The Global Marketplace For Brands and Products Marketing 3349 Chip Besio.
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Transcript of The Global Marketplace For Brands and Products Marketing 3349 Chip Besio.
The Global Marketplace
For Brands and Products
Marketing 3349
Chip Besio
Great American Brands
Caterpillar – 61% of sales from outside USJohnson and Johnson – 49% of sales
Otis Elevator – 81% of sales
Great American Brands
Mc Donald’s65% of $23.5 billion Sales from Outside U.S.32,000 restaurant in 122 countries serve more than 100,000 people per day
Mc Donald’s RussiaOpened in Moscow in 199026 Cash Registers (more than a Wal-Mart
Supercenter)900 Seats (average US – 50 seats)240 restaurants in 40 Russian cities – 80 in
Moscow850,000 customers per year – 2 times avg.
Global Marketing into the Twenty-First Century
The world is shrinking rapidly with the advent of faster communication, transportation, and financial flows.
International trade is booming and now accounts for a quarter of the United States’ GDP.
Between 1990 and 2010, global companies grew from 30,000 to 60,000
Between 2000 and 2008 world trade grew by 7%/yr. outstripping GDP growth of 3%
Global competition is intensifying and few U.S. industries are now safe from foreign competition.
Global Companies Exceed GDP in Some Countries
Of the 150 largest economies in the world:89 are countries, 61 are companies
Wal-Mart the world’s largest company has annual revenues that are larger than all but the top 25 countries.World trade in 2010 was $19.7 trillion about 28% of world GDP
Global Marketing into the Twenty-First Century
To compete, many U.S. companies are continuously improving their products, expanding into foreign markets, and becoming global firms.
Global firms face several major problems: High debt, inflation, and unemployment have
resulted in highly unstable governments & currencies,
Governments placing more regulations on foreign firms,
Protectionist tariffs and trade barriers, Corruption.
Major Decisions in International Marketing
Looking at the global marketing environmentLooking at the global marketing environment
Deciding whether to go international Deciding whether to go international
Deciding which markets to enter Deciding which markets to enter
Deciding how to enter the market Deciding how to enter the market
Deciding on the global marketing program Deciding on the global marketing program
Deciding on the global marketing organizationDeciding on the global marketing organization
Looking at the Global Marketing Environment
The International Trade Systemi.e. Tariff, Quota, Embargo, Exchange Control, and Nontariff Trade Barriers
The International Trade Systemi.e. Tariff, Quota, Embargo, Exchange Control, and Nontariff Trade Barriers
The World Trade Organization and GATTTreaty designed to promote world trade by
reducing tariffs and other international trade barriers
The World Trade Organization and GATTTreaty designed to promote world trade by
reducing tariffs and other international trade barriers
Regional Free Trade ZonesGroup of nations organized to work toward
common goals in the regulation of international trade
Regional Free Trade ZonesGroup of nations organized to work toward
common goals in the regulation of international trade
Economic EnvironmentSubsistence Economies
Industrial Economies
Raw Material Exporting Economies
Industrializing Economies
Types of IndustrialStructure
Political-Legal Environment
At Least Four Political-Legal Factors Should be Considered in Deciding Whether to do
Business in a Given Country:
Attitudes TowardInternational
Buying
Attitudes TowardInternational
Buying
GovernmentBureaucracyGovernmentBureaucracy
Political StabilityPolitical Stability
MonetaryRegulationsMonetary
Regulations
Cultural EnvironmentSellers Must Examine the Following Before Planning a Marketing Program Within a Given Country.
How CustomersThink About
andUse Products
Cultural Traditions,
Preferences, andBehaviors
BusinessNorms andBehavior
Deciding Whether to Go International
Reasons companies might consider international expansion: Global competitors attacking the domestic market, Foreign markets might offer higher profit
opportunities, Domestic markets might be shrinking, Need an enlarged customer base to achieve
economies of scale, Reduce dependency on any one market, Customers might be expanding abroad.
Most companies do not act until some situation or event thrusts them into the international market.
Deciding Which Markets to Enter
Define Organization’s Marketing Objectives and Policies
Define Organization’s Marketing Objectives and Policies
What Volume of Foreign Sales is Desired?What Volume of Foreign Sales is Desired?
How Many Countries Should the Firm Go Into?How Many Countries Should the Firm Go Into?
What Types of Countries Should be Entered?What Types of Countries Should be Entered?
Rank by Market Size & Growth, Cost of Doing Business, Competitive Advantage, & Risk Level.
Rank by Market Size & Growth, Cost of Doing Business, Competitive Advantage, & Risk Level.
Discussion Connections Assess China as a market for McDonald’s.
What factors make it attractive? What factors make it less attractive?
Assess Canada as a market for McDonald’s. In what ways is Canada more attractive than
China? In what ways is it less attractive?
If McDonald’s could operate in only one of these countries, which one would you choose and why?
Deciding How to Enter the Market Exporting
•Indirect
•Direct
Exporting
•Indirect
•Direct
Joint venturing
•Licensing•Contract manufacturing•Management Contracting•Joint Ownership
Joint venturing
•Licensing•Contract manufacturing•Management Contracting•Joint Ownership
Direct investment
•Assembly facilities•Manufacturing facilities
Direct investment
•Assembly facilities•Manufacturing facilities
Deciding on the Global Marketing Program
Ch
an
ges in
Pro
du
ct,
A
dvert
isin
g,
Dis
trib
uti
on
C
han
nels
, &
Pri
ce
Adapted Marketing Mix
Adjusts the Elements of the
Marketing Mix to Each International Target Market. i.e.
Japanese Barbie
Standardized Marketing Mix
Uses Basically the Same Elements of the Marketing Mix
in all the Company’s
International Markets. i.e Coca-
Cola
The Coca-Cola logo is the same throughout the world.
This is an example of astandardized marketing mix.
Which other companiesuse a standardized marketing mix?
Do some companies use a blend of adapted and standardized marketingmix? Which ones?
Click or press spacebar to return
The Maharaja Mac is an example of an Adapted Marketing Mix
Click or press spacebar to return
Five International Product and Promotion Strategies
1. StraightExtension
3. ProductAdaptation
5. Product Invention
4. DualAdaptation
2. Communi-cation
Adaptation
Product
AdaptProduc
t
Don’t ChangeProduct
Develop New
Product
Pro
moti
on
Don’tChange
Promotion
AdaptPromotio
n
International Pricing
Companies face many problems in setting their international prices.
Possibilities in setting prices include: Charge a uniform price all around the world. Charge what consumers in each country could
pay. Use a standard markup of its costs everywhere.
International prices tend to be higher than domestic prices because of price escalation.
Companies may become guilty of dumping – when a foreign subsidiary charges less than its costs or less than in its home market.
Whole-Channel Concept for International MarketingSeller
Seller’s headquarters organization for international marketing
Seller’s headquarters organization for international marketing
Channels betweennations
Channels betweennations
Channels within nations
Channels within nations
Final user or buyer
Final user or buyer
Deciding on the Global Marketing Organization
Export DepartmentExport Department
International DivisionInternational Division
Global OrganizationGlobal Organization
Degree of Involvement in International Marketing Activities
High
Low