Chapter 13 Global Marketing Communications Decisions I: Advertising and Public Relations

Global Marketing, 6e (Keegan/Green)
Chapter 13 Global Marketing Communications Decisions I: Advertising and Public

Relations
1) The environment in which marketing communications programs and strategies are

implemented remains the same among countries.
Answer: FALSE
Diff: 2 Page Ref: 397
AACSB: Reflective Thinking
2) McDonald's "I'm lovin' it" theme is a good example of global advertising.

Answer: TRUE
3) The globalization of coffee culture has created market opportunities for companies such as
Starbucks.
Answer: TRUE
4) "Globalness" of consumer products companies such as P&G, Unilever, and Nestl can be
inferred from the proportion of advertising expenditures outside the home-country markets.
Answer: TRUE
5) According to data published by Advertising Age in 2007, Proctor & Gamble ranks # 1 in
worldwide advertisement spending.
Answer: TRUE
6) The "extension versus adaptation" debate is essentially a debate over "standardized versus
localized" advertising.
Answer: TRUE
Diff: 2 Page Ref: 399-400
7) Recently, global companies have embraced a technique known as "pattern advertising."

Answer: TRUE
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8) As a practical matter, marketing managers may choose to run both global and local ads rather
than adopt an "either/or" stance.
Answer: TRUE
9) The "localized" versus "standardized" debate pertaining to global advertising has finally been
resolved in favor of standardization.
Answer: FALSE
10) Standardized print campaigns can be used for industrial products or for technology- oriented
consumer products such as Apple iPhone.
Answer: TRUE
11) Despite an unmistakable trend toward using global advertising agencies to support global
marketing efforts, companies with geocentric orientations will adapt to the global market
requirements and select the best agency or agencies accordingly.
Answer: TRUE
12) A German agency devised McDonald's "I'm lovin' it" tagline.

Answer: TRUE
13) In 1994, the Chinese government banned tobacco advertising from television, radio,
newspaper, magazine, and cinema ads.
Answer: TRUE
14) The Omnicom Group is the world's largest advertising organization.

Answer: TRUE
15) If the product needs a strong local identification, it would be best to select an international
agency.
Answer: FALSE
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16) Western advertising agencies still find markets such as China and Japan to be very complex,
as Asian agencies find it just as difficult to establish local agency presence in Western markets.
Answer: TRUE
17) In the advertising industry, "creative strategy" is a statement of what a particular message or
campaign will say.
Answer: TRUE
AACSB: Analytic Skills
18) The advertising agencies can be thought of as "idea factories."

