Business Marketing Strategies for Global Markets

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Business Marketing Strategies for Global Markets

• Chapter 8

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Capturing Global Advantage

• What are RDEs?
• Why are they important?

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Sources of Global Advantage

• Three major types of advantages
• Cost advantages
• Market access advantages
• Capabilities advantages

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Cost Advantages

• 20-40 savings in landed costs
• What are landed costs?
• Lower Operating Costs
• Wage differences
• Business process outsourcing
• Lower Capital Costs
• Capital and equipments costs
• 30 savings
• Hidden costs

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Market Access Advantages

• Access to Growing Markets
• China
• Following customers

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Capabilities Advantage

• Gain knowledge and skills
• China and India
• How does this help?
• Improve RD
• Address unmet consumer needs
• Tailor products to local market

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To Outsource or not to Outsource?

• THAT is the question
• To outsource
• To not outsource

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International Market Entry Options

• Exporting
• Contracting
• Strategic Alliances
• Joint Venture

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Market Entry Options

• Exporting
• Goods are produced ___________
• Sales are made through __________________
• Lowest commitment and risk
• Disadvantages

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Market Entry Options

• Contracting
• Two types
• Licensing
• What can be licensed?
• Advantages
• Disadvantages
• Management contracts
• Turnkey operations

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Market Entry Options

• Strategic Alliances
• Collaborations among partners involving the
  commitment of capital and management resources
  with the objective of enhancing the partners
  competitive positions.
• Advantages
• Disadvantages

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Market Entry Options

• Joint Ventures
• Why?
• Advantages
• Disadvantages
• Choosing a Mode of Entry
• Factors

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Multidomestic v. Global

• Multimdomestic
• Global

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International Strategy and the Value Chain

• Primary activities
• Upstream
• Downstream
• Competitive Advantage
• Downstream
• Upstream
• Coordination
• Configuration

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General Framework

• Build a Unique Competitive Position
• Emphasize a Consistent Positioning Strategy
• Establish a Clear Home Base for Business
• Whats a home base?
• HP
• Leverage Product Line Home Bases at Different
  Locations

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General Framework

• Disperse Activities to Extend Home Base
  Advantages
• Purchase from cost-effective vendors
• Improve market access
• Tap competitive advantages in other places
• Coordinate and Integrate Dispersed Activities
• Establish clear global strategy
• Develop info and accounting systems
• Encourage personal relationships
• Rely on incentive systems