international marketing week 2 · pdf file• international marketing is the performance of...
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Product Place Price Promotion
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International MarketingWeek 2
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Course Objectives
• The Benefits of International Markets
• The scope of the International Marketing Task
• The Importance of Self-Reference Criterion (SRC)
• The increasing importance of global awareness
• The Progression of Becoming a Global Market
• The Importance of Gatt and The WTO, IMF and World Bank
• The Evolution of the EU and strategic implications
• Marketing Opportunities in EU/Africa/Middle East
• Importance of the Bottom-of-the-Pyramid Market
• Diversity Across the Region
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Objective
• Explain what is Marketing Mix
• The scope of the International Marketing Task
• The Importance of Self-Reference Criterion (SRC)
• The increasing importance of global awareness
• The Progression of Becoming a Global Market
• The Importance of Gatt and The WTO, IMF and World Bank
• The Evolution of the EU and strategic implications
• Marketing Opportunities in EU/Africa/Middle East
• Importance of the Bottom-of-the-Pyramid Market
• Diversity Across the Region
• The Benefits of International Markets
![Page 4: International Marketing Week 2 · PDF file• International Marketing is the performance of business activities designed to plan, price, promote, and direct the](https://reader033.vdocument.in/reader033/viewer/2022051722/5aa17fe87f8b9a07758baf23/html5/thumbnails/4.jpg)
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• The Benefits of International Markets
No company in the world can participate
in international business without
escaping the effects of increasing numbers of
competitors from home and abroad
••
Globalization have created a
borderless world where trade, commerce,
business are created in the
most unthinkable situations
••
International marketing helps prosperity and
brings development to every corner of the world if there
are favourable conditions
••
Today, most business
activities are global in scope and managers,
CEOs, policy makers must be in possess of up to date global
awareness
••
Global strategic plans need to be
developed because being global is not any more a luxury
but an obligation for economic survival
•
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International Marketing: Why is so important for development of an economy
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Introduction to International Marketing
BENEFITS AND CONSIDERATIONS OF INTERNATIONAL MARKETING
• • •
Global Commerce needs peace among countries in order to develop
Political stability, stable and steady economy, ideal social and cultural infrastructure
Access to quality education, heavy investment in Research and Development, and Innovation in Science and Technology
Competitive edge, strong government support, daring private entrepreneurship, availability of funds, global vision
• •
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4 Most important Factors affecting International Marketing
There are many factors influencing and creating International Marketing
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There are many factors influencing and creating International Marketing
There is mandate to manage the resources and global environment properly for the generation to come and invest heavily in Research and Development of renewable energies
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4 Most important Factors affecting International Marketing
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There are many factors influencing and creating International Marketing
The burgeoning impact of the Internet, mobile phones, and other global media have accelerated the disappearance of borders
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4 Most important Factors affecting International Marketing
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There are many factors influencing and creating International Marketing
Developing countries in order to progress are forces, by globalization, to open up their borders to global trade. In doing so, they have increased the dependence to import-export system and in controlling their economic growth
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4 Most important Factors affecting International Marketing
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The World Trade organization, the World Bank, the International Monetary Fund and the proliferation of free trade agreements have created an interwoven global market where no country can survive alone or in isolation
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4 Most important Factors affecting International Marketing
There are many factors influencing and creating International Marketing
![Page 11: International Marketing Week 2 · PDF file• International Marketing is the performance of business activities designed to plan, price, promote, and direct the](https://reader033.vdocument.in/reader033/viewer/2022051722/5aa17fe87f8b9a07758baf23/html5/thumbnails/11.jpg)
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Marketing Mix In International Market
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International Marketing System
Exporting Countries (collection of sellers)
Communication
Goods / Services
Money
Information
Importing Countries
(collection of buyers)
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Simple Marketing System
Industry (collection of sellers)
Communication
Goods / Services
Money
Information
Market (collection of buyers)
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Objective
• The Benefits of International Markets
• Explain the 4 Ps and 4 Cs of Marketing Mix
• The Importance of Self-Reference Criterion (SRC)
• The increasing importance of global awareness
• The Progression of Becoming a Global Market
• The Importance of Gatt and The WTO, IMF and World Bank
• The Evolution of the EU and strategic implications
• Marketing Opportunities in EU/Africa/Middle East
• Importance of the Bottom-of-the-Pyramid Market
• Diversity Across the Region
• The scope of the International Marketing Task
![Page 15: International Marketing Week 2 · PDF file• International Marketing is the performance of business activities designed to plan, price, promote, and direct the](https://reader033.vdocument.in/reader033/viewer/2022051722/5aa17fe87f8b9a07758baf23/html5/thumbnails/15.jpg)
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The Scope of International Marketing
• International Marketing is the performance of business activities designed to plan, price, promote, and direct the flow of a company’s goods and services to consumers or users in more than one nation for a profit.