Answer: TRUE
19) Some of the world's most memorable advertising campaigns originate from "big" ideas with
unlimited number of new executions. Such a campaign is said to have "legs."
Answer: TRUE
20) When creating global advertising, it is important to remember that the "advertising appeal"
should be based on the agency's understanding of the target audience's buying motives.
Answer: TRUE
21) The way a product's appeal or proposition is presented is called the "creative execution."
Answer: TRUE
22) Revlon has used a French producer to develop television commercials in English and
Spanish for use in international markets.
Answer: TRUE
23) Copywriters are specialists who check advertisements to see that they meet copyright
regulations in different countries.
Answer: FALSE
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24) In spring 2004, Adidas launched a $50 million global print and TV campaign keyed to the
tagline "Nothing is impossible."
Answer: TRUE
25) In China, McDonald's is careful not to advertise prices with multiple occurrences of the
number four since, in Cantonese, the pronunciation of the word four sounds similar to that of the
word death.
Answer: TRUE
AACSB: Multicultural and Diversity
26) In China, a humorous TV ad showing a student humiliating a teacher in the classroom would
be an effective execution for a soft drink brand.
Answer: FALSE
27) In Japan, intimate scenes between men and women are in bad taste and in Saudi Arabia such
ads are outlawed.
Answer: TRUE
28) Ads that strike viewers in some countries as humorous or irritating may not necessarily be
perceived that way by viewers in other countries.
Answer: TRUE
29) Partial nudity and same-sex couples are frequently seen in ads in Latin America and Europe.
Answer: TRUE
30) In Germany, expenditures for newspaper advertising are greater than those for television
advertising.
Answer: TRUE
31) U.S. ads contain more price information, and are more likely to include comparative appeals
than Arabic ads.
Answer: TRUE
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32) Benetton's striking print and outdoor advantage campaigns keyed to the "United Colors of
Benetton" generated both controversy and wide media attention.
Answer: TRUE
33) Publicity is similar to advertising in that companies pay the media for placement of stories
and news items.
Answer: FALSE
34) Many companies utilize corporate advertising which, despite the name, is generally
considered part of the PR function.
Answer: FALSE
35) Advocacy advertising enhances the public's perception of a company, creates goodwill, or
announces a major change.
Answer: FALSE
36) Image advertising is used by global companies to present themselves as good corporate
citizens in foreign countries.
Answer: TRUE
37) "United Colors of Benetton" generated both controversy and wide media attention, which
executives consider as an opportunity to generate publicity.
Answer: TRUE
38) Consumer products companies typically use advocacy advertising to give the public reasons
to buy their products.
Answer: TRUE
39) Any company that is increasing its activities outside the home country can utilize PR
personnel as boundary spanners between the company and employees, unions, stockholders,
customers, the media, financial analysts, governments, or suppliers.
Answer: TRUE
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40) A company that is ethnocentric in its approach to PR will not extend home-country PR
activities into host countries.
Answer: FALSE
41) As companies recognize and embrace new concepts such as the globalization of coffee
culture, the potential for effective global advertising:
A) decreases.
B) increases.
C) remains the same.
D) becomes evident.
E) is ignored.
Answer: B
42) A ________ company is one that targets customers worldwide or sources products
worldwide, standardizing some marketing mix elements and adapting others.
A) domestic
B) local
C) global
D) international
E) multinational
Answer: C
43) Which of the following product category/company pairings best illustrates the concept of
"product cultures?"
A) earth-moving equipment/Caterpillar
B) personal hygiene/Procter & Gamble
C) coffee bars/Starbucks
D) batteries/Duracell
E) automobiles/Ford
Answer: C
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44) A company that successfully creates standardized global advertising can reap which potential
advantage?
A) economies of scale
B) improved access to distribution channels
C) "first mover" status in uncovering global market
D) creative leverage
E) all of the above
Answer: E
45) Which company ranks number one in terms of worldwide ad spending?

A) General Motors
B) Philip Morris
C) Unilever
D) Procter & Gamble
E) Coca-Cola
Answer: D
46) Which company ranks number one in terms of ad spending in Europe?

A) General Motors
B) Philip Morris
C) Unilever
D) Procter & Gamble
E) Coca-Cola
Answer: D
47) What do Unilever and Procter & Gamble have in common?

