MARKETING MANAGEMENT CHAPTER 21– TAPPING INTO GLOBAL MARKETGuided by DR. S.V KULKARNI PRESENTED BY: URMEE DOSHI (27) NAINA HINGHER (32) SANDEEP KAUR BATH (11)
What is a Global Firm? A global firm is one that operates in more than one country and captures R&D, production, logistical, marketing, and financial advantages in its costs andreputation that are not available to purely domestic competitors.
Major Decisions in International Marketing Deciding whether to go abroad Deciding which markets to enter Deciding how to enter Deciding on the marketing program Deciding on the marketing organization
DEVELOPED V/S DEVELOPING MARKETS Developing market have huge potential Market leaders rely on developing markets to fuel their growth UNILEVER & COLGATE generated 40% of their business in developing markets
Top Global Firms Based in Developing Markets America Movil Huawei Technologies Cemex Infosys Technologies China Mobile Koc Holding CNOOC Lenovo Group Embraer MMC Norilsk Nickel Gazprom Mahindra & Mahindra Haier Hisense
Regional Free Trade Zones European Union NAFTA MERCOSUL APEC ASEAN The purpose of these trade zones are not only to remove trade barriers on member nations but also to impose common external barriers on non-members. They allow free movement of labour and capital within the region.
Key Developing Markets Brazil Russia India China South Africa
Desired Country Characteristics for Market Entry Rank high on market attractiveness Rank low in market risk Possess a competitive advantage
Five Modes of Entry into Foreign Markets Indirect exporting Direct exporting Licensing Joint ventures Direct investment
INDIRECT EXPORT:There is less investmentThere is less riskThus , it is the best way to get involved in international market.DIRECT EXPORT: (ways)Domestic based exportOverseas sales branchTravelling export sales representativeForeign based agentsLICENSING:It means to get permission to use a manufacturing process,trademark etc. for a fee or royaltyA company can also enter foreign market through franchising
JOINT VENTURES:A joint venture (often abbreviated JV) is an entity formedbetween two or more parties to undertake economic activitytogether. The parties agree to create a new entity by bothcontributing equity, and they then share in the revenues,expenses, and control of the enterprise.Eg:- Procter & Gamble, Maruti Suzuki ltd. EtcDIRECT INVESTMENT:Foreign companies buy a part or full interest in a localcompanyEg:- General Motors invested in Shanghai GM etc.
Global Marketing Advantages Disadvantages Economies of scale Differences in consumer Lower marketing costs needs, wants, usage Power and scope patterns Consistency in brand Differences in consumer image response to marketing mix Ability to leverage Differences in brand Uniformity of marketing development process practices Differences in environment
What Marketing Aspects Might Be Adapted for International Marketing? Product features Brand name Labeling Packaging Colors Advertising execution Materials Prices Sales promotion Advertising themes Advertising media
Cultural Dimensions Individualism vs. collectivism (self worth is rooted more in social system than individuals achievement) Masculine vs. feminine (culture dominated by assertive males vs nurturing females) High vs. low power distance (high power cultures tends to be less egalitarian) Weak vs. strong uncertainty avoidance (it shows how risk tolerant people are)
Commandments of Global Branding Understand similarities and differences in the global branding landscape Do not take shortcuts in brand building Establish a marketing infrastructure Embrace integrated marketing communications Establish brand partnerships
Commandments of Global Branding (cont.) Balance standardization and customization Balance global and local control Establish operable guidelines Implement a global brand-equity measurement system Leverage brand elements
Levels of Product Adaptation Production of regional product versions Production of country versions Production of city versions Production of retailer versions
Price Choices Set a uniform price everywhere Set a market-based price in each country Set a cost-based price in each country
What is a Gray Market? A gray market consists of branded products diverted from normal or authorizeddistributions channels in the country of productorigin or cross international borders; dealers in lower priced countries sell products in higher priced countries
Whole-Channel Concept for International Marketing Seller International headquarters Channels between nations Channels within nations Final buyers
Global Organization Strategies Export department (world as a single market) International division Global organization
SUMMARY Companies cannot simply stay domestic; they need to internationalize their operations While deciding a company needs to define its marketing policies & objectives Then decide on the best mode of entry Decide how to adapt its marketing program Manage international marketing activity