MARKETING (IB)

IB Note for International Marketing

Marketing

Marketing

The activity and processes for creating, communicating, delivering, and capturing offerings that have value for customers, partners, and society.

Marketing Management

The art and science of choosing target markets; getting, keeping, and growing customers through creating, delivering, and communicating superior customer value.

International Marketing

The utilization and adaptation of best marketing practices for the purpose of conducting commerce in other countries.

Basic Marketing Principles

General principles for achieving organizational objectives in marketing, including consumer-orientedness, identifying competitive edge, offering something valuable and unique, and creating great customer experience.

Domestic Marketing

Marketing practices within a home country.

World/Global/Multinational

The perspective where nothing is foreign, the world is their home and they are corporate citizens of the world.

Driving Forces

Factors that influence international marketing, including consumer needs and wants, advancements in ICT and online platforms for trade, opening of borders and favorable trade policies, exploration of consumer taste and preferences, improvements in transportation and communications, and popularity and accessibility of media.

Income and Consumption

The economic factors that affect international marketing, including gross domestic product (GDP), gross national income (GNI), income classifications, purchasing power, and purchasing power parity.

Prices and Inflation

The economic factors related to prices and inflation rates, including inflation rate, consumer price index (CPI), price elasticity, and their relevance to marketing.

Employment and Labor Force

The economic factors related to employment, wages, and labor force, and their relevance to marketing.

Exchange Rates

The rates at which currencies can be exchanged, and their relevance to marketing.

International Trade

The concept of trade between countries, including production possibilities, absolute advantage, comparative advantage, balance of trade, and foreign direct investment.

Tariffs/Taxes, Quotas, Subsidies

The trade barriers and policies, including tariffs, quotas, subsidies, and their impact on international marketing.

Regional Integration

The economic agreements and organizations that aim to reduce trade barriers, such as the General Agreement on Tariffs and Trade (GATT).

Most Favored Nation

Equal treatment given to all member nations, treating each as the most favored nation.

Open Markets

Removal of protection measures such as custom tariffs and quota restrictions.

Fair Trade

Removal or limitation of export subsidies.

World Trade Organization (WTO) 1995-present

Continuation of GATT, now includes services and intellectual properties.

Culture

A way of life and thinking process, set of traditional beliefs and values shared in a society.

Cultural Perspectives

Prescriptive, socially shared, subjective, learned, cumulative, dynamic, and enduring aspects of culture.

Self-Reference Criterion (SRC)

Unconscious reference to one's own cultural values, experiences, and knowledge as a basis for decision-making.

Ethnocentrism

Bias view that one's own culture is superior to others.

Cultural Universals

Common patterns or traits shared among societies.

High Context

Communication style emphasizing background, basic values, and interpersonal relationships.

Low Context

Communication style emphasizing explicit, clear, and specific information.

Hofstede Cultural Dimensions

Empirical model measuring power distance, individualism vs. collectivism, masculinity vs. femininity, uncertainty avoidance, long term vs. short term orientation, and indulgence vs. restraint.

Market Research

Systematic process of collecting, organizing, analyzing data to generate insights from consumer groups.

Principles in Market Research

Conversation-based, unbiased and objective, behavior over intent, data privacy.

Ad Test

Research to test communication materials before and after release.

Packaging Test

Testing of packaging materials or content.

Pricing Test

Determining price point or assessing purchase intent given a product or price point.

Van Westendorp

Methodology to capture customer perception of prices.

Consumer Behavior

Patterns in consumption and purchase.

Concept-Product Test

Evaluation of a product or service by its target customers.

Cluster distribution

Measuring the distribution of clusters based on different attributes.

Overall liking

Identifying the mean overall liking of each cluster.

Penalty

Computing the penalty scores by subtracting the mean of too low from the JAR mean, and subtracting the mean of too high from the JAR mean.

Quadrant

Plotting the penalty scores and the % of the population to determine the critical corner quadrant.

Research design

The type of research (qualitative or quantitative), research method, respondents, sample size, and sampling methodology.

Qualitative research

Obtaining information on meanings, opinions, feelings, and motivations of consumer responses.

Quantitative research

Measurement of the magnitude, incidence, volume for generalization of information.

Questionnaires

Important tools for collecting information, with factors to consider such as type of question, neutrality, and bias.

Sampling methodology

Different types of sampling methods, including probability sampling (random, systematic, stratified random, cluster) and non-probability sampling (convenience, purposive, snowball, voluntary).

Data analytics

Analyzing data to gain insights, check for patterns and commonality, and answer research objectives.

