INTERNATIONAL MARKETING MANAGEMENT

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INTERNATIONAL MARKETING MANAGEMENT
SESSION 13 GLOBAL PORTFOLIO STRATEGY
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CHANGING MARKET ORIENTATION
PHASE 1
PHASE 2
PHASE 3
domestic countries
sub
sub
firm
firm
firm
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LEVERAGING ECONOMIES OF SCALE

• Tangible Assets
• Production, RD, Advertising
• Intangible Assets
• Image, Experience, Ideas

LEARNING
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LEVERAGING ECONOMIES OF SCOPE

• Shared Physical Assets
• Production, Warehousing
• Shared External Relations
• Suppliers, Distributors
• Shared Experience
• RD, Country Knowledge

BUILDING
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TRIGGERS TO GLOBAL RATIONALIZATION

• Country-focused international expansion (e.g.
  acquisition, local expansion)
• Trend to industry consolidation and growth of
  global competition
• Forces towards global market integration
• Need to
• re-center direction for growth
• Improve coordination across national
  boundaries
• adopt global perspective

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PHASE 3 GLOBAL RATIONALIZATION
world markets
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PHASE 3 KEY STRATEGIC DECISIONS

• Establish Global Portfolio of Countries,
  Products, Market Segments
• Develop Global Marketing Strategy Broad-Based,
  Focused, Hybrid
• Improve Efficiency of Productionand Logistics

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LEVERAGING SYNERGIES

• Scale Efficiencies (Tangible and Intangible)
• Learning
• Transfer of Ideas, Products, Programs, Experience
  and Know-how (Best Practices)

LEADING
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TYPICAL FIRMS IN INTEGRATION PHASE
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GLOBAL MARKET GROWTH DIRECTIONS
Countries/Regions Existing New
Products/Product Lines Existing New
Stage in Value Chain Existing
New
Segments/Customers New Existing
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RE-ENGINEERING THE GLOBAL PORTFOLIO
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SBU PORTFOLIOS REGION
Asia
Latin America
Market Attractiveness low
high
U.S.
Africa
Europe
low
high Competitive Strength
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FOOD AND BEVERAGE PORTFOLIOS
COMPETITOR A
COMPETITOR B
Key Countries
Key Countries
Japan
China
Japan
China
S. Korea
U.S.
U.S.
Market Attractiveness Low High
Market Attractiveness Low High
Brazil
Brazil
France
France
Hungary
Argentina
Germany
Germany
U.K.
U.K.
Low High Competitive Strength
Low High Competitive Strength
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ILLUSTRATIVE INDICATORS FOR ASSESSING CS

• Market Strength
• sales volume
• market share and market share growth
• rank in industry
• gross/net profits
• Market Presence and Coverage
• geographic market coverage
• presence in key markets
• degree of vertical integration
• Innovativeness
• investment in RD
• patents
• new product introductions

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GEOGRAPHIC MARKET LINKAGES
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FOOD AND BEVERAGE EXPANSION OPTIONS FOR A COMPANY
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BALANCING THE PORTFOLIO

• Growth vs. Mature Markets
• Risk Diversification
• Geographic Concentration (Market
  Interconnectedness)

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BALANCING THE GLOBAL PORTFOLIO
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IMPLICATIONS

• Need to chart direction for long-run growth
• Importance of balancing growth vs. mature markets
• Growing integration of markets impacts expansion
  choice

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