Define Globalization. How does it contribute to international business? Globalization is the process of extending social relations across world-space. Such extensions arise from the movements of people, things and ideas. It cannot be defined in terms of internationalization or integration as some theorists have suggested, though these developments might be an outcome of globalization . Globalization describes the interplay across cultures of macro-social forces. These forces include religion, politics, and economics. Globalization refers to the increasing unification of the world's economic order through reduction of such barriers to international trade as tariffs, export fees, and import quotas. The goal is to increase material wealth, goods, and services through an international division of labor by efficiencies catalyzed by international relations, specialization and competition. It describes the process by which regional economies, societies, and cultures have become integrated through communication, transportation, and trade. The term is most closely associated with the term economic globalization: the integration of national
Transcript
Define Globalization. How does it contribute to international business?
Globalization is the process of extending social relations across world-space. Such extensions arise from the movements of people, things and ideas. It cannot be defined in terms of internationalization or integration as some theorists have suggested, though these developments might be an outcome of globalization. Globalization describes the interplay across cultures of macro-social forces. These forces include religion, politics, and economics.
Globalization refers to the increasing unification of the world's economic order through reduction of such barriers to international trade as tariffs, export fees, and import quotas. The goal is to increase material wealth, goods, and services through an international division of labor by efficiencies catalyzed by international relations, specialization and competition. It describes the process by which regional economies, societies, and cultures have become integrated through communication, transportation, and trade.The term is most closely associated with the term economic globalization: the integration of national economies into the international economy through trade, foreign direct investment, capital flows, migration, the spread of technology, and military presence.Globalization seems to be an important tool for businesses to positioning themselves in borderless trade system. Globalization is the worldwide trend which economics of every country all over the world become integrated to another.
Globalization can also descript when businesses are expanding their operations to new countries or marketplace also. In a global marketplace, any company from any country can become a competitor to the other.Most of company tend to change themselves from "domestic-only" – companies that do business only within their own country – into multinational company or seeking new opportunities to go aboard by expanding their market, moving their facilities into developing countries, or diverse themselves to another region.E.g. having their headquarter in Northern Europe and having their branches in Europe, North America, or South East Asia.Trade allows nations to enhance their resources more efficiently, acquire more goods and services, and to specialize their production. Nations can gain the most by specializing in the products it can produce the most efficiently and trade for the products it cannot produce as efficiently.
What is FDI? How does it contribute to international business?
Foreign direct investment (FDI) is a direct investment into production or business in a country by a company in another country, either by buying a company in the target country or by expanding operations of an existing business in that country.Foreign direct investment is in contrast to portfolio investment which is a passive investment in the securities of another country such as stocks and bonds.Foreign direct investment has many forms. Broadly, foreign direct investment includes mergers and acquisitions, building new
facilities, reinvesting profits earned from overseas operations and intra company loans.In a narrow sense, foreign direct investment refers just to building new facilities. The numerical FDI figures based on varied definitions are not easily comparable.As a part of the national accounts of a country, and in regard to the national income equation Y=C+I+G+(X-M), I is investment plus foreign investment, FDI is defined as the net inflows of investment (inflow minus outflow) to acquire a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor.Foreign investment robustly increases local productivity grows. The Commitment to Development Index ranks the "development-friendliness" of rich country investment policies.The investing firm needs sufficient cooperation and concessions to justify their business case in terms of lower labor costs, and the opening of the country's or even regional markets at a distinct advantage over (global) competitors. The hosting country needs sufficient contractual promises to politically sell uncertain benefits—versus the better-known costs of concessions or damage to local interests.The benefits to the host may be: creation of a large number of more stable and higher-paying jobs; establishing in lagging areas centers of new economic development that will support attracting or strengthening of many other firms without costly concessions; hastening the transfer of premium-paying skills to the host country's work force; and encouraging technology transfer to local suppliers.Foreign investment was introduced in 1991 under Foreign Exchange Management Act (FEMA), driven by Finance minister Manmohan Singh. As Singh subsequently became a prime minister, this has been one of his top political problems, even in the current (2012) election. Starting from a baseline of less than $1 billion in 1990, a recent UNCTAD survey projected India as the second most important FDI destination (after China) for transnational corporations during
2010–2012. As per the data, the sectors that attracted higher inflows were services, telecommunication, construction activities and computer software and hardware.Mauritius, Singapore, US and UK were among the leading sources of FDI. Based on UNCTAD data FDI flows were $10.4 billion, a drop of 43% from the first half of the last year.How Political, Legal, Economic and Technological Systems
Affect International Business?
