1. Introduction to International
Marketing
 Ch. 1: Scope and Challenge of International Marketing
 Ch.2: The Dynamic Environment of International Trade

2. Understanding International MarketingUnderstanding International Marketing
 Market, Marketing, International marketingMarket, Marketing, International marketing
 Domestic vs. International MarketingDomestic vs. International Marketing
 Strategic Orientation: domestic,Strategic Orientation: domestic,
multidomestic, and globalmultidomestic, and global
 Marketing mix: 4 PsMarketing mix: 4 Ps
 Environmental forces:Environmental forces: controllables vs.controllables vs.
uncontrollablesuncontrollables
 Environment and the marketing mixEnvironment and the marketing mix

3. 7
The International Marketing MixThe International Marketing Mix
Political/legal
forces
Economic
forces
1
2
Environmental
uncontrollables
country market A
Environmental
uncontrollables
country
market B
Environmental
uncontrollables
country
market C
Competitive
structure Competitive
Forces
Level of
Technology
Price Product
Promotion
Channels of
distribution
Geography
and
Infrastructure
Foreign environment
(uncontrollable)
Structure of
distribution
Economic climate
Cultural
forces
3
4
5
6
7
Political/
legal
forces
Domestic environment
(uncontrollable)
(controllable)

4. Environment and Marketing mixEnvironment and Marketing mix
Environment
Product Price Promotion Place
Economic
Competitive
Technological
Demographic
Geographic
Cultural
Political/legal

5. Understanding International MarketingUnderstanding International Marketing
 International MarketingInternational Marketing……. developing a mindset?. developing a mindset?
 Developing awarenessDeveloping awareness
 Self-Reference Criterion (SRC)Self-Reference Criterion (SRC)
 Adapting to local cultureAdapting to local culture
 FPs’ Globalization IndexFPs’ Globalization Index
 Economic integrationEconomic integration
 Personal contactPersonal contact
 Political engagementPolitical engagement
 Technological connectivityTechnological connectivity

6. Global GovernanceGlobal Governance
 Politics/PeacePolitics/Peace- United Nations- United Nations
 TradeTrade- World Trade Organization (WTO)- World Trade Organization (WTO)
 Money/FinanceMoney/Finance- International Monetary Fund- International Monetary Fund
(IMF)(IMF)
 DevelopmentDevelopment- World Bank- World Bank
 OverallOverall- G8 Nations (USA, Canada, UK,- G8 Nations (USA, Canada, UK,
France, Germany, Italy, Japan, and Russia)France, Germany, Italy, Japan, and Russia)
 Other international institutions/bodiesOther international institutions/bodies

7. Institutions in International TradeInstitutions in International Trade
 World Economic and Trade Environment
 WTO, IMF, and World Bank in the World Economy
 Role of the organizations
 Easing trade restrictions
 Protest against globalization
 Multinationals in the global economy
 Role of American, European, Japanese, and Third
World multinationals on a timeline
|_______|________|_______|_______|_______|_______I
1950 1960 1970 1980 1990 2000 2010

8. Protectionism and Trade BarriersProtectionism and Trade Barriers
 Protectionism and Tariff BarriersProtectionism and Tariff Barriers
 Cost of protectionism: arguments for and againstCost of protectionism: arguments for and against
 Nontariff Barriers:Nontariff Barriers:
 Quota and Import LicensesQuota and Import Licenses
 Domestic Subsidy and Economic StimuliDomestic Subsidy and Economic Stimuli
 Standards and documentation requirementsStandards and documentation requirements
 Boycotts and EmbargoesBoycotts and Embargoes
 Monetary barriersMonetary barriers
 Antidumping PenaltiesAntidumping Penalties

9. Balance of Payments (BOP) AccountBalance of Payments (BOP) Account
A. Current AccountA. Current Account
Merchandise TradeMerchandise Trade
ServicesServices
Unilateral TransferUnilateral Transfer
C. International ReserveC. International Reserve
Gold, Silver, and Precious MetalsGold, Silver, and Precious Metals
Foreign CurrencyForeign Currency
Special Drawing Rights (SDR)Special Drawing Rights (SDR)
B. Capital AccountB. Capital Account
Portfolio InvestmentPortfolio Investment
Direct InvestmentDirect Investment
Short term loansShort term loans
D. Net StatisticalD. Net Statistical
DiscrepancyDiscrepancy
BOP Account must balance,BOP Account must balance,
Equation: A+B = C+DEquation: A+B = C+D

10. Ch 1 and 2: Questions for DiscussionCh 1 and 2: Questions for Discussion
1.1. What is international marketing? How does it differWhat is international marketing? How does it differ
from domestic marketing?from domestic marketing?
2.2. What is “developing a mindset” in internationalWhat is “developing a mindset” in international
marketing? How is it related to self-referencemarketing? How is it related to self-reference
criteria?criteria?
3.3. What is protectionism? Is it good (or bad) for anWhat is protectionism? Is it good (or bad) for an
economy? How?economy? How?
4.4. Explain how nontraiff barriers affect trade.Explain how nontraiff barriers affect trade.
5.5. What is subsidy? What is the effect of subsidy onWhat is subsidy? What is the effect of subsidy on
trade and economy?trade and economy?
6.6. What is a BOP account? Explain the four subheadsWhat is a BOP account? Explain the four subheads
of a BOP account. Why should an internationalof a BOP account. Why should an international
marketing manager study the BOP account of amarketing manager study the BOP account of a
country?country?

