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International Marketing

International Marketing. Tim Beal Lecture 3 25 July 2007. Today. Housekeeping The political framework of the global economy DVD Paul Vaughan Changing social fabric. Housekeeping. Tutorials started this week Details on coursepage Blackboard only leads you to coursepage

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International Marketing

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  1. International Marketing Tim Beal Lecture 3 25 July 2007

  2. Today • Housekeeping • The political framework of the global economy • DVD Paul Vaughan • Changing social fabric

  3. Housekeeping • Tutorials started this week • Details on coursepage • Blackboard only leads you to coursepage • Coursepage has all the information • If you are not in a tutorial see me

  4. The Political Framework Why is politics important to IM? Liberalisation and globalisation Global Regional Bilateral Issues, doubts and problems

  5. Why is politics important? • Politics can prohibit trade • US sanctions and embargoes on Iraq, North Korea, Cuba… • Politics can restrain trade • US controls on advanced computers to China • Australian restrictions on NZ apples (SPS) • US and EU restrictions on agricultural imports to protect local industry • NZ restrictions on Korean whiteware to protect local industry

  6. Yesterday -Auckland airport • What will happen to Auckland airport? • Who wants to buy it? • Who’s opposing that and why? • What does this mean for IM?

  7. Restraint>liberalisation and facilitation • Governments can restrict trade • military, local interest groups, economic (eg trade balance) • Governments can also liberalise trade • remove restrictions • Governments can facilitate trade • incentives/support for • exporters • foreign investors • importers (eg Japan)

  8. Incentives • Lack of incentives hampering foreign investment/ work in NZ • Lack of incentives blamed as Bollywood calls 'cut'

  9. Liberalisation and globalisation • Liberalisation is the political expression and facilitator of globalisation • Conflict between liberalisation and protectionism • Globalisation>> winners and losers • Countries • Industries • Companies • People • Continuing struggle

  10. Global liberalisation • 1930s – protectionism as response to depression • ‘beggar my neighbour’ approach • Bretton Woods 1944 • Resort in new Hampshire • United Nations Monetary and Financial Conference • Established global framework

  11. Bretton Woods • International Monetary Fund (IMF) • International Bank for Reconstruction and Development • >>part of World Bank

  12. World Bank • Important actor • Aid, etc. • Source of information • In news recently because of its president • Architect of invasion of Iraq • Anti-corruption evangelist who got fired for corruption

  13. Paul Wolfowitz

  14. World Bank • World Bank

  15. Back to Bretton Woods • International currency framework • Stable exchange rates, linked to gold • US$ as reserve currency • Collapsed in 1971 • Liberalisation>>GATT

  16. GATT • General Agreement on Tariffs and Trade • Policy of reduction of tariffs, quotas and subsidies • Tariff – tax on imports • Quota – quantitative restriction on imports • Subsidy – financial support for production/export

  17. Stages of the GATT • Divided in ‘rounds’ • Eg Tokyo Round, Uruguay Round • First phase 1947-50 establishment • Second phase – 1979 – reduction of tariffs on manufactures • Third phase - Uruguay Round 1986-1993

  18. Uruguay Round • Moved into intellectuals property, services, capital, and agriculture • Agriculture – Cairns Group set up in 1986 • Very important to NZ • Cairns Group website

  19. GATT>>WTO • `1995 World Trade Organization • Two contestants for 2nd Director General • Thailand’s Supachai Panitchpakdi • And this man…

  20. Director Generals of WTO • Italy’s Renato Ruggiero 1995-99 • Former NZ PM Mike Moore 1999-2002 • Thailand’s Supachai Panitchpakdi 02-05 • France’s Pascal Lamy 1995-

  21. WTO • Important actor in world trade, but problems • Doha Round suspended July 2006 • Disagreement between EU, US, India, Brazil on opening up I & B to agricultural and industrial products, farms subsidies in US & EU