Perhaps the most important considerations for global business firms are the political and legal forces operative in the countries in which they plan to conduct business.Some foreign governments are unstable, that is, there may be frequent, dramatic and unpredictable regime changes and/or political unrest. When this occurs industries may be nationalized; private property may be seized or destroyed; normal business operations may be suspended, the workforce may go on strike.For example, during the recent unrest in Venezuela banks were shut down for months, workers were on strike, rioting broke out, food stuffs were seized from private companies.Even within relatively stable governments, as different administrations come to power different business regulations and attitudes may be adopted.Governments of different countries use various techniques to encourage and discourage global transactions. When governments favor international trade, they create a friendly environment in the form of free trade zones, free trade agreements and trading blocs.On the contrary, when they want to shield their countries from international competition, they institute trade barriers and protectionist measures such as tariffs, quotas, even licensing requirements.Transactions between different countries around the world create a need for money exchange. This need comes into play because each country has its own currency system.
A company usually likes to receive its payment in its home currency. As a result, companies need to convert currencies by buying or selling the currency of one country to another. This is done by using the exchange rate of different available markets such as the spot market, forward market and the future market depending on the ultimate goals. At this stage, the success of an international company is relative to the currency of the country where it operates. If the currency of that country is soft which means it is not easily convertible, it may present a problem. On the other hand, it can also be a hard currency, which means it can be exchanged with no difficulty.When approaching a host country, it is essential to determine the tendency of the economic system of that country. This can very well determine the economic success of a company in that country because some economic systems value individual goals better than collective goals and vice versa.This tendency can create environments where one type of business can be more welcomed than another. Although there are different types of economic systems around the world such as centrally planned economy, market economy, countries that lean more toward our free market economic systems have been proven to be working better. The economic conditions of any country fluctuate regularly.One key factor to stability is the rate of inflation. Sometimes governments are unable to control the rate of inflation through monetary policy and other times they even exacerbate inflation but printing too much currency.Another factor is the relative value of one currency versus another. When the relationship changes it may cost more or less to do business.For example, when the currency of the other country devalues relative to your own, it could be an advantage to you if you wish to produce in the other country and sell at home. If currency values fluctuate dramatically and rapidly it is very difficult to plan.The International Monetary Fund (IMF) was established to monitor the exchange rates among currencies and intervene when there is a currency crisis.
For example, we have seen the IMF step into Argentina when the ARS (peso) experienced runaway inflation.
Impact of technology on International Business
The tremendous technological growth that is being witnessed is made possible through extensive programs of technological research being conducted by many types of researches working within universities, business and non-profit research organizations.Technological developments are strong and all pervasive forces of the business environment. Technology is the scientific knowledge to practical problems.Technology feeds on itself and it affects business in two major ways-
1. Through its impact on society in general2. Through its direct influence on business operations and
activitiesTechnology affects society. In fact it affects our everyday lives. It affects economic growth, our standard of living and our culture. However, some of the effects of technology are highly beneficial and some detrimental. These effects on members of the society may in turn affect business practices.The discovery of new technology sometimes affects economic growth- TV with its high entertainment value takes away productive hours of mankind. Each new technology creates major long term consequences, which are not always foreseeable.Developing nations have to buy new technologies from foreign countries, as they are not resourceful in term of capital needed for Research and Development, expertise, patents, licenses and equipments and so on.This transfer of technology involves huge costs as a result of which a vicious circle is formed, in which weak technology creates dependence and dependence creates weakness.
