Transcript Global Marketing

FEM 3204 : 3 (2+1)
Perancangan Kewangan Dalam Pasaran Global
Financial Planning in a Global Market
HUSNIYAH BT. ABD. RAHIM
BILIK A2-14
Jabatan Pengurusan Sumber & Pengajian Pengguna
Fakulti Ekologi Manusia
Chapter 9
Analysis of the Strategic Global
Marketing Approach and the
Effect on Individuals Financial
Behavior
Global Marketing
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It refers to marketing activities coordinated &
integrated across multiple country markets (Johansson,
2000)
Global marketing & international marketing has a slight
difference with global marketing a broader marketing
compared to international marketing
Global marketing is an extension of international
marketing
Global Marketing
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A global approach is used to international marketing.
What are being focused by managers are on the product
markets, that is, groups of customers seeking shared
benefits or to be served with the same technology,
emphasizing their similarities regardless of geographic
areas in which they are located
They should not be focusing on country markets, that
is, the differences due to the physical location of
customers groups
Global Marketing
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Global marketing is the process of conceptualizing &
conveying a final product or services worldwide hoping
to reach the international marketing community
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With proper global marketing, it can enable to eleviate a
company to the next level,
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Need different strategies based on the region the
company is marketing to
Global Marketing
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The operation mode is very different from marketing
locally
Organisations begin to develop and run operations in
the targeted country or countries outside of the
domestic one
In practice, organisations evolve from domestic to
global enterprises
It involves 4 stages of change & the characteristics of
companies at different stages in the process of evolving
from domestic to global enterprises are different as
follows:.
Global Marketing
1. Stage one:
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Focus on domestic, all activity concentrated in the
home market.
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Many organisations can survive doing business
domestically, but may bring to long term failure.
2. Stage two:
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Home focus, but with exports.
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Rely in home values, but creates an export division
Global Marketing
3. Stage three:
 Stage two organisations which realise that they must
adapt their marketing mixes to overseas operations.
 The focus switches to multinational & more on
adaption
4. Stage four:
 Global organisations create value by extending products
& programmes, & focus on serving emerging global
markets
 They have to recognise that markets around the world
consist of similarities & differences
Global Marketing
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Thus, for stage 4, it is possible to develop a global
strategy based on similarities to obtain scale economies,
but also recognises & responds to cost effective
differences.
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Its strategies are a combination of extension, adaptation
& creation
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Unpredictable in behaviour & should always alert to
opportunities
Global Marketing
In planning to do global marketing, must consider the
following:
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A number of environmental factors
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Generally the company should be looking for
"unifying" or "differentiating" influences that will
dictate a "standard or "adapted" planning approach
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Demographic factors of the locals in each country:
income, age; purchasing power
Global Marketing: Orientation of
Management
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Based on Perlmutter (1967): There are 4 orientations
of management of global/international organisations.
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Named as the "EPRG" scheme
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Associated with successive stages in the evolution of
international operations
1.
Ethnocentrism : home country orientation - exporting
surplus
2.
Polycentrism : host country orientation - subsidiary
operation (international)
Global Marketing: Orientation of
Management
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3. Regiocentrism: regional orientation - world market
strategies (multinational)
4. Geocentrism: world orientation - world market
strategies (global)
Number 3 & 4 are based on
 similarities & differences in markets
 capitalising on similarities to obtain cost benefits, but
still recognising differences
Global Marketing: Theoretical
Approaches
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Theory of comparative advantage (Adam Smith &
David Ricardo), the product trade cycle (Raymond
Vernon), & The Business Orientation (Howard
Perlmutter)
The theory of comparative advantage:
is a demonstration (under assumptions) that a country
can benefit from trade even if it has an absolute
disadvantage in the production of all goods, or it can
gain from trade even if it has an absolute advantage in
the production of all goods.
Global Marketing: Theoretical
Approaches
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Even though a country has an absolute production
advantage it may be better to concentrate on its
comparative advantage.
To maximise the wellbeing of both individuals and
countries, countries are better off specialising in their
area of competitive advantage and then trading and
exchanging with others in the market place.
