42
1-1 MKT 3620
1-1
MKT 3620
Name: Surej P JohnOffice: MSM 3rd floor, Cabin# 01
Email: [email protected]
Website: http://surejpjohn.hpage.com/
CHAPTERS & TOPICS TO BE DISCUSSEDChapter 1: Introduction to Global Marketing Chapter 2: The Global Economic Environment Chapter 3: Regional Market Characteristics and Preferential Trade AgreementsChapter 4: Social and Cultural Environments Chapter 5: The Political, Legal and Regulatory Environments
QUIZ I ***(Chapter 1 – 5)
Chapter 7: Segmentation, Targeting, and PositioningChapter 8: Importing, Exporting, and SourcingChapter 9: Global Market Entry Strategies: Licensing, Investment, and Strategic AlliancesReview for Midterm / Term Project Checking (1st Half)
Midterm Examination *** (Chapter 1 – 5, 7 – 9)
July 19th, 2011 at 12.00-14.00
Mark Allocations
Surej P John 4
Quizzes (2x5%) 10%Class Participation 5%Group Project 10%Group project presentation 5%Midterm Examination 30%Comprehensive Final Examination 40%Total 100%
Online resources
• Course syllabus, project outline, power points are all available in www.lms.au.edu
• Enrollment key: MKT 30• All students are
requested to register online to make use of the online resources.
1/ 2010 Surej P John 5
CHAPTER 1
INTRODUCTION TOGLOBAL MARKETING
IntroductionGlobal versus “regular” marketing
Scope of activities are outside the home-country market
1-7
Product/market growth matrix
Market Penetration
1/ 2011Surej P John8
Started the first shop in 2004
In 2009, the number of shops reached 41 including 8 University campuses
Market Development
Product Development
1/ 2011Surej P John10
DiversificationDiversification is developing new products
for new markets
1/ 2010Surej P John11
Global MarketingCreate value for customers by
improving benefits or reducing priceImprove the productFind new distribution channelsCreate better communicationsCut monetary and non-monetary
costs and prices
1-12
Value = Benefits/Price
1/ 2010Surej P John13
Globalization
1-14
Globalization is the inexorable integration of markets, nation-states & technologies to a degree never witnessed before—
in a way that is enabling: individuals, corporations & nation-states to reach around the world farther, faster, deeper & cheaper than ever before, &
in a way that is enabling: the world to reach into individuals, corporations & nation-states farther, faster, deeper & cheaper than ever before.
Competitive Advantage and Global IndustriesCompetitive advantage:
When a company succeeds in creating more value for customers than its competitors, that company is said to enjoy more competitive advantage.
Global industryA global industry is one in which competitive advantage can
be achieved by integrating and leveraging operations on a world wide
OR
An industry is global to the extent that a company’s industry position in one country is interdependent with its industry position in another country1-
15
Degree of Industrial Globalization
1/ 2011Surej P John16 Consumer electronics Apparel Auto Steel IT/BPO0%
20%
40%
60%
80%
100%
120%118%
77%
42%
33%
1%
Competitive Advantage
1/ 2011Surej P John17
Global Marketing:What it is & What it Isn’t???
Single Country Marketing Strategy
• Target market strategy
• Marketing mix – Product
– Price– Promotion
– Place
(Domestic Marketing activities)
(Table 1-2)
p. 43
Global Marketing:What it is & What it
Isn’t???Global Marketing Strategy
(GMS)• Global market participation
(companies have operations in more than one market)
• Marketing mix development– 4 P’s: adapt or standardize?
• Concentration of marketing activities.
• Coordination of marketing activities.
• Integration of competitive moves. (Eg. Lenovo) p. 43-4
1-20
Standardization versus Adaptation
Globalization (standardization)Developing standardized products marketed
worldwide with a standardized marketing mixEssence of mass marketing
Global localization (adaptation)Mixing standardization and customization in
a way that minimizes costs while maximizing satisfaction
Essence of segmentationThink globally, act locally
1-21
1/ 2011Surej P John22
Change in the Slogan of Nike in European market
Standardization versus Adaptation
1-23
Arabicread right to left
Chinese “delicious/happiness”
The faces of Coca-Cola around the world
McDonald’s Global Marketing
1-24
Marketing Mix Element Standardization Localized
Product
Promotion
Place
Price
Big Mac
Brand name
Advertising slogan “I’m Loving It”
Free-standing
Big Mac is $3.10 in U.S. and Turkey
McAloo Tikka potato burger (India)
Slang ’Macca’s (Australia)
MakDo (Philippines)
McJoy magazine, “Hawaii Surfing Hula” promotion (Japan)
Home delivery (India)
Swiss rail system dining cars
$5.21 (Switzerland)
$1.31(China)
In India, there are no Big Macs because the Hindu people don't eat beef.However, they have the Maharaja Mac, which is a Big Mac made of lamb or chicken meat. There is also a vegetarian burger, the McAloo Tikki.
