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Chapter 14

Marketing

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Learning ObjectivesSuggest how markets for international expansion can be selected, their demand assessed, and appropriate strategies for their development devised.Describe how environmental differences generate new challenges for the international marketing manager.Compare and contrast the merits of standardization versus localization strategies for country markets and of regional versus global market efforts.Discuss market-specific and global challenges facing the marketing functions: product, price, distribution, and promotion within both the traditional and e-business dimensions.

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Marketing

A look at: Target MarketSelection

MarketingManagement

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Identification and Screening

Preliminary ScreeningEstimating Market Potentials by Product TypeEstimating Sales Potential for Company’s ProductIdentifying Segments in Target Market

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Preliminary Screening

This process must rely chiefly on secondary data for country-specific factors as well as product and industry specific factors.

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Estimating Market PotentialThe international marketer needs to assess the size of existing markets and forecast the size of future markets.The marketer uses both quantitative and qualitative techniques for assessment.

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Estimating Sales Potential

Collect product and market specific data

Competition Market Consumers Product Channel structure

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Identifying SegmentsIndividuals and organizations vary in their wants, resources, geographical locations, buying attitudes, and buying practices.

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Concentration Versus DiversificationMajor alternatives for choosing an expansion policy:

Concentration on a small number of markets.Diversification is growth in a relatively large number of markets in early stages.

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Marketing ManagementStandardization

The extent to which elements of the marketing mix should be standardized.

AdaptationMarketers may consider every situation independently, or rely on decision-support systems to aid in program adaptation.

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Product PolicyThe Core of the Firm’s Operations

Goods

Services

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Factors in Product AdaptationRegional, Country, or Local Characteristics.

Governments hold stringent requirements. Consider nontariff barriers. Competitive offerings may provide a baseline for resource measurement. Economic development must be accounted for. Customer preferences must be considered. Consider economic status of users. Consideration of geography. Purchase patterns must be considered.

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Product Characteristics

Product characteristics are the inherent features of the product offering.

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Company Considerations

Is It Worth It?

ResourcesCost of adaptingOrganizationMarket OpportunityProfitability

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Pricing PolicyThe only element in the marketing mix that is revenue generating.

Export Pricing Foreign Market Pricing Price Coordination Intracompany Pricing

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Export PricingStrategies

Standard worldwide pricing is based on average unit costs of fixed, variable, and export-related costs.Dual pricing differentiates between domestic and export prices.Market-differentiated pricing is based on demand-oriented strategy making it more consistent with the marketing concept.

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Foreign Market PricingDetermined By

Corporate Objectives. Costs. Consumer Behavior and Market Conditions. Market Structure. Environmental Constraints.

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Price Coordination

Standard worldwide pricing may be mostly theoretical.Significant price gaps lead to the emergence of gray markets.

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Intracompany Pricing

The pricing of sales to

members of the

corporate family.

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Distribution Policy

Channels of distribution provide the

essential links that connect

producers and customers.

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Channel DesignDetermined by the 11 C-FactorsCustomersCultureCompetitionCompanyCharacterCapital

CostCoverageControlContinuityCommunication

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E-CommerceIs forecast to grow at a compound annual rate of 50+ percent within 5 years.Western Europe has most growth.Governments work to come to terms with security, privacy, and access to the Internet.

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Promotional Policy

AdvertisingPersonal SellingSales PromotionPublicity