Global Marketing Management Global Promotions Decisions

1. Global Marketing ManagementGlobal Promotions Decisions MKTG 3215-001 Spring 2013 Mrs. Tamara L. Cohen Class # 24

2. Wed. April 24 Costa Rica Mexico Philippines Mon. April 29 India Ireland Israel Mon. May 6 11 am - 1:30 pm Brazil Russia Singapore South Africa Taiwan GROUP PROJECTSREMEMBERHand in on your Presentation day :Final Report (hard copy & soft copy)Presentation (hard copy & soft copy) Each Group’s Presentation should be 15 minutes long+ 3 minutes question-and-answer.

3. Case #3 due April 17AIDS, Condoms, & Carnival Requirements for each TEAM Case Write-up: • 4 - 6 pages, typed & double-spaced • Review on my web site: “Case Studies: How to write a great CASE STUDY” • Pay attention to grading sheet. • Work with DIFFERENT partner from before. Use headings

4. Promotionsin the Marketing Mix Promotion = business of COMMUNICATING with customers Product benefits must be communicated to customers to generate sales and profits. Promotional Mix blends • advertising • public relations • sales promotion • selling GLOBAL context

5. Sellingoverseas … … the expatriate experience

6. KEY CONCEPTS • Relationship marketing • Expatriate • Virtual Expatriate • Repatriation • Third-Country Nationals • Local Nationals • Separation allowance

7. Americans Abroad Number of Americans living abroad has steadily grown over past decade, as more people have become interested in living abroad, exploring another language and culture, or finding an overseas job. According to recent estimates by the U.S. State Department, there are 3 - 6 million Americans living overseas.

8. Global PerspectiveAre International Assignments Glamorous? • Job security • Adjustment to other cultures – family considerations • Readjustment when return home – reentry culture shock • Will an international assignment really help your career? • International sales force may be the ultimate way to: “Think global. Act local.”

9. Designing the Sales Force • Relationship marketing • Decisions about sales personnel: • numbers • characteristics • assignments • Different markets affect direct sales & customer approaches • Territory allocationdetails after personnel • Customer call plans decisions fixed

10. Recruiting marketing & sales personnel Largest personnel requirement abroad for most companies is sales force. • Expatriates • Virtual expatriates • Local nationals • Third-country nationals

11. Tokyo Luanda Osaka Moscow Geneva Zurich 6. Singapore N’djamena Hong Kong Nagoya Sydney São Paulo Rio de Janeiro Bern Melbourne Shanghai Beijing Oslo Perth Libreville 2012: The 30 Most Expensive Citiesto Live in the WorldasEXPATS Copenhagen Seoul Canberra Brisbane London Khartoum Adelaide St. Petersburg Caracas Shenzhen ASIA EUROPE AFRICA MIDDLE EAST AUSTRALIA AMERICAS

12. Best Countries to be an Expat • Thailand • Saudi Arabia • Singapore • Egypt • Switzerland Important factors to expats: • health care • education • quality of life • social life • income

13. SelectingSales & Marketing Personnel • Management must define expectations • Most important requirements • maturity • emotional stability • breadth of knowledge (language skills) • positive outlook • flexibility • cultural empathy • energetic & enjoy travel (stamina) • Selection mistakes can be costly • Manager’s culture affects personnel decisions

14. Training forInternational Marketing • nature of training program depends on: • home culture of sales person • culture of business system & foreign market • continual training important in foreign markets • companies should provide home-office personnel with cross-cultural training • Internet makes sales training more efficient

15. Personal Selling Tips BELGUIM be able to identify decision makers. Flanders (Dutch) group decisions common; Wallonia (French) high level exec’s have final say CHINA expect to continue negotiations after deal is signed. Signing contract is just beginning of business relationship. Both sides expected to continue working together afterwards. COLOMBIA business counterparts want personal relationship, strong friendship. Be sure to keep same sales representatives throughout negotiation or risk losing deal. GERMANY be prepared with data to support sales proposition. German businessmen unimpressed with flashy presentation, so keep materials serious & detailed, no exaggeration. INDIA maintain flexible schedule to accommodate casual punctuality. Rigid hierarchy dictates decisions made only by highest level boss.

16. morePersonal Selling Tips MEXICO when planning meetings, breakfast / lunch preferred. Take time to cultivate relationships with business contacts - relationships more important than professional experience. PERU relate to individuals not corporate entities. Establish personal rapport. Maintain same sales rep’s throughout negotiations. RUSSIA 1st meeting is formality. Russian counterparts use this time to judge credibility. Be warm & friendly. SCOTLAND people soft-spoken & private. Takes time to build relationships. SOUTH KOREA status important. Make sure business card indicates title. Don’t send representative to meet Korean exec of higher status – could be viewed as disrespectful. THAILAND emphasizes non-conflict. Don’t make assertive demands in sales pitch.

