Global Marketing

THE GLOBAL MARKETPLACETHE GLOBAL MARKETPLACE

““Marketing”Marketing”

““Evolution”Evolution”

AdvantagesAdvantages Economies of scale in production and Economies of scale in production and

distributiondistribution Lower marketing costsLower marketing costs Power and scopePower and scope Consistency in brand imageConsistency in brand image Helps to establish relationships Helps to establish relationships

outside of the political arena outside of the political arena

DisadvantagesDisadvantages Differences in consumer needs,Differences in consumer needs,

wants and usage patterns for products wants and usage patterns for products Differences in consumer response to Differences in consumer response to

marketing mix elements marketing mix elements Differences in brand and product Differences in brand and product

development and competitive development and competitive environmentenvironment

Differences in administrative proceduresDifferences in administrative procedures Differences in product placementsDifferences in product placements

Managing a global market Managing a global market placeplace Identify your Identify your

customer’s partners customer’s partners Make sure your ads Make sure your ads

and literature reach a and literature reach a global audienceglobal audience

Learn the local Learn the local customs customs

If possible hire local If possible hire local people in a local office people in a local office

Try to learn key Try to learn key phrases of the phrases of the language language

OpportunitiesOpportunities Import / Export Import / Export Produce / Invest / Produce / Invest /

License a product on License a product on behalf of a foreign behalf of a foreign firmfirm

Partner with an Partner with an existing firm existing firm

Invest directly in a Invest directly in a foreign branch with foreign branch with domestic and foreign domestic and foreign managementmanagement

Economic trendsEconomic trends Service sector – 41% in Service sector – 41% in

developing countries developing countries and 58% in developed.and 58% in developed.

Industry- slight declines Industry- slight declines in Africa in Africa

and America and recent and America and recent increases in Asia and increases in Asia and Oceania.Oceania.

Agriculture – 11% of Agriculture – 11% of economic activity in economic activity in developing countriesdeveloping countries

and 2% in developed. and 2% in developed. Poverty Poverty

Global marketing Global marketing planningplanning

GLOBAL MARKETING IN THE GLOBAL MARKETING IN THE 2121stst CENTURY CENTURY

MAJOR DECISIONS IN MAJOR DECISIONS IN INTERNATIONAL MARKETINGINTERNATIONAL MARKETING

Looking at the global marketing environment

Deciding whether to go international

Deciding which markets to enter

Deciding how to enter the market

Deciding on the global marketing program

Deciding on the global marketing organization

(1) LOOKING AT THE (1) LOOKING AT THE GLOBAL MARKETING GLOBAL MARKETING

ENVIRONMENTENVIRONMENT The international trade system The international trade system Global firm – operates more than in one Global firm – operates more than in one

country, gains R & D, P/M/F advantages country, gains R & D, P/M/F advantages in its cost and goodwill. in its cost and goodwill.

Tariff – tax levied by the govt. Tariff – tax levied by the govt.

against certain imported items. against certain imported items. Quota – limit on the amount of Quota – limit on the amount of

certain product categories that certain product categories that

an importing country will accept. an importing country will accept.

Embargo – ban on some kind of import Embargo – ban on some kind of import items.items.

Exchange controls – limit on the amount Exchange controls – limit on the amount of foreign exchange and the exchange of foreign exchange and the exchange rate against other currencies. rate against other currencies.

Non-tariff trade barriers – barriers to Non-tariff trade barriers – barriers to foreign products such as bias against a foreign products such as bias against a foreign company bids or foreign company bids or

product standards that product standards that

go against a foreign go against a foreign

company product company product

features.features.

Cultural DimensionsCultural Dimensions Directness Vs Directness Vs

indirectnessindirectness Comparison Comparison Humor Humor Gender roles Gender roles ExplicitnessExplicitness Sophistication Sophistication Popular Vs Popular Vs

Traditional culture Traditional culture Information content Information content

Vs fluffVs fluff

(2) Deciding whether to go (2) Deciding whether to go internationalinternational

It’s not always important to venture It’s not always important to venture into international market for survival.into international market for survival.

The decision depends on operations, The decision depends on operations, country’s language and laws.country’s language and laws.

Strategic position/global Strategic position/global position/compete on the worldwide position/compete on the worldwide basis to succeed. basis to succeed.

Global competitors attack on domestic Global competitors attack on domestic market.market.

Ability to operate globally?Ability to operate globally?

Can the company learn to understand the Can the company learn to understand the preferences and the buyer behavior?preferences and the buyer behavior?

Can it offer competitively attractive Can it offer competitively attractive products?products?

Will it adapt to other countries’ business Will it adapt to other countries’ business culture?culture?

