Perspective
Instructor Supplements
Created by Geoffrey da Silva
19
Chapter 19 Outline
19.1
19.2
19.3
19.4
19.5
19.6
19.7
Opening Case
Google in China: Running the Global Marketing Gauntlet
Just as international
markets provide
opportunities, they
sometimes present
challenges. Googles
odyssey into mainland
Chinaand back out again
vividly illustrates the
prospects and perils of
going global
19.1
Global Marketing Today
19.1
Between 2000 and 2008, total world trade grew by more than 7
percent annually, while global gross domestic product has grown at
only about 3 percent annually.
It
Globalization
Almost every company,
large or small, is touched
in some way by global
competition. Today,
companies are also buying
more supplies and
components abroad.
Many American companies have now made the world their market.
11 2012 Principles of Marketing: An Asian Perspective
19.2
Looking at the Global Marketing Environment
19.2
International Trade
Restrictions to Trade
Tariffs
Quotas
Exchange controls
Non-tariff trade barriers
Facilitators of trade
WTO
and GATT
Region
EU
and NAFTA
ASEAN
Economic Environment
Economic Environment
Two
A.
B.
The
Income Distribution
Industrialized
households.
Countries
other countries may have households with only either very low or
very high incomes.
Even
Countertrade
Countertrade
Besides
Yet
many nations have too little hard currency to pay for their
purchases from other countries.
They
may want to pay with other items instead of cash, which has led
to a growing practice called countertrade.
Countertrade
Political/Legal Environment
Political-Legal Environment
Nations
Political-Legal Environment
Companies
Cultural Environment
Cultural Environment
Each
When
turn, they must also understand how their strategies affect local
cultures
Cultural Environment
Marketing
Culture
tend to sit or stand very close to one another when they queue or
talk businessin fact, almost nose-to-nose. The Asian business executive
tends to move closer as the American and Australian keep backing away.
Both may end up being offended. Asian business executives need to be
briefed on these kinds of factors before conducting business in another
country.
Chinese
Americanization
19.3
Deciding Whether to Go Global
19.3
Go Global?
Going Global
Not all companies need to venture into international markets to
survive.
Any of several factors might draw a company into the international
arena.
a) Global competitors might attack the companys home market by
offering better products or lower prices.
b) The company might want to counterattack these competitors in their
home markets to tie up their resources.
c) The companys customers might be expanding abroad and require
international servicing.
d) International markets might simply provide better opportunities for
growth.
54 2012 Principles of Marketing: An Asian Perspective
Going Global
Risks
International regulations
19.4
Deciding Which Markets to Enter
19.4
Entry criteria
Possible global markets should be ranked on several factors:
MARKET SIZE
COST OF DOING
BUSINESS
COMPETITIVE
ADVANTAGE
RISK LEVEL
62 2012 Principles of Marketing: An Asian Perspective
19.5
Deciding How to Enter the Market
19.5
Exporting
Exporting
Joint Venture
Joint Venture
A.
Licensing
For a fee or royalty, the licensee buys the right to use the
companys manufacturing process, trademark, patent, trade
secret, or other item of value.
A.
Licensing
B. Contract Manufacturing
C. Management Contracting
D. Joint Ownership
D. Joint Ownership
Direct Investment
Direct Investment
Advantages:
Lower costs in the form of cheaper labor or raw materials,
foreign government investment incentives, and freight savings.
The firm may improve its image in the host country.
Development of a deeper relationship with government,
customers, local suppliers, and distributors.
The firm keeps full control over the investment.
Direct Investment
19.6
Deciding on the Global Marketing Program
19.6
Product
Straight Extension
Product Adaptation
Product Invention
Five strategies exist that allow for adapting product and marketing
communication strategies to a global market (Figure 19.3).
Promotion
Communication Adaptation
Price
International Pricing
International Pricing
Distribution
Figure 19.4 shows the two major links between the seller and the
final buyer.
19.7
Deciding on the Global Marketing Organization
19.7
Organize an
export
department
Create
international
division
Become
global
organization
International Division
International divisions are organized in a variety of ways.
i.Geographical
Global Organizations
Global organizations are companies that have stopped thinking of
themselves as national marketers who sell abroad and have started
thinking of themselves as global marketers
Company Case
Haier: Internationalization
Thank
you