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Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-2
Chapter Questions What factors should a company review before
deciding to go abroad? How can companies evaluate and select
specific foreign markets to enter? What are the differences between marketing in
a developing and a developed market? What are the major ways of entering a foreign
market?
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-3
Chapter Questions To what extent must the company adapt its
products and marketing program to each foreign country?
How do marketers influence country-of-origin effects?
How should the company manage and organize its international activities?
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-4
What is a Global Firm?A global firm is one that operates in more
than one country and captures R&D, production, logistical, marketing, and financial
advantages in its costs and reputation that are not available to purely domestic competitors.
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-5
Major Decisions in International Marketing
Deciding whether to go Deciding which markets to enter Deciding how to enter Deciding on the marketing program Deciding on the marketing organization
Reasons for Pursuing Global Markets
Better profit opportunities Larger customer base to achieve economies
of scale Less dependence on any one market Desire to counterattack global competitors in
their home markets Customers require international service
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-6
Risks to Going Abroad
Lack of knowledge of foreign culture Lack of understanding of foreign needs Lack of understanding of foreign regulations Lack of managers with international expertise Changes in the country environment
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-7
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-8
Four Stages of Internationalization
Stage 1: No regular export activities Stage 2: Export via independent agents Stage 3: Establish sales subsidiaries Stage 4: Establish production facilities abroad
Momentum in Market Entry
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-9
Waterfall Approach
Sprinkler Approach
Born Global
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-11
Regional Free Trade Zones
European Union NAFTA MERCOSUL APEC ASEAN
Key Emerging Markets
Brazil Russia India
China Indonesia South Africa
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-12
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-13
Five Modes of Entry into Foreign Markets
Indirect exporting Direct exporting Licensing Joint ventures Direct investment
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-14
Indirect Exporting Methods
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-15
Direct Exporting Methods
Domestic-based export department Overseas sales branch or subsidiary Traveling export sales representatives Foreign-based distributors or agents
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-19
Table 21.2 Global Marketing
Advantages Economies of scale Lower marketing costs Power and scope Consistency in brand
image Ability to leverage Uniformity of marketing
practices
Disadvantages Differences in
consumer needs, wants, usage patterns
Differences in consumer response to marketing mix
Differences in brand development process
Differences in environment
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-20
Cultural Dimensions
Individualism vs. collectivism Masculine vs. feminine High vs. low power distance Weak vs. strong uncertainty avoidance
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-21
What Marketing Aspects Might Be Adapted for International Marketing?
Product features Labeling Colors Materials Sales promotion Advertising media
Brand name Packaging Advertising
execution Prices Advertising themes
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-22
Commandments of Global Branding
Understand similarities and differences in the global branding landscape
Do not take shortcuts in brand building Establish a marketing infrastructure Embrace integrated marketing
communications Establish brand partnerships
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-23
Commandments of Global Branding
Balance standardization and customization Balance global and local control Establish operable guidelines Implement a global brand-equity measurement
system Leverage brand elements
Figure 21.3 Five International Product and Communication Strategies
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-24
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-25
Levels of Product Adaptation
Production of regional product versions Production of country versions Production of city versions Production of retailer versions
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-26
Price Choices
Set a uniform price everywhere Set a market-based price in each country Set a cost-based price in each country
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-27
What is a Gray Market?
A gray market consists of branded products diverted from normal or authorized
distributions channels in the country of product origin or cross international
borders; dealers in lower priced countries sell products in higher priced countries
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-28
Whole-Channel Concept for International Marketing
Seller International headquarters Channels between nations Channels within nations Final buyers
Country of Origin Effects
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-29
The Marketing Organization
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-30
Export Departments
International Divisions
Global Organization
For Review
What factors should a company review before deciding to go abroad?
How can companies evaluate and select specific foreign markets to enter?
What are the differences between marketing in a developing and a developed market?
What are the major ways of entering a foreign market?
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-31
For Review
To what extent must the company adapt its products and marketing program to each foreign country?
How do marketers influence country-of-origin effects?
How should the company manage and organize its international activities?
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 21-32