Presentation on theme: "International Marketing. It is the multinational process of planning and executing the marketing mix ( 4Ps) to create exchanges that satisfy organizational."— Presentation transcript:
It is the multinational process of planning and executing the marketing mix ( 4Ps) to create exchanges that satisfy organizational objectives
Dynamics of World Trade Global Competition among Global Companies for Global Consumers Emergence of Networked Global Marketplace
Global Competition Global competition exists when firms originate, produce, and market their products and services worldwide.
Global Company It operates in more than one country and captures R&D, production, marketing, financial, logistical advantages in its costs that are not available to purely domestic competitors
Global Consumer Global consumers consist of customer groups living in many different countries or regions of the world who have similar needs or seek similar features and benefits from products or services.
Global Brand A global brand is a brand marketed under the same name in multiple countries with similar and centrally coordinated marketing programs.
Birth of a nation Since 1990, 33 new countries have been created; South Sudan will be Africa’s 54th nation 1991 | 15 new countries after dissolution of USSR: Armenia, Azerbaijan, Belarus, Estonia, Georgia, Kazakhstan, Kyrgyzstan, Latvia, Lithuania, Moldova, Russia, Tajikistan, Turkmenistan, Ukraine, Uzbekistan Early 1990s | Yugoslavia dissolves into 5 independent nations: Bosnia-Herzegovina, Croatia, Macedonia, Serbia & Montenegro and Slovenia Mar 21, 1990 | Namibia freed by South Africa May 22, 1990 | North and South Yemen merge to form unified Yemen Oct 3, 1990 | East and West Germany create unified Germany Sept 17, 1991 | Marshall Islands and Micronesia freed by US Jan 1, 1993 | Czech Republic and Slovakia become independent as Czechoslovakia is dissolved May 25, 1993 | Eritrea gains freedom from Ethiopia Oct 1, 1994 | Palau freed by United States May 20, 2002 | East Timor gets independence from Indonesia June 2006 | Montenegro, Serbia go separate ways Feb 17, 2008 | Kosovo declares independence from Serbia
Political Interrelationships between political, legal and business decisions It is closely tied up with Social environment Government Form : – Parliamentary – No. of parties and their philosophies – Business ownerships -: private or govt. owned or combination of both
Type of Govt. & Business Ownership – Communist : Resources owned and shared by all people – Socialist : Govt. owns and operates basic major industries & leaves small ones to private ownerships – Capitalist : Free market system ( market oriented system )
Major Trends in Political Environment Govt. dominated economies or Socialist political systems have moved to Free market economies Free trade / reduce protectionism ( EEA – European Economic Area, NAFTA..) Lifting of trade sanctions
Political Risk It is uncertainty that stems from exercise of power by govt. and non-govt. actors It includes political instability, violence, expropriation, politicized policies, etc. Study govt. & public
Managing risks Resource commitment Demand stimulation Earning foreign exchange Provide employment Merge with local company Adapt country environment / local personality Organizational credibility Insurance Avoidance
Social Trends Helps in knowing market size and needs Global population : Size & Growth Global demographics characteristics and trends : – Urban & emerging rural population – Population in different Age group
Economic Environment Income levels Production of goods and services Market opportunities are function of both economic size and growth Customer Satisfaction Index
Legal Environment Legal & political environment are interdependent Branch or Subsidiary : – Negotiation – Arbitration – Litigation Bribes / Corruption Intellectual capital
Protecting Consumer & Society Act Purpose Food, Drug, and Cosmetics Act (1938) Regulates food, drug & cosmetic industries Fair Packaging and Labeling Act (1966) Regulates packaging & labeling Child Protection and Toy Safety Act (1969) Prevents marketing of dangerous products to children Consumer Credit Protection Act (1968) Requires full disclosure of financial charges for loans Fair Credit Report Act (1970) Regulates reporting & use of credit information Fair Debt Collections Practice Act (1970) Regulates methods for collecting debts Child Protection Act (1990) Regulates advertising on children’s television programs Americans with Disabilities Act (1990) Prohibits discrimination against consumers with disabilities
Culture It is values, customs, belief…. It helps communication, can be learned,… It influences consumption, thinking, behaviour, etc. It includes : – Verbal & Non verbal communications ( space, addressing, languages, smile, negotiation, etc. ) – Business time – Religion / fundamentalism / Superstition – Colour – Gifts Subcultures
Adaptation Creating local units in each national market- carrying out all steps in local market and achieving economies of scale Location : Various countries Business headed by country chiefs Strategy : Decentralization, Flexibility, Innovation Control : Since it is present in various location, control is complex
Aggregation To deliver economies of scale by creating regional or sometimes global operations Standardizing the product / services & grouping the development and production processes – emphasis on economies of scale Strategy : Regional or country groupings, focus on products, functions, competence
Arbitrage To achieve absolute economies through international specialization – exploitation of differences between national or regional markets, often by locating separate parts of the supply chain in different places Location : Diverse set of countries Operations : By functions across organisational boundaries
Conclusion Focus on one or two of A’s Make sure that all strategies are good fit organizationally Creativity, innovation, leaderships, change ---- key to integrate mechanisms