MKT 340 Topics 1-6

Marketing is creating, communicating, delivering, and exchanging offerings that have for customers.

For U.S. companies, % of total world market for goods and services is the country.
Coca-Cola earns of profit of North America
For Japanese companies, % of world market is the country.
For Germany companies, % of market potential is of the country.

Global marketing is:
1. Marketing products and services the home market.
2. Coordinating marketing in markets in the face of global competition to reach of brand image.

Marketing strategies need outlook and adjustments.

Why marketing goes global?
- of domestic markets
- markets
- Competition and Cooperation
-Technology

What to expect?
Unfamiliar problems and uncertainty in the foreign market.

Countries vary in:
-Political
- forces
-Level of
-Geography
-Culture
- climate
-Structure of distribution
-Infrastructure

Tasks of Global Marketing:
1. Recognize and constraints of the foreign environment.
2. Compete and with global competitors.
3. marketing activities across countries.
4. Conduct thorough market to identify consumer needs in different markets and determine whether those needs are different from those of the customers.
5. If needs differ across countries and regions, consider how to marketing strategies to best satisfy customers.

Trends in Global Marketing:
1. The economies provide both opportunities and competition.
2. Continued growth and strength of the sector.
3. Tremendous growth opportunities in foreign .
4. The global business environment continues to change as communication becomes , product development cycles , and competitors become more .
5. Increasing economic and cooperation between countries include opportunity and risk.

environment also influences global marketing strategy.
Political and legal forces: political decision involving foreign policy can have a effect on a firm's international marketing success.
Economic climate and competition: if internal economic conditions , restrictions against foreign investment and purchasing may be imposed to strengthen the domestic economy.

Success in global marketing:
- A thorough understanding of marketing environments, people, and cultures, and their influences on the total marketing process
- Ability to assess and adjust properly to the impact of a strange
- Knowledge of world market potential, and global economic, social, and political
- Respect cultural
- Don't be ethnocentric.

Marketing research provides the information to:
- determining the firm's mission, scope, and long-range
- monitor changes and their effects
- understand consumers and competitors

Challenges of global marketing research:
1. of research design due to environmental differences.
2. Lack or inaccuracy of data
3. Time and cost requirements to collect primary data due to higher level of
4. of multi-country research and efforts
5. Need of a high degree of understanding of the market in which research is being conducted.

Firm's Internal Conditions:
- Internal strengths to internationally
- Internal regarding international expansion
- Level of current international
- Management to internationalize
- commitment to internationalize

Consumers:
- Size
- rates
- Demographic information
- Needs &
- power and intentions
- Response to products, price, and promotion
- Switching behavior
- Role of credit
- Transaction methods
- Future needs
- Impact of cultural

Information needed:
- Go international or remain
- Which markets to
- How to target markets
- How to in target markets

data is data that is collected yourself.

data is data that is collected by another.

Secondary data involves minimal and cost. Problems of it include accuracy, availability, timeline, and comparability of data.

Keys to successful international marketing research:
1. The of natives of the foreign culture on research teams.
2. The use of multiple methods.
3. Paying close attention to the .
4. Utilize relevant and reliable information as much as possible.

Current World Economy Overview
1. The global economic that began around mid-2016 has become broader and stronger.
2. Employment in manufacturing continues to ever since World War II.
3. and Korea have now emerged as significant contributors to the global technology development.
4. E-Commerce diminishes the importance of national barriers.
5. Growth in markets and economies (EMDEs) will gain further strength, but progress in per capita income growth is uneven across EMDEs.

