Xia” to be the first Chinese brand
dominant in that sector. Although it is developed in China, it is for the whole world
(Torgemen, 2011).

Conclusion

As mentioned above, the major decisions in international marketing are decisions

about whether to enter the market, what forms and methods of entry to use, decisions
regarding the marketing program and organization of marketing, as evidenced by the
examples given by us of the entry of companies in the luxury business sector in partic-
ular in Emerging Market countries BRIC. Multinational corporations often tend to apply
the method of standardization, with the expected benefits of product policy and brand
policy. The survey of international marketing strategies of companies operating in the

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luxury sector, attests to the fact that companies are trying to adapt, not only the
product itself, but also other elements of the marketing mix, local customs and re-
quirements of the customer. Global Strategy of luxury brand companies is based on
similar characteristics of its own consumers: high-income groups, trying to get or
strengthen their social status. China in this area gets more and more to the forefront,
which until recently was dominated by wealthy American and Japanese clients. With
regard to the entry strategies: there is the waterfall method, when the company enters
into foreign markets gradually and the way of sprayer, at a time when the company
entered into several foreign markets in a short period of time, in our case it is more a
question of the second route: using the form of sprays when companies operating in
the luxury industry on time recognized worldwide redistribution of income during the
economic crisis and focused their attention on the surplus, emerging economies. Given
the attractiveness of the market, according to which we distinguish four groups of
countries: the key markets, potential markets, occasional markets and abstinent mar-
kets, emerging market economies undoubtedly belong to the group of key markets
and not just because of rising incomes of the population and creating more and more
of the rich but also for their further development potential, which although the manu-
facturers of luxury branded goods are reluctant to admit, there are cost savings in the
form of using cheap labour or rented premises. If we evaluate approaches to interna-
tional strategic management: market-oriented method and the method of establishing
the sources, where market-oriented approach is reflected in the marketing strategy of
the company before the business environment and markets and method based on the
resources, which is based on the unique resources and capabilities of the company. In
the case of luxury business sector is used a combined strategy of international strate-
gic management, as new markets are great for brands in new growth opportunities
and competitive advantage at the same time. The main motive of expansion into inter-
national markets is profit and to the key factors of profit is assigned: achieving a
unique competitive advantage or obtaining exclusive information, economies of scale,
tax benefits and the location of production sites with the effective costs of production
and distribution. This is partly confirmed by the analysis mentioned by us, in which
resonates the use of cost savings of production of luxury branded products, employing
cheap labour, whether in traditional production areas but also delocalisation of produc-
tion to countries with cheap labour and other lower-costs for example: lower rent for
production facilities, retail space and so on. In general, the demand for products and
services are governed by their usefulness to the consumer. Due to the limitations of
consumer purchasing power (incomes, assets), the consumer is in his purchasing poli-
cy governing the acquisition of a product-service, which will give him the best possible
results. It only applies partially to the consumers of luxury branded products since they
are highly affluent consumers who’s purchase or owning of branded luxury products
means more gain and sustaining of social status, sector benefits of the subject do not
always play such an important role, the attempt to have a luxury branded product and
thus declare the membership of a social class wins over. Translation of the objectives
of international marketing strategy of a company into action is carried out by using the
international marketing mix tools, in the industry of luxury branded products, in addi-
tion to traditional 4P’s of the marketing mix is used their extended group of the ele-
ments belonging to the services marketing mix (7P’s). This stems from the fact that a
group of consumers of luxury branded products are distinguished in the aforesaid spe-
cifics and they are extremely demanding on location of the outlets (a luxury neigh-
bourhood places where they are shopping) equipment and design execution of sales