• The only difference between the definition of domestic marketing and international marketing is that, in the latter case, marketing activities take place in more than one country.
• Therefore, International Marketing is more complex, diverse, and challenging (unpredictable).
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International Marketing
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The Business Goal of International Marketing
• The business goal is to make a profit by promoting, pricing, and distributing products for which there is a market.
• The difference with domestic market is that the global environment which is the scenario where all marketing plans must be implemented.
• The challenges come from the unfamiliar terrain determined by competition, legal system, government controls, weather, consumers and other unpredictable elements
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Business Goal of International Marketing
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4 Ps
Marketing mix is the combination of four elements. They are:
Pro
du
ct
Pla
ce
Pri
ce Pro
mo
tio
n
These are known as the 4 Ps of marketing.
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Additional PsSome marketers also consider an additional four Ps to the original 4 Ps that you learnt. These are:
Peo
ple
Ph
ysi
cal
Pre
sen
ce
Pro
cess
Ph
ysi
cal
Evi
den
ce
How your staff, are different from those in a competitor’s organization, and how your clients are different from your competitor’s clients.
How your shop or website looks.
How your product is built and delivered, or how your service is sold, delivered and accessed.
How your service becomes tangible. e.g. policies & brochures are something the customers can touch and hold.
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Price
Product
Promotion
Place
4 Ps and 4 Cs
Now-a-days, the Four Ps is being replaced by the Four Cs model,
consisting of :
The Four Cs model is more consumer-oriented and fits better in the
movement from mass marketing to niche marketing.
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Elements of 4 Cs Model
The elements of the four Cs model are:
Product- Customer /Consumer
Place- Convenience
Price- Cost
Promotion- Communication
Let’s look at each in detail.
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Product - Customer/Consumer
In the four Cs model, the product part of the Four Ps model is replaced by customer or consumer which shifts the focus to satisfying the consumer.
PRODUCT
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Place - Convenience
In the Four Cs model, the place part of the Four Ps model is replaced by the convenience function. Place is no longer as relevant as before due to the rise of internet and hybrid models of purchasing. Convenience takes into account the ease to buy a product, find a product, find information about a product, and several other considerations.
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Price - Cost
In the Four Cs model, the price part of the Four Ps model is replaced by cost, reflecting the reality of the total cost of ownership.
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Promotion - Communication
Finally, in the Four Cs model, the promotion part of the Four Ps model is replaced by communication. Communications represents a broader focus than simply promotions. Communications includes any form of communication between the firm and the consumer such as advertising, public relations, personal selling, viral advertising etc.
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Marketing Decision Factors
There may be two types of Marketing Decision Factors:
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Controllable Market Decision Factors
• The Characteristics of the Firm
• The pricing of the product• The product development
and manufacturing• Promotional Strategy• Channels of Distribution• Research
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Uncontrollable Market Decision Factors
• Competition and Market System• Government Law• Political Environment• Social Structure• Economic Climate• Education and Technology• Cultural Forces
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DomesticEnvironment
Foreign Environment
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Aspects of Domestic Environment
All domestic environment uncontrollable:1. Foreign policy decision effecting a firm’s international marketing success2. Domestic Economic Climate3. Domestic Competition4. Social culture and structure
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Aspects of the Foreign Environment
All foreign environment uncontrollable:
1. Political Stability, Political Forces, Political System2. Class Structure, Income Distribution, Social Development3. Economic Climate, Business Culture, Trading infrastructure4. Banking and Financial System5. Level of Education and Technology6. Level of Understanding and knowledge of the targeted foreign market
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Objective
• The Benefits of International Markets
• The scope of the International Marketing Task
• Explain what is Viral Marketing
• The increasing importance of global awareness
• The Progression of Becoming a Global Market
• The Importance of Gatt and The WTO, IMF and World Bank
• The Evolution of the EU and strategic implications
• Marketing Opportunities in EU/Africa/Middle East
•
• Diversity Across the Region
• The Importance of Self-Reference Criterion (SRC)
• Importance of the Bottom-of-the-Pyramid Market
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What is Self-Reference Criterion
SRC
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SRC and International Marketing
SRC
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Cross Cultural Analysis Framework
• Define the business problem or goal in home country cultural traits, habits, or norms
• Define the business problem or goal in foreign country cultural traits, habits, or norms through consultation with natives of the target country. Make no value judgements
• Isolate the SRC influence in the problem and examine it carefully to see how it complicates the problem
• Redefine the problem without the SRC influence and solve for the optimum business goal situation
• This approach requires an understanding of the culture of the foreign market as well as one’s culture. Before understanding other cultures it is important to be aware of our own.
