3. Principal driving forces in global marketing
• Changes in Social Factors.
• Changes in Technology.
• Changes in Political Conditions.
• Competition in the Market.
• Competitive Advantage.
• Regulations in Home Country.
• Lack of Demand in Home Country.
4. Changes in Social factors
Example, people in the East enjoy Western Music, while
the West relishes the cuisines of India & China.
With homogenization of tastes & preferences of
customers across the world
5. Changes in Technology
Advances in Technology have made it possible for
even high contact services like healthcare &
technical support to be offered to remote
customers
6. Changes in the Political & legal conditions
In some countries, political conditions have facilitated
globalization.
7. Competition in the Market
Within a country, there may be intense competition
among the domestic players, forcing some of them to
venture outside in search of better fortunes.
9. Regulations in Home Country
Sometimes too many regulations imposed by govt in
home country encourage national players to set up
their operations in countries where such regulations
do not exist.
10. Lack of Demand in Home Country
IT firms in India like Infosys, Satyam & Mastek
concentrated on global markets in their initial
stages primarily because Indian companies did
not come forward to purchase the advanced IT
solutions that they offered.
11. Reasons for Growth of international
service marketing
1. International Transport.
2. Growing awareness about culture & countries.
3. Sate-of-the-art international communications.
4. Free & Liberalized Trade.
5. Rising standards of Living.
6. Growth of service industries like international
tourism, healthcare, education etc…
12. Global Service Strategies
1. Multi country expansion.
2. Importing Customers.
3. Following Customers.
4. Service Unbundling.
5. Beating The Clock.
13. Multi country Expansion
Franchising has come in handy for services for a multi
site expansion.
With this, services can be quickly cloned at multiple
locations. Mc Donald’s, Federal Express & Holiday Inn
Hotels etc are examples of this.
14. Importing Customers
Some services require their customer to travel a long distance &
stay for an extended period. Example Taj cannot be
recreated. Tourists must visit Agra to enjoy the beauty of Taj.
16. Service Unbundling
It refers to dividing the service into parts along the supply
chain.
Back office activities in the host country
The part requires contact with the customers in country
where the customers are present.
17. Beating The Clock
This strategy stems from the difference in time
zones across the world.
19. Exporting
Selling services to overseas customers.
For example an IT firm in India can export the services of
it’s software engineers to overseas customers.
20. Turn Key Projects:
In a turnkey project the contractor handles all aspects of
the project for a foreign client, from planning to
completion and hand over.
Turnkey projects are common in IT, Chemical,
Pharmaceutical & petroleum refining industries.
21. Licensing
Licensing is an arrangement through which an
organization grants the rights of intangible property
like patents, invention, formula, process, design,
copy rights etc to another company for a specified
period.
22. Franchising
It is similar to licensing except that it requires a long term
commitment on the part of both franchiser & franchisee.
Franchiser insists that the franchisee follows the standards
& rules specified by it.
Franchiser receives a royalty payment usually a percentage
of franchiser revenues.
Mc Donald
23. Joint Ventures
JVs allow companies to own a stake in & play a role in
management of foreign operations.
JVs require more direct investment, training, management
assistance & technology transfer.
Examples in India are ICICI & prudential, Tata and Sky
Local partner’s knowledge of host countries culture, language
& political systems
24. Strategic Alliances (SA)
A SA is an understanding or agreement among the players
in a market.
Firms form SA to expand to new markets, gain quick
access to new technology, extend the product portfolio
or avoid competition.
25. Wholly Owned Subsidiary
It allows to have a tight control over operations, but it calls for
huge investments & company has to bear the complete
risk.
26. Mergers & Acquisitions
In a merger, two organizations come together as one, with mutual
consent, in a view to synergize their operations & gain more.
In an acquisition, One organization buys out another using it’s
financial strength & negotiation skills.
27. Piggyback
In this method, an organization takes the help of another
organization to market it’s products / services in a foreign market.
Carrier
Rider
36. Factors Influencing Success of a
Global Service Firm
1. Select the right entry mode.
2. Select the right Marketing research methods.
3. Customize the service offering.
4. Train the service personnel.
5. Select the right promotion strategy.
