Lecture Marketing (12/e): Chapter 7 – Kerin, Hartley, Rudelius

Chapter 7 – Understanding and reaching global consumers and markets. After reading chapter 7, you should be able to: Describe the nature and scope of world trade from a global perspective and identify the major trends that have influenced world trade and global marketing, identify the environmental forces that shape global marketing efforts, name and describe the alternative approaches companies use to enter global markets, explain the distinction between standardization and customization when companies craft worldwide marketing programs.

LO 7-2

LEARNING OBJECTIVES (LO)

AFTER READING CHAPTER 7, YOU SHOULD BE ABLE TO:

LO 7-1 Describe the nature and scope of world

trade from a global perspective and identify the major trends that have influenced world trade and global marketing.

Identify the environmental forces that shape global marketing efforts.

LO 7-4

LEARNING OBJECTIVES (LO)

AFTER READING CHAPTER 7, YOU SHOULD BE ABLE TO:

LO 7-3 Name and describe the alternative

approaches companies use to enter global markets.

Explain the distinction between standardization and customization when companies craft worldwide marketing programs.

BUILDING A BILLION DOLLAR BUSINESS

IN INDIA THE DELL INC WAY

DYNAMICS OF WORLD TRADE

WORLD TRADE FLOWS

LO 7-1

 Global Perspective

 United States Perspective

• Countertrade

• Trade Feedback Effect

• Gross Domestic Product (GDP)

• Balance of Trade

FIGURE 7-1 Leading countries in global

merchandise trade in terms of imports (U.S.)

and exports (China)

DYNAMICS OF WORLD TRADE

COMPETITIVE ADVANTAGE OF NATIONS

LO 7-1

 Porter’s “Diamond”

• Factor Conditions

• Demand Conditions

• Company Strategy, Structure, and Rivalry

• Related and Supporting Industries

 Economic Espionage Act (1996)

FIGURE 7-2 Porter’s diamond of national

competitive advantage has four key elements

on why some industries and firms in different

countries become world leaders

Sony Bravia 3D HDTV and Bruno Magli Shoes

What element of Porter’s Diamond of National Competitive Strategy?

LO 7-1

MARKETING IN A BORDERLESS

ECONOMIC WORLD TREND 1—DECLINE OF ECONOMIC PROTECTIONISM

MAKING RESPONSIBLE DECISIONS

GLOBAL ETHICS AND GLOBAL ECONOMICS—

THE CASE OF PROTECTIONISM

LO 7-1

FIGURE 7-3 Protectionism hinders world trade

when countries raise prices and limit supply

through tariff and quota policies

MARKETING IN A BORDERLESS

ECONOMIC WORLD TREND 2—RISE OF ECONOMIC INTEGRATION

FIGURE 7-4 The European Union in late-2013

consists of 28 countries with more than 500

million consumers

MARKETING IN A BORDERLESS

ECONOMIC WORLD TREND 3A—GLOBAL COMPETITION

LO 7-1

 Global Competition

 Strategic Alliances

FIGURE 7-A Global companies and marketing

strategy

MARKETING IN A BORDERLESS

ECONOMIC WORLD TREND 3B—GLOBAL COMPANIES

LO 7-1

 International Firms

 Transnational Firms

 Multinational Firms

• Multidomestic Marketing Strategy

• Global Marketing Strategy

• Global Brand

MARKETING IN A BORDERLESS

ECONOMIC WORLD TREND 3C—GLOBAL CONSUMERS

LO 7-1

 Global Consumers

MARKETING MATTERS

The Global Teenager—A Market of

2 Billion Voracious Consumers

LO 7-1

MARKETING IN A BORDERLESS

ECONOMIC WORLD TREND 4—A NETWORKED GLOBAL MARKETPLACE

LO 7-1

A GLOBAL ENVIRONMENTAL SCAN

CULTURAL DIVERSITY

LO 7-2

• Foreign Corrupt Practices Act (1977)

 Cross-Cultural Analysis

 Values

 Customs

FIGURE 7-B Cultural appreciation

A GLOBAL ENVIRONMENTAL SCAN

A GLOBAL ENVIRONMENTAL SCAN

A GLOBAL ENVIRONMENTAL SCAN

A GLOBAL ENVIRONMENTAL SCAN

A GLOBAL ENVIRONMENTAL SCAN

A GLOBAL ENVIRONMENTAL SCAN

POLITICAL-REGULATORY CLIMATE

LO 7-2

 Political Stability

 Trade Regulations

MARKETING INSITE

Checking a Country’s Political Risk Rating

LO 7-2

FIGURE 7-5 Alternative global market-entry

strategies

GLOBAL MARKET-ENTRY STRATEGIES

MARKETING MATTERS

Creative Cosmetics and Creative Export Marketing in Japan

LO 7-3

GLOBAL MARKET-ENTRY STRATEGIES

GLOBAL MARKET-ENTRY STRATEGIES

GLOBAL MARKET-ENTRY STRATEGIES

FIGURE 7-6 Five product and promotion

strategies for global marketing

CRAFTING A WORLDWIDE MARKETING PROGRAM

CRAFTING A WORLDWIDE MARKETING PROGRAM PROMOTION STRATEGIES

CRAFTING A WORLDWIDE MARKETING PROGRAM DISTRIBUTION AND PRICING STRATEGIES

LO 7-4

 Countries Impose Pricing Constraints

 Channels Can Be Long or Short

 Prices May Be Too High or Too Low

• Dumping • Gray Market

 Channels and Economic Development

FIGURE 7-7 Channels of distribution in global

marketing

MARY KAY, INC.: BUILDING

A BRAND IN INDIA

VIDEO CASE 7

FIGURE 1 Social and economic statistics for

India in 2007 and China in 1995