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Objective
• The Benefits of International Markets
• The scope of the International Marketing Task
• The Importance of Self-Reference Criterion (SRC)
• Explain Extended Marketing Mix
• The Progression of Becoming a Global Market
• The Importance of Gatt and The WTO, IMF and World Bank
• The Evolution of the EU and strategic implications
• Marketing Opportunities in EU/Africa/Middle East•
• Importance of the Bottom-of-the-Pyramid Market
• Diversity Across the Region
• The increasing importance of global awareness
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Importance Global Awareness
OpportunitiesUnlimited opportunities await for the international marketer prepared to confront the challenges of cultural aspects of global marketing
Global Awareness
Target Segment
Tolerance
Being Knowledgeable
Global Knowledge
Global Network
Opportunities
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Importance Global Awareness
Global Awareness1) Tolerance of cultural differences2) Knowledge of cultures, history, world
market potential and global economic, social and political needs
Cost
Opportunities
Tolerance
Being Knowledgeable
Global Knowledge
Global Network
Global Awareness
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Importance Global Awareness
ToleranceFor cultural differences is critical. It is understanding cultural differences and accepting and working with others whose behaviour and values may be different from ours
Global Awareness
Opportunities
Competition
Being Knowledgeable
Global Knowledge
Global Network
Tolerance
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Importance Global Awareness
Global Awareness
Opportunities
Tolerance
Society & Law
Global Knowledge
Global Network
Being Knowledgeable
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Being KnowledgeableBeing Knowledgeable: It is important • To understand behaviour in the
marketplace, • To comprehend the way people think
and interact with each other, • to be abreast of economic, social and
political trends• To be able to change or shift strategy
to better fit the market
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Importance Global Awareness
Being KnowledgeableGlobal Knowledge: It is important • to be aware of the geo-political shifts
happening continuously • To analyse the past with the eyes of
the present to predict tomorrow’s shifts
• To realize that the uncontrollable factors need to be observed and forecasted
Global Awareness
Opportunities
Tolerance
Being Knowledgeable
Variant Prices
Global Network
Global Knowledge
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Importance Global Awareness
Global Network: It is the ability of growing professional connections within the global community, in the foreign target markets, with international partners with the purpose of having solid cooperation and network based on understanding and acceptance
Global Awareness
Opportunities
Tolerance
Being Knowledgeable
Global Knowledge
Discount PolicyGlobal Network
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Objective
• The Benefits of International Markets
• The scope of the International Marketing Task
• The Importance of Self-Reference Criterion (SRC)
• The increasing importance of global awareness
• Explain 7Ps & 7Cs of Marketing Mix
• The Importance of Gatt and The WTO, IMF and World Bank
• The Evolution of the EU and strategic implications
• Importance of the Bottom-of-the-Pyramid Market
•
• Diversity Across the Region
• The Progression of Becoming a Global Market
• Importance of the Bottom-of-the-Pyramid Market
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Stages of International Marketing Involvement
• No Direct Foreign Marketing: A company in this stage does not actively , cultivate customers outside national border; however, this company’s products may reach foreign markets. Sales can be made by trading companies as well as foreign customers who directly contact the firm.
• Infrequent Foreign Marketing: Temporary surpluses caused by variations in production levels or demand may result in infrequent marketing overseas. The surpluses are characterised by their temporary nature; therefore sales to foreign market are made available with little or no serious intention to continue or maintain market representation
• Regular Foreign Marketing: The firm has permanent production capacity devoted to the production of goods and services to be marketed to foreign markets, Firms employs domestic or foreign international marketers to expand further
• Global Marketing: The company is completely oriented towards foreign markets and plan global marketing activities. The home and foreign market are considered one market and the marketing research and strategy is uniformly applied
• International Marketing: Companies are more involved and committed to international marketing, always seek for new markets and produce goods to fit the target markets. Companies go into joint venture or form of partnerships with firms in the foreign target market
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KOF Globalization Index Measures
The KOF Globalization Index measures the three main dimensions of globalization:• economic• social• and political.In addition to three indices measuring these dimensions, it calculates an overall index of globalization and sub-indices referring to• actual economic flows• economic restrictions• data on information flows• data on personal contact• and data on cultural proximity.
Let’s look at each in detail.
