Transcript Marketing 333

Chapter 4
Developing a Global Vision
Global Vision
 Identifying and
reacting to
international
marketing
opportunities
 Creating effective
global marketing
strategies
 Being aware of
worldwide competition
Global Marketing
Influences Economies
 The U.S. exports a fifth of what it manufactures
 One in ten jobs in the U.S. is supported by
exports
 Almost one-third of U.S. corporate profits come
from international trade and foreign investment
 The U.S. Is the world’s largest exporter of
agricultural goods
Benefits Versus Concerns
About Global Marketing
 Concerns:
 Jobs going overseas

Lower salaries
 Foreign products
replace “made in
America”
 Wage cuts
 Service centers moving
offshore
 Negative image of
America in some foreign
markets
 Benefits:
 Increased competition


May bring prices down
May result in more
innovation
 Increased standard of
living in other countries

More markets for
American products
 May result in more
individual freedom in
some countries
Multinational Firms
 Move resources, goods,
services and skills
across national
boundaries regardless
of the location of the
company headquarters
Why Go Global?
 Earn additional sales and profits
 Leverage a unique product or technological
advantage
 Possess exclusive marketing information
 Domestic market is saturated
 Excess capacity
 Gain economies of scale
Global Marketing Strategies
Standardization
Customization
 Assumes markets around
 Recognizes the
the world are similar
 Marketing mix is as much
the same as possible
 Gain economies of scale
differences in global
markets
 Create marketing mixes to
suit each market
 More costly, but may be
worth it
External Environments
 All of the major environments have to be
considered international and domestically
 Socio-cultural
 Economic
 Technological
 Demographics
 Physical/natural
 Political/legal
Global Legal issues
 Tariff
 Quota
 Boycott
 Exchange control
 Trade alliances
 Trade Agreements
Trade Agreements
 Uruguay Round
 World Trade
Organization
 NAFTA
 Central American Free
Trade Agreement
 European Union
 International
Monetary Fund
Common Methods for Entering the
Global Marketplace
 Exporting
 Licensing
 Franchising
 Contract
manufacturing
 Joint Venture
 Direct Investment
The Global Marketing Mix:
Product / Promotion
One product
One message
Product
Adaptation
Message
Adaptation
Product
Invention
The Global Marketing Mix:
Distribution
 Adequate distribution is
necessary for success
 Some countries have
complicated systems
 Lack of distribution
infrastructure and
cultural differences
 The company may gain
competitive advantage
through innovative
distribution strategies
Global Marketing Mix - Price
 Consider transportation
costs, taxes and tariffs
 Determine what
customers will spend
 May need to simplify a
product to lower the
price
 Don’t assume that lower
income countries are
willing to accept lower
quality
Exchange Rates
 The price of one’s
currency in terms of
another country’s
currency
Dumping
 The sale of an
exported product at a
price lower than that
charged for the same
or a like product in the
home market.
Countertrade
 An alternative to
exchanging currency
for goods
 A form of trade in
which all or part of the
payment for goods or
services in the form of
other goods or
services.