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Lamb, Hair, McDaniel

Lamb, Hair, McDaniel. CHAPTER 5. Developing a Global Vision. Importance of Global Marketing to the U. S. U.S. exports a fifth of industrial production. One of every 10 jobs in U.S. is supported by exports. U.S. businesses export over $800 billion in goods.

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Lamb, Hair, McDaniel

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  1. Lamb, Hair, McDaniel CHAPTER 5 Developing a Global Vision

  2. Importance of Global Marketing to the U. S. • U.S. exports a fifth of industrial production. • One of every 10 jobs in U.S. is supported by exports. • U.S. businesses export over $800 billion in goods. • Exports account for 25 percent of U.S. economic growth. • U.S. is world’s leading exporter of farm products.

  3. Benefits of Globalization Expands economic freedom Spurs competition Raises productivity and living standards Offers access to foreign capital, global export markets, and advanced technology Promotes higher labor and environmental standards Acts as a check on government power Developing a global vision is a must in a globalized world

  4. Benefits of Globalization:The company perspectives Earn additional profits Leverage a unique product or technological advantage Possess exclusive market information Saturated domestic markets Excess capacity Utilize “economies of scale” Diversify markets Benefits of Globalization

  5. The Cost-Fear of Trade and Globalization • Millions of Americans have lost jobs • Millions fear losing jobs • Threat of outsourcing if workers do not accept pay cuts • Vulnerability to operations moving offshore

  6. Global Governance How the world is being governed/run by various international organizations Politics/Peace- United Nations Trade- World Trade Organization (WTO) Money/Finance- International Monetary Fund (IMF) Development- World Bank Overall- G8 Nations (USA, Canada, UK, France, Germany, Italy, Japan, and Russia) Other international institutions/bodies

  7. Global Marketing Issues Role of multinational corporations Developed, Emerging and Developing Nations Economic, Demographic, Cultural and Political Environmental Variations Global vs. Domestic Marketing Changes in the mix Changes in the environment Standardization Adaptation Debate Integration and regional economic blocs EU, NAFTA, MERCOSUR, ASEAN Various market entry strategies Multinational companies and their strategies

  8. External Environment Facing Global Marketers NaturalResources Cultural • values • language • dependence • customs • independence • traditions Demography GlobalMarketingMix • urban v. rural EconomicDevelopment • young v. old • purchasing power Political Structure • tariffs TechnologicalDevelopment • quotas • boycotts • exchange controls • market controls • trade agreements

  9. WTO and the Doha Round • Began in 2001 • Highly contentious from the beginning • Failed in summer, 2008 • First multilateral free trade act failure since WWI • Cost of Failure: $100 billion annually

  10. Export Sell domestically produced products to buyers in other countries Licensing Legal process allowing use of manufacturing/patents/knowledge ContractManufacturing Private-label manufacturing by a foreign country Joint Venture Domestic firm buys/joins a foreign company to create new entity Direct Investment Active ownership of a foreign company/manufacturing facility Entering the Global Marketplace

  11. The Impact of the Internet • Opening an e-commerce site puts a company in the international marketplace • Internet Economy remains hindered by brick and mortar rules, regulations, and habits

  12. Ch 5 Discussion Questions What is global/international marketing? How does it differ from domestic marketing? What is globalization? What are the costs and benefits of globalization? Discuss the role played by different international institutions in Global Governance. Discuss the five entry strategies we studied in class. What is a multinational company? Discuss the role they play in international marketing.

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