Elements that influence market openness are:
- restriction of investment
- difficulty in launching foreign-owned business
- drive of rate
- degree of freedom in and information movement
- existence of free-trade with other nations

Elements that influence how reliable the capital market is:
- effectiveness of country's financial institutions at collecting and channeling them into investments
- reliability of sources on company
- effectiveness of regulators at the banking industry and stock markets
- existence of orderly process

Infrastructure and Product Market:
- Infrastructure directly determines a country's economic potential
- Infrastructure affects the ability of a global company to engage effectively in the country

Low-Income Countries
- GNI per capita of $ or less
- industrialization
- High percentage of population in
- High rates
- Low rates
- Heavy reliance on aid
- Political and unrest

Lower-Middle-Income Countries:
- GNI per capita $ to $
- Rapidly expanding markets
- Cheap and motivated
- Mature, standardized, labor-intensive industries like footwear, textiles, and toys
- is the only BRICS nation

Upper-Middle-Income Countries:
- GNI per capita $ to $
- Rapidly , less employment
- Increasing urbanization
- wages
- High literacy rates and advanced
- Lower wages costs than countries
- BRICS except

High-Income Countries:
- GNI per capita is $ or
- Service sector is more than % of GNI
- Households have ownership levels of basic products
- Product and market opportunities are heavily dependent upon new products and innovation because of

Free Trade Area:
- two or more countries agree to abolish and other barriers to trade amongst themselves
- countries continue independent trade policies with countries agreement

Customs Union
- evolution of free trade area
- includes elimination of barriers to trade
- establishes common barriers to trade for countries of agreement

Common Market
- includes the elimination of barriers to trade
- establishes common barriers to trade
- allows for free movement of factors of

Economic Union:
- Union is the only Economic Union in the World
- includes the elimination of barriers to trade
- establishes common barriers to trade
- allows for free movement of factors of
- coordinates and harmonizes economic and policy within the union

Characteristics of Economic Union
- unified central
- single
- common policies on issues such as agriculture, social policy, transport, competition, mergers, taxation
- requires extensive unity
- would lead to a government in time

Dimensions of Political Environment
- Host country's international
- Host country's political
- Your own company's in the host country

Host Country's International Relations
- political environment is typically related to the relations between and home countries

Political environment will be more challenging when:
- host and home country do not have relations
- host country has relations with other countries
- host country is not a member of any organizations

Host Country's Political Risk:
- Political risk is the possibility that in political situation or in government policy would affect a company's ability to operate effectively and profitably
- higher perceived political risk is, the harder to attract direct investment
- some governments offer political risk
- external resources are available to help determine political risk

Trade Barriers:
- tariff = a tax on products from other countries
- quotas = quantitative restrictions that limit the amount of goods that may a country
- non-tariff barriers (NTBs) - trade barriers that include customs documentation requirements, marks of origin, food and drug laws, labeling laws, antidumping laws, "buy national" policies, and subsidies

Forced asset transfer: governmental action to dispossess a foreign company or investor
- expropriation = compensations
- confiscation = with no
- nationalization = a government takes control an entire
- acceptable according to international law if it satisfies purpose and
includes

Political Sanctions: one or a group of nations may boycott another nation, thereby stopping all between the countries, or may issue against the trade of specific products.
- US long-term boycott of trade with Cuba and Iran
- Trade sanctions against Russia for its continued aggression toward Ukraine
- Russians retaliating against McDonald's closing stores in Moscow

Company factors that help with political risks are:
- contributions of the firm to the country = employment generated, tax paid, exports generated, new technology, resources or skills
- of operations = using local managers, suppliers, brands, stimulating growth and development of local industry

Pre-entry political risk assessment:
- perform to assess potential political risks
- avoid countries
- with host government
- purchase against political risk from government agencies
- adjust entry method

Post-entry political risk management:
- have a monitoring system
- develop stakeholders
- have appropriate advisory board
- adjust overtime as perceived host country cost-benefit ratio changes
- have contingency plans

Export controls are laws enacted by a government that determine what products may be and to which countries and buyers

Antitrust laws - designed to combat practices and to encourage competition
- acquires a firm
- engages in a venture with a foreign firm
- enters into an overseas marketing agreement with a firm

Bribery - a corrupt business practice of demanding or offering a payment when negotiating a cross-border deal
Foreign Corrupt Practices Act - prohibits US firms or its subsidiaries from paying bribes to government officials for the purpose of obtaining or keeping business

