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Transcript of Global Markets and International Marketing Copyright © Houghton Mifflin Company. All rights...
![Page 1: Global Markets and International Marketing Copyright © Houghton Mifflin Company. All rights reserved. PowerPoint Presentation by Charlie Cook 5 5 Part.](https://reader035.fdocuments.us/reader035/viewer/2022062717/56649e4e5503460f94b4550c/html5/thumbnails/1.jpg)
Global Markets andInternational Marketing
Copyright © Houghton Mifflin Company. All rights reserved.Copyright © Houghton Mifflin Company. All rights reserved. PowerPoint Presentation by Charlie CookPowerPoint Presentation by Charlie Cook
55
Part OnePart OneMarketingMarketing
and Itsand ItsEnvironmentEnvironment
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Copyright © Houghton Mifflin Company. All rights reserved. 5–2
Chapter Learning Objectives
• To understand the nature of global markets and international marketing
• To analyze the environmental forces affecting international marketing efforts
• To identify several important regional trade alliances, markets, and agreements
• To examine methods of involvement in international marketing activities
• To recognize that international marketing strategies fall along a continuum from customization to globalization
![Page 3: Global Markets and International Marketing Copyright © Houghton Mifflin Company. All rights reserved. PowerPoint Presentation by Charlie Cook 5 5 Part.](https://reader035.fdocuments.us/reader035/viewer/2022062717/56649e4e5503460f94b4550c/html5/thumbnails/3.jpg)
Copyright © Houghton Mifflin Company. All rights reserved. 5–3
Chapter Outline
• The Nature of International Marketing• Environmental Forces in International Markets• Regional Trade Alliances, Markets, and
Agreements• International Involvement• Customization Versus Globalization of
International Marketing Strategies
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Copyright © Houghton Mifflin Company. All rights reserved. 5–4
The Nature of International Marketing
• International Marketing–Developing and performing
marketing activities across national boundaries
• Provides growth opportunities• Promotes innovation• Fosters marketing of better,
less expensive products
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Copyright © Houghton Mifflin Company. All rights reserved. 5–5
Environmental Forces in International Markets
• Cultural, Social, and Ethical Forces–Beliefs and values about:
• Family• Religion• Education• Health• Recreation
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Copyright © Houghton Mifflin Company. All rights reserved. 5–6
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Copyright © Houghton Mifflin Company. All rights reserved. 5–7
Environmental Forces in International Markets (cont’d)
• Economic Differences Affecting International Marketing–Standards of living–Credit–Buying power–Income distribution–National resources–Exchange rates
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Copyright © Houghton Mifflin Company. All rights reserved. 5–8
Environmental Forces in International Markets (cont’d)
• Trade Restrictions Affecting International Marketing–Import tariff
• A duty levied by a nation on goods bought outside its borders and brought in
–Quota• A limit on the amount of
goods an importing countrywill accept for certain product categories in a specific period of time
Border
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Copyright © Houghton Mifflin Company. All rights reserved. 5–9
Environmental Forces in International Markets (cont’d)
• Trade Restrictions Affecting International Marketing (cont’d)–Embargo
• A governmental suspension of trade in a particular product
or with a given country
–Exchange controls• Government restrictions on the amount of a particular
currency that can be bought or sold
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Copyright © Houghton Mifflin Company. All rights reserved. 5–10
Environmental Forces in International Markets (cont’d)
• Balance of Trade–The difference between the value of a nation’s imports
and exports
• Gross Domestic Product (GDP)–The market value of a nation’s total
output of goods and services for a given period; an overall measure of economic standing
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Copyright © Houghton Mifflin Company. All rights reserved. 5–11
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Copyright © Houghton Mifflin Company. All rights reserved. 5–12
Environmental Forces in International Markets (cont’d)
• Political and Legal Forces–Governmental policies, laws, and regulations–Import barriers (quotas, port-of-entry taxes)–Standards of ethics (payoffs, bribes)
• Technological Forces–Telecommunications (e-mail, cell phones, Internet)–Extent of technological infrastructure
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Copyright © Houghton Mifflin Company. All rights reserved. 5–13
