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International Marketing

International Marketing. Trade policy Culture Consumer buying power Product strategies. Obstacles to Trade: Protectionism. Differing interests of consumers and manufacturers Benefits of trade tend to be more diffused than benefits to specific groups of protectionism.

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International Marketing

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  1. International Marketing • Trade policy • Culture • Consumer buying power • Product strategies

  2. Obstacles to Trade: Protectionism • Differing interests of consumers and manufacturers • Benefits of trade tend to be more diffused than benefits to specific groups of protectionism

  3. Approaches to Protectionism • Tariffs • Quotas • “Voluntary” export restrictions • Subsidies to domestic producers/exporters • Non-tariff barriers • legal obstacles • differential treatment

  4. Cultural Lessons • Diet Coke is named Light Coke in Japan--dieting was not well regarded • Red circle trademark was unpopular in Asia due to its resemblance of Japanese flag • Packaging of products is more important in some countries than in U.S. • Advertisement featuring man and dog failed in Africa--dogs were not seem as man’s best friend

  5. More Cultural Lessons... • Cologne ad featuring a man “attacked” by women failed in Africa • Food demonstration did well in Chinese stores but not in Korean ones--older women were insulted by being “taught” by younger representatives • Pauses in negotiations • Level of formality

  6. Product Strategies • Extent of product change • Standardization: Attempt at global product • Customization: Specific product for each market • Adaptation: Some changes made to product • Physical: Product changes (e.g., voltage, size, taste) • Communications: Positioning • More issues when we considered product strategy in general

  7. Physical Product vs. Communication Adaptations

  8. CONSUMER INCOMES AND BUYING POWER • Measuring country wealth • gross domestic product • “purchase parity” vs. nominal • Government role in the economy • Tax burden • Services provided by the Government—e.g., health care, education

  9. Nominal vs. Purchase Parity Adjusted GNPs--Examples Source: World Bank (http://www.worldbank.org/data/databytopic/gnppc97.pdf)

  10. Exporting Low investment Low control of promotion Licensing Low investment Low control of promotion, positioning, and quality Able to benefit from existing distribution and market knowledge Joint venture Considerable investment More control Able to benefit from partner’s experience Must work with partner Direct investment Large investment Risky Greater control May lack knowledge of market Market Entry Strategies

  11. U.S. Laws of Interest to firms with U.S. Involvement • Anti-trust • Foreign Corrupt Influences • Anti-boycott laws • Trading With the Enemy

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