Chp 8 Of Global Marketing Management

Front 1

Global Marketing Strategies

Back 1

*on a competitive map, financial, trading and industrial activities across national boundaries have rendered political borders increasingly irrelevant.
*the availability and explosion of information technology has changed the nature of global competition.
*all firms will be affected by competition from around the world.

Front 2

Information Technology

Back 2

*With information technology, geographical distance has become increasingly less relevant in designing global strategy.
*we are observing the emergence of a gross information product and it dwarfs the gross
domestic product.

Front 3

Different types of Information Technology and Global Competition

Back 3

*Electronic Commerce (e-commerce)
*real-time management
*online communications
*”internet” organization
*faster product diffusion
*global citizenship

Front 4

Electronic Commerce (e-commerce)

Back 4

Type of information technology
*no geographic boundaries
*product life cycle is becoming shorter and shorter

Front 5

Real-Time Management

Back 5

Type of information technology
*information that managers have about the state of the firm’s operations in almost in real time
*get information constantly

Front 6

Online Communications

Back 6

Type of information technology
*Sales representatives now can access headquarters from laptops that are enabled instant access to data from the company’s central databases.

Front 7

“Internet” Organization

Back 7

Type of information technology
*companies use internal Web servers on the Internet to facilitate communication with employees, etc.
*improves communication around the company

Front 8

Faster Product Diffusion

Back 8

Type of information technology
* shorter PLC (product life cycles)

Front 9

Global Citizenship

Back 9

Type of information technology
*the spreading of the English language as the language of international business

Front 10

Global Strategy

Back 10

*to array the competitive advantages arising from location, world-scale economies, or global brand distribution, namely, by building a global presence, defending domestic dominance, and overcoming country-by-country fragmentation.
*must integrate their worldwide strategy.

Front 11

Global Industry

Back 11

*those industries where a firm’s competitive position in one country is affectd by its position in other countries.
*the first question that faces managers is the extent of globalization of their industry
*every industry has global or potentially global aspects.

Front 12

Global Industry Drivers

Back 12

*Markets
*costs
*government
*competitive

Front 13

Market Globalization Drivers

Back 13

Part of industry globalization
1. Common customer needs-factors that affect whether customer needs are similar in different countries. Based on economic development, climate, physical environment, and culture.
2. Global Customers and Channels-global customers buy on a centralized or coordinated basis for decentralized use. Global Products, global marketing, etc.
3. Transferable Marketing-certain elements like brand name and pricing strategy may be transferable across markets.
4. Lead countries-countries where innovation in particular industries are prone to take place.

Front 14

Cost Globalization Drivers

Back 14

Part of industry globalization
1. Global Economies of Scale and Scope-apply when single-country markets are not large enough to allow competitors to achieve optimum scale. May be visible include consumer research, product development and the creation of marketing programs.
2. Steep Experience Curve-concentration of activitiessignify cost advantages.
3. Global Sourcing Efficiencies-coordination of procurement activities of raw materials and components.
4. Favorable logistics-a favorable ratio of sales value to transportation cost increases the ability to concentrate production and take advantage of economies of scale.
5. Difference in Country Costs
6. High product development costs-can be reduced few global or regional products.
7. Fast-changing technology-lead to high product development costs, which increase their globalization potential.

Front 15

Government Globalization Drivers

Back 15

Part of industry globalization
1. Favorable Trade Policies-import tariffs and quotas, local content requirements, etc. These policies can have a significant negative impact on standardization of products and programs.
2. Compatible Technical Standards
3. Common Market Regulations-restrictions on various marketing activities can also acts as a barrier to the use of uniform marketing approaches.
4. Government-owned competitors
5. Government-owned customers

Front 16

Competitive Globalization Drivers

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Part of industry globalization
1. High Exports and imports-the interaction between countries.
2. Competitors from different continents and countries-more severe
3. Interdependent countries-helps firms subsidize attacks on competitors in different countries.
4. Globalized competitors

Front 17

Competitive Structure of Global Strategy

Back 17

*cost leadership-builds its competitive advantage on economies of scale ex. walmart. Most effective way. There is no guarantee that cost leadership will last.
*product differentiation-a unique product with special features that has a high cost.
*niche strategy-highly specialized segment of the market. Specialize in higher end products/services. Very expensive.

Front 18

Nature of Competitive Industry Structure

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*Industry Competitor determine the rivalry among existing firms
*Potential Entrants are companies that have the potential to be major threats in another market.
*Bargaining power of supplies can change the structure of industries.
*Bargaining power of buyers may affect the firm’s profitability. Especially when governments try to get price and delivery concessions from foreign firms.
*Threat of substitute products or services are other products that might be better than yours.

Front 19

Hypercompetition

Back 19

Part of global strategy
*all firms are faced with a form of aggressive competition that is tougher than oligopolistic or monopolistic competition, where the firm is atomistic and cannot influent the market at all
*Firms compete in the following four arenas of competition:
-creative destruction
-cost and quality
-timing and know-how
-strongholds-where the firms has strong advantages
-financial resources.

Front 20

Interdependency

Back 20

Part of global strategy
*companies being interdependent with another. EX: computers
*governments also play a larger role, affecting parts of the firm’s strategy

Front 21

Global Marketing Strategy

Back 21

*Benefits
-cost reduction-savings in workforce and materials
-improved products and program effectiveness-greatest advantage
-enhanced customer preference-help build recognition
-increased competitive advantage-focusing on resources into a smaller number of programs
*Limits
-standardization v. adapting issues
-globalization v. localization
-global integration v. local responsiveness
-scale v. sensitivity

Front 22

Regionalization of Global Marketing Strategy

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*Cross-subsidization of market share battles in pursuit of regional production, branding, and distribution advantages.

Front 23

Issues in Regionalization of Global Marketing Strategy

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*Cross-subsidization of Markets-multinational firms using profits gained in a market where they have a strong competitive position to beef up their competitive position in a market where they are struggling to gain foothold.
*Identification of Weak Markets-not covered by a firm in its home market.
*Use of Lead Market Concept-unique local competition is nurturing product and service standards to be adopted by the rest of the world over time.
*Marketing Strategies for Emerging Markets

Front 24

Competitive Analysis

Back 24

SWOT (strength, weaknesses, opportunities, and threats)
*Two main categories: internal and external
*based on SWOT analysis, marketing executives can construct alternative strategies
*the aim of any SWOT analysis to isolate the key issues that will be important to the future of the firm and that will be addressed by subsequent marketing strategy.
*its bad b/c it tends to persuade companies to make lists rather than think critically.