Global Marketing for Levi's

Levi's now faces a decision on whether to further centralize its advertising management, to fully decentralize it, or to maintain the current system of local management under central direction. The current global advertising policy at Levi's has been to place primary responsibility for advertising in the hands of its regional groups, but with substantial input from corporate headquarters.

Step 2: Justification for Problem Definition

The context in which this policy question arises includes the following factors. Levi's is continuing to expand and diversify its operations on a global scale. For the most recent year reported, American domestic scales were $1.888 billion, while European sales were $526 million, and other international sales were $426 million. International sales thus accounted for almost exactly a third of total sales, a proportion which is expected to continue increasing.

Advertising has been largely, though not entirely, in the hands of local groups, and advertising strategies vary widely; for example, advertising in Britain and Northern Europe stresses the American Wild West mythos, whereas Brazilian advertising stresses a European (especially Parisian) connection. Corporate headquarters has expressed dissatisfaction with the quality of advertising campaigns in Latin America, and eyebrows at headquarters have been raised by the sexually suggestive flavor of European advertising.

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esses of each end-point option. In short, whichever option is chosen will involve both advantages and costs, and all involve risks. Step 4: Evaluate Alternatives 1. Centralized direction of advertising. Centralized direction has both objective and subjective advantages. The principal objective advantage is that noted above: unity of effort, and global reinforcement of the unique value of the Levi's brand name. A secondary objective advantage is administrative focus, consistancy, and quality control. However, central direction also seems to offer subjective advantages which are in fact illusory. Executive management naturally likes to feel in control, to feel that it knows what is going on and is setting direction. Yet this can lead to counterproductive micromanagement. For example, the sensibilities of American corporate executives are not an appropriate standard for European advertising; Europeans have different mores, and should not be constrained by American attitudes toward sexuality. This instance illustrates the broader shortcoming of centralized direction; it is too far from customers, and tends to assume that all customers will respond the same way, which is very much not the case in a global market. 2.

Category: Business - G