Technology has changed the dynamics of how business is conducted and has also affected the ways people communicate with one another. This is especially true since the Internet has been integrated into the workplace.The ability to link information systems has moved the business environment to the global environment. This capability is very powerful and most businesses have figured out how to harness this power and use it to gain a competitive advantage. As a result some issues have arisen that businesses must pay close attention to. The integration of technology into business has impacted areas such as diversity, ethics and organizational structure.The global atmosphere is now presented with new business opportunities, such as outsourcing, making international business deals, exposing themselves to a larger customer base and employees do not even necessarily need to live in the same country as their bosses!Business processes are primarily connected to information systems and various other forms of technology, and people using automation must act responsibly with the data they transmit as part of their daily tasks.Technological architectures provide businesses with the opportunity to find previously undiscovered territory, and this is an ongoing process. It is not too uncommon to find new organizational structures emerging and those already in place experiencing rapid change.Even small businesses, which previously were mostly confined to local markets, are now able to compete alongside the 'big dogs' in markets which were formally closed to them. This is primarily due to the inclusion of information systems as a part of their business processes.Information systems have done a lot more than just expand local markets. They've also affected diversity, ethics and organizational structures. As a result businesses must learn to adapt and embrace these revolutionary changes in order to grow and maintain success.
David Richado’s theory about Comparative Advantage
International trade attracted much attention from the burgeoning time of economics. Most of the economists who wrote between 1500 and 1750 advocated what is now called Mercantilism.
It proposed to increase export and decrease import in order that the state can accumulate precious metals. Mercantilists thought that the plenty of money metal makes country rich.Adam Smith opposed to this idea and preached the gains from trade. Although Smith preached free trade, he could not show when and how the trade is profitable.It was Ricardo who made it clear by the logic what is now called comparative advantage. His numerical example is given as follows:
Labor necessary to the production
Country \ Product
Cloth
Wine
England 100 120
Portugal 90 80
Paul Samuelson called these numbers the "four magic numbers". In spite of the fact that Portuguese could produce both cloth and wine with less amount of labor, Ricardo showed that both countries have merits to trade with each other.What determines the direction of trade is not the absolute advantage in the production of goods but the ratio of labor inputs necessary to produce products, thus the denomination of "comparative advantage."Benefits from trade in Ricardo's example are easy to be seen. Ricardo assumes that cloth and wine (of the given quantities, but not specified) are exchanged at equal international value.
Therefore, if England exports cloth, which is the produce of 100 workers a year, it gets wine, which would be the produce of 120 workers a year and can reduce the total amount of labor by 20 workers.As for Portugal, it exports wine, which is the produce of 80 workers a year, and procures cloth, which is the produce of 90 workers a year. Thus both countries can reduce by trade labors which are necessary to procure the same amount of commodities.The chance of trade, which is beneficial to both traders, is much wider than the cases when the doctrine of absolute advantage is applicable.Indeed, when the ratio of labor inputs Cloth/Wine for England is smaller than the ratio of labor inputs Cloth/Wine for Portugal, then the comparative advantage theory teaches us that the same kind of benefits can be derived from trade.If a country should have absolute advantage for it to export a product, then the trade can occur in special, restricted cases where both counties have absolute advantage (i.e. to have higher productivity than the other country) for one of products they produce.For example, the case like the following table:
Labor necessary to the production
Country \ Product
Cloth
Wine
England 90 120
Portugal 100 80
Ricardo's example has continued to give inspirations until now to the students of international trade. At present there are two major forms of comparative advantage, which form the basis of modern
trade theory. They are Heckscher–Ohlin theorem and The Ricardian theory of international trade.
Implication to International Business
There are 3 categories of foreign exchange risk:
Transaction exposure Translation exposure Economic exposureTransaction exposureThis is the extent to which fluctuations in foreign exchange values affect the income from individual transaction. E.g. A China company may receive less US$ now for goods sold 3 months ago due to stronger RMB exchange rate if the payment is quoted in US$.