A) Revenues at both companies have been hurt by regulations concerning tobacco advertising
and promotion.
B) Both companies utilize extension approaches to advertising.
C) Both companies rank high in terms of non-U.S. ad spending.
D) Both companies use a great deal of corporate advertising.
E) Both companies use the same advertising agency.
Answer: C
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48) A company's efforts to effectively communicate with customers may be hindered if the
message:
A) does not reach the intended recipient.
B) reaches the intended recipient but is misunderstood.
C) reaches the intended recipient and is understood but the recipient may fail to take action.
D) is distorted by noise.
E) all of the above
Answer: E
49) ________ is the phrase global marketers use to describe ads with common design elements
into which localized elements are inserted for individual country markets.
A) "Pattern advertising"
B) "Template advertising"
C) "Cookie-cutter advertising"
D) "Model advertising"
E) "Stereotype advertising"
Answer: A
50) In the language of global marketing, ________ is the phrase used to describe advertising that
represents a middle ground between 100% standardization and 100% localization:
A) "stereotype advertising"
B) "template advertising"
C) "cookie-cutter advertising"
D) "compromise advertising"
E) "pattern advertising"
Answer: E
51) When the subheads and body copy of an advertisement is localized, not simply translated, is
an example of:
A) local advertising.
B) global advertising.
C) pattern advertising.
D) advocacy advertising.
E) stereotype advertising.
Answer: C
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52) In selecting an advertising agency, all but one of the following issues should be taken into
consideration.
A) company organization
B) national responsiveness
C) area coverage
D) buyer perception
E) franchise or company owned status
Answer: E
53) According to data published by Advertising Age (2009), which of the following is the largest
global advertising organization?
A) WPP Group
B) Interpublic Group
C) Omnicom Group
D) Dentsu Inc.
E) Havas
Answer: A
54) When it is time to choose one or more advertising agencies, a company with a decentralized
structure and a polycentric organization will:
A) make the decisions at headquarters.
B) leave the decision to local country managers.
C) automatically go with a home-country agency.
D) be most concerned with economies of scale.
E) make the decisions on a regional basis.
Answer: B
55) Tobacco companies in Central Europe face the prospect of tougher marketing and
advertisement regulations due to the:
A) growing concern about health hazards associated with smoking.
B) a dislike of global brands crowding out local brands.
C) a desire to return to communist-era policies.
D) a desire to comply with EU regulations.
E) pressure from neighboring countries.
Answer: D
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56) The advertising promise that captures the reason that people buy products is known as:
A) creative strategy.
B) the advertising appeal.
C) the selling proposition.
D) the creative execution.
E) the big idea.
Answer: C
57) In many parts of the world, McDonald's utilizes TV advertising that shows parents
interacting with their happy children. Such advertising utilizes:
A) rational appeals.
B) emotional appeals.
C) SRC appeals.
D) melodramatic appeals.
E) localized appeal.
Answer: B
58) The choice between demonstration, slice-of-life, straight sell, and other advertising forms is a
matter of:
A) creative strategy.
B) the advertising appeal.
C) the selling proposition.
D) the creative execution.
E) the big idea.
Answer: D
59) In advertising, a(n) ________ is an agency "creative" who chooses graphics, pictures, type
styles, and other visual elements and has general responsibility for the overall look of an
advertisement.
A) art director
B) copywriter
C) IMC manager
D) PR practitioner
E) stylist
Answer: A
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60) According to recent research on advertising appeals in global marketing, which of the
following countries rank high in both "think" and "feel" dimensions?
A) Austria, Canada, Germany, United States, Korea
B) Belgium, the Netherlands, India
C) Argentina, Brazil, Italy
D) Denmark, France, Hong Kong, Japan
E) Spain, Sweden, Taiwan
Answer: A
61) According to a research study, a TV advertisement that presents a rational appeal by means
of an argument-type execution would be well suited to:
A) monochronic cultures with low power distance, high uncertainty avoidance, and a good
supply of marketing professionals.
B) collectivist cultures with high power distance and high uncertainty avoidance.
C) collectivist cultures with high power distance, high advertising expenditures, and strict
government control.
D) high power distance, high advertising expenditures, and a limited supply of advertising
professionals.
E) none of the above
Answer: A
62) According to a research study, a TV advertisement that presents an emotional appeal by