Economic Measures
Social Measures
Political Measures
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http://globalization.kof.ethz.ch/query/
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KOF Globalization Index – Economic Measures
• Trade flows and balance of trade• Foreign Direct Investment Flows• Income Payment for Foreigners• Mean Tariff Rates• Taxes on International Trade
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KOF Globalization Index – Social Measures
Telecommunication Technologies and servicesInternational TourismForeign PopulationInternet UsersTelevision and Mass Media
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KOF Globalization Index – Political Measures
• Embassies in the Country• Membership in International Organizations• International Treaties• Participation in UN Missions
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*
*The Marketing
EnvironmentThe MARKETING ENVIRONMENT
LG4
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Objective
• The Benefits of International Markets
• The scope of the International Marketing Task
• The Importance of Self-Reference Criterion (SRC)
• The increasing importance of global awareness
• The Progression of Becoming a Global Market
• Describe the Characteristics of Marketing Mix
• The Evolution of the EU and strategic implications
• Marketing Opportunities in EU/Africa/Middle East
• Importance of the Bottom-of-the-Pyramid Market
• Diversity Across the Region
• The Importance of Gatt and The WTO, IMF and World Bank
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General Agreement on Tariff and Trade
1 What is GATT 2
4Eight rounds of Tariffs Negotiations
6Trade Related Aspects of Intellectual Property Rights
3
5
10
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3 Basic Elements
General Agreement on Trade in Services
Trade Related Investment Measures
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What is GATT
It is an agreement made by the USA and other 22 countries and it provided a process to reduce tariffs and an agency to serve as a watchdog over world trade. Countries with trade disputes can ask to resolve their disputes through GATT’s advisory boards.GATT is just an advisory body created by agreement and help to solve by agreement. If members fail to solve their disputes or reject the GATT ‘s recommendations, there is no enforcement policy or powers of legal obligation from GATT
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General Agreement on Tariff and Trade
2 3 Basic Elements
6Trade Related Aspects of Intellectual Property Rights
1 What is GATT
4Eight rounds of Tariffs Negotiations
General Agreement on Trade in Services
Trade Related Investment Measures
3
5
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reserved.
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3 Basic Elements
The GATT agreement covers these 3 basic elements of trade:1) Trade shall be conducted on a non discriminatory basis2) Protection shall be given to domestic industries through customs tariffs,
not through such commercial measures as import quotas3) Consultation shall be the primary method to solve global problem
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8 rounds of tariffs negotiations
3
2 3 Basic Elements
6Trade Related Aspects of Intellectual Property Rights
1 What is GATT
4General Agreement on Trade in Services
Trade Related Investment Measures5
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reserved.
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General Agreement on Tariff and Trade
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8 rounds of tariffs negotiations
1. Geneva Round 1947 in Switzerland called the foundation round. USA + 22 countries focused on tariffs and lasted 7 months
2. Annecy Round 1949 in France between 34 countries and also focused on tariffs3. Torquay Round 1950 in England between 34 countries and focused to cut tariffs
between member of 25% 4. Genera Round II 1956 in Switzerland between 22 countries and focused on tariffs
and admission of Japan5. Dillon 1960 in Switzerland between 44 countries and almost 5 USD Billion of
tariffs concessions6. Kennedy 1964 in Switzerland between 48 countries and focused on anti-
dumping and more than 40 USD billion of world trade achieved7. Tokyo 1973 in Japan between 102 countries and focused on Tariffs, non-tariff
measures, "framework" agreement and Tariff reductions worth more than $300 billion achieved
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8th Final Round and creation of WTO
URUGUAY ROUND 1986123 COUNTRIES
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8th Final Round and creation of WTO
• Tariffs, non-tariff measures, rules, services, intellectual property, dispute settlement, textiles, agriculture, creation of WTO, etc.
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8th Final Round and creation of WTO
• The round led to the creation of WTO, and extended the range of trade negotiations, leading to major reductions in tariffs (about 40%) and agricultural subsidies, an agreement to allow full access for textilesand clothing from developing countries, and an extension of intellectual property rights.
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4General Agreement on Trade in Services
Eight rounds of Tariffs Negotiations3
2 3 Basic Elements
6Trade Related Aspects of Intellectual Property Rights
1 What is GATT
Trade Related Investment Measures5
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General Agreement on Tariff and Trade
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3 Main Agreements of GATT
The GATT members, before the creation of WTO, have reached 3 multilateral agreements on various major trading aspects formalized in the:1. General Agreement on Trade in Services
(GATS)2. Trade-Related Investment Measures
(TRIMs)3. Trade Related Intellectual Property
Rights (TRIPs)
Let’s look at each in detail.
GATS
TRIMs
TRIPs
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1. General Agreement on Trade in Services (GATS)
1st multilateral, legally enforceable agreement covering trade and investment in the services sector. It provides a legal basis for future negotiations for the elimination of barriers that discriminate against foreign services and deny them market access. It also covers trade and investment in services like telecommunications, technology and research among members.