Global Marketing: Financial Products
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Covers financial products marketing across three
different continents - US, UK, & China
Marketing of financial products in the US focuses on
banking, insurance, & credit cards
The banking system in the US has undergone a
transformation over the years & maturing
Expanded their business into other financial services,
other than bank & branch.
Many banks in the US make a shift from depending on
fund-based products to fee-based services.
Global Marketing: Financial Products
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Pricing of credit cards has also evolved over the years
with changes in pricing policies & computational
methods
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Ethnic groups in the US form a major customer
segment for insurance marketers.
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Marketers have tailored the communication patterns to
appeal to these groups & this approach has increased
the profit
Global Marketing: Financial Products
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Worksite marketing has also shown tremendous
growth, especially for insurance products
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Most financial products in the future will continue to be
marketed through this channel
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Among the three broad categories of pension plans,
only about 20 percent of the workforce opts for
individual retirement accounts
Global Marketing: Financial Products
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Mutual fund marketers use extensively online
advertising.
In the UK, the banking sector has adopted technologies
to monitor/ understand customer behavior, that would
alert staff to the customer needs & also help devise
methods to improve delivery of services.
In life insurance pricing, lifestyle-linked obesity risk has
been used as premium determination
However, the preferred lives concept has not been very
successful
due
to
operational
difficulties
Global Marketing: Financial Products
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IFAs (Independent Financial Advisors) have gained
prominence as a new channel of distribution for a
majority of financial products like life insurance,
pension, & mutual funds
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A recent development in the UK. Is the emergence of
fund supermarkets
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These are like grocery stores where a wide variety of
funds are available for the customers at one place
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The fees levied are lower compared to dealing directly
with a fund house due to the large number of mutual
fund products that the fund house sells.
Global Marketing: Financial Products
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The Chinese financial services industry is a major target
destination for global financial players
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The magnitude of foreign investments is huge in the
Chinese banking sector, especially in retail banking &
vehicle financing.
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Another attractive segment for global players is the
consumer credit market, which includes credit cards,
loans, & mortgages
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The mutual funds sector is undergoing a major change
with commercial banks being allowed to deal with
mutual funds.
Global Marketing: Cultures
Important issue facing marketers is the extent to which
one or more global consumer cultures or segments are
emerging
 There are proofs to the movement in this direction
 This kind of culture would have a shared set of
consumption-related symbols, with common meaning &
desirability among members
 One example of global culture is that portion of local
cultures that view themselves as cosmopolitan,*
knowledgeable, and modern.
* international in scope: having worldwide relevance or
scope
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Global Marketing: Cultures
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These individuals share many values & consumptionrelated behaviors with similar individuals across a range
of national cultures
Such cultures are created by the globalisation of mass
media, work, education,and travel
Global Marketing: Globalisation of
Financial Product
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Advances in communication & technology together
with financial deregulation abroad (eg. Lifting of
regulatory structures that inhibit competition & protect
domestic markets ) have diminished the distinction
between domestic & foreign financial markets
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With necessary technology & reduced cost of
transaction, the world has become one interconnected
market
Global Marketing: Globalisation of
Financial Product
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Markets for government securities and certain stocks,
foreign exchange trading, interbank borrowing &
lending operate continuously 24 hours around the
world & in enormous size
This result in a big competition among key financial
centers & financial institution that helps to reduce costs
of issuing new securities
Global Marketing: Globalisation of
Financial Product
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This growing competition led to increasing of
deregulation of financial markets worldwide whereby
users of capital markets will issue & trade securities in
financial market with the lowest regulatory standard,
lowest costs.
Treasurers no longer confined to domestic markets as
the source of funding & are quick to exploit any
attractive opportunity occurs elsewhere in the world
Global Marketing: Globalisation of
Financial Product
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The competition drives the international financial
system
It further result in financial innovation that segments,
transfers and diversifies risk
Enables companies to tap previously inaccessible
markets & permits investors & issuers to take
advantage of tax loopholes
International capital mobility has increased
tremendously