Publishing as Prentice Hall
Publishing as Prentice Hall
• Deciding Whether to Go Global
• Deciding Which Markets to Enter 
• Deciding How to Enter the Market
• Deciding on the Global Marketing Program
• Deciding on the Global Marketing rgani!ation
!opic %utline
Publishing as Prentice Hall
• Gains marketing# prod"ction# $%D# and
&inancial advantages not available to p"rely
domestic competitors
market
Publishing as Prentice Hall
Global &irms ask a n"mber o& basic '"estions(
• What market position sho"ld we try to establish in o"r own co"ntry# in o"r economic region# and globally)
• Who will o"r global competitors be# and what are their strategies and reso"rces)
• Where sho"ld we prod"ce or so"rce o"r prod"ct)
 
Publishing as Prentice Hall
$estrictions on trade between nations incl"de(
• Tari&&s
Publishing as Prentice Hall
oo$ing at the "lobal #ar$eting Eniron)ent
!ari((s are ta+es on certain imported prod"cts designed to raise reven"e or to protect domestic &irms
uotas are limits on the amo"nt o& &oreign imports a co"ntry will accept in certain prod"ct categories to conserve on &oreign e+change and protect domestic ind"stry and employment
!he International !rade yste)
Publishing as Prentice Hall
oo$ing at the "lobal #ar$eting Eniron)ent
Echange controls are a limit on the amo"nt o& &oreign e+change and the e+change rate against other c"rrencies
ontari(( trade barriers are biases against bids or restrictive prod"ct standards that go against -merican prod"ct &eat"res
!he International !rade yste)
Publishing as Prentice Hall
•  - ./0year0old treaty
• $ed"ces tari&&s and other international trade barriers
!he International !rade yste)
 
Publishing as Prentice Hall
7orld !rade %rgani8ation
 
Publishing as Prentice Hall
• Economic comm"nities are &ree trade
!ones
3,-5T-4
36-5T-4
 
Publishing as Prentice Hall
Economic &actors re&lect a co"ntry7s
attractiveness as a market(
Publishing as Prentice Hall
• 8"bsistence economies
• 1nd"striali!ing economies
• 1nd"strial economies
Publishing as Prentice Hall
• Low0income ho"seholds
• Middle0income ho"seholds
• High0income ho"seholds
Publishing as Prentice Hall
• 6o"ntry7s attit"de toward international
Publishing as Prentice Hall
Countertrade is non0cash payment
• =arter  is the e+change o& goods or services
• Co)pensation or  buybac$ is the sale o& a plant or e'"ipment and the payment in res"lting prod"cts
• Counterpurchase is when the seller receives payment and agrees to spend some o& the money in the other co"ntry
Political-egal Eniron)ent
Publishing as Prentice Hall
• 9"siness norms
 
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val"es and traditions rather than
imposing their own
Cultural Eniron)ent
 
Publishing as Prentice Hall
• 6an the company "nderstand the cons"mers
• 6an it o&&er competitively attractive prod"cts
• Will it be able to adapt to local c"lt"re
• 6an they deal with &oreign nationals
• Do the company7s managers have the
e+perience
:actors to Consider 
Publishing as Prentice Hall
De&ine international marketing ob:ectives and policies
• 5oreign sales vol"me
• Types o& co"ntries to market to based on(
 ; Geography
Publishing as Prentice Hall
$ank potential global markets based on(
• Market si!e
• Market growth
Publishing as Prentice Hall
• E+porting
• <oint vent"ring
• Direct investment
Publishing as Prentice Hall
<eciding Ho> to Enter the #ar$et
Eporting is when the company prod"ces its goods in the home co"ntry and sells them in a &oreign market= 1t is the simplest means involving the least change in the company7s prod"ct lines# organi!ation# investments# or mission=
• 1ndirect e+porting
• Direct e+porting
Publishing as Prentice Hall
<eciding Ho> to Enter the #ar$et
?oint enturing is when a &irm :oins with &oreign companies to prod"ce or market prod"cts or services
• Licensing • 6ontract man"&act"ring • Management contracting • <oint ownership
 
Publishing as Prentice Hall
• Licensing is when a &irm enters into an
agreement with a licensee in a &oreign
market= 5or a &ee or royalty# the
licensee b"ys the right to "se the
company7s process# trademark# patent#
?oint @enturing
Publishing as Prentice Hall
&oreign market to prod"ce its prod"ct or
provide its service= 9ene&its incl"de
&aster start"p# less risk# and the
opport"nity to &orm a partnership or to
b"y o"t the local man"&act"rer=
?oint @enturing
Publishing as Prentice Hall
<eciding Ho> to Enter the #ar$et
#anage)ent contracting is when the domestic &irm s"pplies management skill to a &oreign company that s"pplies capital= The domestic &irm is e+porting management services rather than prod"cts=
?oint o>nership is when one company :oins &orces with &oreign investors to create a local b"siness in which they share :oint ownership and control= <oint ownership is sometimes re'"ired &or economic or political reasons=
?oint @enturing
Publishing as Prentice Hall
<eciding Ho> to Enter the #ar$et
<irect inest)ent is the development o& &oreign0based assembly or man"&act"ring &acilities and o&&ers a n"mber o& advantages
Lower costs
• $aw material
Publishing as Prentice Hall
tandardi8ed )ar$eting )i involves selling
the same prod"cts and "sing the same
marketing approaches worldwide
market# bearing more costs b"t hoping &or a
larger market share and $1
 
Publishing as Prentice Hall
<eciding on the "lobal #ar$eting Progra)
traight product etension means marketing a prod"ct in a &oreign market witho"t any change
Product adaptation involves changing the prod"ct to meet local conditions or wants
Product inention consists o& creating something new &or a speci&ic co"ntry market
• Maintain or reintrod"ce earlier prod"cts
• 6reate new prod"cts
Publishing as Prentice Hall
comm"nication strategy they "se at
home or change it &or each market
Pro)otion
Publishing as Prentice Hall
<eciding on the "lobal #ar$eting Progra)
Ani(or) pricing is the same price in all markets b"t does not consider income or wealth where the price may be too high in some or not high eno"gh in other markets
#ar$et-based pricing is the price the market can pay b"t does not consider act"al costs
tandard )ar$up pricing is a price based on a percentage o& cost b"t can ca"se problems in co"ntries with high costs
Price  
Publishing as Prentice Hall
<eciding on the "lobal #ar$eting Progra)
ellerBs headuarters organi8ation s"pervises the channel and is also a part o& the channel
Channels bet>een nations move the prod"cts to the borders o& the &oreign nations
Channels >ithin nations move the prod"cts &rom their &oreign point o& entry to the &inal c"stomers
<istribution Channels
7hole-Channel @ie>
Publishing as Prentice Hall
Typical management o& international marketing
activities incl"de(
sales manager and sta&& 
by geography# prod"cts# or operating "nits
• 9ecoming a complete global organi!ation