Translation exposureThis is the impact of currency exchange rate changes on the reported financial statements of a company. E.g. SingTel’s profit declined in 2009 due to translation loss as S$ was stronger against Australia $.
Economic exposureThis is the extent to which a company’s future international earning power is affected by change rates.
Define Business Strategy. Steps involved in starting a Business Activity
Business Strategy-The definition of business strategy is a long term plan of
action designed to achieve a particular goal or set of goals or objectives. Strategy is management's game plan for strengthening the performance of the enterprise. It states how business should be conduct to achieve the desired goals. Without a strategy management has no roadmap to guide them.
New businesses face many challenges, from planning and licensing to opening bank accounts and creating a company website. Regardless of where you are in the process, The Company Corporation can help. Follow each step on our checklist to stay on the right track.
1. Write a business plan. Form goals and objectives for your new company. A successful start to any business requires a detailed outline of what you plan to accomplish.
2. Obtain start-up capital. Whether you use your own savings or obtain loans, starting a business requires money. The loan process can take months to complete, so start early. Lenders often request a completed business plan prior to approval of funding.
3. Set up a legal business structure. Forming a corporation or LLC can protect owners' personal assets from business debts. Additionally, incorporating can provide credibility and tax benefits. Let the Company Corporation help you incorporate or form an LLC online.
4. Register "Doing Business As" names. Will your corporation or LLC do business under a name other than its legal name filed with the Secretary of State? If so, it must file a DBA (Doing Business As) name. We can help you file your DBA name.
5. Appoint a Registered Agent. Businesses must maintain an address for service of process where legal documents can be received. The Company Corporation provides Registered Agent service for all companies that we form.
6. Protect your company's name. Businesses file names on a per-state basis, so other companies may be using the same or a similar name in other states. Conducting a trademark search ensures that your unique company name isn't already in use.
7. Obtain a Federal Employer Identification Number (EIN).Incorporated businesses and companies that hire employees must obtain an EIN. The Company Corporation includes this service in our Premium formation package. You can also order an EIN separately.
8. Satisfy business licensing requirements. The Company Corporation provides a Business License Compliance Package to identify typical requirements for your business activities. Most state, county, and local governments require businesses to obtain licensing before they begin to operate. We can provide you with the application forms and contact information for the appropriate agencies.
9. Draft internal documents for the business. Corporations are governed by their internal bylaws, whereas LLCs are governed by an operating agreement. The Company Corporation can customize bylaws or an LLC operating agreement for your business.
10. Satisfy insurance requirements. Incorporating or forming an LLC does not provide a company with business insurance. Most companies obtain general business insurance from an insurance provider. Corporations and LLCs that hire employees also typically obtain unemployment and workers compensation insurance.
11. Establish a business presence. Identify a location for the business and establish a business address. The Company Corporation offers regular mail forwarding service in either Delaware or Nevada.
12. Establish a Web presence. Not having an effective Website eliminates opportunities for new customers and more profit.
13. Develop business collateral. Businesses use customized letterhead, cards, and forms with their company name and logo to establish credibility. Vista Print makes "do-it-yourself" business cards, business identity products, advertising products, and signage a snap.
14. Open a bank account and merchant account. To protect their corporate or LLC veil, businesses must maintain separate business and personal accounts and records. Establish a separate business bank account so that your personal assets are not co-mingled with business funds. Banks may also require an Employer Identification Number (EIN) in order to open a business checking account.
15. Establish proper accounting procedures. The Company Corporation understands that paying your taxes is only part of the picture when it comes to setting up your business. Whether you need help setting up your chart of accounts, have questions about completing a specific tax form, or need answers to tax questions we can help. Request a 30 minute consultation with a recommended accountant to discuss your unique situation and get the answers you need.
16. Get a business credit card. A business credit card helps separate your professional and personal expenses and can help you protect your personal assets from business liabilities.
