GLOBAL MARKETING
4th Edition
4-3
Macro Level
(Porter Diamond)
National competencies are critical Competitive advantage of nations Though firms compete yet home nation is critical Being a home based international is determinant of firms strengths and weaknesses relative to foreign rivals
4-4
Diamond Model
4-5
Factor Conditions
Climate Physical Infrastructure Natural Resources Educational System Human Resources Technological Infrastructure Capital
Hollensen, Global Marketing 4e, Pearson Education 2008
4-6
Demand Conditions
The nature and size of home demand
Economies of Scale Transportation Cost large local demand understanding of local market needs Sophistication of buyer Price inelasticity
4-7
4-8
4-9
Chance
Creativity Entrepreneurial idea availing chance will enable you to yield scale and clustering effects
4-10
Government
Critical role player in developing local industries
Finance Construct infrastructure roads, airports, education, health care and energy resources
4-11
4-12
Suppliers
Buyers Substitutes
Vertical collaborations
Partnering with customers; lead users Related Diversification alliances with producers of complements and substitutes
New Entrants
4-13
Firm A
R&D
Produ ction Mrktg
Sales n Services
Firm B
R&D
Produ ction
Sales n Services
Mrktg
4-14
Competitive advantage
P 110
Core competences
competences
Resources
Intangible Assets
Source: adapted from Jttner and Wehrli, 1994.
4-15
Competitive Benchmarking
Key Terms Critical Success Factors:
P 112
Those Value Chain Functions where the customer demands/expects the supplier to have a strong Competence
Core Competencies:
Those Value Chain Functions where we as a firm has a strong competitive position
Hollensen, Global Marketing 4e, Pearson Education 2008 4-16
Competitive Benchmarking
Value Chain Functions (selected)
Importance to customers How do customers rate the performance of our firm? How do customers rate performance of key competitor?
4-17
What is this?
What term refers to value chain activities in which the firm is regarded as better than its competitors?
Core competences
4-18
What is this?
What term refers to a technique for assessing relative marketplace performance compared with main competitors?
Competitive benchmarking
4-19
4-20
What is this?
What term refers to tough head-to-head competition in mature industries which often results in nothing but fighting over a shrinking profit pool?
Red oceans
4-21
What is this?
What term refers to unserved markets, where competitors are not yet structured and the market is relatively unknown?
Blue oceans
4-22
Value Innovation
The logic of value innovation starts with an ambition to dominate the market by offering a tremendous leap in value.
Value innovation build on the powerful commonalities in the features that customers value.
Hollensen, Global Marketing 4e, Pearson Education 2008 4-23