  22. WTO website • WTO also important source of information on world trade • http://www.wto.org/

  23. Global>>regional/bilateral • Regional • EU • 25 • NAFTA • Mercosur…and others • APEC • Asia-Pacific Economic Cooperation

  24. APEC • Australian initiative 1989 • Forum in which NZ important member • Hosted APEC 1999 • China and Taiwan both members • Also in WTO, not UN, etc) • http://www.apec.org/

  25. ASEAN • Association of Southeast Asian Countries • 1967 – now all ten state in SE Asia • AFTA – ASEAN Free Trade Area • ASEAN + 3 • China, Japan, South Korea • >>>East Asia Summit

  26. East Asia Summit

  27. >>FTAs • Because of difficulties in multilateral fora (WTO, APEC) attention turned to Free Trade Agreements

  28. NZ and FTAs • MFAT on trade agreements • PM Clark in Indonesia last week, signed a TIFA • story on links page

  29. Liberalisation/Globalisation>>>

  30. Opposition • Left/Greens, etc. • Eg Green party and Buy Kiwi Made campaign • But now also from right • Wall Street Journal

  31. The BIG issue • Is globalisation GOOD or BAD? • Is it stoppable or changeable? • How can the opportunities be realised, the negative effects minamised? • etc. etc. • Ongoing debate

  32. Trade policy and globalisation issues • Debate on trade policy and globalisation will continue to have great impact on IM • Marketers need to monitor what is going on • Market access does not guarantee market success • market access is necessary but not sufficient • IM needs knowledge about markets and products to satisfy them

  33. DVD Paul Vaughan

  34. Changing social fabric • Marketing takes place within society • Consumer behaviour course discussed interaction between individual CB and social environment • families, reference groups, lifestyle changes, attitudes… • What happens in a particular society (eg NZ) happens globally • extremely complex manner

  35. Four examples • Immigration • Social issues –Green market, pink market, ethics • aging society – Silver market • changing (globalising) tastes

  36. Immigration • Why is it important to IM? • old identification of a country with an ethnic/cultural group is becoming increasingly invalid • in many countries immigration is main social trend

  37. Main social trend of 1990s in Britain.. • in Britain immigration much more important than natural population growth • ‘consequences for ethnic mix and age structure’ • In NZ? • Cultural diversity in NZ

  38. Immigration • on increase in EU, USA, etc. • creation of multiethnic societies • write down some marketing implications of changes in ethic composition

  39. Tourism • Tourism has somewhat similar effects • 700 million international tourism arrivals in 2000 • 2003 – 6% of global exports of G&S • in many countries a large part of the market is made up of permanent or temporary ‘foreigners’ • eg China’s tourism market is important for NZ exports • they want to eat familiar foods, drink wine

  40. International students • Important financially to host countries • Learn and spread news tastes and customs • Often develop business links when return home

  41. Social issues • Environment – green market • Sex – pink market • Ethics • Labour standards • Child labour • Opposition to country policies • Consumer boycotts • some examples

  42. Ageing society • part of general issue of changing age structure in societies • why is age structure important for marketing? • population pyramids; the case of Japan • Japan is foremost example of aging society • Japanese population pyramids

  43. Japan’s ageing society • implications for NZ? • What change in products? • Goods and services • China moving that way

  44. Globalisation of tastes • McDonalds -Epitome of globalisation – few countries where they yet to penetrate • http://www.mcdonalds.com/home.html • Who hasn’t had a Big Mac? • other examples – Coke, Pepsi, jeans…. • Often connected with American cultural hegemony • The American dream

  45. Has McDonalds peaked? • McDonald’s Korea Closes First Outlet

  46. but other things move as well • Chinese food, Italian food…etc • NZ wine

  47. NZ wine in HK

  48. Transmitted by • media (films, TV) (images) • migration, tourism..(people) • Companies themselves ..IM programmes • result is that tastes do change and can be changed

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