11. Top Ten 2000 U.S. Trading
Partners ($ billions)
Canada $176.4 $229.2 $405.6 -$52.8
Mexico 111.7 135.9 247.6 -24.2
Japan 65.3 146.5 211.8 -81.3
China 16.3 100.0 116.3 -83.8
Germany 29.3 558.7 88.0 -29.5
United Kingdom 41.5 43.5 85.0 -1.9
South Korea 27.9 40.3 68.2 -12.4
Taiwan 24.4 40.5 64.9 -16.1
France 21.0 29.0 50.0 -8.0
Singapore 17.4 19.6 37.0 -2.2
Country U.S. Exports U.S. Imports Total Surplus/
Deficit

12. The Nationality of the World’s 100 Largest Industrial
Corporations (by country of origin)
United States 67 47 47 33 32 24 24 36
Germany 13 13 8 12 14 14 13 12
Britain 7 7 5 6 4 1 2 5
France 4 11 5 10 6 12 13 11
Japan 3 7 12 18 23 37 29 22
Italy 2 3 3 4 4 3 4 3
Netherlands-United Kingdom 2 2 2 2 2 2 2 --
Netherlands 1 3 1 1 1 2 2 5
Switzerland 1 1 2 3 3 3 5 3
Argentina -- -- 1 -- -- -- -- --
Belgium -- 1 1 -- -- -- -- 1
Brazil -- 1 -- 1 1 -- -- --
Canada -- 2 3 -- -- -- -- --
India -- -- 1 -- -- -- -- --
Kuwait -- -- 1 -- -- -- -- --
Mexico -- 1 1 1 1 -- 1 --
Venezuela -- 1 1 1 1 -- 1 --
South Korea -- -- 4 2 4 2 4 --
Sweden -- -- 1 2 1 -- -- --
South Africa -- -- 1 1 -- -- -- --
Spain -- -- -- 2 2 -- -- --
Turkey -- -- -- -- 1 -- -- --
China -- -- -- -- -- -- -- 2
1963 1979 1984 1990 1993 1995 1996 2000

13. U.S. Current Account by Major Components,
1990-1999 ($ billions)
Merchandise Trade
a. Exports $201.8 $219.9 $215.9 $224.0 $246.6 $319.9 $362.1 $389.3 $416.9 $440.4 $456.9
b. Imports 268.9 332.4 338.1 368.5 409.9 446.4 477.4 498.3 491.0 536.5 589.4
c. Balance -67.1 -112.5 -122.2 -144.5 -160.3 -126.5 -115.2 -109.0 -74.1 -96.1 -132.5
Business Services
a. Exports 42.3 44.3 46.2 51.8 59.4 69.1 116.5 136.6 153.7 164.4 174.5
b. Imports 35.8 42.3 47.2 51.0 58.0 63.2 86.9 98.7 101.6 104.4 112.7
c. Balance +6.6 +2.0 -1.0 +0.8 +1.4 +5.9 +29.6 +37.9 +52.1 +60.0 +61.8
1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993
SOURCES: Survey of Current Business, U.S. Department of Commerce,
Bureau of Economic Analysis. http://www.stat-usa.gov/BEN/heal/sch.html.
Februarly 1998Irwin/McGraw-Hill

14. 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993
U.S. Current Account by Major Components,
1983-96 ($ billions)
International Investment Income
a. Receipts 77.3 85.9 88.8 90.1 103.8 108.2 152.5 160.3 136.9 114.4 113.9
b. Payments 52.4 67.4 62.9 67.0 83.4 105.6 138.9 139.6 122.1 109.9 109.0
c. Balance +24.9 +18.5 +25.9 +23.1 +20.4 +2.6 +13.6 +20.7 +14.8 +4.5 +4.0
Total Goods and Services
a. Exports 334.4 360.8 360.6 375.0 424.8 507.8 641.4 696.8 717.0 731.4 755.6
b. Imports 371.2 455.6 460.7 498.6 565.3 629.6 718.2 754.9 730.7 767.3 827.3
c. Balance -36.8 -94.8 -100.1 -123.6 -140.5 -121.8 -76.7 -58.1 -13.7 -35.9 -71.7
Net unilateral
transfers -9.5 -12.2 -15.0 -15.3 -13.4 -13.6 -26.1 -33.7 +6.7 -31.9 -32.0
Current account
balance -46.2 -107.0 -115.1 -138.9 -153.9 -135.4 -102.8 -91.8 -7.0 -67.8 -103.7
SOURCES: Survey of Current Business, U.S. Department of Commerce,
Bureau of Economic Analysis. http://www.stat-usa.gov/BEN/heal/sch.html.
February 1998.

15. Buying Boom for Asia, 1995-2000
Millions of
households
approaching
$18,000 per year
buying power
Indexed to
Singapore prices
14.4
32.5
73.3
1991 1995 2000
What the added Between 1993 and
middle class will 1995 2000
buy (In million)
Bedrooms 32 116
Living Rooms 16 58
Kitchens 16 58
Bathrooms 32 116
Living space (sq.m.) 1,200 4,350
Large appliances 16 58
Televisions 24 87
Telephones 24 87
Cars 16 58
SOURCE: Bill Saporito, “Where the Global Action Is.”
Fortune, Autumn-Winter 1993, p.64.

16. The Price of Protectionism
Industry Total Costs to Number of Cost per
Consumers Jobs Saved Job Saved
(in $ millions)
Textiles and
apparel $27,000 640,000 $ 42,000
Carbon Steel 6,800 9,000 $ 750,000
Autos 5,800 55,000 $ 105,000
Dairy products 5,500 25,000 $ 220,000
Shipping 3,000 11,000 $ 270,000
Meat 1,800 11,000 $ 160,000
SOURCE: Michael McFadden, “Protectionism Can’t Protect Jobs,”
Fortune, May11, 1987, pp. 125.