Transcript Ch19

International Trade and Canada
 1/3 of our jobs depend on international
trade.
 9,000 new jobs result from every $1 billion of
additional exports.
 Nearly half of our manufacturing is exported.
 85% of our exports are to the U.S.
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Canadian Marketing in Action, 6th ed. Keith J. Tuckwell
©2004 Pearson Education Canada Inc.
The Movement to Global Markets
Global opportunities are attractive due to:
1. Low growth prospects in domestic
markets.
2. The formation of common markets and
trading agreements.
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Canadian Marketing in Action, 6th ed. Keith J. Tuckwell
©2004 Pearson Education Canada Inc.
Entering Foreign Markets
When entering a foreign market a company looks for
advantage.
Absolute Advantage
One country produces a
good, or produces a good
at much lower cost than
others.
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Comparative Advantage
One country produces and
markets a good more
efficiently than others.
Canadian Marketing in Action, 6th ed. Keith J. Tuckwell
©2004 Pearson Education Canada Inc.
Environments of Global
Marketing
•Economic
•Political
Marketing
Strategy
•Consumer
•Legal
•Technical
•Competitive
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Canadian Marketing in Action, 6th ed. Keith J. Tuckwell
©2004 Pearson Education Canada Inc.
Global Consumers
There are significant variations in consumer
characteristics from one part of the world to
another.
 Culture
 Language
 Needs and Motivation
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Canadian Marketing in Action, 6th ed. Keith J. Tuckwell
©2004 Pearson Education Canada Inc.
Politics and Business
Governments laws and regulations must be abided
by. New governments can change the rules.
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Nationalization
A form of expropriation;
government takes control
of a foreign company.
Protectionism
Foreign trade is restricted
to protect local industries.
Canadian Marketing in Action, 6th ed. Keith J. Tuckwell
©2004 Pearson Education Canada Inc.
Trade Restrictions
To restrict trade governments resort to a variety
of means.
 Tariff
Quota
 Embargo
 Boycott
 Local Content Law

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Canadian Marketing in Action, 6th ed. Keith J. Tuckwell
©2004 Pearson Education Canada Inc.
Competitive Trade Influences
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Cartel
Firms or countries band
together to conduct trade.
Orderly Market
Agreement
Barriers eliminated among
partner countries; others
face barriers.
Common
Market
Trade agreement among a
geographical grouping of
countries.
Canadian Marketing in Action, 6th ed. Keith J. Tuckwell
©2004 Pearson Education Canada Inc.
Market Entry Strategies
Export
Direct (self) and
indirect (use
intermediaries).
Joint
Venture
Licensing,
franchising, contract
marketing.
Direct
Investment
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Risk
Commitment
Cost
Increases
Start-up or acquire.
Canadian Marketing in Action, 6th ed. Keith J. Tuckwell
©2004 Pearson Education Canada Inc.
Global Marketing Strategy
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Global
Same marketing strategy
in each country.
CountryCentred
Unique marketing strategy
for each country.
Glocalize
Products intended for global
markets are customized for
local culture.
Canadian Marketing in Action, 6th ed. Keith J. Tuckwell
©2004 Pearson Education Canada Inc.
Marketing Strategy
Answers to 3 basic questions provides guidance to
marketing strategy.
1. How does market development differ
from one country to another?
2. Do the needs of consumers vary from
country to country?
3. Are the characteristics of the target
market profile different?
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Canadian Marketing in Action, 6th ed. Keith J. Tuckwell
©2004 Pearson Education Canada Inc.
Product Strategy
A marketer can select from three basic options.
1. Standard product.
2. Adapting a product to local tastes
and preferences.
3. Develop new product.
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Canadian Marketing in Action, 6th ed. Keith J. Tuckwell
©2004 Pearson Education Canada Inc.
Price Strategy
Several factors are considered when devising a
price strategy.

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Local competition

Value of currency

Tariffs
Canadian Marketing in Action, 6th ed. Keith J. Tuckwell
©2004 Pearson Education Canada Inc.
Marketing Communications
Standardized advertising is provided in order to
protect brand image. It may not be effective due to:
 Cultural differences
 Language differences
Appropriateness is the key element of global advertising
decisions.
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Canadian Marketing in Action, 6th ed. Keith J. Tuckwell
©2004 Pearson Education Canada Inc.
Potential Marketing Channels
To secure distribution in a foreign market a firm uses
existing channels or develops new ones. Some
options are:
Direct Sales Force
Foreign Distributors
Consumers
Foreign Subsidiary
Local Distributors
Consumers
Trading Company
Local Distributors
Consumers
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Canadian Marketing in Action, 6th ed. Keith J. Tuckwell
©2004 Pearson Education Canada Inc.