17. Identify where to get help. Smart business owners know where and when to seek advice from other sources. Identify attorneys and accountants in your area who can assist you with specific questions about your business, or contact us to help identify a solution to meet your needs.
18. Get started. Schedule an opening day for your business. Giving yourself a goal helps keep things on track and can increase your productivity.
19. Complete additional filings as needed. Companies that expand to do business outside their original state of incorporation or LLC formation generally register in the those additional states. The Company Corporation can assist with these registration filings, also called "qualifications." Amendments can also be filed if the information listed on the formation document, like the legal name of the company or address, changes. Contact us at 800-818-6082 (toll-free) or 302-636-5440 for assistance with additional state filings.
20. Follow government rules. Operating a small business means satisfying ongoing government and legal requirements to maintain the company's good standing. Stay aware of the steps needed to maintain your company's status, and take advantage of The Company Corporation's $50,000 Corporate Veil Guarantee, provided at no cost with our Registered Agent service.
What is Overseas Market Research?
Overseas market research is any activity that helps you understand the marketplace and the customer's needs and wants better.
Overseas market research ranges from preliminary market research using the phone and the internet to thorough customer surveys, competitor analysis and analysis of target markets, Marketing Channels and the macro-environment in general.
Overseas market research gives insight in marketing problems, situations or markets.
Overseas market research tests hypotheses about cause-and-effect relationships.
Always. However, what you need to research and how thorough your research must be depends on your actual knowledge / your 'white spots' and the risks involved.
New Thoughts has extensive experience when it comes to overseas market research. New Thoughts has a good network abroad and can help you define and execute thorough overseas market research in cooperation with affiliated foreign marketing consultancies.
10 free thoughts on overseas market research:
1. Do make sure you understand the marketplace and the customer's needs and wants yourself: If necessary, let professional marketers that know your target market(s) research consumers and the marketplace first and develop structures to manage marketing information beforehand.
2. Do use the internet to search for free reports on your potential markets regularly. If necessary, let professional marketers do this preliminary research.
3. Do research your (potential) competitors thoroughly. In many Western countries companies are open about their strategies and communicate about their markets and performance openly; So, think of the possibility to have professional marketers collect the information available locally: It's a fast and inexpensive way to gain hands-on knowledge.
4. Do talk with your foreign customers openly about your plans if it does not harm their interests: Customers often are a cheap and very reliable source for market information, especially if the relationship is strong.
5. When the internet is a potential medium in marketing communications, do use tools like Google Analytics to retrieve market information.
6. To make sure adequate internet marketing information is gathered, do hire professional internet marketers with access to - or actual native language abilities for your potential target markets.
7. Do narrow the focus of any overseas market research: Prepare for a dominating position in one market or part of a market before conquering the rest of the world.
8. Make sure the outcome of your market research will enable you to make decisions on market segmentation and - targeting and product differentiation and - positioning.
9. Do conduct any overseas market research with respect for - and in mind the local culture, - history and stage of development: Do not think light of prejudices.
10. Do get in-touch with one of our Western consultants in the Strategy & Planning department now: Call 13603091702, send an email or contact us via this website.
In business and engineering, new product development (NPD) is the complete process of bringing a new product to market. A product is a set of benefits offered for exchange and can be tangible (that is, something physical you can touch) or intangible (like a service, experience, or belief).
There are two parallel paths involved in the NPD process: one involves the idea generation, product design and detail engineering; the other involves market research and marketing analysis.
Companies typically see new product development as the first stage in generating and commercializing new product within the overall strategic process of product life cycle management used to maintain or grow their market share.
The eight stages
1. Idea Generation is often called the "NPD" of the NPD process[1]. Ideas for new products can be obtained from basic
research using a SWOT analysis (Strengths, Weaknesses, Opportunities & Threats). Market and consumer trends, company's R&D department, competitors, focus groups, employees, salespeople, corporate spies, trade shows, or ethnographic discovery methods (searching for user patterns and habits) may also be used to get an insight into new product lines or product features.
