Chapter Four Country Attractiveness MKT568 Global Marketing Management Dr. Fred Miller 3-1

Environmental Dimensions for Research Political Risk Forms and levels of risk Physical Climate, topography, space, pop density, etc Sociocultural Social interaction, hierarchies, interdependence, etc Economic Income, employment, prices, development, etc Regulatory Government agencies and systems, laws,ordinances, etc.

Porter’s Diamond Competitive Advantage for Countries Firm strategy, structure and rivalry Related and supporting industries Demand conditions Factor conditions Source: Adapted and reprinted with the permission of the Free Press, a division of Simon and Schuster, from The Competitive Advantage of Nations, by Michael E. Porter. Copyright © 1990 by Michael E. Porter

4-10 Political Risk Factors Exhibit 4.2 Source: Steven J. Kobrin, “Political Risk: A Review and Reconsideration,” Journal of International Business Studies 10, no.1 (1979), p Reprinted by permission.

Sample Political Risk Report

Basic Evaluation Procedure Four stage process & data sourcesProject Component country identificationcountry identification: Introduction groupinggrouping, preliminary screeningpreliminary screening: Part 1 Business Int’l indices in depth screening: Part 2 DoCDoC ID: msumgtmkt, PW racers Commercial data: Euromonitor, DIALOGEuromonitorDIALOG final selection: prior data, judgment Analysis of reports Special criteria Competitive attack, leading markets, Direct experience

Country Teams Latin America Argentina Brazil Chile Mexico Asia China India Indonesia Japan South Korea Thailand Europe France Germany Italy Spain UK

World Bank Comparative Data

Population Pyramids

Basic Evaluation Procedure Four stage process & data sourcesProject Component country identificationcountry identification: Introduction groupinggrouping, preliminary screeningpreliminary screening: Part 1 Business Int’l indices in depth screening: Part 2 DoCDoC ID: msumgtmkt, PW racers Commercial data: Euromonitor, DIALOGEuromonitorDIALOG final selection: prior data, judgment Analysis of reports Special criteria Competitive attack, leading markets, Direct experience

Euromonitor Data for In Depth Screening

Data Sources in International Market Assessment At what stage of the international market assessment process would you typically use each of the following sources of data? Personal interviews with potential intermediaries in the country Statistical information from various sources Market studies purchased from Euromonitor or other sources Lists of the world’s countries Trade reports purchased from industry associations Descriptive information on cultural/religious/ethnic factors US DoC’s consular lists of potential agents

Forecasting Methods (Pro Forma) Early Product Life Cycle (PLC) stages build-up, analogy, judgemental-jury,expert,Delphi Later PLC stages extrapolation, regression Forecasting market share competitors, domestic and import competition

Yearly Increase in Household Ownership of TV Sets, Exhibit 4.8 Source: Lindberg, Adapted with permission. ©1982 by the American Marketing Association United StatesUnited KingdomGermany,West

Forecasting Methods (Pro Forma) Early Product Life Cycle (PLC) stages build-up, analogy, judgemental-jury,expert,Delphi Later PLC stages extrapolation, regression Forecasting market share competitors, domestic and import competition

Sample Essay Questions HouseHelp Inc. produces a line of moderately priced, handheld electronic kitchen appliances which it markets on the benefits of convenience, ease of use and time savings. For its international market assessment analysis, the firm wishes to use one statistical measure related to each of the following: target market, product strategy, distribution strategy, promotion strategy and pricing strategy. Identify one measure for each factor and explain its relevance.

Statistics and Marketing Strategy Total GNI ($US bil) GDP growth rate GNI per capita ($US) GNI per capita PPP($US) Gini = Income to top 10% Inflation Rate Population Age Distribution Urbanization Literacy Life Expectancy Child Malnutrition Energy use per capita KM of paved roads Internet users per 1000 Percent HHs with TV Mainline phones per 1000 people Mobile subscribers per 1000 International voice/bandwidth Consumer Expend Beer $US Mil Beer as % of Alcohol Spending Per Capita Consump (L’s per head) VAT on beer (% of price)

4-10 Match Statistics with Strategy Elements Target Market: definition, size, purchasing power, etc Product: brands, lines, characteristics, packaging, etc IMC: message, media, promo, sponsorship, etc. Distribution; breadth, intensity, stores, HORECA, etc Price: levels, lines, discounts, channel, etc

Sample Essay Questions HouseHelp Inc. produces a line of moderately priced, handheld electronic kitchen appliances which it markets on the benefits of convenience, ease of use and time savings. For its international market assessment analysis, the firm wishes to use one statistical measure related to each of the following: target market, product strategy, distribution strategy, promotion strategy and pricing strategy. Identify one measure for each factor and explain its relevance. How would these measures change for; 1) a consumer electronics company, 2) a producer of branded food products, 3) a cosmetics firm, 4) a specialty retailer, or 5) a mass merchandise retailer.

Sample Essay Questions HouseHelp Inc. produces a line of moderately priced, handheld electronic kitchen appliances which the firm markets on the benefits of convenience, ease of use and time savings. Identify and explain one method for forecasting sales in countries where this type of product is new. For countries where this type of product has been sold for many years. Identify and explain two factors you would use to estimate the firm’s market share in the first year after entry.

Chapter Four Country Attractiveness MKT568 Global Marketing Management Dr. Fred Miller 3-1