means of a psychological-type execution would be well suited to:
A) monochronic cultures with low power distance, high uncertainty avoidance, and a good
supply of marketing professionals.
B) collectivist cultures with high power distance and high uncertainty avoidance.
C) collectivist cultures with high power distance, high advertising expenditures, and strict
government control.
D) high power distance, high advertising expenditures, and a limited supply of advertising
professionals.
E) none of the above
Answer: C
63) Which of the following is true about advertising expenditures in Germany and Brazil?
A) Television is the leading medium in both Germany and Brazil.
B) Newspapers are the leading medium in both Germany and Brazil.
C) Television is the leading medium in Brazil; newspapers are the leading medium in Germany.
D) Television is the leading medium in Germany; newspapers are the leading medium in Brazil.
E) Magazines are the leading medium in Brazil and Germany.
Answer: C
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64) The United States and ________ are the two top-ranked countries in terms of ad spending
across all measured media.
A) UK
B) France
C) Canada
D) Japan
E) Germany
Answer: D
65) In which country are global marketers likely to encounter the most restrictions on
advertising?
A) United States
B) Japan
C) Saudi Arabia
D) Russia
E) Germany
Answer: C
66) In which country would a global marketer most likely encounter the need to use print
advertisements?
A) United States
B) Japan
C) China
D) India
E) Germany
Answer: C
67) Generally speaking, a company has little control over media. To compensate for this lack of
control many companies utilize:
A) image advertising.
B) advocacy advertising.
C) corporate advertising.
D) TV advertising.
E) radio advertising.
Answer: C
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68) Which promotional mix element is most closely associated with activities designed to foster
goodwill and understanding with various constituents both inside and outside the company?
A) personal selling
B) advertising
C) public relations
D) sales promotion
E) publicity
Answer: C
69) One task of the ________ department is to generate nonpaid forms of communication to
foster goodwill among customers and others.
A) sales promotion
B) global marketing
C) headquarters
D) public relations
E) advertising
Answer: D
70) What do Ford Motor Company, Coca-Cola, Nike, and McDonald's all have in common?
A) They are all consumer packaged-goods companies.
B) They all have foreign CEOs.
C) They have all received a great deal of negative publicity in recent years.
D) They all rely exclusively on TV advertising.
E) They spend more in advertising in foreign markets than home markets.
Answer: C
71) Which of the following marketing mix elements was at the heart of the problems Ford Motor
Company and Bridgestone/Firestone faced in 2000?
A) pricing problems
B) distribution problems
C) sales promotion problems
D) public relations problems
E) advertising problems
Answer: D
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72) In the summer of 1999, Coca-Cola faced a major marketing problem in Europe. Which of the
following was at the heart of the problem?
A) pricing problems
B) advertising problems
C) sales promotion problems
D) public relations problems
E) distribution problems
Answer: D
73) Japan's Fuji Photo Film asked its advertising agency to develop an advocacy campaign for
the United States targeted to appeal both to Wal-Mart and to its customers. This is an example of
________ advertising.
A) local advertising
B) pattern advertising
C) global advertising
D) advocacy advertising
E) image advertising
Answer: D
74) Recently, some of the biggest advertising holding companies have acquired leading public
relations agencies. The best explanation for this trend is:
A) a growing realization of the importance of IMC (Integrated Marketing Communications).
B) increasing client demands for localized PR campaigns.
C) stepped-up efforts by large companies to combat anti-globalization activists.
D) declining demand for global public relations means agencies have to agree to be acquired or
risk going out of business.
E) increasing demand by global public for transparency.
Answer: A
75) Which of the following most accurately describes the state of global public relations (PR)
today?
A) Expenditures on PR are dropping.
B) Expenditures on PR are increasing.
C) PR practices are standardized worldwide.
D) PR is not important in emerging markets like India.
E) Foreign investments are increasing.
Answer: B
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76) A company adopting a(n) ________ approach to worldwide PR activities gives the host-
country practitioner maximum leeway to incorporate local customs and practices into the PR
effort.
A) ethnocentric
B) regiocentric
C) local
D) polycentric
E) publicity
Answer: D
77) Even in the face of such tough and growing competition, Adidas still enjoys high brand
loyalty among older Europeans. The company recruits young people and pays them to wear
Adidas shoes in public. This is an example of:
A) local advertising.
B) pattern advertising.
C) global advertising.
D) advocacy advertising.
E) image advertising.
Answer: E
78) China's ongoing trade-related friction with the United States highlights the need for:
A) a better distribution system.
B) a better PR effort.
C) sales promotion.
D) a better transportation system.
E) pattern advertising.
Answer: B
79) PepsiCo undertook an ambitious global program to revamp the packaging of its flagship
cola. To raise awareness of its new blue can, Pepsi spent $500 million on advertising and PR;
Pepsi leased a Concorde jet and painted it in the new blue color. This is a good use of:
A) product packaging that will help a product "sell itself."
B) Concorde jet for advertising and promotion.
C) IMC ( Integrated Marketing Communications).
D) packaging that can be transported in various ways.
E) advertising budget.
Answer: C
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80) In developing countries, such as Ghana, the best way to communicate with market segments
may be through:
A) mass media.
B) written word.
C) magazine ads.
D) TV ads.
E) dance, songs, and storytelling.
Answer: E
81) A global company that has the ability to successfully transform a domestic campaign into a
