• Why Marketing Strategies of Foreign Multinational Brands Fail in Ghana

    In recent years, Ghana has become the beckoning land of opportunity with scores of international companies trying to break into the Ghanaian market. As Ghana’s economy matures, it becomes enticing for its growing consumer market. In the coming years, it will only become more important; the fastest-growing economy in the world in 2011 (at 13%) was Ghana.  Multinational companies cannot afford to overlook Ghana yet some have found themselves unable to break in to the Ghanaian market whereas others have found more success in Ghana than in their home country. Even companies with very similar products have achieved greatly varying levels of success.
    A company’s marketing strategy is often the key to whether a product succeeds or fails in every market and especially in Ghana. There are a plethora of reasons why western marketing strategies fail to reach Ghanaian consumers. Many companies believe that the same marketing campaigns that have been used elsewhere will also translate to the Ghanaian market but this is often not the case. Ghanaian preferences, tastes, and interpretations are different from those of other cultures. Even within Ghana, with  over 70 ethnic groups and people with vastly varying levels of affluence, particular market demands differ across regions.
    On the other hand, some foreign companies have localized too much to the point that they have lost their unique appeal. Marketing mistakes in Ghana come from various elements of the campaign, not only product but also promotion, price and placement.Therefore when designing a marketing campaign, companies will need to carefully consider their audience, keep any cultural particularities in mind, stay informed of current events affecting their consumers and conduct thorough market research.
    Below are some examples of multinationals companies and the consumer experiences they encountered on the Ghanaian market.
    The KFC Example
    A 63% majority of international companies operating in Ghana acknowledged that they needed to alter their product specifically for the Ghanaian market.  In most cases, this does not mean completely creating a new product or service but rather making small adjustments to better suit Ghanaian culture and preferences. Western fast food chains in particular KFC, upon discovering that Ghanaians do not like their popular French fries and chicken menu, made an alternative for kenkey (a local staple food in Ghana) with chicken. KFC has encountered much success in Ghana due to its combination of an extensive chicken and kenkey menu; a favourite among Ghanaians local dishes.
    Other fast food chains like NANDOS and STEERS from South Africa that had nearly the same beef-filled menu as in the United States did not have nearly as much success in Ghana and had to end their operations in the country due to low sales.
    The Tonaton Example
    The success of Ghana’s Tonaton (a local dialect which translates to buy and share) versus eBay demonstrates the importance of knowing one’s target audience. Both have the same basic service; providing a means through which individuals can sell products to other individuals.Yet it is the platform and methods through which Tonaton operates that specifically captured the Ghanaian market.
    EBay required purchasers to pay online using a credit card as is standard in the west. Tonaton understanding that many Ghanaians do not like to use credit cards online either because of not owning one or because of security concerns, allows customers to pay with cash on delivery. Price was another concern of using eBay; which required sellers to pay a fee for using their service. Tonaton instead makes profits through advertisements—something that is only a mild annoyance to Ghanaian website goers compared to a fee. Furthermore, due to the culture of bargaining and establishing trust and relationships before making purchasing decisions, Tonaton allows sellers to leave their contact information to allow buyers to be able to communicate with each other. EBay, fearing that the two parties would use this to make transactions without using their service—perhaps in part due to the service fee—chose not to add this feature. Despite its popularity in the United States, eBay is not popular in Ghana.
    On the other hand, having too much localization can hurt a brand just as badly as not having enough localization. Ghanaians like foreign products because they are unique and often are seen as a luxury item. If a foreign company localizes its products too much, it simply becomes a more expensive version of something Ghanaian companies already have. Therefore, multinational companies entering the Ghanaian market must carefully strike a balance between localizing and maintaining their original image. KFC appears to have discovered the right balance between Western and African, with a good mix of foreign and local dishes.
    The Coca Cola ‘Share A Coke’ Advertising Campaign Example
    The means through which a company advertises their products can also have a profound impact on the success or failure of the campaign. Advertising campaigns in Ghana have gone bad when companies miscalculate the Ghanaian audience’s reaction to a particular message or fail to consider local conditions. Coca Cola Ghana’s ‘Share a Coke’ advertisement campaign featured people sharing Coke Bottles with their names tagged on it.This campaign was a huge success in the western market, generating millions of YouTube views and praise. Unfortunately, the advertisement did not translate well to the Ghanaian audience, who rather than embracing the Ghanaian version thought Coca Cola was discriminating against some ethnic groups in Ghana since the Coke Bottles in the ad campaign were tagged with the names of individuals from a particular ethnic group ignoring other ethnic groups, which most Ghanaians believe wasn’t fair.  Other advertisements have been ineffective because they depict people and/or situations that are unfamiliar to the Ghanaian audience.
    Aligning Your Campaign with Politics
    Multinational companies must also carefully consider current events and politics when designing advertisement campaigns. Ghanaians are very passionate about politics using politically inclined individuals for your product or service promotion can hurt your business. Guinness Ghana Limited a subsidiary of Diageo Group once had to pull an advertisement featuring a Ghanaian actor who was blacklisted by members of the most powerful opposition political party in Ghana after appearing in their rival political party’s advertisement campaign. Most businesses fail if consumers who belong to any of the 2 most powerful political parties in Ghana realize your brand is affiliated to one side.
    Price Positioning
    Price is another important marketing factor to consider, and like the localization, requires finding the right balance between two ends of the spectrum. Ghana’s Per Capita GDP is $1,902 compared with the United States’ $53,143, and United Kingdom’s $39,351.  Western companies operating in Ghana must adjust their prices to suitable levels that their target Ghanaian consumer can afford. Companies should also consider price level differences across different regions of the country, as there are vast differences in income levels between people living in the Southern sector and people living in the Northern sector of Ghana.
    However, foreign companies need not simply charge the lowest prices possible.Marketing campaigns for luxury foreign products with a high perceived value could backfire if the price is too low. Luxury goods are gradually having a huge market in Ghana and more wealthy people are willing to pay more for valuable goods. Ghanaians also have a perception that if an item is too inexpensive, then it has no value and uniqueness; it becomes a common product that everyone can have. Therefore companies need to consider the perceived value of their products or services along with the disposable income level of their target audience, and price their products and services accordingly.

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