Regional Trade Alliances, Markets, and Agreements
• The North AmericanFree Trade Agreement (NAFTA)–An alliance that merges Canada, Mexico, and
the United States into a single market
• Eliminates barriers• Eases investment• Simplifies trade
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Copyright © Houghton Mifflin Company. All rights reserved. 5–14
Regional Trade Alliances, Markets, and Agreements (cont’d)
• The European Union (EU)–An alliance that promotes trade
among its member countries in Europe
• Market unification• Common currency (euro)• Economic efficiency
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Copyright © Houghton Mifflin Company. All rights reserved. 5–15
Regional Trade Alliances, Markets, and Agreements (cont’d)
• The Common Market of the Southern Cone (MERCOSUR)–An alliance that promotes the free
circulation of goods, services, and production factors, and has a common external tariff and commercial policy among member nations in South America
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Copyright © Houghton Mifflin Company. All rights reserved. 5–16
Regional Trade Alliances, Markets, and Agreements (cont’d)
• Asia-Pacific Economic Cooperation (APEC)–An alliance that promotes open trade and economic
and technical cooperation among member nations throughout the world
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Copyright © Houghton Mifflin Company. All rights reserved. 5–17
Regional Trade Alliances, Markets, and Agreements (cont’d)
• General Agreement on Tariffs and Trade (GATT)–An agreement among nations to reduce worldwide
tariffs and increase international trade• Dumping: selling products at unfairly low prices
• World Trade Organization (WTO)–An entity that promotes free trade among member
nations• Provide legal ground rules
for international commerce and trade policy
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Copyright © Houghton Mifflin Company. All rights reserved. 5–18
Levels of Involvement in Global Marketing
FIGURE 5.1
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Copyright © Houghton Mifflin Company. All rights reserved. 5–19
International Involvement
• Importing–The purchase of products from a foreign source
• Exporting–The sale of products to foreign markets
• Trading Companies–Companies that link buyers
and sellers in different countries• Not involved in actual
manufacture of products• Market and take title to goods
to facilitate overseas exchange trading
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Copyright © Houghton Mifflin Company. All rights reserved. 5–20
International Involvement (cont’d)
• Licensing–An alternative to direct investment requiring the
licensee to pay commissions or royalties on sales or supplies used in manufacturing
• Franchising–A form of licensing in
which the franchiser grants the franchisee the right to market its product in accordance with the franchiser’s standards
BIG PACK of Asia
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Copyright © Houghton Mifflin Company. All rights reserved. 5–21
International Involvement (cont’d)
• Contract Manufacturing–The practice of hiring a foreign firm to produce a
designated volume of product to specification
• Joint Ventures–Joint venture
• A partnership between a domestic firm and a foreign firm or government
–Strategic alliance• A partnership (possibly of traditional rivals) formed to
create a competitive advantage on a worldwide basis
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Copyright © Houghton Mifflin Company. All rights reserved. 5–22
International Involvement (cont’d)
• Direct Ownership–A situation in which a company owns subsidiaries or
other facilities overseas
• Multinational Enterprise–A firm that has operations or
subsidiaries in many countries
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Copyright © Houghton Mifflin Company. All rights reserved. 5–23
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Copyright © Houghton Mifflin Company. All rights reserved. 5–24
Customization Versus Globalization of International Marketing Strategies
• Customization–Adjusting marketing mixes according to cultural,
regional, and national differences
• Globalization–The development of marketing strategies that treat the
entire world (or its major regions) as a single entity• Includes standardization of products, promotion
campaigns, prices, and distribution channels• “Think globally, act locally”
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Copyright © Houghton Mifflin Company. All rights reserved. 5–25
Customization Versus Globalization of International Marketing Strategies (cont’d)
• Effect of a Firm Having a Global Presence–Provides global competitive opportunities for creating
value through• adapting to local market differences• exploiting economies of global scale
and scope.• acquiring optimal locations for
activities and resources.• maximizing the transfer of knowledge
across locations.
