Global Marketing

THE GLOBAL MARKETPLACE

“Marketing”

“Evolution”

Advantages  Economies

of scale in production and distribution  Lower marketing costs  Power and scope  Consistency in brand image  Helps to establish relationships outside of the political arena

Disadvantages  Differences

in consumer needs, wants and usage patterns for products  Differences in consumer response to marketing mix elements  Differences in brand and product development and competitive environment  Differences in administrative procedures  Differences in product placements

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Managing a global market place Identify your customer’s partners Make sure your ads and literature reach a global audience Learn the local customs If possible hire local people in a local office Try to learn key phrases of the language

Opportunities  

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Import / Export Produce / Invest / License a product on behalf of a foreign firm Partner with an existing firm Invest directly in a foreign branch with domestic and foreign management

Economic trends 

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Service sector – 41% in developing countries and 58% in developed. Industry- slight declines in Africa and America and recent increases in Asia and Oceania. Agriculture – 11% of economic activity in developing countries and 2% in developed. Poverty

Global marketing planning

GLOBAL MARKETING IN THE 21st CENTURY

MAJOR DECISIONS IN INTERNATIONAL MARKETING 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 organization

(1) LOOKING AT THE GLOBAL MARKETING ENVIRONMENT  The international trade system  Global

firm – operates more than in one country, gains R & D, P/M/F advantages in its cost and goodwill.  Tariff – tax levied by the govt. against certain imported items.  Quota – limit on the amount of certain product categories that an importing country will accept.

Embargo – ban on some kind of import items.  Exchange controls – limit on the amount of foreign exchange and the exchange rate against other currencies.  Non-tariff trade barriers – barriers to foreign products such as bias against a foreign company bids or product standards that go against a foreign company product features. 

Cultural Dimensions        

Directness Vs indirectness Comparison Humor Gender roles Explicitness Sophistication Popular Vs Traditional culture Information content Vs fluff

(2) Deciding whether to go international  It’s

not always important to venture into international market for survival.  The decision depends on operations, country’s language and laws.  Strategic position/global position/compete on the worldwide basis to succeed.  Global competitors attack on domestic market.

Ability to operate globally? Can the company learn to understand the preferences and the buyer behavior?  Can it offer competitively attractive products?  Will it adapt to other countries’ business culture?  Do the company managers’ have the necessary international experience?  Impact of regulations and political environment of the other country? 

(3) Deciding which markets to enter  Defining

international marketing objectives and policies.  Deciding upon how many/types of countries to market in.  Indicators of potential market to enter: Demographic, geographic, economic, socio-cultural, political and legal factors.

(4) Deciding how to enter the market Exporting Direct/Indirec t

Joint Venturing - Licensing - Contract manufacturing - Management contracting - Joint ownership

Direct investment -Assembly facilities - Manufacturing facilities

Amount of commitment, risk, control and profit potential

(5) Deciding on the global marketing program  Standardized

marketing mix – strategy used basically for the same product advertising, distribution and other elements in marketing mix.  Adapted marketing mix – strategy for adjusting the marketing mix elements to each international target market. E.g McDonalds serves their food with onions, pickles to suit Indian taste.

Don’t change promotio n Adapt promotio n

Don’t change product Straight Extension

Communication adaptation

Adapt product Product Adaptation

Dual Adaptation

Develop new product

Product invention

(6) Deciding on the global marketing organization  Companies

manage the international marketing activities through three ways: (1) Organize export department (2) Create international division (3) Finally become a global organization E.G – for international distribution, distribution channels vary from nation to nation.

G-5 STRATEGIES GLOBAL NETWORK STRATEGY

GLOBAL PLATFORM STRATEGY

GLOBAL INVESTMENT STRATEGY

GLOBAL INTERMEDIARY STRATEGY

GLOBAL ENTREPRENEUR STRATEGY

Trade Barriers TARIFF AND NON-TARIFF COSTS

TRANSACTION COSTS

THE FOUR T’S

TRANSPORTATION COSTS

TIME COSTS

Globalization of Markets and Competition    

Technological improvements Improved transportation Communication opportunities Global agreements with trade organizations such WTO, NAFTA,EU.

Star Analysis for competitive advantage HOME COUNTRY SUPPLIER COUNTRY

INTERNTIONA LBUSINESS

PARTNE R COUNTR Y

CUSTOME R COUNTRY

COMPETITO R COUNTRY

Constraints on Global communication strategies

Trends   

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Insight and innovation key Customers are top of the list Green marketing and global warming lose importance Marketers sick of web Most opportunity in china and among boomers

India as a Global power – The Forbes coverage 

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Foreign investment in more than 1000 Indian companies. 100 corporations with a market value exceeding $1 billion. India’s average growth rate jumped to 7.5% from the earlier 6%. Cries for a level playing field are becoming louder. Important pre-requisite is land acquisition for any investment in India.

Brand “YOU” and the Global market place 

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Ideas such as ‘life time employment’ and ‘job for life’ are slowly becoming obsolete. We are becoming the ‘free agents’ of sorts.

Made by: Chandni kundel Anupamjeet kaur (Msc) sim)