International Marketing Nicos Rodosthenous PhD 06/10/2014 1 06/10/2014Dr Nicos Rodosthenous1.

Dr Nicos Rodosthenous 1

International Marketing

Nicos Rodosthenous PhD

06/10/2014

1

06/10/2014


Define the field of International Marketing. State the importance of global marketing

• 1. Introduction to Global Marketing• Consider the following proposition: We live in

a global marketplace, where McDonald’s, Sony digital TVs, Swatch watches etc are found everywhere on the planet.

• Global companies like American auto giants General Motors and Ford are in a competitive struggle with Toyota, Hyundai as well as with European companies such as Volkswagen.

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• What Is Marketing? • A. Marketing is the process by which companies

create value for customers and build strong customer relationships to capture value from customers in return.

• B. Marketing is an organizational function responsible for identifying; analyzing, anticipating, and satisfying human needs and wants with product and services by applying market-driven strategies, that offer competitive value to customers with profit.

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• The marketing mix of the 4P’s(Product, Price, Place and Promotion) comprises a contemporary marketer’s primary tools.

• Marketing is regarded as a universal discipline.• Global Marketing:• Organizations engage in global marketing

focus their resources and competencies on global market opportunities and threats.

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• Definition of a Market: people or organizations that are both able and willing to buy.

• If a company is able to offer superior product, distribution, or promotion benefits and lower prices that the competition then it will gain competitive advantage.

• i.e. Toyota, Nissan Japanese automakers offered cars in American market in 1980 with higher quality and lower prices than those of General Motors, Ford and Chrysler.

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• Superior value proposition for customers.• Create value for customers by improving benefits or

reducing price:• – Improve the product• – Find new distribution channels• – Create better communications• – Cut monetary and non-monetary costs and prices.• Value equation: Value=Benefits/Price (money,

time, effort)

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• Globalization-Global Industries• The integration of markets, states,

technologies that enable the world to reach individuals, corporations and nations faster, deeper and cheaper than ever before.

• An industry is global to the extent that a company’s industry position in one country is interdependent with its industry position in another country.

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• Indicators of globalization:• – Ratio of cross-border trade to total

worldwide production• – Ratio of cross-border investment to total

capital investment• – Proportion of industry revenue generated by

companies that compete in key world regions.• i.e. Nestle’ SA. , IBM.

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• Global Marketing: What It Is and What It Isn’t

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Single Country Marketing Strategy• Choose a Target Market and• Develop a Marketing Mix– Product– Price– Promotion– Place



• Global Marketing Strategy• • Global Market Participation in world markets• • Marketing Mix Development • – 4 P’s: Adapt or Standardize?• • Concentration of Marketing Activities• • Coordination of Marketing Activities• • Integration of Competitive Moves

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• Standarization versus Adaptation• The Faces of Coca-Cola Around the World

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ArabicRead right to left

Chinese “delicious/happiness”



• Coke is the best –known strongest brand in the world.

• Companies engaged in global marketing do not necessarily conduct business in every one of the world’s 200-plus country markets.

• i.e. in the $30 billion market for recorded music, 12 countries-including the USA, Japan UK and France-account 70% of sales.

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• Global marketing made Coke a worldwide success.

• Coca-Cola achieved success in Japan by spending a great deal of time and money to become insider.

• Thus, global localization means that a successful global marketer must have the ability to “think globally and act locally”.

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• A global product may be the same product everywhere and yet different.

• Some companies say the new world requires homogeneous products everywhere and others say special products for every region.

• The best companies realize it’s neither and it’s both.

• Some examples: Coca-Cola, Nokia, Marlboro.

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• The success of Toyota and Honda was initially based on exporting cars from Japan.

• Now the have invested in producing cars in USA, Asia and Europe.

• The Importance of Going Global• The larger market in the world in terms of

national income is the USA with 25% of the total world market.

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• U.S. companies that wish to achieve maximum growth potential must “go global”, because 70% of the total world market for goods and services is outside the country.

• – Coca-Cola earns 75% of operating income and 2/3 of profit outside of North America

• For Japanese companies, 85% of world market is outside the country.

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• 94% of market potential is outside of Germany for its companies

• Management Orientations • The world view of company’s personnel can be:

ethnocentric, polycentric, regiocentric and geocentric. (EPRG framework)

• Ethnocentric Orientation:• When a person assumes that his home country

is superior to the rest of the world.06/10/2014



• Ethnocentric companies making business outside the home country are regarded as international companies.

• Today, ethnocentric orientation is one of the major internal weaknesses that must be overcome if a company is to transform itself into an effective global competitor.

• Polycentric Orientation:• It is just opposite of ethnocentric. 06/10/2014



• Each country in which a company does business is unique.

• Each subsidiary develops its own unique business and marketing strategies to succeed

• Often referred to as multinational• Leads to a localized or adaptation approach

that assumes products must be adapted to local market conditions

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• Regiocentric Orientation:• A region becomes the relevant geographic unit; and

the management’s goal is to develop an integrated regional strategy.

• i.e. a European company that focuses its attention on Europe is regiocentric.

• Geocentric Orientation• A company that views the entire world as a

potential market and strives to develop integrated global strategies.

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• It is also known as a global or transnational company.

• i.e. GM’s regiocentric policies were gradually replaced by geometric approach.

• New global competitors emerge on the scene like Toyota, which sold more cars worldwide than GM and has surpassed GM in terms of profitability and market value.

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• At global and transnational companies decisions are made on the basis of ongoing research into market needs and wants.

• Thus, the geocentric orientation represents a synthesis of ethnocentric and polycentric; it is a “world view” that creates a global strategy that is responsive to local needs and wants.

• The multinational solution encounters problems to the implementation of a global strategy and

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• underestimating the impact of global competition.

• Global Market growth in the 21st century• Boeing forecast that Chinese airline companies

will order up to 2,300 aircraft valued more than $180 billion till 2025. Chinese carriers will operate a total of 2,800 aircraft making China the second largest aviation in the world. Boeing will face tough competition from Airbus.

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• Driving Forces Affecting Global Integration and Global Marketing

• Regional economic agreements, converging market needs and wants, technology advances, pressure to cut costs, pressure to improve quality, developments in communication and transportation technology and global economic growth.

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• i.e. the internet is an even stronger driving force: when a company creates a site on the internet, it automatically becomes global.

• The internet allows people everywhere in the world to buy and sell unlimited products and services.

• The new generation of jet aircraft revolutionized communication by making it possible foe people to travel around the world in less than 48 hours.

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• The cost of international calls has fallen due to e-communication developments such as e-mail, fax, mobiles, skype, Wi-Fi.

• Global companies “raise the bar” for all competitors in an industry. i.e. Toyota Prius.

• Global Strategy • Global strategy is a design to create a winning

offering on a global scale. i.e. Star alliance, One world in the Airline business.

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• The reward is not just success, it’s survival.• Restraining Forces Affecting Global Integration

and Global Marketing • Management myopia• • Organizational culture• In many cases management ignores

opportunities to pursue global marketing.• A company that is “nearsighted” and

ethnocentric will not expand geographically.06/10/2014



• Opposition to globalization • For many people around the world,

globalization and global marketing represent a threat.

• National controls• Every country protects the commercial

interests of local companies by keeping control over market access and entry in both low-and high-tech industries.

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International Marketing Nicos Rodosthenous PhD 06/10/2014 1 06/10/2014Dr Nicos Rodosthenous1.

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