17. Motivatingsales personnel • National differences must always be considered when motivating marketing force • Individual incentives? • Communications important in maintaining high levels of motivation (NOT “out of sight, out of mind”) • Company needs to clarify opportunities for growth within firm • Fear of being forgotten

18. Designing Compensation Systems for Expatriates • Fringe benefits – can be 35-60% salary in Europe; tax structure important; e.g. expense accounts in high-tax countries • Compensations comparisons between home office & abroad – important what would have received at home office • Short-term assignment compensation = separation allowances • Using compensation program to recruit, develop, motivate, or retain personnel

19. Evaluating & Controlling Sales Representatives • US emphasis on individual performance • easily be measured by sales revenues generated • In many countries evaluation more complex • where teamwork favored over individual effort • US primary control tool used by sales managers is incentive system • In other countries corporate control & frequent interactions with peers & supervisors are means of motivation & control

20. Designing Compensation Systems for a Global Sales ForceDO: • involve representatives from key countries • allow local managers to decide mix between base & incentive pay • use consistent performance measures • allow local countries flexibility in implementations • use consistent communication & training themes worldwide

21. Designing Compensation Systems for a Global Sales Force DON’T: • design plan centrally & dictate to local offices • create a similar framework for jobs with different responsibilities • require consistency on every performance measure within incentive plan • assume cultural differences can be managed through incentive plan • proceed without support of senior sales executives worldwide

22. Preparing U.S. Personnel for Foreign Assignments • Cost of foreign assignments • typically 150-400% of annual base salary • cost increases if expatriate returns home before completing scheduled assignment (2-4 years) • Planning process • begin prior to selection of those going abroad • include career development after returning home

23. Overcoming Reluctance to Accept a Foreign Assignment • Concerns for career • absence may adversely affect opportunities for advancement • Concerns for family • children’s education • isolation from family & friends • proper health care • potential for violence • Special compensations packages

24. Evaluation of employee’s family 75% of families sent abroad experience adjustment problems with children or marital discord Cross-cultural training for families as well as employee Local ombudsman - someone experienced in country - anticipate challenges & be ready with solutions Reducing Rate of Early Returns

25. 5 steps to Successful Expatriate Repatriation • Commit to reassigning expatriates to meaningful positions • Create mentor program – typically senior exec’s – monitor co. activities, keep up communication, liaise between expat & HQ dept’s • Offer written job guarantee stating what company is obligated to do for returning expatriate • Keep expatriate in touch with HQ through periodic briefings & HQ visits • Prepare expatriate & family for repatriation once return date is set

26. Developing Cultural Awareness • Expatriate failures • caused by lack of understanding of cultural differences & effect on management skills • Cultural skills • can be learned & developed • provide individual with ability to relate to different culture even when individual is unfamiliar with details of that particular culture

27. Do YOU have cultural skills? • Do you communicate respect verbally & non-verbally, conveying sincere interest in people & their cultures? • Do you tolerate ambiguity & absorb frustrations with cultural differences? • Do you display empathy by understanding others’ needs & differences from their points of view? • Do you remain non-judgmental about others’ behavior? • Do you recognize others’ culture & values as influences on their perceptions, evaluations, & judgments? • Can you laugh things off?

28. Fewer companies today limit their search for senior-level executive talent to home countriese.g. Indira Nooyi = head of PepsiCo; Richard Gnodde = co-CEO Goldman Sachs Int’l Some companies believe in international experience early in person’s career integral part of entry-level development programs Many companies committed to making foreign experience an integrated part of a successful corporate career Changing Profile of Global Manager

29. Foreign-Language Skills • Many global companies believe: • learning language improves cultural understanding & business relationships • to be taken seriously in business community, expatriate must be at least conversational in host language • Many companies making stronger efforts to recruit people who are bilingual or multilingual

30. Keys to success in Global Promotions Decisions • Company’s sales force is front line of marketing organization • Recent emphasis on using local personnel operating in own lands highlights importance of adapting managerial techniques to local needs • Development of effective marketing organization requires careful recruiting, selecting, training, motivating, & compensating of expatriate personnel & families • Most practical method of maintaining efficient international sales & marketing force is careful planning at all stages of career development

31. Next class: Global Pricing Decisions