ECONOMIC DISASTER BEGINS

WITH A PHILOSOPHY OF DOING LESS AND WANTING MORE.

BUDAPESTI GAZDASÁGI FŐISKOLA

INTERNATIONAL MARKETING

LECTURE- 7In English

13th April 2012 – FRIDAY

0940hr –1110hr (E.F. 13-15)

Miklós (Nicholas) SOÓS0630 265 9638

miklosoos@hotmail.com

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LECTURE DATES - TIMES - LOCATION RE: Miklós (Nicholas) SOÓS

1. FEB. 17. 0940-1110 [E.F.13-15]

2. FEB. 24. 0940-1110 [E.F.13-15]

3. MARCH 2. 0940-1110 [E.F.13-15]

4. MARCH 9. 0940-1110 [E.F.13-15]

MARCH 16. VACATION

MARCH 23. VACATION

5. MARCH 30. 0940-1110 [E.F.13-15] – re. feb.10

6. APR. 6. 0940-1110 [E.F.13-15] (guest lect?)

7. APR. 13. 0940-1110 [E.F.13-15]

8. APR. 20. 0940-1110 [E.F.13-15]

8. APR. 27. 0940-1110 [E.F.13-15]

9. MAY 4. 0940-1110 [E.F.13-15]

10. MAY 11. 0940-1110 [E.F.13-15]

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CLASS ATTENDANCE

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Lectures No. %

Lect. 1 16 24

Lect. 2 22 33

Lect. 3 30 45

Lect. 4 30 45

Lect. 5 35 52

Lect. 6 34 51

Lect. 7    

Lect. 8    

Lect. 9    

Lect. 10    

absence No. %

0 2 3,0

1 13 19,4

2 8 11,9

3 13 19,4

4 6 9,0

5 7 10,4

6 18 26,9

  67 100,0

ABSENCES

Please ensure that you personally sign the

attendance sheet every time you attend a

lecture.

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The visual contents of lectures will be available internally on

the following site:

K:\Hallgatok\ANGOL\Soós tanár úr

(available internally only)

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SOURCES, REFERENCES – SUGGESTED READINGS

The course is NOT based on any specific textbook. The following are recommended.

International Marketing, Cateora, P. & Graham, J. (2005) 12th edition, McGraw-HillGlobal Marketing, Hollensen, S. (2004) 3rd edition, Prentice Hall

International Marketing Strategy, Doole, I. & Lowe, R (2004) 4th edition Thomson

International Marketing and Export Management, Albaum G, Prentice Hall London

Principles of Marketing, Kotler P et. Al, 2nd European edition, Prentice Hall E. 2003

Principles of Marketing, Jobber D, McGraw-Hill

Principles of Marketing, Brassington F, Financial Times Prentice Hall, 2000

Marketing on the Internet: Principles of online marketing, Strauss J & Raymond F, Prentice Hall,1999

Internet sites:

www.pmcinc.org/

www.tradeport.org

www.FAS.USDA.gov

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ASSESSMENT METHOD

End of year written examination 60%

Two (2) ‘mini’ exams of 20 min. duration

during unannounced lectures 40%

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Where we finished last week.

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MAJOR WAYS IN WHICH COMPANIES

FIRST

ENTER INTERNATIONAL

MARKETS

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1Export

2Licensing

4manufacturing

3Establish

sales offices

5joint venture

Let us now have a brief look at the most

important factors that are common to the successful global

brands, trademarks.

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THE FEATURES COMMONLY ASSOCIATED WITH THE TOP GLOBAL BRANDS

Quelch

Strong in home market

Consumers value the country-of-origin

Geographical/balance in sales

Consistent positioning

Product category focus

Corporate name

Addresses similar consumer needs

7

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THE SEVEN FEATURES COMMONLY ASSOCIATED WITH THE TOP GLOBAL BRANDS (Quelch)

Strong in home market

To be successful on a global scale, firms need to be strong in their home market.

The top ten global brands are heavily dominated by US brands e.g. Intel, Disney, and Microsoft.

These brands are equally dominant in their

domestic, as well as global markets.

1

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THE SEVEN FEATURES COMMONLY ASSOCIATED WITH THE TOP GLOBAL BRANDS (Quelch)

By definition, a global brand has at least a minimum level of awareness, recognition and

sales all over the world.

E.g. there is no global brand that is extremely strong in Europe, but hardly known in Asia.

Leading global brands such as Toyota have high levels of awareness on a global scale.

2 Geographical/balance in sales

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THE SEVEN FEATURES COMMONLY ASSOCIATED WITH THE TOP GLOBAL BRANDS (Quelch)

The Company’s products are the same (or almost the same) worldwide and meet the same

widely-held human needs.

In some cases, brands may adapt to local needs, yet the majority tend to highly standardise their

marketing mix.

The degree of standardisation is one indicator of a global brand.

3 Addresses similar consumer needs

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THE SEVEN FEATURES COMMONLY ASSOCIATED WITH THE TOP GLOBAL BRANDS (Quelch)

Global brands have the same set of values worldwide.

E.g., Disney promotes the same family values throughout all of its markets;

Sony is synonymous with innovation all over the world.

