international marketing study 1

global commerce thrives when?

Peace time

what republic is the USA

constitutional republic/ representative republic

when was north americas economic boom?

late 1990's after the cold war

international tension is cause by

lack of consistent trade policies

world events that effect trade

company scandals, wars, natural disasters, pandemics, financial disruptions

four trends that affect global business

1. growth of WTO and open trade agreements

2. Developing countries moving towards free trade

3. internet, cellular, and networked communication

4. Mandate to manage global environment for the future

how much does foreign companies have in direct investments in the US

4.6 trillion

international marketing

the performance of business activities designed to plan, price, promote, and direct the flow of a company's goods and services to consumers or users in more than one nation for a profit

controllable elements of international marketing

product price promotion and place (people is the fifth option)

uncontrollable elements of international marketing

political/legal forces, economic climate, competition, tech, distribution structure, geography, cultural forces

What is the most challenging task of environmental adaptation

cultural adjustment

Self-Reference Criterion (SRC) and Ethnocentrism

Self-Refrence Criterion

unconscious reference to one's own cultural values when evaluating other markets

Ethnocentrism

Belief in the superiority of one's own culture

two major obstacles of international marketing

SRC and Ethnocentrism

four step process to avoid SRC

1. Define problem in home-country cultural terms

2. Define problem in foreign-country cultural terms (consult with natives)

3. Isolate SRC influence and examine carefully

4. Redefine problem without SRC influence

historical perspective

helps define nations mission and how it perceives itself and neighbors

Historical events impact contemporary business relationships examples

Opium Wars affecting China's wariness of foreign influence; MexicanAmerican War influencing U.S.-Mexico relations

Geography

climate, topography, continents, countries, peoples, industries, and resources

what does Climate and topography impact

product function and require adjustments

wha is the dominant energy source due to ease of storage and transport

petroleum

many countries become dependent on petroleum imports why?

because of its initial self sufficiency

current population

over 8 billion; projected 9.8 billion by 2050

is almost all growth in underdeveloped regions?

yes 85% of population will be concentrated there

Rural to urban migration increasing by what percent

61% urban by 2030

what is our aging population doing in developing countries

its causing economic strain

the evolution of communication technology

telegraph-> telephone-> internet

culture definition

behaviors and values (seen and unseen) that are learned, shared, and transmitted by a group

what makes a culture

knowledge, beliefs, art, morals, laws, customs, and habits

what are the origins of a culture

geography, history, political economy, technology, social institutions

five elements of culture

1. Values

2. Rituals

3. Symbols

4. Beliefs

5. Thought processes

Values: Hofstede's four dimensions

individualism/collectivism, power distance, uncertainty avoidance, masculinity/femininity

individualism/ collectivism

focus on self orrientation

power distancw

focus on authority

uncertainty avoidance

focus on risk

Masculinity/Femininity

focus on assertiveness and achievement

paradox

culture is dynamic yet conservative and resists chance

cultural borrowing

learning from other cultures to solve problems

resistance to change

varies by culture; innovations most accepted when they hold interest and are least disruptive

planned vs unplanned change

increasingly more planned through cultural congruence strategies

10 basic criteria to do business in a foreign country

1. open tolerance

2. flexibility

3. humility

4. justice fairness

5. ability to adjust to varying tempos

6. curiosity/interest

7. knowledge of the country

8. liking for others

9. ability to command respect

10. ability to integrate oneself into the environment

degree of adaptation

1. Know local customs and accommodate differences

2. Evaluate which foreign customs should be adhered to

3. Be aware of self-reference criterion (SRC)

american managment styles

• "Master of destiny" viewpoint

• Merit-based personnel selection

• Objective analysis for decisions

• Wide sharing in decision making

• Competition produces efficiency

Authority and Decision Making is influenced by who

Power Distance Index (PDI)

communication styles

high context; low context

high context communication styles

heavy dependence on nonverbal communication

low context communication style

language that is very explicit, detailed, and precise

monochromatic tempo

linear view, time is important, promptness

polychronic tempo

multi-tasking, involvement with individuals

market orientation

everyone in the organization is encouraged to and even receives rewards if they generate marketing intelligence (consumer prefs, competitions actions)

countries with bias against female managers

asia, middle east, latin america

western corruption is mainly what

bribery

5 broad areas of ethics

employment practices, consumer protection, environmental protection, political payments, human rights

Information-Oriented (IO)

Low context, individualism, low power distance, linguistic directness

Relationship-Oriented (RO)

High context, collectivism, high power distance, linguistic indirectness