Amity Business School AMITY SCHOOL OF BUSINESS BBA, II Sem PRINCIPLES OF MARKETING II Ruchika Jeswal

What is Globalization Globalization (or globalization) is the process of international integration arising from the interchange of world views, products, ideas and other aspects of culture. It involves the firms in making one or more marketing mix decisions across national borders. Companies like Coca cola, GE, IBM, Siemens, Ford, Boeing, Toyota, Sony and several other firms have made the world their market.

Features Cross Border activities Degree of Risk Credit Oriented Regulated by rules and regulations Level of competition Complexity Scope

Major International Marketing Decisions Looking at the global marketing environment. Deciding whether to go global. Deciding which markets to enter. Deciding how to enter the market. Deciding on the global marketing program. Deciding on the global marketing organization.

Deciding whether to go global Global competitors might attack the company’s home market by offering better products or lower prices. Counterattack these competitors in their home markets to tie up their resources. Co’s customer might be expanding abroad and require international servicing. Co’s home market might be stagnating and foreign markets may present additional sales and profit opportunities.

Deciding which markets to enter Company should define its international marketing objectives and policies. Volume of foreign sales it wants. How many countries it wishes to market. Must decide on types of countries to enter. The international markets must then be evaluated.

Deciding how to enter the market Exporting- Entering a foreign market by selling goods produced in the company’s home country, often with little modification. Indirect Exporting- working through independent international marketing intermediaries. Less investment and less risk Direct Exporting- where they handle their own exports. Investment and risk is greater and so is the potential return.

Joint Venturing- Entering foreign markets by joining with foreign companies to produce or market a product or service. Contracting, JV is of four types: licensing contract manufacturing management contracting joint ownership. Direct Investment-

Direct Investment- Entering a foreign market by developing foreign-based assembly or manufacturing activities. Assembly facilities Manufacturing facilities

Challenges of Globalisation Exchange of Currencies Transport Time lag Language Lack of Direct Contact Unstable governments Restrictive government policies and regulations.

Deciding on the Global Marketing Program Co’s operating in one or more foreign markets must decide how much to adapt their marketing strategies and programs to local conditions Standardized global marketing- using largely the same marketing strategy approaches and marketing mix worldwide. Adapted Global Marketing- The producer adjusts the marketing strategy and mix elements to each target market, bearing more costs but hoping for a larger market share and return.

PRODUCT Straight Product Extension- Marketing a product in a foreign market without any change. e.g. Kellogg cereals, Gillette razor. Product Adaptation- Adapting a product to meet local conditions or wants in foreign markets. Product invention- Creating new products or services for foreign markets.

PROMOTION Companies can either adopt the same communication strategy they use in the home market or change it for each local market. Communication adaptation- A global communication strategy of fully adapting advertising messages to local markets.

PRICE companies may face many consideration in setting their international prices. Foreign prices will be higher than their domestic prices for comparable products. When selling to less affluent consumers in developing countries, many cos make smaller versions of their products that can be sold at lower prices. Dumping- when a company either charges less than its costs or less than it charges in its home market.

Distribution channels Whole channel view- Designing international channels that take into account the entire global supply chain and marketing channel, forging an effective global value delivery network. Two major links between the seller and the final buyer- Channels between nations- moves co. products from points of production to the borders of countries within which they are sold. Channels within nations- moves the products from their market entry points to the final consumers. The whole channel view takes in to account the entire global supply chain and marketing channel. It recognizes that to compete well internationally, the company must effectively design and manage an entire global value delivery network.