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Trade Related Aspects of Intellectual Property Rights5
4General Agreement on Trade in Services
Eight rounds of Tariffs Negotiations3
2 3 Basic Elements
6
1 What is GATT
Trade Related Investment Measures
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General Agreement on Tariff and Trade
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3. Trade Related Intellectual Property Rights (TRIPs)This agreement establishes high standards of protection for a full range of intellectual property rights (patents, copyrights, trademarks, trade secrets, industrial designs, and technologic innovations).
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6 Trade Related Investment Measures
Trade Related Aspects of Intellectual Property Rights5
4General Agreement on Trade in Services
Eight rounds of Tariffs Negotiations3
2 3 Basic Elements1 What is GATT
8
9
12
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General Agreement on Tariff and Trade
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2. Trade-Related Investment Measures (TRIMs)
This Agreement establishes the basic principle that investment restriction can be made major trade barriers like • foreign multinationals opening joint-venture or
partnerships with local enterprises to access the market,
• fair labour or employment practices, • respect of the legal system and full compliance with
it, • most of the production must be for export, • buying production supplies from local suppliers even
if they are more expensive.
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World Trade Organization
deals with regulation of trade between
participating countries by providing a framework for
negotiating trade agreements and a dispute resolutionprocess aimed at
enforcing participants' adherence to WTO
agreements
••
oversees the implementation,
administration and operation of the
covered agreements and provides a forum for negotiations and for settling disputes
••facilitate the
implementation, administration and
operation and further the objectives of the
Multilateral Trade Agreements, and shall also provide the frame
work for the implementation,
administration and operation of the
multilateral Trade Agreements
••provide the forum
for negotiations among its members
concerning their multilateral trade
relations in matters dealt with under the Agreement of
Membership
••
cooperate, as appropriate, with the international Monetary Fund
(IMF) and with the International Bank for Reconstruction and Development
(IBRD) and its affiliated agencies
•
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Established during the session of Marrakech in Morocco in 194 of Uruguay Round (1986). is an intergovernmental organization that regulates international trade. The WTO officially commenced on 1 January 1995 under the Marrakesh Agreement, signed by 123 nations on 15 April 1994, replacing the General Agreement on Tariffs and Trade (GATT), which
commenced in 1948. Mr. Roberto Azevedo
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5 Principles of Trading in WTO
Non DiscriminationIt has two major components: the most favored nation (MFN) rule, and the national treatment policy. The MFN rule requires that a WTO member must apply the same conditions on all trade with other WTO members. National treatment means that imported goods should be treated no less favorably than domestically produced goods (at least after the foreign goods have entered the market)
Reciprocity
Target Segment
Binding
Transparency
Safety Values
three types of provision
Non Discrimination
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Importance Global Awareness
RECIPROCITY
• It reflects both a desire to limit the scope of free-riding that may arise because of the MFN rule,
• and a desire to obtain better access to foreign markets.
• A related point is that for a nation to negotiate,
• it is necessary that the gain from doing so be greater than the gain available from unilateral liberalization;
• reciprocal concessions intend to ensure that such gains will materialize
Cost
Non Discrimination
Binding
Transparency
Safety Values
three types of provision
Reciprocity
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Importance Global Awareness
BINDING• The tariff commitments made by
WTO members in a multilateral trade negotiation and on accession are enumerated in a schedule (list) of concessions.
• These schedules establish "ceiling bindings": a country can change its bindings, but only after negotiating with its trading partners, which could mean compensating them for loss of trade
Reciprocity
Non Discrimination
Competition
Transparency
Safety Values
three types of provision
Binding
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Importance Global Awareness
Reciprocity
Non Discrimination
Binding
Society & Law
Safety Values
three types of provision
Transparency
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TRANSPARENCYmembers are required to publish their trade regulations, to maintain institutions allowing for the review of administrative decisions affecting trade, to respond to requests for information by other members, and to notify changes in trade policies to the WTO
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Importance Global Awareness
SAFETY VALUESWTO's agreements permit members to take measures to protect not only the environment but also public health, animal health and plant health
Reciprocity
Non Discrimination
Binding
Transparency
Variant Prices
three types of provision
Safety Values
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Importance Global Awareness
1. articles allowing for the use of trade measures to attain non-economic objectives;
2. articles aimed at ensuring "fair competition"; members must not use environmental protection measures as a means of disguising protectionist policies.
