Global Marketing Management

A European Perspective

Assessing Global Marketing Opportunities

Warren J. Keegan Bodo B. Schlegelmilch

Overview

 Global Marketing Research  Definition  Relevant Dimensions of the Marketing Environment  Idiosyncrasies of Global Marketing Research  Data Compatibility and Equivalence  Secondary Data versus Primary Research  Organisation of the Global Marketing Research Process  Summary Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 2

Learning Objectives

 To understand the key global information needs of a company  To appreciate the impact of globalisation on the marketing research discipline  To learn how environmental differences impinge on primary and secondary research Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 3

Marketing Research

 ... links the consumer, customer, and public to the marketer through information  Information is used to ...

 identify and define marketing opportunities and problems;  generate, refine, and evaluate marketing actions;  monitor marketing performance; and  improve our understanding of marketing as a process.

Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 4

Inadequate International Marketing Research Can Cause Costly Mistakes

Examples:  US ketchup -> Japan  US Kentucky Fried Chicken -> Brasil  US Soft Drink -> Indonesia  D Knorr soup -> USA  US cake Mix -> GB Thus: In international marketing, information is critical in developing effective marketing strategies! Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 5

Relevant Dimensions of the Marketing Environment

Te chnol og ica l Ec ono mic and Com pe ti ti ve GLOBAL INFORMATION NEEDS Soc ia l and Cultural Le ga l Po li ti cal Reg ul ato ry

Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 6

Dimensions to be Examined in the Marketing Environment (1)

 Economic and competitive environment  eg GNP, income level, balance-of payment  Technological environment  eg engineering skills (for production in a specific country)  Political environment  eg government actions with respect to taxes, equity control, and expropriation Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 7

Dimensions to be Examined in the Marketing Environment (2)

 Regulatory environment  eg governmental and non-governmental agencies which enforce laws and set guidelines for conducting business (such as EU or WTO)  Legal environment  eg patents, trademarks, licensing jurisdiction and antitrust laws  Social and cultural environments  eg conscious an unconscious values, ideas, attitudes, and symbols Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 8

Idiosyncrasies of Global Marketing Research

 Complexity of factors to be considered  additional markets add complexity  Competition  more firms have to be taken into account  Lack of research infrastructure  ... especially in developing countries Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 9

Data Compatibility and Equivalence in Global Marketing Research

 National markets have unique characteristics  But: It is essential that data have the same meaning and the same level of accuracy, precision of measurement, and reliability  This aspect covers all stages of marketing research from problem definition to data analysis Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 10

Equivalence in Global Marketing Research

Testing for and Establishing Measurement Equ ivalence Measurement Equivalence Configural Invariance

• Basic Factor Patterns Correspond

Metric Invariance

• Factor Loadings Correspond

Sca lar Invariance

• Relationship of Latent and Manifest Variables Correspond

Data Analysis Equivalence of Data in Cross-Cultural Research

• Compa rability of Data

Data Preparation Data Collection Equivalence of Research Methods

• Data Collection • Stimuli

Equivalence of Data Handling

• Response Translation • Response Categories

Equivalence of Research Units

• Definition • Selection

Equiv. ofResearch Administration

• Timing • Interaction

Equiva lence of Research Topics Problem Definition

 Functional Equivalence  Conceptual Equivalence  Category Equivalence

Equival ence in Cross-Cultural Research

Keegan/Schlegelmilch Global Marketing Management: A European Perspective

Source: Salzberger T., Sinkovics R., Schlegelmilch B.B.: Data Equivalence in Cross-cultural Research: A Comparison of Classical Test Theory and Latent Trait Theory Based Approaches", Australasian Marketing Journal, Vol. 7, No. 2, 1999, p. 3

Chapter 6 / 11

Secondary Data

 Data from sources that already exist - they have not been gathered for the specific research project  Therefore: Minimal effort and cost  Possible problems  accuracy  availability  timeliness  costs and  comparability of data Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 12

Examples of Secondary Data Sources

 Governments  Department of Trade and Industry  International Organisations  UN, OECD, Worldbank,  Trade Associations  Tradefair International, Japan Export Trade Organisation (JETRO)  Electronic Data Bases  Euromonitor Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 13

Primary Research

 ... when secondary data are inadequate  ... provides accurate data which give exact answers to a given research problem  Possible problems  difficulties in gaining the data  cost  more time is necessary to gather the data Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 14

Primary Research Process

 Step I: Identifying the research problem  Step 2: Developing a research plan  Step 3: Collecting data  Step 4: Analysing research data  Step 5: Presenting the findings Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 15

Analysing Research Data

Examples:  Demand pattern analysis  Income elasticity measurements  Market estimation by analogy  Comparative analysis  Cluster analysis Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 16

Organising the Global Marketing Research Process

Means:  Deciding on research responsibilities  Designing global marketing information systems  Possible scanning modes: surveillance and search  Surveillance: informal gathering of information, eg about potential opportunities  Search: more formal activity - seeking of specific information; marketing research is one „method“ Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 17

Honomichl Global 25: The Largest Research Organisations

Rank 1998 1999 1 2 3 1 3 4 5 6 7 8 9 10 4 5 9 6 12 7 Organisation ACNielsen Corp.

IMS Health Inc.

The Kantar Group Ltd.

Research International Millward Brown Other Kantar Taylor Nelson Sofres plc.

Information Resources Inc.

NFO Worldwide Inc.

NFO Worldwide Inc.

Infratest Burke AG Nielsen Media Research GfK Group AG IPSOS Group S.A: Westat Inc.

Country US US UK UK US UK UK US US US Germany US Germany France US No. of countries with subsidiaries 80 74 1 24 15 14 35 17 32 21 12 2 33 20 1 Full-time employees 20,700 8,000 4,347 1,770 1,377 1,200 4,500 4,600 3,100 2,180 920 2,486 3,111 1,538 1,203 Research revenues ? (millions) 1,209.2

919.6

572.5

278.2

192.1

102.1

465.5

433.7

359.9

212.4

147.5

340.9

299.4

192.0

174.2

Source: ”Honomichl Global 25”, Marketing News, 16 August 1999, p.H1

Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 18

Global Marketing Information System

A means for gathering, analysing, and reporting relevant data to provide managers and other decision makers with a continuous flow of information about markets, customers, competitors, and company operations.

Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 19

Summary

 Information is one of the most important assets in international marketing  Among the idiosyncrasies of global marketing research are the complexity of factors to be considered and the lack of research infrastructure  Comparability and equivalence in an international context is essential; i.e. the data must have the same meaning and the same level of accuracy, precision of measurement and reliability Keegan/Schlegelmilch Global Marketing Management: A European Perspective Chapter 6 / 20