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Copyright © Houghton Mifflin Company. All rights reserved. 5–26
After reviewing this chapter you should:
• Understand the nature of global markets and international marketing.
• Be able to analyze the environmental forces affecting international marketing efforts.
• Be able to identify several important regional trade alliances, markets, and agreements.
• Be able to discuss methods of involvement in international marketing activities.
• Recognize that international marketing strategies fall along a continuum from customization to globalization.
![Page 27: Global Markets and International Marketing Copyright © Houghton Mifflin Company. All rights reserved. PowerPoint Presentation by Charlie Cook 5 5 Part.](https://reader035.fdocuments.us/reader035/viewer/2022062717/56649e4e5503460f94b4550c/html5/thumbnails/27.jpg)
Chapter 5 Chapter 5 Supplemental SlidesSupplemental Slides
Copyright © Houghton Mifflin Company. All rights reserved. 5–27
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Copyright © Houghton Mifflin Company. All rights reserved. 5–28
Key Terms and Concepts
• The following slides (a listing of terms and concepts) are intended for use at the instructor’s discretion.
• To rearrange the slide order or alter the content of the presentation–select “Slide Sorter” under View on the main menu.–left click on an individual slide to select it; hold and drag
the slide to a new position in the slide show.–To delete an individual slide, click on the slide to select,
and press the Delete key.–Select “Normal” under View on the main menu to return
to normal view.
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Copyright © Houghton Mifflin Company. All rights reserved. 5–29
Important Terms
• International Marketing–Developing and performing marketing activities across
national boundaries
• Import Tariff–A duty levied by a nation on goods bought outside
its borders and brought in
• Quota–A limit on the amount of goods an importing country will
accept for certain product categories in a specific period of time
![Page 30: Global Markets and International Marketing Copyright © Houghton Mifflin Company. All rights reserved. PowerPoint Presentation by Charlie Cook 5 5 Part.](https://reader035.fdocuments.us/reader035/viewer/2022062717/56649e4e5503460f94b4550c/html5/thumbnails/30.jpg)
Copyright © Houghton Mifflin Company. All rights reserved. 5–30
Important Terms
• Embargo–A governmental suspension of trade in a particular
product or with a given country
• Exchange Controls–Government restrictions on the amount of a particular
currency that can be bought or sold
• Balance of Trade–The difference between the value of a nation’s imports
and exports
• Trading Companies–Companies that link buyers and sellers in different
countries
![Page 31: Global Markets and International Marketing Copyright © Houghton Mifflin Company. All rights reserved. PowerPoint Presentation by Charlie Cook 5 5 Part.](https://reader035.fdocuments.us/reader035/viewer/2022062717/56649e4e5503460f94b4550c/html5/thumbnails/31.jpg)
Copyright © Houghton Mifflin Company. All rights reserved. 5–31
Important Terms
• Gross Domestic Product (GDP)–The market value of a nation’s total output of goods and
services for a given period; an overall measure of economic standing
• The North American Free Trade Agreement (NAFTA)–An alliance that merges Canada, Mexico, and the
United States into a single market.