3. provisions permitting intervention in trade for economic reasons
Reciprocity
Non Discrimination
Binding
Transparency
Safety Values
Discount Policythree types of provision
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International Monetary Fund IMF
It now plays a central role in the management of balance of payments
difficulties and international financial
crises. Countries contribute funds to a pool through a quota
system from which countries experiencing balance of payments problems can borrow
money
••
to promote international monetary co-
operation, international trade, high employment,
exchange-rate stability, sustainable economic growth,
and making resources available
to member countries in financial difficulty
••providing policy,
advice and financing the members, by
working with developing nations to
help them achieve macroeconomic
stability and reduce poverty
••The rationale for
this is that private international
capital markets function
imperfectly and many countries
have limited access to financial markets
••
Such market imperfections, together with
balance-of-payments financing,
provide the justification for
official financing ]
The IMF provides alternate sources of
financing.
•
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An international organization headquartered in Washington, D.C., of "189 countries . Formed in 1944 at the Bretton Woods Conference primarily by the ideas of Harry Dexter White and John Maynard Keynes, and its current director is Christine Lagarde. Foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world.
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3 Primary Functions of IMF
• to oversee the fixed exchange rate arrangements between countries
• national governments manage their exchange rates
• provide short-term capital to aid the balance of payments. This assistance was meant to prevent the spread of international economic crises
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Surveillance of the global economy
The IMF is mandated to oversee the international monetary and financial system and monitor the economic and financial policies of its member countries. This activity is known as surveillance and facilitates international co-operation:
The General Data Dissemination System (GDDS): data dissemination standards with the view of guiding IMF member countries to disseminate their economic and financial data to the public
Special Data Dissemination Standard (SDDS).This is an upgraded statistical system of the GDDS
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Conditionality of Loans
1. IMF conditionality is a set of policies or conditions that the IMF requires in exchange for financial resources
2. The IMF does require collateral from countries for loans but also requires the government seeking assistance to correct its macroeconomic imbalances in the form of policy reform.
3. If the conditions are not met, the funds are withheld. The concept of conditionality was introduced in a 1952 Executive Board decision and later incorporated into the Articles of Agreement.
4. Conditionality is associated with economic theory as well as an enforcement mechanism for repayment. Stemming primarily from the work of Jacques Polak, the theoretical underpinning of conditionality was the "monetary approach to the balance of payments".
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IMF Structure Adjustment for Conditionality of Loans
These are the Macroeconomic Structure of IMF for granting loans to Members
Cutting expenditures,
also known as austerity
Focusing economic output on
direct export and resource
extraction
Devaluation of currencies
Trade liberalization,
or lifting import and
export restrictions
Increasing the stability of
investment (by supplementing foreign direct
investment with the opening of domestic
stock markets),
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IMF Structure Adjustment for Conditionality of Loans
These are the Macroeconomic Structure of IMF for granting loans to Members
Balancing budgets and
not overspending,
Removing price controls
and state subsidies
Privatization, or divestiture of all or part
of state-owned
enterprises
Enhancing the rights of foreign
investors vis-a-vis national laws
Improving governance and
fighting corruption.
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79
World Bank Group
World Bank
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(IBRD) International Bank for
Reconstruction and Development
(IDA) International Development Association
(IFC) International Finance Corporation
(MIGA) Multinational Investment Guarantee Association
(ICSID) International Centre for Settlement of Investment Disputes
Structure of the World Bank Group
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CRITERIA OF THE WORLD BANK
The following are some of the Criteria of the World Bank:
Eradicate Extreme
Poverty and Hunger
Achieve Universal Primary
Education
Promote Gender Equality
Improve Maternal
Health
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Reduce Child
Mortality
Combat HIV/AIDS,
Malaria, and Other Diseases
Ensure Environmental Sustainability and Develop a Global
Partnership for Development
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Objective
• The Benefits of International Markets
• The scope of the International Marketing Task
• The Importance of Self-Reference Criterion (SRC)
• The increasing importance of global awareness
• The Progression of Becoming a Global Market
• The Importance of Gatt and The WTO, IMF and World Bank
• Explain Marketing Planning Process
• Marketing Opportunities in EU/Africa/Middle East
• Importance of the Bottom-of-the-Pyramid Market
• Diversity Across the Region
• The Evolution of the EU and strategic implications
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Factors of concern for the International Marketer
Globalization of
the Markets
Restructuring of the Eastern
European Bloc
New emerging states become
market economies
The birth of Russia from the end of
USSR
Worldwide cooperation and
competition
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Fast facts of the European Union
an internal single market through a standardized system of laws
ensure the free movement of people, goods, services, and capital within the internal market
A monetary union composed of 19 EU member states which use the euro currency