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space, professional staff, etc., all of those factors which complete the overall impres-
sion and contribute to a positive shopping experience. The successful application of
international product policy also contributes to the acceptance of differences charac-
terizing the foreign customer-adapting the product to his requirements. The approach
also suggests that producers of branded luxury products who expanded to the markets
of emerging economies with their internationally recognized luxury brand standardized
products, but now, in an effort to strengthen their position in these, for these key
markets with huge growth potential, increasingly adapted to the local conditions and
consumer demands, example is the development of their own Chinese brand Shang
Xia, which expanded into other major world markets of luxury goods. Even for market-
ing pricing policy applies the rule, that the current price is influenced by factors such
as: the usefulness to the customer, cost of production, the price level of competition …
Again, the given postulates are not enough for guiding the pricing of branded luxury
products, where the price clearly represents a high level of quality and any reduction
would evoke in customers its reduction. When considering the possibility of the trans-
mission of the communication concept to other countries, it is necessary to consider
the subject of the communication policy and the consumer environment. Conditional
factors of transmission of communication concept are for example market potential,
competitive behaviour, values, legislation, age, income, lifestyle of population, recep-
tivity to price and so on. International marketing communication concept of luxury
brands products industry is relatively uniform, with the acceptance of local cultural dif-
ferences in individual national markets. Companies that are based on a very strong
base of brand building, as it is certainly in luxury products industry, orientate their
communication marketing strategy clearly on the principles of continuous improvement
or even possible enhancement of their reputation as needed for their business success.
In case of luxury products they are goods with certain specific characteristics, which
are characterized by specific features, both for the consumer and for the company it-
self. Brand means a symbol, name of the product, something that makes the product
different from the other. Something that is unique and special. As already pointed out,
the brand can greatly affect consumer behaviour. Owning a luxury brand product is
nowadays a matter of prestige; brand also has an impact on attitudes and behaviour
of people. Producers of luxury branded products guarantee that their quality is contin-
uously maintained, which simultaneously ensures the customer that although at a high
price, but always they get a good quality product. Shops, which sell luxury branded
products are usually located on the streets of the most expensive areas where is for
them the right consumer clientele, which is very demanding also in terms of the actual
architectural design point of sale as well as highly knowledgeable sales staff behaviour
and automatically expect that with the purchase of luxury branded products will go ex-
traordinary, enjoyable experience. Brands are also subject to life cycle, so in an effort
to constantly be original, the companies’ active in the luxury industry must invest con-
siderable funds to maintain its market position. We have already mentioned that due
to the retention or gain of social status, many people are willing to spend on buying a
luxury branded product and considerable part of their income. It is most strikingly re-
flected in times of crisis or recession in the emerging countries with rapidly increasing
number of wealthy people – millionaires, lusting after receiving a similar status that
enjoy well situated citizens of the western world. There are brand products, which cus-
tomers trust and are loyal to, they include major luxury brand products, these brands
reduce risk for their customers while increasing customer loyalty towards them. In ad-
dition, the brand represents a lifestyle of those who used it; the building is closely

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linked with the concept of building a so-called lovemarks-i.e. something more than just
a brand. Something that ensures consumer loyalty to the product, after which the con-
sumer desires, so that he is willing to spend his last money, lovemarks are inspired by
loyalty exceeding the limits of reasonable grounds. Therefore, the strategic objective
of the brand is now a connection with the brand experience into something extraordi-
nary and also broadcast messages to audiences through the media (i.e. counselling of
“famous celebrities” on Facebook in the context of branded luxury products). The
branding affects overall international marketing strategy of companies, making the
overall concept of the brand, including a design expression, particularly the impact of
micro and macro business environment, which should result in its effective internation-
al marketing communication. Successful brand management always evaluates the
brand development and controls its successful position on the international markets.
The successful management of building products of luxury brands can also talk the
new strategy of internationalisation, successful entry into the markets of emerging
economies (China, Russia, India, Brazil…) despite the continuing influence of socio-
economic crisis. Brand is more than the product itself. The fact that the brand includes
environment, marketing communication, but also the attitudes and behaviour of con-
sumers, also shows the implementation of international marketing strategies and thus
the application of the international marketing mix of producers of luxury branded
products -maintaining their consistent quality (despite the fact that production is grad-
ually relocated to emerging economies) keeping their high price levels (high price here
should present and presents high quality), building high standard outlets and expand-
ing their international networks (e.g. luxury neighbourhoods, but also closer to the
customer-urban centres in developing economies, among which China leads), high
costs, spending on the creation of concepts of international marketing communication
(engagement of well-known producers to shoot commercials, internationally renowned
celebrities as products faces of different brands, buying media space in posh-known
magazines …). To build a successful brand requires a good understanding of the
needs and desires of the target audience – customers, the above companies under-
stand that and they focused on target markets and tried to reach potential customers,
offering not only standard brands, but also the creation of a new brand, which is
adapted to the values and conditions of foreign market, while the concept is focused
on building its global influence. Every marketing decision has an impact on the brand.
Elements of design, graphic design, colour range and language, all participate and
complete the brand. Difference between brand perceptions in the past and present is
that in the past, were brands a symbol of permanence a guarantee of the product.
Customers therefore got standard quality and required quantity of the product. Finally,
as it is clear from the above analysis, we can conclude that the market for luxury
products industry, behaves in a modified way in comparison to standard consumer
goods market. This affects largely the character and directional nature of the consum-
er group, highly affluent population groups, who are willing even in difficult times of
economic crisis, spend significant resources for branded luxury products, that provide
gaining and retention of so called high level of social status. To favourable conditions
for the expansion of firms producing luxury brand products to the international mar-
kets in times of crisis contributed also atypical developments in the markets of devel-
oping countries. In these countries, high solvent clientele is rapidly growing, longing
after obtaining the status of belonging to the highest social level in their own country
and they are willing to do everything through the ownership of luxury branded prod-
ucts. The world famous luxury brand producers were aware of this situation and they

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skilfully used it by their timely and properly conceived international marketing strategy
to ensure a high level of turnover and profits of their business activities.

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