Benefits Whirlpool gains by broadening the Whirlpool brand name

By | April 30, 2014

This Assignment Is Published With Permission From The Author For Online Review Only
All Rights Reserved @ ChinaAbout.Net

1. Evaluate the benefits Whirlpool gain by broadening the Whirlpool brand name from a North American brand to a global one.

1.1 Basic concepts

A brand is a name, term, symbol, design, or combination thereof that identifies a seller’s products and differentiates them from competitors’ products. A brand name is that part of a brand that can be spoken, including letters words and numbers. The term global brand refers to a brand that obtains at least a third of its earnings from outside its home country, is recognizable outside its home base of customers, and has publicly available marketing and financial dat. Yum, Brands, which owns Pizza Hut, KFC, and Taco Bell is a good example of a company that has developed strong global brands (Lamb, Hair & McDaniel 2011, p. 162).

1.2 Benefits for Whirlpool to gain a global brand

1.2.1 Facilitate the new product sale and lower the barriers for new market entry

According to Charles W. Lamb, Joseph F. Hair and Carl McDaniel (2009), branding has three major functions: product identification, repeat sales, and new product sales. While product identification is generally considered as the most important function of branding, in the field of international business another critical advantage of using branding strategy is its benefit in facilitating new product sale. For example, with an established global branding of Whirlpool, it would be of great convenience for the company to introduce the new product into the markets in which it has already had sale networks or it is a new market to the products. Because of the fact that the brand is well established with global awareness, it will effectively reduce the barriers for the new market entry because customers have already known this brand.

1.2.2 Brand loyalty and price war avoidance

Research has shown that when firms communicate unique and positive message via advertising, personal selling, promotions, events and other means, they are able to differentiate their brands effectively from competitive offering and insulate themselves from future price competition. Companies usually approach various marketing communications in creating positive brand equity and building strong brand loyalty (Shimp 2010, p. 46). As for Whirlpool, building up a global brand will enhance the brand loyalty in a global scale while at the same time also positively assist the company to avoid getting involved directly in the price war with the competitors.

1.2.3 Help identify the various market similarities

Local brands exist in one country or in a limited geographical area while global brands adopt some elements of the global strategy but execute locally, while global brands adopt the same strategy and marketing mix in all markets. According to Giles David Moss (2007, p. 108), global branding consists of offering a brand that has standardized a maximum number of elements of its strategy and marketing mix to ideally offer one near identical product brand to every international market. And the major principle to follow is therefore to look at what is in common between the markets and minimize or forget the differences between them. As a result, by adopting a global brand for Whirlpool, it will help the company to identify the similarities between the various markets in term of the brand name elements, customers’ perception of the brand positions and so on.

1.2.4 Maintain the brand consistency through the markets

According to Jo Piazza (2011), brand consistency is the hallmark of a successful product, consumers need to know what they are spending their hard-earned money on, when brands act inconsistently, and consumers become confused and wary. As for Whirlpool, pursuing a global brand will help maintain the brand consistency through the markets in different countries and regions. For example, by adopting the same marketing mix throughout the world, customers moving from one country to another would found the Whirlpool of the same branding and therefore they may think that the product quality would remains the same and thus would be hesitate in making up decisions to buy the products.