Market entry strategies

Modes of entry, including export (direct and indirect), intermediate (licensing, financing, contract manufacturing), and hierarchical (joint venture, greenfield, acquisition).

Competitiveness

National and firm level factors affecting competitiveness, including legal, political, and regulatory factors, Porter's Diamond Theory, and STP (segmentation-targeting-positioning).

Business Model Canvas

A tool for planning businesses effectively and efficiently, used for problem identification, opportunity identification, innovation, competitor analysis, and business planning.

Product decisions

Standardize vs. adapt strategies, considering factors such as market characteristics, product characteristics, company considerations, and regulatory attributes.

Local, global, glocal

Different strategies for globalizing products and services, including globalization, localization, and glocalization.

Localization

A strategy that focuses on catering to the unique needs and desires of local markets, with a positive impact on the industry but a negative impact on the global market.

Globalization

A strategy that prioritizes the global market over local markets, with a negative impact on the local market but a positive impact on the global market.

Glocalization

A strategy that combines elements of global culture with local integration, aiming for a well-balanced approach to global and local strategies.

Perceptions

The way consumers perceive a brand, with three categories - local, global, and glocal - based on their perception of the brand's origin and strategy.

Functional

A category of perception where consumers have no interest in whether a product is local or global, treating it as a commodified product.

Innovation & the International Market

A framework for generating new ideas and entering the international market, using the SCAMPER technique (Substitute, Combine, Adapt, Modify, Put to other use, Eliminate, Reverse/Rearrange).

Branding

The process of creating a positive and lasting image of a business that connects emotionally with customers.

Brand Adjustments

Strategies for adapting a brand to different markets, including translation, transliteration, and checking for connotative meaning.

Country of Origin Effect (COO)

The impact of a product's country of origin on consumer perceptions and purchase decisions.

Country Image

General perceptions of a country based on its economic, political, and cultural factors.

Country Product Image

Perceptions of a country's manufacturing quality, innovation, and prestige.

Country Related Product Image

Reputation of a specific product or brand from a country, reflecting technical characteristics, reliability, and status.

Country Equity

The portion of consumer affect towards a brand or product derived from its association with a particular country.

Brand Origin Culture (COBO)

Cultural characteristics attached to a brand based on its linguistic and cultural aspects.

Geographic Indicator

Product origins backed up by Intellectual Property Rights, attributing quality, reputation, and characteristics to a specific locality.

Nation Branding

How a country positions and promotes itself as a place for tourism, investment, and building a good reputation for quality goods and services.

International Place & Distribution Strategy

Strategies for making products and services available and accessible to target consumers in the international market.

Distribution Mix

Elements of the distribution strategy, including coverage, placement/outlet, volume, display, product state, resale price, and goodwill.

Transportation Mode

The mode of transportation used to move products in the distribution chain.

Channels/Customer Touchpoints

Different touchpoints or channels through which products are sold and interact with consumers in the foreign market.

Terms of Delivery

The agreed-upon terms between buyers and sellers regarding the transfer of risk and obligations in international trade.

Eight C's of Pricing

Factors that affect international pricing, including costs, consumer demand, competitors, government control, cost of living, currency and exchange rates, channel costs, and cultural differences.

Entry Pricing

Pricing strategies for entering a new market, including penetration and skimming.

Price Computation

Considering distribution strategies, regulatory components, and costs to compute the price of a product.

Tariffs/Duties

Taxes imposed on imported goods by the destination country, usually expressed as a percentage of the CIF (Cost Insurance Freight) value.

Bilateral Rate

A lower rate given to WTO signatory countries.

Bottom of the pyramid

Refers to consumers who cannot afford certain products or services due to unstable and unpredictable income streams.

Loss leader

Pricing a few items below cost to attract customers and generate interest, with the expectation of positive overall revenue due to spillovers on other products.

Dumping

When loss leader pricing is done in a foreign market, it is termed dumping. Imported products rely on revenues from other markets outside the region, while smaller domestic companies cannot afford the loss. Dumping is often regulated for being anti-competitive.

Predatory Pricing/Dumping Pricing Strategy

Setting a price at an unrealistic rate to drive out competition by absorbing initial losses.

Recoupment

Going back to normal price levels after gaining enough potential profitability.

Grey Market

Unauthorized selling by non-official distributors through parallel importing. It occurs when distributors in a country with lower total costs illegally distribute products in another country that obtains a higher total price for the product due to variations in tariffs, taxes, and transportation.

Pricing Research & Pricing Tools

Using the Van Westendorp method for pricing research and analysis.