Post on 12-Jan-2016
Chapter 5Developing a Global Vision
Global VisionIdentifying and
reacting to international marketing opportunities
Creating effective global marketing strategies
Being aware of worldwide competition
Global Marketing Influences EconomiesThe U.S. exports a fifth of what it
manufacturesOne in ten jobs in the U.S. is supported by
exportsAlmost one-third of U.S. corporate profits
come from international trade and foreign investment
The U.S. Is the world’s largest exporter of agricultural goods
Benefits Versus Concerns About Global MarketingConcerns:
Jobs going overseas Lower salaries
Foreign products replace “made in America”
Wage cutsService centers
moving offshoreNegative image of
America in some foreign markets
Benefits:Increased competition
May bring prices down May result in more
innovationIncreased standard of
living in other countries More markets for
American productsMay result in more
individual freedom in some countries
Multinational FirmsMove resources,
goods, services and skills across national boundaries regardless of the location of the company headquarters
Why Go Global?Earn additional sales and profitsLeverage a unique product or technological
advantagePossess exclusive marketing informationDomestic market is saturatedExcess capacityGain economies of scale
Global Marketing StrategiesStandardization CustomizationAssumes markets around
the world are similarMarketing mix is as much
the same as possibleGain economies of scale
Recognizes the differences in global markets
Create marketing mixes to suit each market
More costly, but may be worth it
External EnvironmentsAll of the major environments have to be
considered international and domesticallySocio-culturalEconomicTechnologicalDemographicsPhysical/naturalPolitical/legal
Global Legal issuesTariffQuotaBoycottExchange controlTrade alliancesTrade Agreements
Trade AgreementsUruguay RoundWorld Trade
OrganizationNAFTACentral American
Free Trade Agreement
European UnionInternational
Monetary Fund
Common Methods for Entering the Global MarketplaceExportingLicensingFranchisingContract
manufacturingJoint VentureDirect Investment
The Global Marketing Mix: Product / Promotion
The Global Marketing Mix: DistributionAdequate distribution is
necessary for successSome countries have
complicated systemsLack of distribution
infrastructure and cultural differences
The company may gain competitive advantage through innovative distribution strategies
Global Marketing Mix - PriceConsider transportation
costs, taxes and tariffsDetermine what
customers will spendMay need to simplify a
product to lower the price
Don’t assume that lower income countries are willing to accept lower quality
Exchange RatesThe price of one’s
currency in terms of another country’s currency
DumpingThe sale of an
exported product at a price lower than that charged for the same or a like product in the home market.
CountertradeAn alternative to
exchanging currency for goods
A form of trade in which all or part of the payment for goods or services in the form of other goods or services.