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MKTG 3361 - CH. 1: Scope & Challenge

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Mario V. Gonzalez-Fuentes

on 7 October 2015

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Transcript of MKTG 3361 - CH. 1: Scope & Challenge

Regular Foreign
Marketing
The Scope and Challenge of International Marketing
International Marketing
Multiple “environments”
International Marketing Environment
Obstacles to adaptation
Self-Reference Criterion (SRC)
Unconscious reference to one’s own cultural values, experiences, and knowledge as a basis for decision
Ethnocentrism
The notion that people in one’s own company, culture, or country know best how to do things.
Risks
International Marketing Involvement
No Direct
Foreign Marketing
Infrequent Foreign
Marketing
International
Marketing
Global
Marketing
Products “indirectly” reach foreign markets
Trading companies
Foreign customers who contact firm
Domestic wholesalers/distributors
Web orders
Foreign orders stimulate a company’s interest to seek additional international sales
No Direct Foreign Marketing – Reactive
Caused by temporary surpluses (Sales to foreign markets are made as goods become available)
Firm has little or no intention of maintaining continuous market representation (Foreign sales activity declines and is withdrawn when domestic demand increases)
Infrequent Foreign Marketing – Reactive
Dedicated production capacity for foreign markets
Firm employs domestic or foreign intermediaries
Uses its own sales force or sales subsidiaries
Products are adapted for foreign markets as domestic demand grows
Firms depend on profits from foreign markets
Regular Foreign Marketing – Proactive
Fully committed and involved in foreign markets and international activities
Production takes place on foreign soil earning firms the MNC (Multinational Corporation) title
International Marketing – Proactive
Fedders being “proactive”:
Looked to Asia for future growth after stymied U.S. sales
Designed new types of air conditioner unit for the Chinese market
Plan to introduce new product in the U.S!
The firm sees the world as one market!
Market segmentation is now defined by income levels, usage patterns, or other factors that span the globe
More than half of its revenues come from abroad
The firm has a global perspective
Global Marketing – Proactive
International Marketing
competition
legal restraints
government controls
weather
fickle consumers
economic conditions
Technology constraints
differences in infrastructure
culture
political situation
Global village or local marketplaces ?
Standardization or Adaptation?
[1983: Dr. Levitt's "The Globalization of Markets" HBR article]
Think globally, act locally!
[Plan it globally and adapt locally accordingly]
Think locally, act globally!
[Plan it at a local level and then expand/apply it globally]
Environmental Adaptation
[A conscious marketer's effort to anticipate the influence of both, foreign and domestic, uncontrollable factors and adjust the marketing mix accordingly]
Product
Big Mac
India: McAloo Tikka (potato burger)
Localization
Standardization
Promotion
Brand name
Use of slang nicknames: Macky D's (UK), Macca's (Australia), Mäkkäri (Finland), MakDo/McDo (Philippines/France)
Advertising
Slogan: "I'm lovin' it"
France: "Venez comme vous êtes" ("Come as you are")
Creative strategy: sexual freedom and rebellion
Place
Free-standing restaurants in high-traffic areas
Switzerland: themed dining cars on the national rail system. India: Home delivery
Price
Big Mac Average Price is $3.54 (USA)
Norway: $5.79. China: $1.83.
Why companies seek foreign markets
Simply
responding
to orders from abroad
To increase sales and profits, when their
domestic market
has reached
maturity
External
shock
: Crisis, Trade agreement
Following
customers who move
abroad
Pure economics:
Cover costs
of a domestic product (TV series)
Ethnocentric
Polycentric
Regiocentric
Geocentric
Management Orientations
Full transcript