Product standardization strategy refers to a uniform representation of all aspects of the product such as the quality, the materials that had been used, product name and packaging for all markets, regardless of the location around the world. In the contrast, the most challenging decision that a company may face in internationalization is the degree of standardization or adaptation in its operations. The question of standardization or adaptation affects all avenues of a business’ operations, such as R&D, finance, production, organizational structure, procurement, and the marketing mix. Whether a company chooses to standardize or adapt its operations depends on its attitudes toward different cultures. These attitudes are defined by three orientations toward foreign culture: ethnocentric, polycentric and geocentric.
Further, standardization is a practice of setting identical characteristics for a particular good or service. Also it suggests a standardized approach as a “one size fits all” approach.
Product standardization is an efficient method to reduce costs and increase quality. By minimizing the differences in your products, you are able to rapidly increase production, streamline distribution, decrease raw material costs and reinforce product branding. The best product standardization strategies allow you to balance the need for targeted adaptation with the cost savings of standardization.
- Piston industry – Standard sizes of pistons are produced for different products. Like Federal-Mougal is producing pistons for many industries like Maruti as well as large scale manufactures like BMW etc…
- Nut & Bolt industry – Standard nuts & bolts are produced. So that they can be easily available in the market in case of requirements.
In here, achieving maximum productivity through standardization of service products, service design and delivery achieve global economy of scale & lowest unit cost which is an important aspect of economics (product or production orientation). Standardization can also contribute a coherent & consistant global image of the firm and its products.
Its developed standardized products are marketed worldwide with a standardized marketing mix.
However there are many obstacles to the application of uniform marketing policies. Such as reduction of choices, less flexibility, small ranges, obstacle to progress, varieties of consumer attitudes, competitive environment etc….
Ex: Toothpaste companies mostly focus in different type of market segmentation in order to stay ahead from competitors.
Package and Designing
Certain colours, symbols, words and imagery can be offensive or inappropriate in different countries.
Ex: Most of the perfumes, cosmetics, shampoo & soap companies use the different design & packaging in different countries.
Ex: Most of the foods, cosmetics and shampoo & soap companies use different ingredients in different countries.
Difference of Language
Ex: Coca-Cola translates the name & taste base on the host countries.
Ex: Muslims all around the world have the same belief & practice. Same goes to Christians as well.
Geography / Climate
- High humidity
Ex: Porton cars in Malaysia only have air –cooler & driving seat to the left side whereas in seasonal countries such Iran Porton cars have both the heater and air cooler and driving seat to the right side.
According to my point of view, both of these strategies have advantages & disadvantages. If the customer’s wants and needs are similar, the best approach is standardization. On the other hand, if the customer has different needs, wants & preferences the target market should go with adaptation strategies. But the practical world of the most companies are used to use a mixture of these two strategies.