chp 16 - global marketing

global marketing

involves promoting products worldwide. It requires understanding diver markets, culture, and consumer behaviors. Companies must adapt strategies. 

components of a country market assessment

• political

• economic

• sociocultural analysis

• technology and infrastructure

political

• tariff

• quota

• boycott

• exchange control

• trade agreements

economic

• economic environment

• market size and population growth rate

• real income

sociocultural analysis

• power distance

• uncertainty avoidance

• individualism

• masculinity

• time orientation

technology & infrastructure

• transportation

• distribution channel

• communication

• commerce

government actions

• tariff

• quota

• boycott

• exchange control

• trade agreement

• trade sanction

trade sanctions

penalties or restrictions imposed by one country over another country for importing and exporting goods, services, and investments

sociocultural factors

• power distance → willingness to accept social inequality as natural

• uncertainty avoidance → the need for structure and consistency

• individualism

• masculinity → the extent that dominant values are male-oriented

• time orientation → long-term vs short-term

• indulgence → gratification of fun and enjoyment

economic environment factors

• trade deficit

• trade surplus

• GDP

• PPP → purchasing power parity

• HDI

appeal of the BRIC countrieds

• greatest change is the growth and expansion of BRIC countries

  • Brazil

  • Russia

  • India

  • China

Appeal of Brazil

• Regional powerhouse, thrived in economic storm  

• 9th largest economy  

• Welcomes foreign investors

Appeal of Russia

• Complicated relations 

• MANYY upturns & downturns in economy  

• Strong demand for American products/brands  

• Finally entering WTO "World Trade Organization" improve trade relations 

• Recent war w Ukraine, many firms HALTED production (Ex. McDonalds, Starbucks) 

Appeal of India

• 17% of overall world population, with expanding middle and upper class 

• Fastest growing market 

• Young are adapting global attitudes, well educated and largely english fluent  

• Dominated by small stores and lacks modern supply chain  

• Fastest E-commerce market  

Appeal of China

• Experienced foreign occupation, civil unrest and communist  

• Market oriented economic development -> rapid gains  

• Recent reduced demand for Chinese exports  

• 2nd largest population from India  

entry strategies

• exporting

• franchising

• strategic alliance

• joint venture

• direct investment

exporting

Producing goods in one country and selling them in another. 

indirect exporting

Occurs when the exporting firm sells its goods in the host country through an intermediary. 

direct exporting

Occurs when the exporting company sells its products in the host country directly without the intermediaries. 

franchising

a contractual agreement b/w a firm (franchisor) and another firm or individual (franchisee) 

strategic alliance

A collaborative relationship between independent firms, though the partnering firms do not create an equity partnership; that is, they do not invest in one another. 

joint venture

Formed when a firm entering a new market pools its resources with those of a local firm to form a new company in which ownership, control, and profits are shared. 

direct investment

When a firm maintains 100 percent ownership of its plants, operation facilities, and offices in a foreign country, often through the formation of wholly owned subsidiaries. 

STP for global marketing strategy

• cultural nuances

• subcultures

• view of product and consumer role

• different positioning

• product adaptation

• after marketing mix as needed

the global marketing mix

• sell the same product or service in both the home country market and host country

• sell a product or service similar to that sold in home country bt include minor adaptations

• sell totally new products or services

global pricing strategies

• tariffs

• quotas

• anti-dumping policies

• currency exchange policies

global labour issues

Concerns about working conditions and wages paid to factory workers in developing countries

cultural imperialism

The belief that one’s own culture is superior to that of other nations