MANAGEMENT ORIENTATIONSManagement
emphasisStage one Domestic
Stage two International
Stage three Multinational
Stage four Global
Focus Domestic Ethnocentric Polycentric Geocentric
Marketing strategy Domestic Extension Adaption Extension
Structure Domestic International Worldwide area Adaption creation matrix/mixed
Management style Domestic Centralized top
downDecentralized
bottom up Integrated
Manufacturing stance Mainly domestic Mainly domestic Host country Lowest cost
worldwide
Investment policy Domestic Domestic used
worldwideMainly in each host country Cross subsidization
Performance
evaluationDomestic
market shareAgainst home
country market share
Each host country market
shareWorldwide
1/ 201126
Home country is superior to others
Sees only similarities in other countries.
Assumes products & practices that succeed at home will be successful everywhere .
Leads to a standardized or extension approach.
MANAGEMENT ORIENTATIONSEPRG FRAMEWORK
1. Ethnocentric orientation/
INTERNATIONAL
Home country DO NOT adjust
To Host country!!p. 52
Domestic going International
New true coffee shops at Vientiane, Laos & Shanghai, China
Each country is unique.
Each subsidiary develops its ownunique business & marketing strategies.
Leads to a localized or adaptation approach.
MANAGEMENT ORIENTATIONSEPRG FRAMEWORK
2. Polycentric Orientations/
MULTINATIONAL
Focus is HOST country
p. 53
Multi-National Approach• In Polycentric stage, subsidiaries are formed in each
market and each subsidiaries operates independent of each other and formulates its own marketing strategies
• Separate product lines are formed in each country and these products are modified to meet local needs ( Adaptation)
• Sales force in each country is local nationals• Channels of distribution are those traditionally used
by each country.
A region is the relevant geographic unit.
Ex: NAFTA (North American Free Trade Agreement between: Canada, Mexico & U.S.)
MANAGEMENT ORIENTATIONSEPRG FRAMEWORK
3. Regiocentric orientation
p. 53
Regional airline serving Malaysia and south-east Asian destinations
Entire world is a potential market.
Strives for integrated global strategies.
Retains an association with headquarters country
Pursues serving world markets from a single country or sources globally to focus on select country markets.
Leads to a combination of extension & adaptation elements.
MANAGEMENT ORIENTATIONSEPRG FRAMEWORK
4. GEOCENTRIC ORIENTATIONS/
GLOBAL OR TRANSNATIONAL
p. 53
HD serves worldMarkets from U.S.
DRIVING FORCES AFFECTING GLOBAL INTEGRATION & GLOBAL MARKETGING
Multilateral economic agreements
Converging market needs & the information revolution
p. 56
Transportation & communication improvements
Product development costs
DRIVING FORCES AFFECTING GLOBAL INTEGRATION & GLOBAL MARKETGING
World economic trends
Leverage
p. 59
Quality
LeverageScale economies. • The global company can take advantage of its
greater manufacturing volume to obtain traditional scale advantages within a single factory.
• Also, finished products can be produced by combining components manufactured in scale-efficient plants in different countries.
• The larger scale of the global company also creates opportunities to improve corporate staff competence and quality.
Experience transfers. A global company can leverage its experience in any market in the world. It can draw on management practices, strategies, products, advertising appeals, or sales or promotional ideas that have been tested in actual markets and apply them in other comparable markets.
Leverage
ABB- 1400 subsidiaries in 140 countries.Very famous for running the operations with the minimum number of staff
LeverageGlobal strategy.• The global company's
greatest single advantage can be its global strategy.
LeverageResource utilization. A major strength of the global company is its ability to scan the entire world to identify people, money, and raw materials that will enable it to compete most effectively in world markets. This is equally true for established companies and start-ups. For example, British Biotechnology Group, founded in 1986, raised $60 million from investors in the United States, Japan, and Great Britain. For a global company, it is not problematic if the value of the "home" currency rises or falls dramatically, because for this company there really is no such thing as a home currency.
RESTRAINING FORCES AFFECTING GLOBAL INTEGRATION & GLOBAL MARKETGING
Management myopia & Organizational culture
p. 62
National controls – (to protect local industries)
Opposition to globalization
Summary• Global marketing is the process of focusing
resources on global marketing opportunities
• Goal, to create customer value & competitive advantage by maintaining focus
• Three classifications of management orientation: ethnocentric, polycentric, regiocentric, geocentric
• Global marketing importance is shaped by a variety of driving & restraining forces
Group Assignment No. 1• Make a detailed study on the Socio-Economic
and Cultural factors of BRIC Nations and submit the assignment as a typewritten report.
• All groups has to prepare a short presentation ( not more than 15 mins.) and one of the groups may be asked to do the presentation in the class!!
IT MAY BE ANY OF YOU….. GOOD LUCK
•
Looking Ahead to Chapter 2
The global economic environment
1-42