worldwide one or to create a new global campaign from the ground up, possesses a critical
marketing advantage. Explain this statement in light of the global advertising.
Answer: Advertising can be any sponsored, paid message that is communicated in a non
personal way. Global advertising can be defined as messages whose art, copy, headlines,
photographs, tag lines, and other elements have been developed expressly for their worldwide
suitability. Many companies have used local, international, and global themes from time to time
for domestic or worldwide use. A global company may use single-country advertising in addition
to campaigns that are regional and global in scope. The search for a global advertising campaign
should bring together everyone involved with the product to share information. Regional market
areas such as Europe are experiencing an influx of standardized global brands as companies align
themselves. This phenomenon is accelerating the growth of global advertising. The potential for
effective global advertising also increases as companies recognize and embrace new concepts
such as "product cultures." An example of such cultures can be coffee culture which has created
market opportunities for Starbucks Company. Companies also realize that some market segments
can be defined on the basis of global demography such as youth culture. MTV, for example, is
just one of the media vehicles that enable people virtually anywhere to see how the rest of the
world lives and to learn about products that are popular in other cultures. Global advertising also
offers companies economies of scale in advertising as well as improved access to distribution
channels. A global brand supported by global advertising may be very attractive from the
retailer's standpoint; a global brand is less likely to languish on the shelves. Although
standardization is recommended for some products it is not always required or necessary. For
example, Nestl's Nescafe coffee is marketed as a global brand, even though advertising
messages and product formulation vary to suit cultural differences.
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82) There is an ongoing debate between "Standardization" versus "Adaptation" pertaining to
global advertising. Explain how different sides of the arguments fit into the global context.
Answer: Communication experts generally agree that the overall requirements of effective
communication and persuasion are fixed and do not vary from country to country. The same is
true for the components of communication process whereby the marketer is the source of the
message; the message must be encoded, conveyed via the appropriate media, and decoded by a
member of the target audience. Also, that the message is fully communicated when there is
desired feedback. Four major difficulties can compromise an organization's attempt to
communicate with customers in any location: (a) the message may not get through to the
intended audience. This may be due to advertiser's lack of knowledge or experience about
appropriate media to reach certain types of audiences; (b) the message may reach the target
audience but may not be understood or may even be misunderstood. This may be due to
inadequate understanding of the target audiences; (c) the message may reach the target audience
and may be understood but still may not compel the recipient to take action. This could be due to
the lack of cultural knowledge about a target audience; and the effectiveness of the message can
be impaired by noise, which in this case is external influences such as competitive advertising,
other prejudices and related factors. All these factors compel a marketer to think and decide
whether to use adaptations in advertising from country to country and region to region.
Proponents of the "one world; one voice" approach to global advertising believe that the era of
the global village has arrived and that tastes and preferences are converging worldwide.
According to the standardization arguments, people everywhere want the same products for the
same reasons. Advertisers who prefer the localized approach are skeptical of the global village
argument. They assert that consumers still differ from country to country and must be reached by
advertising tailored to their respective countries. Proponents of localization point out that very
costly blunders have occurred since advertisers have failed to understand or adapt to different
cultures. Currently the argument remains unresolved and companies are using both standardized
advertising as well as adapting where necessary.
83) What issues must be considered in selecting an advertising agency for global advertising?
Answer: Care should be taken in selecting advertising agencies particularly when entering a new
market in a foreign country. The following issues should be considered: (a) company
organization companies that are decentralized may want to leave the choice to the local
subsidiary; (b) national responsiveness the global agency should be familiar with the local
culture and buying habits in a particular country. If not, a local agency might be more suitable;
(c) area coverage does the agency cover the areas, regions, or countries targeted; and (d)
buyer perception what kind of brand awareness does the company want to project? For
example, if a product needs a strong local identification, it would be best to select a national
agency. Despite the trend toward using global agencies to support global marketing efforts,
companies with geocentric orientations will adapt to the global market requirements and select
the best agency or agencies accordingly.
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84) Considering the fact that the "message" is at the heart of advertising, discuss how creative
strategy and different types of appeals can be created in global advertising.
Answer: The particular message and the way it is presented will depend primarily on the
advertiser's objectives; whether the ad is meant for informing, entertaining, reminding, or
persuading. Moreover, in a world characterized by information technology, ads must break
through the clutter, grab the audience's attention, and linger in their minds for a desired period of
time. All this requires developing an original and effective creative strategy. Advertising agencies
can be thought of as "idea factories" since they have to create ideas from scratch, sometimes
