ISM CH3 Global marketing strategies

Domestic vs. International vs. Global Markets

• Domestic: Operates within one country

• International: Cross-border trade with some adaptations

• Global: Worldwide presence with a standardized approach
  

  Mnemonic: Home, Abroad, Everywhere

Uppsala Model Stages

A process of internationalization in progressive and sequential stages following the development of knowledge and learning

• No regular export

• Export via agents

• Sales subsidiary

• Production abroad

Principles: Gradual learning, proximity first, reduce risk

What is psychic distance in international marketing?

Perceived business, cultural, and regulatory differences between the home and foreign market. Firms expand first into low-distance markets.

What defines the Network Model of internationalization?

Internationalization happens through relationships and partnerships with foreign stakeholders (e.g., suppliers, distributors).
Key: Trust, interdependence, gradual commitment

What are characteristics of Born Global companies?

• Operate globally from the start

• Fast internationalization

• Tech-driven, niche-focused

• 25% revenue abroad in 2–3 years

Examples: Skype, WhatsApp, Spotify

What is ethnocentric orientation in global marketing?

• HQ makes decisions

• Little to no adaptation

• Home-country practices dominate

  Example: Walmart in Germany (failure)

What is polycentric orientation?

• Local adaptation

• Decentralized management

• Market-specific products

Example: McDonald’s menu adaptations worldwide - Mc Raclette

What is geocentric orientation?

• Integrates global efficiency with local responsiveness

• Talent and decisions from any country

Example: Tetra Pak
Summary: the world is seen as one place, and units are centralized where it makes sense (Tetra Pak)

How does internationalization differ between service and manufacturing firms?

Manufacturing firms:
Product: tangible - Entry: Export, FDI - Challenges: logistics - Ex: Toyota

Services firms:
Product: Intangible - Entry: Remote delivery, Franchising - Challenges: Cultural adaptation - Ex: Starbucks

What are the implications of service features for globalization?

• Intangibility: Perceived quality varies

• Heterogeneity: Needs training to standardize

• Perishability: Difficult to shift excess capacity

• Indivisibility: Remote delivery/back-office sharing potential

What are the 4 value levels in the Value Pyramid?

• Functional (e.g., saves time, quality)

• Emotional (e.g., nostalgia, wellness)

• Life-changing (e.g., motivation, self-actualization)

• Social Impact (e.g., self-transcendence)

What are the 3 types of International market orientation?

• Domestic Extension: Same product abroad (Kaegi)

• Multidomestic: Customized per market (Unilever)

• Global: Unified global product (Microsoft)

What are the modes of market entry by increasing commitment?

• Sporadic export

• Export through agents

• Foreign sales office

• Full production abroad (FDI)

Sporadic export

refers to irregular, non-systematic, and unplanned exporting activities by a company. It is typically the first stage of internationalization in many models (like Uppsala), where the firm does not yet have a formal strategy or dedicated resources for international markets.

What are the 5 internationalization approaches?

• Domestic focus

• Export marketing

• International marketing (polycentric)

• Multinational marketing (regional)

• Global marketing (geocentric)

What are the 4 phases in global marketing planning?

• Preliminary analysis & screening

• Adapting the mix to target market

• Developing the marketing plan

• Implementation & control

Stages of Export Development (Andersen 1993)

• Domestic focus

• Pre-export stage

• Experimental involvement

• Active involvement

• Committed exporter