BA320

1
The Global Marketplace

• BA320
• Summer 2006

2
Agenda for Today

• Discuss how the international trade system,
  economic, political-legal, and cultural
  environments affect a companys international
  marketing decisions.
• Describe three key approaches to entering
  international markets.
• Explain how companies adapt their marketing mixes
  for international markets.

3
Global Marketing in the 21st Century

• The world is shrinking rapidly with the advent of
  faster communication, transportation, and
  financial flows.
• International trade is booming and accounts for
  20 of GDP worldwide.
• Global competition is intensifying.
• Higher risks with globalization.

4
Figure 15-1Major International Marketing
Decisions
5
Looking at the Global Marketing Environment

• The International Trade System
• Restrictionstariffs, quotas, embargos, exchange
  controls, and nontariff trade barriers.
• The World Trade Organization and GATT
• Helps tradereduces tariffs and other
  international trade barriers.
• Regional Free Trade Zones
• Groups of nations organized to work toward common
  goals in the regulation of international trade.

6
Lets Talk!
GATT promotes international trade by reducing
tariffs.
7
Economic Environment

• Industrial Structure
• Shapes a countrys product and service needs,
  income levels, and employment levels.
• Four types
• Subsistence economies
• Raw material exporting economies
• Industrializing economies
• Industrial economies

8
Country Comparisons
9
Marketing Implications
10
Political-Legal Environment

• Attitudes toward international buying
• Government bureaucracy
• Political stability
• Monetary regulations
• Countertrade
• Barter
• Compensation
• Counterpurchase

11
Cultural Environment

• Sellers must examine the ways consumers in
  different countries think about and use products
  before planning a marketing program.
• Business norms and behavior vary from country to
  country.
• Companies that understand cultural nuances can
  use them to advantage when positioning products
  internationally.

12
The Importance of Culture
Marketing in Action

• Ignoring cultural differences can result in
  strong consumer backlash. Nike was forced to
  pull these shoes from distribution after learning
  that the stylized shoe logo resembled Allah
  when written in Arabic.

13
Levis
14
Lets Talk!
15
Figure 15-2Market Entry Strategies
16
Joint Ownership
Marketing in Action

• KFC entered Japan through a joint ownership
  agreement with Japanese conglomerate Mitsubishi.

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Deciding on the Global Marketing Program

• Standardized Marketing Mix
• Selling largely the same products and using the
  same marketing approaches worldwide.
• Adapted Marketing Mix
• Producer adjusts the marketing mix elements to
  each target market, bearing more costs but hoping
  for a larger market share and return.

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Figure 15-3Global Product and Communication
Strategies
19
Marketing Mix Adaptation
Marketing in Action

• In India, McDonalds serves chicken, fish, and
  veggie burgers, but no beef. Check out the
  Maharaja Mac!

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Marketing Mix Adaptation
Marketing in Action
http//www.cocacolabrasil.com.br/nossasmarcas/noss
asmarcas.asp

• In Brasil, Coca Cola Co. offers standard Coke,
  but also Guarana and Fanta

21
Rest Stop Reviewing the Concepts

• Discuss how the international trade system,
  economic, political-legal, and cultural
  environments affect a companys international
  marketing decisions.
• Describe three key approaches to entering
  international markets.
• Explain how companies adapt their marketing mixes
  for international markets.