Lots of ideas are generated about the new product. Out of these ideas many are implemented. The ideas are generated in many forms. Many reasons are responsible for generation of an idea.
Idea Generation or Brainstorming of new product, service, or store concepts - idea generation techniques can begin when you have done your OPPORTUNITY ANALYSIS to support your ideas in the Idea Screening Phase (shown in the next development step).
2. Idea Screening The object is to eliminate unsound concepts prior to
devoting resources to them. The screeners should ask several questions:
Will the customer in the target market benefit from the product?
What is the size and growth forecasts of the market segment / target market?
What is the current or expected competitive pressure for the product idea?
What are the industry sales and market trends the product idea is based on?
Is it technically feasible to manufacture the product?
Will the product be profitable when manufactured and delivered to the customer at the target price?
3.Concept Development and Testing Develop the marketing and engineering details
Investigate intellectual property issues and search patent databases
Who is the target market and who is the decision maker in the purchasing process?
What product features must the product incorporate? What benefits will the product provide? How will consumers react to the product? How will the product be produced most cost
effectively? Prove feasibility through virtual computer aided
rendering and rapid prototyping What will it cost to produce it?
Testing the Concept by asking a number of prospective customers what they think of the idea - usually[citation
needed] via Choice Modeling.4.Business Analysis
Estimate likely selling price based upon competition and customer feedback
Estimate sales volume based upon size of market and such tools as the Fourt-Woodlock equation
Estimate profitability and break-even point5.Beta Testing and Market Testing
Produce a physical prototype or mock-up Test the product (and its packaging) in typical usage
situations Conduct focus group customer interviews or introduce at
trade show Make adjustments where necessary Produce an initial run of the product and sell it in a test
6.Technical Implementation New program initiation Finalize Quality management system Resource estimation Requirement publication Publish technical communications such as data sheets Engineering operations planning Department scheduling Supplier collaboration Logistics plan Resource plan publication Program review and monitoring Contingencies - what-if planning
7.Commercialization (often considered post-NPD) Launch the product Produce and place advertisements and other promotions Fill the distribution pipeline with product Critical path analysis is most useful at this stage
8.New Product Pricing Impact of new product on the entire product portfolio Value Analysis (internal & external) Competition and alternative competitive technologies Differing value segments (price, value and need) Product Costs (fixed & variable) Forecast of unit volumes, revenue, and profit
Various strategies to launch new product in the market.
Many new products are launched into the marketplace with little prior planning for targeting the customers, creating a sales strategy, developing a distribution strategy, training the sales force, and integrating the competitive strategy.
This mistake significantly reduces or eliminates any potential profit the product may have, and greatly increases the sales development time. These problems must be avoided if a company wants to survive in today's competitive marketplace.
10 Ways Market Engineering Can Help Make New Product Launches More Successful
1. Identifying the best customer segments for penetration2. Positioning the product successfully against competition3. Optimizing impact of sales strategy4. Creating a system to maximize sales leads while minimizing
marketing expense5. Basing sales strategy on customer benefits rather than
6. Making the team market-driven rather than technologically driven
7. Setting sales goals based on market potential, not staff's guesses
8. Reducing sales development time and maximizing profit9. Improving market efficiency10. Identifying optimal mix of marketing tools and
distribution channels to maximize sales
Market Engineering Checklist for Product Launch
Market Engineering cross-functional team training Determination of Market Engineering Measurements Completion of customer survey Focus group performance Beta sites on product Selection of distribution channels analyzed Sales targets based on market size and potential Design of lead generation programs Design of market-based pricing strategy Lead tracking systems Design of public relations strategy Design of sales strategy Design of marketing strategy Competitive analysis and benchmarking Design of customer database Development of customer database Design of market monitoring system Buying, reading, and implementing Customer Engineering
What is sales promotion strategy? How does it benefits into business?
