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Global Marketing

Global Marketing. Chapter 5. Global Marketing. Why do I need to study this? Why Go Abroad? Increased Revenue Economies of Scale Cheap Labor Why Not Go Abroad? Lost Jobs Outsourcing. Global Marketing Strategies. Global AKA International Market existing products in the same way

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Global Marketing

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  1. Global Marketing Chapter 5

  2. Global Marketing • Why do I need to study this? • Why Go Abroad? • Increased Revenue • Economies of Scale • Cheap Labor • Why Not Go Abroad? • Lost Jobs • Outsourcing

  3. Global Marketing Strategies • Global • AKA International • Market existing products in the same way • Multinational firms • AKA Multidomestic • Product variations for each country • Transnational firms • Standardize across similar markets while adapting them to specific markets

  4. Environmental Factors- Social • Cultural diversity • Values • Customs • Foreign Corrupt Practices Act • Nonverbal behavior • Cultural symbols • Semiotics • Language • Back translation • Cultural ethnocentricity • Consumer ethnocentrism Source: http://www. facts-about-japan.com

  5. Environmental Factors- Economic • Stage of development • Developed v. Developing • Gross domestic product • Economic infrastructure • Communications, transportation, financial, and distribution systems • Consumer income and purchasing power • Government subsidies • Currency Exchange Rates

  6. Environmental Factors- Political-Regulatory Climate • Protectionism • Why? • Methods • Tariffs • Quotas • Reducing Protectionism • General Agreement on Tariffs & Trade (1948) • World Trade Organization (1995) • Chicken War • Trade blocs and International Organizations

  7. Trade Blocs • NAFTA • 1994 • Three members • Purpose • CAFTA • 2005 • Effects • MERCOSUR • South America • ASEAN

  8. Trade Blocs • European Union • 27 members • 500 million people • $2 trillion investment • Effects

  9. International Organizations • World Bank • Loans to developing countries • International Monetary Fund • Emergency loans • Group of 20 (G-20) • 20 largest economies Source: http://www.topnews.in/ Source: http://www.topnews.in/

  10. Environmental Factors- Political-Regulatory Climate • Natural Resources • Oil-producing countries • Saudi Arabia • Japan • Africa

  11. Global Market-Entry Strategies • Four strategies • Exporting • Licensing • Joint venture • Direct investment

  12. Exporting • Indirect exporting • Use an intermediary • Least profit • Direct exporting • Sell directly to foreign country • 60 percent of U.S. firms using this strategy have less than 100 employees

  13. Licensing • Advantages • Disadvantages • Three types • Contract manufacturing • Contract assembly • Franchising

  14. Joint Venture • Two companies (one foreign, one local) go together to enter market • Advantages • Disadvantages

  15. Direct Investment • Biggest commitment • Advantages • Disadvantages

  16. Porter’s Competitive Advantage of Nations • Factor conditions • Demand conditions • Related and supporting industries • Company strategy, structure, and rivalry • Economic Espionage Act

  17. Global Marketing Mix • Products • Product invention • Product adaptation • Promotion • Language Source: http://www.cbsnews.com

  18. Global Marketing Mix • Place • Reebok • Coke • Pricing • Exchange rates • Dumping • Countertrade • Bartering Source: http://www.worldchanging.com

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