- International Law of Trade: comprises the collections of treaties, conventions, and agreements between nations that carry the force of
- Tax treaties: to reduce or eliminate taxation
- International organizations: to improve world trade and increase economic and stability
- Standards organization: to promote standards in production and services
- Intellectual property protections

Intellectual Property Protections:
- Patents = for technology and
- Trademarks = for words, phrases, symbols that one brand for another
- Copyrights = for written, recorded, performed, or filmed work
- Trade Secrets = proprietary company information that is highly to the company

Infringement of Intellectual Property:
- Counterfeits = unauthorized and production of a product
- Imitation = product name differs slightly from a well-known brand
- Piracy = unauthorized publication or of copyrighted work

Culture - ways of
- built up by a group of human beings
- distinguishes the members of one group of people from those of another
- transmitted from one to another

Global Consumer Culture - consumers from cultures share the similar meanings of consumption-related symbols
- emerging
- primarily resulted from a technologically interconnected world

Culturally sensitive consumers
- independent of social class and income, culture significantly influences consumption and
- is the most culturally sensitive
- also influences nearly every part of doing business

High Context Cultures:
- information resides in the
- emphasis on background
- less emphasis on paperwork
- focus on personal reputation &
- a person's word is their bond
- lawyers are important
- negotiations often take , parties try to get to know each other
- time is open and flexible

Low Context Cultures:
- information resides in the
- carry all information
- reliance on legal paperwork
- focus on non-personal documentation of credibility
- a person's word is not be relied upon, need to get it in
- lawyers are more important
- negotiations tend to proceed
- is highly organized

Time Orientation:
Individualism - people define themselves as and form looser ties with their groups
Collectivism - people have stronger bonds to their groups and membership forms a person's self identity

Power Distance:
Low power distance - unequal distribution of power as relatively
High power distance - unequal distribution of power as relatively

Uncertainty avoidance:
low - comfortable in situations and have tolerance for ambiguity
high - prefer situations and have tolerance for ambiguity

Masculinity - value and competitiveness, as well as money and objects
Femininity - value good , caring for others and quality of life

Time Orientation (actual, the other one was wrong):
Short-term orientation - care more about gratification
Long-term orientation - focus on the

STP:
Segmentation - dividing market into groups based on certain variables
Targeting - segments and choosing which segments(s) to
Positioning - creating a clear, position in the target consumer's mind relative to

Global Market Segmentation - the process of dividing the target market into distinct of customers that have needs

Geographic Segmentation - dividing the target market into subgroups
Demographic Segmentation - based on population characteristics
Global elite - affluent consumers who are well traveled and have the money to spend on prestigious products with an image of
Psychographic segmentation - based on attitudes, , interests, and lifestyles

Behavior Segmentation:
1. Whether or not people buy and a product
2. How - brand loyalty
3. When -
4. How much - rate

Benefit segmentation - focuses on the
- based on understanding the problem a product , the benefits it offers, or the it addresses

Global Market Targeting:
1. Decide whether the segments are or not
2. Compare the of segments
3. Select a targeting to target the attractive segments

Targetable segments must be:
- : size, purchasing power, and profiles can be measured
- Accessible: segments can be
- Substantial: enough to be profitable

Which segments are attractive?
- current segment & potential
- potential & feasibility

Standardized Targeting:
- Meaning: targeting the segments with the product
- Condition: all the segments must have needs

Differentiated Targeting:
- Meaning: targeting distinct segments with products
- Condition: target segments have needs/look for benefits

Concentrated Targeting:
- Meaning; concentrating the firm's market offering solely on segment
- Condition: the single segment has sufficient global depth to make

Positioning Strategies:
- global consumer culture: identifies the brand as a of a particular global culture or segment
- foreign consumer culture: associates the brand's users, or product origins with a country or culture
- local consumer culture: identifies with cultural meanings, locally produced for local people