Marketing Six ConceptsChapter 21

Tapping Into Global Markets

Guo,Li (Lisa)Ateneo Graduate School of Business

May 9, 2013

Outline

• Six Concepts • Global Markets......

• 1. Four Factors that draws companies into the international arena.• 2. Three criteria should be rated.• 3. Developed versus developing markets.• 4. Best mode of entry.• 5. Companies decide on a marketing program.• 6.Companies manage their international marketing activity in three

ways.

Concept 1: Four Factors That Draws Companies Into The International Arena.

3. Independence From One Market

1. Higher

Profits • 　 　4.

Competition

With Global

Competitors

2. Larger Customer

Example of Concept 1• Tata Group• India's biggest conglomerate, operates successful businesses that

range from software,cars, and steel to phone service, tea bags, and wristwatches.

• The market potential is huge, ther are just seven automobiles per 1000 people in India.

• Targeting markets such as Africa and Southeast Asia and perhaps even parts of Eastern Europe and Latin America.

Concept 2: Three Criteria Should Be Rated

1. Market Attractiveness 2. Risk

3. Competitive Advantage

Example of Concept 2

1. Market Attractiveness

Market size and growth rate.

2. Risk Foreign Preference, Differeent Business Culture, Specifice foreign regulations.

3. Competitive Advantage

Products or services at the lowest cost in the industry.A variety of products, services, or features to cunsumers that competitors are not ye offering or are unable to offer.Completely new or notable better products or services.

Concept 3: Developed And Developing Markets

• Brazil• Russia• India• China• Indonesia• South Africa

Example of Concept 3

• Each nation has unique features.• Depend on its demographic,

economic, sociocultural, natural, technological, and political-legal environments.

Concept 4: Global Market Entry Strategies

Example of Concept 4Indirect Exporting

Work through independent intermediaries.

Direct exporting A producer or supplier directly sells its product to an international market

Licensing A simple way to engage in international marketing.To use a manufacturing process, trademark, patent, tarde secret, or other item of value for a fee or royalty.

Joint Ventures To share ownership and control.To reach more geographic and technological market.To diversify its investment and risk.

Direct Investment

Can buy part or full interest in a local company.Build its own manufacturing or service facilities.

Concept 5: Companies Decide On A Marketing Program

• Product Level

• Price Level

• Communication Level

• Distribution Level

Example of Concept 5

Product Products or services are easily standardized and appropriate adaptation.(Google, eBay, Amazon.com)-made quick progress in overseas markets.

Communication

To make the message as compelling and effective.Global Adaptations(Apple,Coca-Cola, Goodyear)

Pricing Set a uniform price everywhereset a market based price in each countrySet a cost based price in each country

Distribution The multinational must choose the right distributors, invest in them, and set up performance goals to which they can agree.

Concept 6: Companies manage their international marketing activity in three ways

ExportDepartments

GlobalOrganization

InternationalDivisions

Example of Concept 6

Export Department

A sales manager and a few assistants.Various marketing services.

International Division

Headed by a division president who sets goals and budgets.Responsible for the company's international growth.Corporate staff consists of functional specialists who provide services to various operating units.

Global Organization

Plan worldwide manufacturing facilities, marketing policies, financial flows, and logistical systems.Report directly to the chief executive or executive committee.

Summary

• Six Concepts • Global Markets......

• 1. Four Factors that draws companies into the international arena.

• 2. Three criteria should be rated.• 3. Developed versus developing markets.• 4. Best mode of entry.• 5. Companies decide on a marketing program.• 6.Companies manage their international marketing

activity in three ways.