Volvo is known internationally as a safe vehicle

4 Consistent positioning

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THE SEVEN FEATURES COMMONLY ASSOCIATED WITH THE TOP GLOBAL BRANDS (Quelch)

This is typically associated with brand origin and/or country of manufacture. The country-of-origin (COO) effect includes

country-of-design, country-of-assembly, and country-of-corporate-ownership.

COO affects consumers’ perceptions of brand image and consumer behaviour.

E.g., consider: watches from Switzerland televisions made in Japan

German cars: BMW, Mercedes

5 Consumers value the country-of-origin

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THE SEVEN FEATURES COMMONLY ASSOCIATED WITH THE TOP GLOBAL BRANDS (Quelch)

The majority of the world’s leading global brands focus on one main product category

e.g. Nike – sportswear.

A more diversified range of product categories is likely to make it more difficult

to become a leading global brand.

6 Product category focus

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THE SEVEN FEATURES COMMONLY ASSOCIATED WITH THE TOP GLOBAL BRANDS (Quelch)

A strong corporate or brand name is extremely important. Brand names are important to both

sellers and buyer. One common branding objective is to choose ‘inherently meaningful’

brand names, so that the name itself conveys relevant product information e.g Budapest Bank.

The second option is to create an ‘unrelated’ name. This includes words that have no connection with the product being named (e.g.

Allianz International), or fictitious names e.g. Lenovo

7 Corporate name

Lets have a detailed examination of the

factors that need to be considered when

entering a foreign market.

FACTORS IN THE FOREIGN MARKET ENTRY MODE DECISION

External Factors

Internal Factors

Foreign MarketEntryMode

Decision

Target Country Market Factors

Target Country Environmental Factors

Target Country Produc-tion Factors

Home Country Factors

Company Product Factors

Company Resource/ Commitment Factors

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FACTORS IN THE FOREIGN MARKET ENTRY MODE DECISION

External Factors

Target Country Market Factors

Target Country Environmental Factors

Target Country Produc-tion Factors

Home Country Factors

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Market, environmental and production factors in both the target and home countries can seldom be affected by management decisions.

They are external to the company and may be regarded as parameters of the entry mode decision. Since no single external factor is likely to have a decisive influence on the entry mode for

companies in general it can only be said that such factors encourage or discourage a particular entry mode.

FACTORS IN THE FOREIGN MARKET ENTRY MODE DECISION

External Factors

Target Country Market Factors

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Current & Projected Market Size

Small markets favor low breakeven volume entry modes e.g. exporting, licensing contractual

Large markets favor entry modes with high breakeven volumes e.g. equity investment, local production

Competitive Structure

Atomistic – x no. dominant competitors Oligopolistic – few domint. competitors Monopolistic – a single firm

Atomistic – usually export

Others – equity inv., licensing, contractual modes

Marketing Infrastructure

The existence or otherwise of good local agents or distributors who are not committed to other foreign companies.

FACTORS IN THE FOREIGN MARKET ENTRY MODE DECISION

External Factors

Internal Factors

Foreign MarketEntryMode

Decision

Target Country Market Factors

Target Country Environmental Factors

Target Country Produc-tion Factors

Home Country Factors

Company Product Factors

Company Resource/ Commitment Factors

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FACTORS IN THE FOREIGN MARKET ENTRY MODE DECISION

External Factors

Target Country Environmental Factors

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Government Policies & Regulations

Restrictive import policies:

• high tariffs

• tight quotas

• restrictive foreign investment policy

On the other hand gov. may encourage foreign investment

Geographical Distance

Transportation costs can be prohibitive

Economical Factors

Market economy

Centrally pland.

Size of economy

GNP/capita

Dynamics

Rate of investment Personal income Employment

External ec. relation

Balance of payment Debt service Exchange rate

Sociocultural

Cultural distance Social structure Language

FACTORS IN THE FOREIGN MARKET ENTRY MODE DECISION

External Factors

Internal Factors

Foreign MarketEntryMode

Decision

Target Country Market Factors

Target Country Environmental Factors

Target Country Produc-tion Factors

Home Country Factors

Company Product Factors

Company Resource/ Commitment Factors

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FACTORS IN THE FOREIGN MARKET ENTRY MODE DECISION

External Factors

Target Country Production Factors

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• quality

• quantity

• material cost

• labor

• energy

• transport

• communication

• port facilities

Productive Agents Economic Infrastructure

Low production costs in the target country encourage some form of local production as against exporting.

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BGF. INTERNATIONAL MARKETING MINI TEST 1 – APRIL 13. 2012

DURATION: 15 MINUTES –

QUESTIONS ARE OF EQUAL VALUE (10% / question) –

ONLY ONE (1) POSSIBLE ANSWER FOR EACH QUESTION –

MARK X THE CORRECT ANSWER –

ONLY MARK (X) ONE BOX FOR EACH QUESTION OTHERWISE YOUR ANSWER WILL BE IGNORED

PLEASE THINK CAREFULLY – ALTERNATIVE ANSWERS CAN BE VERY SIMILAR, HOWEVER ONLY ONE CORRECT

ANSWER POSSIBLE FOR EACH QUESTION.

SUCCESS IS NOT SO MUCH

WHAT WE HAVE AS IT IS WHAT

WE ARE.