International Marketing, 5th Edition

Soybean, corn, and beef are commodities. They are not differentiated by brands but rather by standardized grades. As such, the demand is strictly a function of price. It will be difficult to transform them into differentiated products (unless some unique, meaningful attributes can be found). Any attempt on branding or any promotional effort to support a brand is, more likely than not, unnecessary, costly, and ineffective.

There are several reasons why U.S. firms place their trademarks on products made by foreign firms. First, they may be able to create a unique product by bundling or unbundling product attributes. Second, the strategy guarantees that U.S. firms cannot be bypassed by their suppliers. Third, they can avoid fixed production costs. Finally, the strategy offers these firms brand loyalty, bargaining power, and price.

Foreign manufacturers also have their own reasons for agreeing to place other firms' brands on the products. One benefit is the ease in gaining market entry and dealers' acceptance which may allow a larger market share overall while contributing to offset fixed costs. Another advantage is that there are no promotional headaches and expenses. Finally, the strategy prevents other competitors from making this same product for these customers.

Many languages do not have all the alphabets. The Spanish language does not include the letter w, while the Italian language has no j, k, w, x, or y. The letter z is pronounced zed at places influenced by the British education system.

Any prefix, suffix, or word containing such letters as ph, gh, ch, and sh invites difficulty because of the possibility of varying pronunciation. People in many countries do not make any distinction, as far as pronunciation is concerned, for the following pairs: v and w; z and s; c and z; and ch and sh. A similar lack of distinction often exists with the trio of j, g, and y. The letter c can be pronounced like either an s or a k. The letter y also poses some problems since it can sound like an e at one time and an i at another time.

In its favor is the fact that the Hyundai is short and can be registered. Overall, however, Hyundai is not a good name to use for an international brand. First, it does not suggest product benefits. Second, unlike Japanese names which often imply quality, the Hyundai name is associated with Korea whose products are still struggling to gain respectability.

The most serious problem is that Hyundai is not easy to pronounce. In Asia, the pronunciation is Hoon-di. In the United States, the company chose to facilitate the pronunciation by rhyming it with Sunday, creating pronunciation inconsistency. In any case, Hyundai, in spite of its name, was a success in the United States — at least at the beginning. It is thus important to keep in mind that a clever name cannot overcome a product's inherent weaknesses but that a good product which satisfies consumer needs can overcome the limitations of its name.

In the United States, soft drinks are available in a great variety of forms and sizes. The sizes are 8oz., 12oz., 16oz., 32oz., 2-liter, etc. They are available in cans and bottles. The cans are usually made of aluminum but are also available as 2-piece or 3-piece steel cans. The bottles are made of either glass or plastic. Some of the containers require deposit returns while others are disposable.

For LDCs, many of such containers are wasteful. Disposable containers are expensive and have no secondary use. Smaller-sized containers are relatively more expensive.

It is a good idea to simplify inventory and avoid consumer confusion by reducing the number of sizes and styles of containers in LDCs while stressing economy and function.

Still it must be pointed out that, with the growth of the middle class in many countries, the containers which once were luxuries have become more acceptable. Cans of cola, in spite of being more expensive than larger-sized bottles, have gained acceptance. In LDCs, a can of soft drink is a status symbol.

The purpose of this minicase is to teach students of the importance of having a registered trademark and to protect it. The case also considers registration eligibility and makes a distinction between a valid trademark and a generic name.

Majorica is a valid trademark. The fact that the brand name is also the name of a place (island) does not make the mark generic. It is true that names of places are very low on the hierarchy of registration eligibility, making it unlikely for anyone to obtain registration for the names of places as trademarks. However, although the name of a place is generally not distinctive enough for registration, it is capable of becoming distinctive and associated with a particular marketer. London Fog is a prime example. Therefore, it can be argued that Majorica should be given the same kind of protection.

Macy's action was not legally defensible because its practice could cause consumer confusion. Thus, Macy's labeling constituted trademark infringement. R. H. Macy tried to justify its Marjoca-labeled pearls which were made by Hobe Cie Ltd. on the ground that it was the name of the island where the pearls were made. But acting on the suit filed by Majorica S.A., a Spanish firm which has used Majorica (an ancient name for Marjoca) since 1954 to describe its pearls, a federal court ordered Macy to stop using the name in order to prevent confusion and erosion of goodwill of the trademark. Macy's other alternative is to use the supplier's name and place of origin (i.e., Hobe pearls/made on Marjoca).