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Global Marketing Management

Global Marketing Management. Chapter 1 Introduction to Global Marketing. Warren J. Keegan. Overview. Marketing: A Universal Discipline The Three Principles of Marketing Global Marketing:What It Is & What It Is Not Importance of Global Marketing Management Orientation & Global Marketing

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Global Marketing Management

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  1. Global Marketing Management Chapter 1 Introduction to Global Marketing Warren J. Keegan

  2. Overview • Marketing: A Universal Discipline • The Three Principles of Marketing • Global Marketing:What It Is & What It Is Not • Importance of Global Marketing • Management Orientation & Global Marketing • Driving and Restraining Forces Affecting Global Integration & Global Marketing • Summary

  3. Understand how the world economy developed over the past decades Know the impact of globalization on the marketing discipline Learn about the interdependencies between management orientation & marketing performance Understand the factors supporting or inhibiting international marketing activities Learning Objectives

  4. Marketing (1): the process of focusing the resources & objectives of an organization on environmental opportunities & needs Marketing (2): a set of concepts, tools, theories, practices, procedures, & experiences Although marketing is a universal discipline, marketing practice varies from country to country Marketing: A Universal Discipline

  5. Concept has chanced dramatically 1950’s: Focus on products 1960’s: Focus on customer orientation Development of marketing mix: product, price, place, promotion (4P’s) The Marketing Concept (1)

  6. 1990’s: Focus on customer in the context of the broader external environment Competition, government policy & regulation Focus on stakeholder value employees, customers, shareholders, society The Marketing Concept (2)

  7. Today: Two key tasks of marketing Focus on customer & his/her environment Create value for consumers & stakeholder Shift towards Focus on managing strategic partnerships Positioning of firm in value chain to optimize value creation Profit as a measure of success, not an end in itself The Marketing Concept (3)

  8. The Three Principles of Marketing CUSTOMER VALUE DIFFERENTIATION FOCUS

  9. Goal: create customer value that is greater than the value created by competitors Strategy: Expand or improve product and/ or service benefits Reduce the price Combine these two elements Key Elements of Marketing – 1. Customer Value

  10. V = Value B = Perceived Benefits – Perceived Costs P = Price Elements of Marketing – Customer Value V = B / P

  11. Goal: create competitive advantage through differentiation Advantage can exist in any element of a company’s offer One way to penetrate a new national market is to offer a superior product at a lower price. Key Elements of Marketing – 2. Differentiation

  12. Goal: a concentration of attention & resources Requirement to create customer value at a competitive advantage A viable way for small & medium sized companies to achieve dominant position in world market A clear focus on customer needs & wants Key Elements of Marketing – 3. Focus

  13. Marketing discipline is universal but markets & customers are quite different 3 domains of knowledge Cross-Cultural Knowledge Country/ Regional Knowledge Cross-Border Transactions Knowledge Need for “Global Localization”: Adjustment of global marketing strategies to local requirements Global Marketing

  14. Examples of Global Marketing

  15. International arena is of great importance to companies maximizing growth potential 75% of market potential is outside the US 94% of market potential for German companies is outside of Germany A large number of industries will be dominated by a handful of global companies Importance of Global Marketing

  16. Different Management Orientations in the Global Arena – EPRG Framework Management Orientation and Global Marketing (1) Polycentric Ethnocentric Regiocentric Geocentric

  17. Ethnocentric Orientation: Characteristic of domestic & international companies Opportunities outside the home market are pursued by extending various elements of the marketing mix Polycentric Orientation Characteristic of multinational companies Marketing mix is adapted by autonomous country managers Management Orientation & Global Marketing (2)

  18. Regiocentric or Geocentric Orientation: Characteristic of global & transnational companies Marketing opportunities are pursued by both extension & adaptation strategies in global markets Management Orientation & Global Marketing (3)

  19. Technology Regional Economic Agreements Market Needs & Wants Transportation & Communication Improvements Product Development Costs Quality World Economic Trends Leverage The Global/ Transnational Corporation Driving Forces Affecting Global Marketing

  20. Management Myopia & Organizational Culture National Controls & Barriers Restraining Forces Affecting Global Marketing

  21. Summary • Global marketing is the process of focusing resources on global marketing opportunities • Goal, to create customer value & competitive advantage by maintaining focus • Three classifications of management orientation: ethnocentric, polycentric, regiocentric, geocentric • Global marketing importance is shaped by a variety of driving & restraining forces

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