• The European Union (EU)–An alliance that promotes trade among its member
countries in Europe
![Page 32: Global Markets and International Marketing Copyright © Houghton Mifflin Company. All rights reserved. PowerPoint Presentation by Charlie Cook 5 5 Part.](https://reader035.fdocuments.us/reader035/viewer/2022062717/56649e4e5503460f94b4550c/html5/thumbnails/32.jpg)
Copyright © Houghton Mifflin Company. All rights reserved. 5–32
Important Terms
• Asia-Pacific Economic Cooperation (APEC)–An alliance that promotes open trade and economic
and technical cooperation among member nations throughout the world
• The Common Market of the Southern Cone (MERCOSUR)–An alliance that promotes the free circulation of goods,
services, and production factors, and has a common external tariff and commercial policy among member nations in South America
![Page 33: Global Markets and International Marketing Copyright © Houghton Mifflin Company. All rights reserved. PowerPoint Presentation by Charlie Cook 5 5 Part.](https://reader035.fdocuments.us/reader035/viewer/2022062717/56649e4e5503460f94b4550c/html5/thumbnails/33.jpg)
Copyright © Houghton Mifflin Company. All rights reserved. 5–33
Important Terms
• General Agreement on Tariffs and Trade (GATT)–An agreement among nations to reduce worldwide
tariffs and increase international trade
• World Trade Organization (WTO)–An entity that promotes free trade among member
nations
• Importing–The purchase of products from a foreign source
• Exporting–The sale of products to foreign markets
![Page 34: Global Markets and International Marketing Copyright © Houghton Mifflin Company. All rights reserved. PowerPoint Presentation by Charlie Cook 5 5 Part.](https://reader035.fdocuments.us/reader035/viewer/2022062717/56649e4e5503460f94b4550c/html5/thumbnails/34.jpg)
Copyright © Houghton Mifflin Company. All rights reserved. 5–34
Important Terms
• Licensing–An alternative to direct investment requiring the
licensee to pay commissions or royalties on sales or supplies used in manufacturing
• Franchising–A form of licensing in which the franchiser grants the
franchisee the right to market its product in accordance with the franchiser’s standards
• Contract Manufacturing–The practice of hiring a foreign firm to produce a
designated volume of product to specification
![Page 35: Global Markets and International Marketing Copyright © Houghton Mifflin Company. All rights reserved. PowerPoint Presentation by Charlie Cook 5 5 Part.](https://reader035.fdocuments.us/reader035/viewer/2022062717/56649e4e5503460f94b4550c/html5/thumbnails/35.jpg)
Copyright © Houghton Mifflin Company. All rights reserved. 5–35
Important Terms
• Joint Ventures–A partnership between a domestic firm and a foreign
firm or government
• Strategic Alliance–A partnership (possibly of traditional rivals) formed to
create a competitive advantage on a worldwide basis
• Direct Ownership–A situation in which a company owns subsidiaries or
other facilities overseas
• Multinational Enterprise–A firm with operations or subsidiaries in many countries
![Page 36: Global Markets and International Marketing Copyright © Houghton Mifflin Company. All rights reserved. PowerPoint Presentation by Charlie Cook 5 5 Part.](https://reader035.fdocuments.us/reader035/viewer/2022062717/56649e4e5503460f94b4550c/html5/thumbnails/36.jpg)
Copyright © Houghton Mifflin Company. All rights reserved. 5–36
Important Terms
• Customization–Adjusting marketing mixes according to cultural,
regional, and national differences
• Globalization–The development of marketing strategies that treat the
entire world (or its major regions) as a single entity
![Page 37: Global Markets and International Marketing Copyright © Houghton Mifflin Company. All rights reserved. PowerPoint Presentation by Charlie Cook 5 5 Part.](https://reader035.fdocuments.us/reader035/viewer/2022062717/56649e4e5503460f94b4550c/html5/thumbnails/37.jpg)
Copyright © Houghton Mifflin Company. All rights reserved. 5–37
Transparency Figure 5E
Top Ten Countries Maintaining Trade Deficits and Surpluses with the U.S.
Trade Deficit
1. China
2. Japan
3. Canada
4. Mexico
5. Germany
6. Italy
7. France
8. Taiwan
9. Ireland
10. Malaysia
Trade Surplus
1. Netherlands
2. Australia
3. Egypt
4. Singapore
5. Brazil
6. Hong Kong
7. Chile
8. Kenya
9. Argentina
10. JamaicaSource: http://www.census.gov/foreign-trade, “Top Trading Partners” for July 2001, Accessed Oct. 13, 2001. Used with permission.
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Copyright © Houghton Mifflin Company. All rights reserved. 5–38
Transparency Figure 5I
Global Sales of Licensed Products Worldwide and in the U.S. and Canada (in billions of dollars)
Source: The Licensing Letter, a newsletter published by EPM Communications, in Suzanne Vranica, “Ford Buys Beanstalk for LicensingMagic,” The Wall Street Journal, June 11, 2001, p.B6. Used with permission.