Sales promotion has been one of the most heavily used weapons of the producers or manufacturers. It is counted amongst one of their most affective ways of boosting their sales.Sales promotion has certain misconceptions attached to it. One of the most obvious is that sales promotion is only considered as targeted only at the wholesalers. However, this notion is totally wrong.There are many ways to promote the sales. Sales promotion can be targeted at the wholesaler, retailer or even at times the end customer. There are various methods that are used.First of all, a producer or manufacturer should be able to know his channel members i.e., is the intermediaries and the end customers very well. Moving a product through all these members to the end customer is not an easy job. It takes a lot of patience and understanding.There are many strategies built around the philosophy of moving the products through. There are three strategies that are widely used to boost the sales promotion activities.1. Push Strategy In a push strategy the company is sure that its customers want the product. The only thing lacking is the lack of push the products have from the intermediates i.e., the wholesalers and retailers. In this the company provides incentives to these intermediaries and asks them to push the product by increasing its sale. This kind of strategy is usually involved in products where there is fierce competition amongst producers and the intermediaries are given heavy margins by each producer to ensure his product is given the preference.
2. Pull Strategy This strategy is quite the opposite of the push strategy discussed above. The assumption in this strategy is that the customers either don't know at all or not enough about the manufacturer's product features to have an interest in it. By adopting this strategy the producer works with the intermediaries, especially
the retailers to better present the products not only in shelves but also improve its general outlook.
3. Mix Strategy This kind of strategy is adopted when the company thinks that the products need a push from both sides. Neither the intermediaries are pushing the product of the company to the extent nor the customers know or are interested in the product. To make this thing really happen the company simultaneously launches a two prong battle. This strategy is obviously more cost bearing and takes more time to materialize. In this strategy the company not only gives heavy margins to the intermediaries like the wholesalers and distributors, but also tries to attract the customers by making its products more attractive in shelves and packaging.
Evaluating the effects of a promotion strategy involves comparing its results with the objectives. Although this may seem simple, determining promotion effects can be difficult.
For example, even clearly stated cognitive objectives, such as “increase brand awareness by 25 percent,” are not easily evaluated because different methods of measuring awareness may give different results.
Moreover, it is often difficult to determine whether a change in brand awareness resulted from the promotion strategy or from something else, such as word-of-mouth communication.
Similarly, promotion objectives stated in behavior terms— “increase sales by 10 percent”—can be hard to evaluate. It is often difficult to determine what factors caused a sales increase.
Increases in competitors’ prices, opening new territories and outlets, changes in consumers’ attitudes, and various other factors may be responsible for the increase in sales. Likewise, if sales decrease or remain the same during the promotion period, it
is difficult to determine whether the promotion strategy was ineffective or whether other factors were responsible.
In other cases, however, evaluation of promotion effects can be relatively straightforward. Sales promotion tools such as coupons are used to stimulate short-term sales, and coupon redemption rates can give a good idea of effectiveness.
The dollar amounts sold by different salespeople can also be compared to determine their relative effectiveness. In sum, although measuring the effectiveness of promotion strategies may be difficult, marketers do have methods for estimating these effects.
Steps involved in promoting new product in international market.
Getting a new product out for customers to see and try out is the first step in selling that product successfully. Even the best
product will do little good for the public if they do not know it exists.
Therefore, business owners or marketing professionals must utilize various marketing techniques to guarantee that the right audience knows about the product and that they receive the knowledge as effectively as possible.
Fortunately, there are a number of fairly simple marketing opportunities for spreading the word and ensuring sales.
Offer promotional products. The majority of people love freebies, and creating an event at which you give away products is more likely to draw customers that might not otherwise have been interested.
In addition, a promotional event creates an opportunity for you to send out a press release about the event--as well as the product--and thus utilize the local media outlets, such as newspapers and news programs, for getting the word to the public.
Order printed promotional material that shares information about the products. Printed promotional material can range from simple flyers to more elaborate pamphlets that detail product specifications.
