The Global Marketplace By Gavin, Lisbeth, Maura, Orlando, Trixie

Agenda Looking at global marketing environment Whether to go global Which markets to enter and how Deciding on the global marketing program and organization McDonalds

The International Trade System Trade System Regulations Trade System Regulations Tariffs/Quotas/Exchange Controls/Nontariff Trade Barriers Tariffs/Quotas/Exchange Controls/Nontariff Trade Barriers The World Trade Organization (WTO) The World Trade Organization (WTO) General Agreement on Tariffs and Trade (1947) General Agreement on Tariffs and Trade (1947) WTO (1955) WTO (1955) Regional Free Trade Zone Economic Communities (Free Trade Zones) European Union (EU) North American Free Trade Agreement (NAFTA) Central American Free Trade Agreement (CAFTA) Union of the South American Nations (UNASUR)

Cultural Environment The Impact of Culture on Marketing Strategy The Impact of Marketing Strategy on Cultures

Political-Legal Environment Attitude towards International Buying and Selling Political Stability Government Bureaucracy Monetary Regulations

Economic Environment Industrial Structures Industrial Structures Subsistence Economies Subsistence Economies Raw Material Exporting Economies Raw Material Exporting Economies Emerging Economies Emerging Economies (Industrializing Economies) Industrial Economies Industrial Economies Income Distribution Income Distribution Low/Medium/High Income Households Low/Medium/High Income Households

Deciding Whether to Go Global Local Advantages: Easier and safer Disadvantage: Increase competition Global Advantages: Opportunity for growth Disadvantages: “One-size-fits-all” approach

Deciding Which Markets to Enter How Many Countries to Enter? What types of countries To Enter Products Geography Population Income Political Climate

Deciding How to Enter the Market Exporting Exporting Indirect and Direct exporting Indirect and Direct exporting Joint Venturing Joint Venturing Licensing Licensing Contract Manufacturing Contract Manufacturing Management Contracting Management Contracting Joint Ownership Joint Ownership Direct Investment Direct Investment

Deciding on the Global Marketing Product Three strategies are used for adapting a product: 1.Straight product extension – marketing a product without making any changes to it Pros: Involves no additional product development costs, manufacturing changes or promotion changes Cons: Can be costly in the long-run if products fail to satisfy consumers in a specific global market 2.Product adaptation – adapting a product to meet local conditions, needs, or wants 3.Product invention – creating a new product or service to match the local environment

PROMOTION Communication Strategy Home Market Use Localized Marketing Cultural Adjustments Communication Adaptation Differentiation Among Ads Media Internationally Deciding on the Global Marketing

Deciding on the Global Marketing Organization Price Poor countries (High vs Low Prices) Additional costs Modified products New brands with affordable price Internet Global Pricing Steve MaddenSteve Madden: Madden Girl

Deciding on the Global Marketing Program Distribution Channels Whole Channel View Global Value Delivery Network Nation to Nation Variations Intermediaries New Distribution Structures International seller Channels between nations Channels within nations Final user or buyer

1.Companies manage international marketing in three steps: 2.Organize an Export Department 3.Create an Internal Division 4.Become a Global Organization Geographical organizations - Country managers are responsible for sales people, sales branches, distributors, and licensees in their respective countries. World product groups - Each operating unit is responsible for worldwide sales of different product groups. International subsidiaries - Each unit is responsible for their own sales and profits. Deciding on the Global Marketing Organization

MCDONALDSMCDONALDS Product Promotion Price Distribution Channels