pp 01 introduction keegan

Global Marketing Management

Warren J. Keegan

Chapter 1 Introduction to Global Marketing

Keegan: Global Marketing Management Chapter 1/ 2

Overview

Marketing: A Universal Discipline The Three Principles of MarketingGlobal Marketing:What It Is & What It Is Not Importance of Global MarketingManagement Orientation & Global MarketingDriving and Restraining Forces Affecting Global

Integration & Global MarketingSummary


Learning Objectives

Understand how the world economy developed over the past decades

Know the impact of globalization on the marketing discipline

Learn about the interdependencies between management orientation & marketing performance

Understand the factors supporting or inhibiting international marketing activities


Marketing: A Universal Discipline

Marketing (1): the process of focusing the resources & objectives of an organization on environmental opportunities & needs

Marketing (2): a set of concepts, tools, theories, practices, procedures, & experiences

Although marketing is a universal discipline, marketing practice varies from country to country


The Marketing Concept (1)

Concept has chanced dramatically1950’s: Focus on products1960’s:

Focus on customer orientation Development of marketing mix: product, price, place,

promotion (4P’s)



1990’s: Focus on customer in the context of the broader external

environment Competition, government policy & regulation

Focus on stakeholder valueemployees, customers, shareholders, society



Today: Two key tasks of marketing

Focus on customer & his/her environmentCreate value for consumers & stakeholder

Shift towards Focus on managing strategic partnerships Positioning of firm in value chain to optimize value

creation Profit as a measure of success, not an end in itself


The Three Principles of Marketing

CUSTOMER VALUE

DIFFERENTIATION FOCUS


Key Elements of Marketing – 1. Customer Value

Goal: create customer value that is greater than the value created by competitors

Strategy: Expand or improve product and/ or service benefits Reduce the price Combine these two elements


Elements of Marketing – Customer Value

V = Value

B = Perceived Benefits – Perceived Costs

P = Price

V = B / P


Key Elements of Marketing – 2. Differentiation

Goal: create competitive advantage through differentiation

Advantage can exist in any element of a company’s offer

One way to penetrate a new national market is to offer a superior product at a lower price.


Key Elements of Marketing – 3. Focus

Goal: a concentration of attention & resources Requirement to create customer value at a

competitive advantage A viable way for small & medium sized companies

to achieve dominant position in world market A clear focus on customer needs & wants


Global Marketing Marketing discipline is universal but markets &

customers are quite different 3 domains of knowledge

Cross-Cultural Knowledge Country/ Regional Knowledge Cross-Border Transactions Knowledge

Need for “Global Localization”: Adjustment of global marketing strategies to local requirements


Product Design

Canon/photocopier/McDonalds/Toyota/Ford

Brand Name Marlboro/Coke/Pepsi/Mercedes/Caterpillar

Product Positioning

Colgate toothpaste/Unilever fabric softener

Packaging Gillette razors

Advertising Strategy

Coca-cola/British Airways/Benetton

Sales Promotion

IBM

Distribution Benetton/United Distillers

Customer Service

American Express/Hertz

Examples of Global Marketing


Importance of Global Marketing

International arena is of great importance to companies maximizing growth potential

75% of market potential is outside the US 94% of market potential for German companies is

outside of Germany A large number of industries will be dominated by a

handful of global companies


Management Orientation and Global Marketing (1)

Different Management Orientations in the Global Arena – EPRG Framework

Regiocentric

Ethnocentric

Geocentric

Polycentric


Management Orientation & Global Marketing (2)

Ethnocentric Orientation: Characteristic of domestic & international companies Opportunities outside the home market are pursued by

extending various elements of the marketing mix

Polycentric Orientation Characteristic of multinational companies Marketing mix is adapted by autonomous country

managers


Management Orientation & Global Marketing (3)

Regiocentric or Geocentric Orientation: Characteristic of global & transnational companies Marketing opportunities are pursued by both extension &

adaptation strategies in global markets


Driving Forces Affecting Global Marketing Technology Regional Economic Agreements Market Needs & Wants Transportation & Communication Improvements Product Development Costs Quality World Economic Trends Leverage The Global/ Transnational Corporation


Restraining Forces Affecting Global Marketing

Management Myopia & Organizational Culture

National Controls & Barriers


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

pp 01 introduction keegan

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