International Business Module 12: International Markets Assessment and Entry Mode

Vocabulary flashcards covering international market assessment, the six steps of country screening, segment screening criteria, market entrance methods, and cultural research concepts from Module 12.

Environmental Screening

An approach that looks for world changes, such as future demand for mobile commerce or the replacement of gas engine cars by electric vehicles.

Market Screening

The process of looking for and identifying potential markets for specific products or services, such as determining if Taco Bell is suitable for the Chinese market.

Country Screening

A six-step level of market screening used to determine if a specific country represents a good market for a company's products.

Segment Screening

A level of market screening that identifies which specific group within a country is a good market, such as Costco targeting the $22$-$40$ year old population in China.

Initial Screening (Basic Needs)

The first step of country screening which assesses whether people in a country actually need the product, such as checking if beef can be sold in India or ice makers in Iceland.

Second Screening (Financial and Economic forces)

Assessment of whether the market can afford the product using market indicators like size, growth rate, and ecommerce readiness.

Market Size (Indicator)

A calculation based on factors such as the size of the urban population and electricity consumption per person.

Market Growth Rate

Calculated as the $\text{growth rate in commercial energy use} + \text{real GDP growth rate}$.

Ecommerce Readiness

An indicator calculated as the $\text{number of mobile phones per } 1000 \text{ people} + \text{PCs per } 1000 + \text{Internet hosts per million}$.

Market Factor

The use of a particular product's percentage replacement rate to estimate demand for similar, correlated products.

Third Screening (Political and Legal Forces)

The assessment of government barriers, controls, policy stability, and political stability, such as the safety of investing in Venezuela.

Fourth Screening (Cultural Forces)

The assessment of whether cultural differences, language meanings, or local preferences allow for a product's success, requiring localization of the business.

Fifth Screening (Competitive Forces)

Analysis of the number, size, and financial strength of competitors, including their market shares and marketing strategies.

Marketing Strategy 5Ps

The components used to assess competitive positioning: Price, Place, Promotion, Product, and People.

Final Screening

The last step involving field trips, observations, and visits to the local market to validate findings and find local partners.

Definable (Segment Criterion)

The ability to identify and measure specific segments within a market.

Large (Segment Criterion)

The requirement that a segment must be large enough to be worth the business effort.

Accessible (Segment Criterion)

The requirement that a target segment can be reached by the company.

Actionable (Segment Criterion)

The requirement that $4\text{Ps}$ actions are permitted and can be executed within the segment.

Capturable (Segment Criterion)

The condition where there is less competition in a segment, increasing the chance of success.

Trade Missions

Market visits conducted by business people or government officials to search for business opportunities.

Trade Fairs

Large exhibitions, such as CeBIT or the Paris Air Show, where companies promote their products.

Social Desirability Bias

The tendency of research respondents to answer in a way they believe will please the interviewer rather than truthfully.

Turnkey Project

A nonequity mode of entry involving the export of technology, management expertise, and capital equipment.

Licensing

A nonequity mode where one firm (licensor) grants another (licensee) the right to use expertise for the licensee's products.

Franchising

A form of licensing where one firm contracts with another to operate a business under an established name according to specific rules.

Management Contract

An arrangement where one firm provides managers to another company.

Contracted Manufacturing

An arrangement where one firm contracts another to produce products according to its specific specifications.

Joint Venture

An equity-based entry mode involving a cooperative effort among two or more organizations that often creates a separate entity.

Strategic Alliances

A less formal equity-based collaboration with competitors, customers, or suppliers based on agreements and relationships.

Clotaire Rapaille

A psychologist and marketing consultant known for breaking the "code" of cultural psyches to understand consumer motivations.

Reptilian Brain

The deep psychological level Rapaille explores in research sessions to understand why people do what they do, beyond what they say.

Cultural Archetypes

Long-lasting cultural patterns discovered through psychological research that are more stable than temporary opinions.