The European Union (EU) is a political and economic union of 28 member states
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The Maastricht Treaty established the European Union in 1993 and introduced European citizenship
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Organizational Structure
Donald Tusk
President of
the
European
Council
since 2014
Jean-Claude
Juncker
President of
the
European
Commission
since 2014
Antonio
Tajani
President of
the
European
Parliament
since 2017
Mario
Draghi
President of
the
European
Central
Bank
Since 2011
Jeroen Dijsselbloem
President of the
Euro Group and
President of the Board of
Governors of the European Stability
Mechanism (ESM)
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Organizational Structure
European Union
European Union
Court of Justice of the
European Union
Court of Justice of the
European Union
Council of the European
Union
Council of the European
Union
European Council
European Council
European Commission
European Commission
European ParliamentEuropean
Parliament
European Central Bank
European Central Bank
European Court of Auditors
European Court of Auditors
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Bases for Segmentation
European Council
sets the general political directions and priorities of the Union by gathering together its member states' heads of state/government
Council of the European Union
executive meeting of ministers of member states governments' departments. It is the Upper House
Court of Justice of the European Union
ensures the uniform application of EU law and resolves disputes
manages and directs the Commission's permanent civil service
European Commission
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European Parliament
consists of 751 directly elected representatives, forming the EU's lower house
Bases for Segmentation
European Central Bank
responsible for monetary stability within member states
European Court of Auditors
investigates the proper management of finances
Behavioral Segmentation
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Aspects regulated by the EU
Military SupportMilitary Support
Humanitarian Aid
Humanitarian Aid
Internal MarketInternal Market
Monetary Union
Monetary Union
EnergyEnergy
InfrastructureInfrastructureCompetitionCompetition
Cultural PolicyCultural Policy
SportSport
MediaMedia
AgricultureAgriculture
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Objective
• The Benefits of International Markets
• The scope of the International Marketing Task
• The Importance of Self-Reference Criterion (SRC)
• The increasing importance of global awareness
• The Progression of Becoming a Global Market
• The Importance of Gatt and The WTO, IMF and World Bank
• The Evolution of the EU and strategic implications
• Explain AIDA
• Importance of the Bottom-of-the-Pyramid Market
• Diversity Across the Region
• Marketing Opportunities in EU/Africa/Middle East
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NAFTA (North America Free Trade Agreement)
It is agreement signed by Canada, Mexico, and the United States, creating a trilateral trade bloc in North America. The agreement came into force on January 1, 1994It regulates trade of goods and services, movement of capitals, banking and financing, movement of people, educational and cultural exchanges, environment protection policies, research and development and cooperation between Canada, Mexico and USA
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ASIA PACIFIC TRADE ASSOCIATIONS
Association of Southern Asian Nationsa regional intergovernmental organization comprising ten Southeast Asian states which promotes Pan-Asianism and intergovernmental cooperation and facilitates economic, political, military, educational and cultural integration amongst its members and Asian states.
AFTA
Target Segment
ASEAN + 3
APEC
ASEAN
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Importance Global Awareness
ASEAN FREE TRADE AREA
• a trade bloc agreement by the Association of Southeast Asian Nations supporting local manufacturing in all ASEAN countries.
• was signed on 28 January 1992 in Singapore
The primary goals of AFTA seek to:• Increase ASEAN's competitive edge as a
production base in the world market through the elimination, within ASEAN, of tariffs and non-tariff barriers; and
• Attract more foreign direct investment to ASEAN.
Cost
ASEAN
ASEAN + 3
APEC
AFTA
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Importance Global Awareness
ASEAN + 3• ASEAN Plus Three (APT) is a forum that
functions as a coordinator of co-operation between the Association of Southeast Asian Nations and the three East Asia nations of China, Japan, and South Korea.
• has been credited as forming the basis for financial stability in Asia
• The Asian Currency Unit (ACU) is a proposed weighted index of currencies for ASEAN+3.
• The Asia Development Bank is charged with the task to create the ACU
AFTA
ASEAN
Competition
APEC
ASEAN + 3
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Importance Global Awareness
AFTA
ASEAN
ASEAN + 3
Society & LawAPEC
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APEC Asia-Pacific Economic Cooperation (APEC) is a forum for 21 Pacific Rim member economies[that promotes free trade throughout the Asia-Pacific region. It was established in 1989 in response to the growing interdependence of Asia-Pacific economies and the advent of regional trade blocs in other parts of the world; to defuse fears that highly industrialized Japan (a member of G8) would come to dominate economic activity in the Asia-Pacific region; and to establish new markets for agricultural products and raw materials beyond Europe
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Marketing Opportunities
1 Strategic Implications 2
4Market Barriers
6Level of Market Development
3
5
10
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Opportunities
Marketing Mix Implications
Demand in Developing Countries
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Strategic Implications
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General Agreement on Tariff and Trade
2 Opportunities
6Level of Market Development
1 Strategic Implications
4Market Barriers Marketing Mix Implications
Demand in developing countries
3
5
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reserved.