In addition, business cards can be an excellent marketing tool. If the company features one product in particular, the business card can note that the company is & amp; ldquo; home of the ______ product & amp; rdquo; or something along those lines, to keep the connection in mind for customers. And be sure to hand out as many of these printed promotional items as possible, to reach the widest desired audience.
Create sample sizes of products and offer them to those who can review the products and offer feedback or a positive response. Focus on sending the samples to those with credibility in the
industry, such as professionals or experts whose feedback will have more effect on convincing customers to try the product.
Collect testimonials from customers who have used and enjoyed the product. Testimonials can be a powerful tool for convincing potential customers to take the plunge, because they create the link between customers who trust the opinions of others like themselves.
Suppose, for instance, that you have designed and are marketing a new range of hand lotion. Testimonials from customers can be powerful for persuading others to pass by more familiar names to use your product. What is more, testimonials that speak to specific & amp; ndash; such as reduced psoriasis or elimination of chapping on hands & amp; ndash can help to convince others with similar concerns.
A marketing plan provides details on how a company plans to achieve its marketing objectives. Marketing plans are used to promote an entire brand or product line and individual products or services. A good marketing plan is vital to the economic success of new products.Step 1Conduct market research. Learn who is using the product, who will buy it and to whom is it beneficial?Step 2Investigate the competition. Evaluate how your product differs or compares to current product offerings and determine the ways in which your product/company excels. Identify the reasons customers purchase elsewhere and the ways that you can entice them to purchase your new product instead.Step 3Determine your marketing strategy and test it with focus groups to determine their response to your promotions. Most successful product launches involve marketing of many types. Online promotions, radio/television spots, and email solicitations can all
lead a visitor to your website to learn more about the new product and other product offerings.Step 4Create a public relations program. Ideas include allowing the press to review your product, writing articles to send to public media, giving interviews, and holding a launch event. The more opportunities you have to present your product to the target market, the more people will know the product and become interested in purchasing it.Step 5Evaluate the readiness of the launch to make sure the overall timing is coordinated and the product is absolutely ready when it is announced.Step 6Create a timeline in the marketing plan and follow up regularly to ensure that everyone involved is on schedule.Step 7Train your customer service department fully so that employees can effectively sell the product. The minute the product is available for purchase, your sales staff should be fully knowledgeable about the product and ready to sell it.Define Business Ethics. How does business ethics affect on
international business?
Business ethics (also corporate ethics) is a form of applied ethics or professional ethics that examines ethical principles and moral or ethical problems that arise in a business environment. It applies to all aspects of business conduct and is relevant to the conduct of individuals and entire organizations.
Business ethics has both normative and descriptive dimensions. As a corporate practice and a career specialization, the field is primarily normative. Academics attempting to understand business behavior employ descriptive methods.
The range and quantity of business ethical issues reflects the interaction of profit-maximizing behavior with non-economic concerns. Interest in business ethics accelerated dramatically
during the 1980s and 1990s, both within major corporations and within academia.
For example, today most major corporations promote their commitment to non-economic values under headings such as ethics codes and social responsibility charters. Adam Smith said, "People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices."
Governments use laws and regulations to point business behavior in what they perceive to be beneficial directions. Ethics implicitly regulates areas and details of behavior that lie beyond governmental control.
The emergence of large corporations with limited relationships and sensitivity to the communities in which they operate accelerated the development of formal ethics regimes.
The search for universal values as a basis for international commercial behavior.
Comparison of business ethical traditions in different countries. Also on the basis of their respective GDP and [Corruption rankings].
Comparison of business ethical traditions from various religious perspectives.
Ethical issues arising out of international business transactions; e.g., bio prospecting and bio piracy in the pharmaceutical industry; the fair trade movement; transfer pricing.
Issues such as globalization and cultural imperialism. Varying global standards—e.g., the use of child labor. The way in which multinationals take advantage of
international differences, such as outsourcing production (e.g. clothes) and services (e.g. call centers) to low-wage countries.
The permissibility of international commerce with pariah states.