referred to as the "big idea." Some of the world's most memorable advertising campaigns have
achieved success because they originate from an idea that is big enough to offer opportunities
that will last for a long period of time. Companies seek for such big ideas since they bring a lot
of profitability and exposure to the products and their companies. The advertising appeal is the
communications approach that relates to the motives of the target audience. For example, ads
based on a rational appeal depend on logic and speak to the audience's intellect. Rational appeals
are based on consumers' needs for information. Ads using an emotional appeal may be directed
to evoke a feeling response that will direct purchase behavior. The message elements in a
particular ad will depend, in part, on which appeal is being employed. The selling proposition is
the promise or claim that captures the reason for buying the product or the benefit that ownership
confers. Because products are frequently at different stages in their life cycle in various markets,
and because of cultural, social, and economic differences that exist in those markets, the most
effective appeal or selling proposition for a product may vary from market to market.
85) Food is a product category most likely to exhibit cultural sensitivity. Using Heinz ketchup as
an example, discuss how the company has used its advertising taking into account cultural
sensitivities in different parts of the world.
Answer: Marketers of food and food products have to consider cultural sensitivities in different
parts of the world since food preferences vary from country to country. Localization of the
advertising is highly preferable in the case of food and food product advertising. A good example
is the effort by H.J. Heinz Company to advertise its ketchup products in different markets.
Heinz's strategy involved adapting both the product and advertising to target country tastes. For
example, in Greece, ads show ketchup pouring over pasta, eggs, and cuts of meat. In Japan, they
instruct Japanese homemakers on using ketchup as an ingredient in Western-style food such as
omelettes, sausages, and pasta. Americans like a sweet ketchup, whereas Europeans prefer a
spicier, more piquant variety. Apparently, Heinz's foreign marketing efforts are most successful
when the company quickly adapts to local cultural preferences. In Sweden, the made-in-America
theme is so muted in Heinz's ads that Swedes do not realize that Heinz is American and consider
it to be German because of its name. In contrast, American themes still work well in Germany.
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86) Much academic research has been devoted to the impact of culture on advertising.
Researcher Tamotsu Kishii identified seven characteristics that distinguish between Japanese and
American creative strategy. Briefly describe those characteristics.
Answer: The seven characteristics outlined by researcher Tamotsu Kishii show how Japanese
ads differ from the American ads which can be summarized as follows: (1) indirect forms of
expression are used in Japan where many television ads do not mention what is desirable and let
the audience judge for themselves; (2) there is often little relationship between advantages
content and the advertised product; (3) in the Japanese culture, the more one talks, the less others
will perceive him or her as trustworthy, so only a brief dialogue or narration is preferred; (4)
humor is used to create a bond of mutual feelings and not to dramatize others in a humorous
way; (5) famous celebrities appear as close acquaintances or everyday people; (6) priority is
placed on company trust rather than product quality. Japanese tend to believe that if a company is
large and has a good image, the quality of its products should also be outstanding; and (7) the
product name is impressed on the viewer with short and brief commercials.
87) One of the issues facing advertisers is which medium or media to use when communicating
with global target market. Discuss how these media differ from country to country, giving
examples.
Answer: Media availability varies from country to country. Some companies like Coca-Cola
utilize every media that is available in a country. The available alternatives can be broadly
classified as print media, electronic media, and other. Print media includes newspapers to
magazines and business publications with national, regional, or international audiences.
Electronic media includes broadcast television, cable television, radio, and the Internet. Other
media may include outdoor, transit, and direct mail advertising. Globally, media decisions must
take into account country-specific regulations such as in France retailers are banned from
advertising on television. Worldwide, television is the number one advertising medium; however,
there are some exceptions. In the United States and Japan, television is the number one medium,
whereas in Germany newspapers are the leading medium. Therefore, more companies use
newspaper as a medium for advertising. Television is also important in Latin American countries.
In Mexico, an advertiser that can pay for a full-page advertising may get the front page, while in
India, paper shortages may require booking an ad six months in advance. In some countries,
especially those where the electronic media are government owned, television and radio stations
can broadcast only a restricted number of advertising messages. In Saudi Arabia, no commercial
television advertising was allowed prior to 1986 and currently ad content and visual presentation
are restricted. Also, radio can be an effective advertising media in many countries. The latest
trend, however, is to use the electronic media, and, therefore, internet advertising is gaining
popularity at the expense of television and print advertising. Outdoor advertising may also be a
major medium of choice in countries such as Russia and India. Cultural considerations are
important when selecting the advertising message as well as the media.
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88) Because of its size and presence in more than 200 countries, the Coca-Cola Company is
often the target of antiglobalization protests. Giving examples, show how negative publicity
affects global marketers?
