Tapping Global Market


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Tapping Global Market

  1. 1. Tapping Into Global Markets Top 10 Concepts Michael Tolentino Ateneo Graduate School of Business
  2. 2. Outline: Tapping Into Global Market <ul><li>1. Is expected in companies (why?) </li></ul><ul><li>2. Are based on factors that draws companies into the international arena (how?) </li></ul><ul><li>3. Should be rated into three criteria (how?) </li></ul><ul><li>4. Must first define (what?) </li></ul><ul><li>5. Has two typical entry strategies (what?) </li></ul>
  3. 3. Outline: Tapping Into Global Market <ul><li>6. Have distinctions between (what?) </li></ul><ul><li>7. Should have the best mode of entry (what?) </li></ul><ul><li>8. Makes companies decide on a marketing program (how?) </li></ul><ul><li>9. Can affect consumers and business alike (how?) by country of origin perceptions. </li></ul><ul><li>10. makes companies manage their international marketing activity in three ways (how)? </li></ul>
  4. 4. Concpet 1: Tapping Into Global Market Is Expected in Companies <ul><li>As products and services developed in one country are finding enthusiastic acceptance in other countries. </li></ul><ul><li>Companies cannot simply stay domestic and expect to maintain their markets. </li></ul>
  5. 5. Concept 2: Factors that Draws Companies to the International Arena <ul><li>Presents higher profits. </li></ul><ul><li>Larger customer base. </li></ul><ul><li>Independence from one market. </li></ul><ul><li>Competition with global competitors. </li></ul><ul><li>International service is required </li></ul>
  6. 6. Concept 3: Company’s Marketing Objectives and Policies <ul><li>Marketing objectives and policies should be defined in deciding to go global. </li></ul><ul><ul><li>To market into few or many countries? </li></ul></ul><ul><ul><li>Which countries to market? </li></ul></ul>
  7. 7. Concept 4: Entering Global Market is Rated into Three Criteria <ul><li>Market attractiveness </li></ul><ul><li>Risk </li></ul><ul><li>Competitive advantage </li></ul>
  8. 8. Concept 5: Two Typical Entry Strategy <ul><li>Waterfall Approach </li></ul><ul><ul><li>Gradually entering countries in sequence. </li></ul></ul><ul><li>Sprinkler Approach </li></ul><ul><ul><li>Entering countries simultaneously. </li></ul></ul>
  9. 9. Concept 6: Distinctions in Tapping Global Market <ul><li>Developed Market </li></ul><ul><ul><li>High purchasing powers. </li></ul></ul><ul><li>Developing Market </li></ul><ul><ul><li>Low purchasing powers. </li></ul></ul>
  10. 10. <ul><li>Indirect Exporting – exports that are not handled directly by the manufacturer or producer but through an export agent. </li></ul><ul><li>Direct Exporting – international sales in which a producer or supplier controls all activities and collects all drawbacks. </li></ul>Concept 7: Mode of Entry into the Market
  11. 11. <ul><li>Licensing – right given to a foreign company to use a manufacturing process, trademark, patent, trade secret or other item of value for a fee or royalty. </li></ul><ul><li>Joint Ventures – foreign investors joins local investors to create a company in which they share ownership and control. </li></ul>Concept 7: Mode of Entry into the Market
  12. 12. Concept 7: Mode of Entry into the Market <ul><li>Direct Investment – direct ownership of foreign-based assembly or manufacturing facility. </li></ul>
  13. 13. <ul><li>Product Level </li></ul><ul><ul><li>Straight extension – introduces the product in the foreign market without any change. </li></ul></ul><ul><ul><li>Product adaptation – alters the product to meet local conditions and preferences. </li></ul></ul><ul><ul><li>Product invention – creating new product that are well adapted to a foreign country’s needs. </li></ul></ul>Concept 8: Decide On Marketing Program
  14. 14. Concept 8: Decide On Marketing Program <ul><li>Communication Level </li></ul><ul><ul><li>Communication adaptation – companies run the same marketing communications programs used in the home market. </li></ul></ul><ul><ul><li>Dual adaptation – adapts both the product and communications in foreign country. </li></ul></ul>
  15. 15. Concept 8: Decide On Marketing Program <ul><li>Price Level </li></ul><ul><ul><li>Price escalation – prices can be set uniformly in every country, set a market-based price for each country or set a cost-based price in each country. </li></ul></ul><ul><ul><li>Dumping - Exporting goods at prices lower than the home-market prices. </li></ul></ul>
  16. 16. Concept 8: Decide On Marketing Program <ul><li>Price Level </li></ul><ul><ul><li>Gray Market – Goods sold outside of an authorized sale-territory at prices lower than being charged in the authorized sales area. </li></ul></ul><ul><ul><li>Counterfeit Products – Imitation goods sold made to pass off as a genuine item. </li></ul></ul>
  17. 17. Concept 8: Decide On Marketing Program <ul><li>Distribution Level – companies needs to know how the product moves within the foreign country and take a whole-channel view of distributing products to its final users. </li></ul>
  18. 18. <ul><li>Country of origin perceptions are the mental associations and beliefs triggered by a country. </li></ul><ul><li>Mental associations and beliefs affects consumers and business alike. </li></ul>Concept 9: Country of Origin Effects
  19. 19. Concept 10: Marketing Organization <ul><li>Export department – a local department that handles the shipping out of its goods. </li></ul><ul><li>International division – handles all international activities which is usually headed by a division president. </li></ul><ul><li>Global organization – Has executives doing global operations, has management from different countries, purchases least cost of supplies and makes investments with anticipated returns. </li></ul>