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Opportunities
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Market Barriers
3
2 Opportunities
6Level of Market Development
1 Strategic Implications
4Marketing Mix Implications
Demand in developing countries5
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General Agreement on Tariff and Trade
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Market Barriers
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4Marketing Mix ImplicationsMarket Barriers
3
2 Opportunities
6Level of Market Development
1 Strategic Implications
Demand in developing countries5
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General Agreement on Tariff and Trade
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Market Mix Implications
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Level of Market Development
5
4Marketing Mix ImplicationsMarket Barriers
3
2 Opportunities
6
1 Strategic Implications
Demand in developing countries
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General Agreement on Tariff and Trade
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Levels of Marketing Development
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6 Demand in Developing Countries
Level of Market Development
5
4Marketing Mix ImplicationsMarket Barriers
3
2 Opportunities1 Strategic Implications
8
9
12
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General Agreement on Tariff and Trade
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Demand in Developing Countries
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Objective
• The Benefits of International Markets
• The scope of the International Marketing Task
• The Importance of Self-Reference Criterion (SRC)
• The increasing importance of global awareness
• The Progression of Becoming a Global Market
• The Importance of Gatt and The WTO, IMF and World Bank
• The Evolution of the EU and strategic implications
• Marketing Opportunities in EU/Africa/Middle East
• Explain SWOT Analysis
• Diversity Across the Region
• Importance of the Bottom-of-the-Pyramid Market
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Bottom of the Pyramid Market
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Bottom of the Pyramid Market
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Theory of Bottom of the Pyramid Market
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The wealth pyramid. As we move higher and higher up in wealth we find fewer and fewer people having that wealth and vice versa.
The pyramid is a graphical depiction of inverse relationship between two variables as one increases the other decreases.
We find that the percent of world wealth and the percent of world population controlling it are related with each other in an inverse relation
The standards and benchmarks developed - for example less than $2.5 a day - always tell us about the upper limit of what we call the BoP, and not actually about its base or bottom.
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Examples of BoP Businesses
Microcredit
"lend tiny amounts of money to people with even tinier assets"
Market-specific products
Products designed and packaged for the poor and low income consumers
Innovation in the BoP
Relative advantage and Complexity must be attributes on innovation for the BoPs Markets
several social venture funds are already active, true Venture Capital (VC) funds are now emerging.
Venture capital
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Examples of BoP Businesses
Brand in the bottom of the pyramid market
Brand influences the new product adoption in the Bottom of Pyramid market
Brand may positively influence the relative advantage of an innovation
Relative advantage and Complexity must be attributes on innovation for the BoPs Markets
Partnerships between firms and BoP markets are encouraged for the development of products and services able to address the needs of consumption related to those markets
Business and community partnerships
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Examples of BoP Businesses
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Objective
• The Benefits of International Markets
• The scope of the International Marketing Task
• The Importance of Self-Reference Criterion (SRC)
• The increasing importance of global awareness
• The Progression of Becoming a Global Market
• The Importance of Gatt and The WTO, IMF and World Bank
• The Evolution of the EU and strategic implications
• Marketing Opportunities in EU/Africa/Middle East
• Importance of the Bottom-of-the-Pyramid Market
• Compare Old-School vs. Predictive Marketing Mix Analysis• Diversity Across the Region
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Big Emerging Markets BEMs
• All geographically large
• Have significant population
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• Are sizeable markets for wide range of products and services
• Have strong rates of growth or the potential to achieve higher standards of living
• Have strong plan for economic reform already in planning
• Have political leadership and are considered regional economic drivers in their region, and seek to
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Summary
In this module you learnt that:
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The globalization of markets and competition requires that managers pay attention to global environment
International Marketing is defined as the performance of business activities, including pricing, promotion, product, and distribution decisions across national borders
The Task of International Marketing is made more daunting and complex due to uncontrollable factors in domestic and foreign environments. The various differences of environment must be carefully studied, analyzed, considered and faced as challenges but not as obstacles
SRC and Ethnocentrism may impede the full comprehension of the social, economic, political, and cultural differences of the foreign target markets
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Summary
In this module you learnt that:
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Three different strategies are used by international marketers:
International Marketing is ancillary to domestic market
International Marketing is crucial for generating sales revenue but the firm consider each market separately and applies tailor made marketing strategy focused on each market
Global Marketing may change and force the company to consider the domestic and foreign markets as a single market and all marketing efforts are strategically globalized to meet the needs and wants of the global consumer