Answer: A large group of Indian protestors protested against the use of water by Coke in India,
where getting water for drinking was a problem. With negative publicity due to vast coverage in
news media, the company has to take some reactionary measures. A rapid reaction is necessary to
do any damage control. Hyundai and Samsung in South Korea had to face negative publicity
when their executives were portrayed for embezzlement or bribery. Coca-Cola and Pepsi had to
face negative publicity in India when both companies were alleged to have pesticide residues in
their soft drinks. The sales dropped as soon as the news hit the media. Halliburton in the United
States also suffered when it was revealed that the company overcharged the U.S. government for
supplies and services rendered in Iraq. Ford Motor Company and Bridgestone/Firestone had a
tough time defending their relationship when a rash of tire failures occurred in Ford
manufactured autos. Ultimately, Ford severed its decades-old relationship with Firestone.
Firestone is still recovering from the loss of public confidence. Nike has been continuously
responding to the criticism that its subcontractors operate factories in which sweatshop
conditions prevail. McDonald's is faced with public concerns due to mad cow disease in Europe;
legal battles originating from beef contamination in french fries; links of food to obesity; and
some problems with subcontractors. Thus, there are several large companies that have faced
problems due to negative publicity. The best thing is to take all precautions and try to prevent
any situations which might lead to negative publicity. In case it happens, then they should have a
plan to react in a swift and effective manner.
89) Companies use corporate advertising; image advertising, and advocacy advertising from time
to time. How are these advertising methods used and what are are the circumstances under which
they are used?
Answer: Companies do not have free access to the media and cannot control what they write. In
order to have control, many companies utilize "corporate advertising" which is generally
considered part of the PR function. A company or organization pays for the corporate
advertising. In the context of IMC, corporate advertising is often used to call attention to the
company's other communications efforts, rather than enticing the customers. On the other hand,
"image advertising" enhances the public's perception of a company, creates goodwill, or
announces a major change, such as a merger or acquisition. Global companies frequently use
image advertising in an effort to present themselves as good corporate citizens in foreign
countries. In "advocacy advertising," a company presents its point of view on a particular issue.
Examples of such advertising methods include the following: Nokia purchased full-page
newspaper ads to congratulate the University of Florida Gators for winning the 1997 Sugar
Bowl. Also, Japan's Fuji Photo Film did an advertising campaign in the United States while they
were competing with Kodak. They were able to secure a contract with Wal-Mart, which gave
them access to many customers of a large discount store. Thus, companies use advertising for
enhancing their image, advocating a cause, or putting their point across to consumers, regulatory
agencies, suppliers, competitors, or government at home or in a foreign country.
20
90) The ultimate test of an organization's understanding of the power and importance of public
relations occurs during a time of environmental turbulence. In light of this statement, explain the
importance of public relations and show how it differs around the world.
Answer: When disaster strikes, a company or industry often finds itself thrust into the spotlight.
With modern technology, easily accessible communications and media have made it more
important for companies to be prepared for any potential disasters or acute problems. A
company's swift and effective handling of communications during such times can have
significant implications. The best response is to be forthright and direct, reassuring the public,
and provide the media with accurate information. Cultural traditions, social and political
contexts, and economic environments in specific countries can affect PR practices. The mass
media and the written word are important vehicles for information dissemination in many of the
industrial countries. In developing countries these may not be as effective or the only source of
communication. In Ghana, dance, songs, and storytelling are important communication channels.
In India, where half of the population cannot read, written communication is of no importance,,
mostly in the extensive rural areas. Even in industrialized nations PR practices vary to a great
extent. In the United States, the hometown news release comprises much of the news in a small,
local newspaper. In Europe, PR professionals are viewed as part of the marketing function rather
than as distinct and separate specialists in a company. A company that is ethnocentric in its
approach to PR will extend home-country PR activities into host countries. The rationale behind
this approach is that people everywhere are motivated and persuaded in much the same manner;
a company adopting a polycentric approach to PR gives the host-country practitioner more
leeway to incorporate local customs and practices into the PR effort.
21

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Global Marketing, 6e (Keegan/Green)

Chapter 13 Global Marketing Communications Decisions I: Advertising and Public

1) The environment in which marketing communications programs and strategies are

2) McDonald's "I'm lovin' it" theme is a good example of global advertising.

7) Recently, global companies have embraced a technique known as "pattern advertising."

12) A German agency devised McDonald's "I'm lovin' it" tagline.

14) The Omnicom Group is the world's largest advertising organization.

18) The advertising agencies can be thought of as "idea factories."

45) Which company ranks number one in terms of worldwide ad spending?

46) Which company ranks number one in terms of ad spending in Europe?

47) What do Unilever and Procter & Gamble have in common?

62) According to a research study, a TV advertisement that presents an emotional appeal by

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