basic15_ppt.ppt 194KB Sep 05 2010 10:46:02 PM

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Chapter Fifteen

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Roadmap:

Previewing the Concepts

1. Discuss how the international trade system, economic, political-legal, and

cultural environments affect a company’s international marketing decisions.

2. Describe three key approaches to entering international markets.

3. Explain how companies adapt their marketing mixes for international markets.

4. Identify the three major forms of

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Background

 _{Established in 1893 in}

Atlanta pharmacy.

 _{1900: Coke was available}

in foreign countries.

 _{1940s: built bottling plants}

abroad to supply soldiers.

 _{Growth fueled by strong}

marketing: “I’d like to buy the world a Coke” TV ad.

Coca-Cola – Successfully Going

Global

Case Study

How They Did It

 _{Balances brand building}

and global standardization with local adaptation.

 _{Consistent positioning,}

packaging, and taste.

 _{Brands, flavors, ads, price,}

distribution, and

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Global Marketing in the 21

st

Century



The world is shrinking rapidly with the

advent of faster communication,

transportation, and financial flows.



International trade is booming and

accounts for 20% of GDP worldwide.

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Major International Marketing

Decisions

 _{Looking at the global marketing environment.}  _{Deciding whether to go international.}

 _{Deciding which markets to enter.}  _{Deciding how to enter the market.}

 _{Deciding on the global marketing program.}  _{Deciding on the global marketing}

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Looking at the Global

Marketing Environment

 _{The International Trade System:}

– Restrictions—tariffs, quotas, embargos, exchange controls, and nontariff trade barriers.

 _{The World Trade Organization and GATT:}

– Helps trade—reduces tariffs and other international trade barriers.

 _{Regional Free Trade Zones:}

– Groups of nations organized to work toward

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Economic Environment



Industrial Structure:

– Shapes a country’s product and service needs, income levels, and employment levels.



Four types:

– Subsistence economies

– Raw material exporting economies

– Industrializing economies

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Political-Legal Environment



Attitudes toward international buying



Government bureaucracy



Political stability



Monetary regulations

– _Countertrade • _Barter

• _Compensation

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Cultural Environment

 _{Sellers must examine the ways consumers in}

different countries think about and use products before planning a marketing program.

 _{Business norms and behavior vary from}

country to country.

 _{Companies that understand cultural nuances}

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Deciding Whether to Go

International



Reason to consider going global:

– Foreign attacks on domestic markets.

– Foreign markets with higher profit opportunities.

– Stagnant or shrinking domestic markets.

– Need larger customer base to achieve economies of scale.

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Deciding Which Markets to Enter

 _{Before going abroad, the company should try}

to define its international marketing objectives and policies.

– What volume of foreign sales is desired?

– How many countries to market in?

– What types of countries to enter?

 _{Choose possible countries and rank based}

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Market Entry Strategies



Exporting:

– Indirect:

• Working through independent

international marketing intermediaries.

– _Direct:

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Market Entry Strategies



Joint Venturing:

– Joining with foreign companies to produce or market products or services.



Approaches:

– Licensing

– Contract manufacturing

– _{Management contracting}

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Market Entry Strategies



Direct Investment:

– The development of foreign-based assembly or manufacturing facilities.

– _{This approach has both advantages and}

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Deciding on the Global

Marketing Program



Standardized Marketing Mix:

– Selling largely the same products and using the same marketing approaches worldwide.



Adapted Marketing Mix:

– Producer adjusts the marketing mix

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Global Product Strategies



Straight Product Extension:

– Marketing a product in a foreign market without any change.



Product Adaptation:

– Adapting a product to meet local

conditions or wants in foreign markets.



Product Invention:

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Global Promotion Strategies



Can use a standardized theme globally,

but may have to make adjustments for

language or cultural differences.

– _{Communication Adaptation:}

• Fully adapting an advertising message for local markets.

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Global Pricing Strategies



Companies face many problems in

setting their international prices.

– Standard pricing methods such as uniform pricing, standard markup of costs

everywhere, or charging what the market will bear ignores cost differentials and

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Global Pricing Strategies

 _{International prices tend to be higher than}

domestic prices because of price escalation.

 _{Companies may become guilty of}_dumping

when a foreign subsidiary charges less than its costs or less than it charges in its home market.

 _{The Internet makes global price differences}

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Global Distribution



International firms must take a

whole-channel view of distributing products

to final consumers.



Differences in the numbers and types

of intermediaries serving each foreign

market requires time and money to

navigate.



Size and character of retail units differ

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Deciding on the Global

Marketing Organization



Organize an export department



Create international divisions

– Geographical organizations

– World product groups

– International subsidiaries

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Rest Stop:

Reviewing the Concepts

1. Discuss how the international trade system, economic, political-legal, and cultural environments affect a

company’s international marketing decisions.

2. Describe three key approaches to entering international markets.

3. Explain how companies adapt their marketing mixes for international markets.

4. Identify the three major forms of