Do the company managers’ have the Do the company managers’ have the necessary international experience?necessary international experience?

Impact of regulations and political Impact of regulations and political environment of the other country?environment of the other country?

(3) Deciding which markets (3) Deciding which markets to enterto enter

Defining international marketing Defining international marketing objectives and policies.objectives and policies.

Deciding upon how many/types of Deciding upon how many/types of countries to market in.countries to market in.

Indicators of potential market to enter:Indicators of potential market to enter:

Demographic, geographic, economic, Demographic, geographic, economic, socio-cultural, political and legal socio-cultural, political and legal factors.factors.

(4) Deciding how to enter (4) Deciding how to enter the marketthe market

Exporting

Direct/Indirect

Joint Venturing- Licensing- Contract manufacturing- Management contracting- Joint ownership

Direct investment-Assembly facilities- Manufacturing facilities

Amount of commitment, risk, control and profit potential

(5) Deciding on the global (5) Deciding on the global marketing programmarketing program

Standardized marketing mix – Standardized marketing mix – strategy used basically for the same strategy used basically for the same product advertising, distribution and product advertising, distribution and other elements in marketing mix.other elements in marketing mix.

Adapted marketing mix – strategy for Adapted marketing mix – strategy for adjusting the marketing mix elements adjusting the marketing mix elements to each international target market. to each international target market. E.g McDonalds serves their food with E.g McDonalds serves their food with onions, pickles to suit Indian taste. onions, pickles to suit Indian taste.

Straight Extension

Product Adaptation

Communicationadaptation

DualAdaptation

Product invention

Don’t change product

Adapt product

Develop new product

Don’t changepromotion

Adapt promotion

(6) Deciding on the global (6) Deciding on the global marketing organizationmarketing organization

Companies manage the international Companies manage the international marketing activities through three marketing activities through three ways:ways:

(1) Organize export department(1) Organize export department

(2) Create international division(2) Create international division

(3) Finally become a global organization(3) Finally become a global organization

E.G – for international distribution, E.G – for international distribution, distribution channels vary from nation distribution channels vary from nation to nation.to nation.

G-5 STRATEGIESG-5 STRATEGIES

GLOBAL PLATFORM STRATEGY

GLOBAL NETWORKSTRATEGY

GLOBAL INTERMEDIARYSTRATEGY

GLOBAL ENTREPRENEURSTRATEGY

GLOBAL INVESTMENTSTRATEGY

Trade BarriersTrade Barriers

THE FOUR T’S

TARIFF AND NON-TARIFF COSTS

TIME COSTSTRANSPORTATION

COSTS

TRANSACTION COSTS

Globalization of Markets and Globalization of Markets and CompetitionCompetition

Technological Technological improvements improvements

Improved Improved transportationtransportation

Communication Communication opportunitiesopportunities

Global agreements Global agreements with trade with trade organizations such organizations such

WTO, NAFTA,EU.WTO, NAFTA,EU.

Star Analysis for Star Analysis for competitive advantagecompetitive advantage

INTERNTIONALBUSINESS

HOME COUNTRY

CUSTOMER COUNTRY

COMPETITOR COUNTRY

PARTNER COUNTRY

SUPPLIER COUNTRY

Constraints on Global Constraints on Global communication strategiescommunication strategies

TrendsTrends

Insight and innovation Insight and innovation key key

Customers are top of Customers are top of the list the list

Green marketing and Green marketing and global warming lose global warming lose importanceimportance

Marketers sick of web Marketers sick of web Most opportunity in Most opportunity in

china and among china and among boomers boomers

India as a Global power – The India as a Global power – The Forbes coverageForbes coverage

Foreign investment in Foreign investment in more than 1000 Indian more than 1000 Indian companies.companies.

100 corporations with a 100 corporations with a market value exceeding market value exceeding $1 billion.$1 billion.

India’s average growth India’s average growth rate jumped to 7.5% rate jumped to 7.5% from the earlier 6%.from the earlier 6%.

Cries for a level playing Cries for a level playing field are becoming field are becoming louder.louder.

Important pre-requisite is Important pre-requisite is land acquisition for any land acquisition for any investment investment

in India. in India.

Brand “YOU” and the Global Brand “YOU” and the Global market placemarket place

Ideas such as ‘life Ideas such as ‘life time employment’ time employment’ and ‘job for life’ are and ‘job for life’ are slowly becoming slowly becoming obsolete. obsolete.

We are becoming We are becoming the ‘free agents’ of the ‘free agents’ of sorts.sorts.

Made by: Chandni kundel Anupamjeet kaur (Msc) sim)