Transcript Slide 1
Thrive in the Marketing Environment:
The World
Is
Flat
Chapter Three
Chapter Objectives
Understand the big picture of international marketing and the decisions firms must make when they consider globalization Explain how international organizations such as the World Trade Organization (WTO), economic communities, and individual country regulations facilitate and limit a firm’s opportunities for globalization Understand how factors in a firm’s external business environment influence marketing strategies and outcomes in both domestic and global markets Explain some of the strategies that a firm can use to enter global markets
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Global
Marketing
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Take a Bow:
Marketing on the Global Stage
The global marketplace World trade: The flow of goods and services among different countries —the value of all the exports and imports of the world’s nations
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Figure 3-1
North American Trade Flows (in Billions of Dollars) © 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Take a Bow:
Marketing on the Global Stage
Countertrade: A type of trade in which goods are paid for with other items instead of with cash
•
Barter is common form of countertrade © 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Countertrade
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Going
Global?
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Figure 3-2
Steps in the Decision Process for Entering Global © 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Deciding to Go Global
Must consider
market conditions
and
competitive advantage
when making a decision
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Chinese firms such as Chery are now exporting their brands to other countries, including the U.S.
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Understand International, Regional and Country Regulations
Initiatives in international regulation and cooperation help trade
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General Agreement on Tariffs and Trade (GATT)
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World Trade Organization (WTO)
Protectionism restricts trade
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Quotas, embargoes, and tariffs
Economic communities help to promote trade
World Trade Organization © 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Environmental Scanning Yields Opportunities
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ECONOMIC ENVIRONMENT COMPETITIVE ENVIRONMENT TECHNOLOGICAL ENVIRONMENT
Global
Marketing Environment POLITICAL/LEGAL ENVIRONMENT SOCIOCULTURAL ENVIRONMENT
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The Economic Environment:
Indicators of Economic Health
Key economic indicators:
•
Gross domestic product (GDP): Total dollar value of goods/services a country produces within its borders in a year
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Gross national product (GNP): Value of all goods and services produced by a country’s citizens or organizations
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Economic infrastructure Quality of country’s distribution, financial, and communications systems © 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Table 3-2
Selected Comparisons of Economic and Demographic Characteristics © 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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The Economic Environment:
Level of Economic Development
Least developed country (LDC)
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Economic base is often agricultural
Developing countries
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Economy shifts emphasis from agriculture to industry
Developed countries
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Offer wide range of opportunities for international marketers © 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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The Economic Environment:
The Business Cycle
All economies go through periods of:
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Prosperity
• • • •
Recession Recovery Depression Inflation
Do sales of all goods and services suffer in a recession? If not, name some goods and services that may in fact sell better during a Economy.com
recession than during times of prosperity.
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Competitive
Environment
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The Competitive Environment:
Analyzing the Market and Competition
Competitive intelligence: Gathering and analyzing publicly available information about rivals to develop superior marketing strategies
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Collected from news media, the Internet, and publicly available government documents © 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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The Competitive Environment:
Competition in the Microenvironment
Competition in the microenvironment
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Competition for consumer’s discretionary income
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Product competition Brand competition
Name some examples of competition at each level for the iPhone.
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The Competitive Environment:
Competition in the Macroenvironment
Competition in the macroenvironment (overall structure of industry)
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Monopoly
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Oligopoly Monopolistic competition Perfect competition © 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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The Technological Environment
Technology:
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Provides firms with important competitive advantages
• •
Profoundly affects marketing activities Can transform industries
Patent:
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Legal document giving inventors exclusive rights to produce/sell a particular invention in that country © 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Roadblocks
at the border
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The Political and Legal Environment: Political Constraints on Business
Retaliatory actions against American businesses sometimes occur as a result of political activity or war
Political constraints on trade are commonly imposed:
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Economic sanctions
• •
Nationalization Expropriation © 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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The Political and Legal Environment: Regulatory Constraints on Business
Regulatory constraints on trade often restrict the marketing of goods
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Local content rules
Human rights issues may limit foreign countries’ business opportunities
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The Sociocultural Environment
Key sociocultural considerations:
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Demographics
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Cultural values
Individualism
• •
Collectivism
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Social norms and customs Language Ethnocentrism © 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Market Entry
Strategies
Exporting Contractual Agreements Strategic Alliances Direct investment COMMITMENT - RISK
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Table 3.6
Market Entry Strategies © 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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How “Global” Should a Global Marketing Strategy Be?
Product-level decisions: the marketing mix strategy:
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Standardization vs. localization
Standardization:
Offer the same products in all markets
Localization:
Offer a customized marketing mix for each country © 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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How “Global” Should a Global Marketing Strategy Be?
Tweaking the marketing mix
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Product decisions:
Straight extension strategy
Product adaptation strategy
Product invention strategy
Backward invention
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Promotion decisions:
Whether or not to modify
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How “Global” Should a Global Marketing Strategy Be?
Tweaking the marketing mix
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Price decisions:
Products are often more expensive to produce for foreign markets
– Free trade zones – Gray market goods – Dumping •
Distribution decisions:
Getting the product to remote locations is often difficult
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Group Activity
Formulate either a brief standardized or local strategy in a foreign country (of your choice) for a product:
Make a SLEPT analysis Describe how the it will affect weather to chose standardized or localized strategy
Explain your strategy (the marketing mix). 32