1. Chapter 6 – Global Strategies
Doole & Lowe
International Marketing Strategy
today looking at factors that drive strategic choice at a global level and the alternative global strategies available plus the challenges such strategies bring

2. The alternative views of globalization
List of World Top Companies

3. The alternative views of globalization (cont.)
The drivers of globalization
Market access
Market opportunities
Industry standards
Sourcing
Products & services
Technology
Customer requirements
Competition
Cooperation
Distribution
Communication
Company’s strategy, business programmes and processes
1. access due to politiacl &economic changeds , opening up of new mkts
2. newopps due to privatidsation ,eg.steel telecomunications, de regulation eg finance services
3.convergence of tech
4.industry restructuring , cross barrier competition eg.gen motors are now in finacanial services, tobacco-food
5.emergence of the global village
6. satellite /clable tv std image importsant. telecommunications 7. mature marketss need for market share marketing , mergers amnongst equals eg glaxo
7. sourcing see next slide
8. need to develop global strageeies supported by effective programmes so what are the alternative responses

4. The alternative views of globalization (cont.)
1. access due to politiacl &economic changeds , opening up of new mkts
2. newopps due to privatidsation ,eg.steel telecomunications, de regulation eg finance services
3.convergence of tech
4.industry restructuring , cross barrier competition eg.gen motors are now in finacanial services, tobacco-food
5.emergence of the global village
6. satellite /clable tv std image importsant. telecommunications 7. mature marketss need for market share marketing , mergers amnongst equals eg glaxo
7. sourcing see next slide
8. need to develop global strageeies supported by effective programmes so what are the alternative responses

5. Alternative strategic responses
The four quadrants are described below:
Kings: Mostly large global corporations in a strong competitive position with an effective global strategy.
Barons: Companies with strong products and limited geographic coverage. Expansion to foreign markets is attractive to them.
Commoners: Companies with relatively weak products on domestic markets. Before undertaking geographical expansion, it is advisable for commoners to improve their product portfolio.
Crusaders: Because they have already expanded geographically with a relatively weak range of products, these companies are vulnerable. Their challenge is to improve and further develop their product portfolio.
The path from commoner to king can either go through the Adventurers stage (e.g., Microsoft) or the baron stage (e.g., SAP).
Several alternative strategic responses really depending where you are at moment in refernce to barnd strenght and geographical coverage against this background need to devepolop approppriate strategic response
tendss to be a trade off of using resource to invest in npd or geographical coverage. level of these determine option
cadbury baron as was rowntree
two cusaders pepsi 7 nestle gto distrinbutiuon sorted in the war
kellog seen as king
own brand tradiitonally common but may now becoming more powerful internationally

6. Alternative strategic responses (cont.)
MD see nerxt slide
global slides after
transnational can beinegration of diverse assets and resources people and flexible management to schieve global flexibility and lkevertage global competititive advantage
very complex to manage that complexity can be its CA equally it can be its downfall eg IBM< mid nineties when lou gerstner came in one of key stragteies was to simplify everything go to slides
The largest, most complex companies in the world use a combination of all these three strategies – i.e. the transitional strategy.

7. Alternative strategic responses (cont.)
Standardization and adaptation
Marketing objectives and strategies
More readily standardized
Marketing mix
Products most easily standardized
Promotion less so
Distribution and pricing difficult to standardize
Operational activities
The more operational the decision, the more likely it will be differentiated
Will you use standardization or adaptation for the drink or food for the UK market?
Does MacDonald's use standardization or adaptation?

8. Continuum of standardization
Alternative strategic responses (cont.)
Continuum of standardization
Pricing
Distribution
Sales Force
Sales Promotion
Product
Image
Objectives
Strategy
Differentiation
challenge is how to turn widestpread internationalk presence into global brand
however have to do this by offering added value & benefits on a blobal scale whilst achieving cost effeciencies . there global strategies of whatever kind are a trade off between standardisatio and adaptation
discuss coninuum
when debating standardisation important to differntiate between differnt levels of stragegey see next slide
Standardization

9. Alternative strategic responses (cont.)
Forces driving a multi-domestic approach
Industry standards remain diverse (e.g. the harmonization of standard is high or impossible such as wine market)
Customers continue to demand locally (e.g. Cultural heritages and traditions such as foods and drinks)
Being an insider remains critically important (e.g. In business-to-business )marketing, there is a definite bias in favour of products sourced from particular areas, such as Silicon in the US Valley)
Global organisations are difficult to manage (e.g. different culture and values)
Management myopia (e.g. managers fail to seize market opportunity to build their business in a wider range of markets.)

10. Alternative strategic response (cont.)
Transnational strategies
Transnational companies aim to build three strategic capabilities:
Global scale efficiency and competitiveness
National level responsiveness and flexibility
Cross-market capacity to leverage learning on a world wide basis

11. Alternative strategic response (cont.)
Transnational strategies
Simple and complex individual product and market policies
Customer segments specific and unique to specific market or transnational group
Working closely with firms and simultaneously ensuring that values of company are maintained and demonstrated to stakeholders
Maintaining / building added value in the supply chain

12. International marketing management for global firms
It is suggested that there is a pyramid of wealth. Prahalad and hart (2002) emphasize that those with the lowest incomes still have the potential to create a significant demand for goods and services if a company can offer suitable products and services with reasonable prices.

13. International marketing management for global firms (cont.)
The emergence of MNEs from emerging markets
Responding to the changing basis of competitive advantage
Increasing global appeal by building the global brand
Developing sustainable strategies
Creating a global presence by achieving global reach
Management of diverse and complex activities

14. International marketing management for global firms (cont.)
Managing diverse and complex activities across a range of often similar but often disparate markets and cultures
Financial loss due to inappropriate investment (e.g. buying unusable assets)
Damage to firms reputation (e.g. having close relationship with other countries or organizations which are considered to be corrupt)
Litigation (e.g. the process of taking legal action)
Unexpected competitor response (e.g. competitors protected by other county’s government)
Inappropriate long term partnerships or joint ventures
Damage to firm’s reputation (e.g. demanding the natural environment of the country)

15. International marekting management for global firms (cont.)
The cornerstone of effective management is control:
Set standards relevant to corporate goals
Measure performance against standards
Correct deviations from the plan

16. International marketing management for global firms (cont.)
What makes a good international manager
Able to cope with cognitive complexity
Understand issues from variety of complicated perspectives (e.g. understanding how to cope with government officers)
Have cultural empathy
Including sense of humility and power of active listening (e.g. understanding communicate with culture which is entirely to the host country)
Have emotional energy
Capable of adding depth and quality to interaction
Demonstrate psychological maturity
curiosity to learn, orientation to time, personal morality