Chapter 1

Introduction to
Global Marketing
1-2
Introduction
Goba versus reguar marketng
Scope of actvtes are outsde the
home-country market
Product/market growth matrx
1-3
Global Marketing
Create vaue for customers by
mprovng benefts or reducng
prce
Improve the product
Fnd new dstrbuton channes
Create better communcatons
Cut monetary and non-monetary
costs and prces
Value =
Benefits/Price
1-4
Globalization
Globalization is the inexorable integration of
markets, nation-states and technologies to a
degree never witnessed beforein a way that is
enabling individuals, corporations and nation-
states to reach around the world farther, faster,
deeper and cheaper than every before, and in a
way that is enabling the world to reach into
individuals, corporations and nation-states
father, faster, deeper and cheaper than ever
before.
Thomas L. riedman
1-5
Global Industries
An ndustry s goba to the extent that a
companys ndustry poston n one country s
nterdependent wth ts ndustry poston n
another country
Indcators of gobazaton
Rato of cross-border trade to tota
wordwde producton
Rato of cross-border nvestment to tota
capta nvestment
Proporton of ndustry revenue generated by
companes that compete n key word
regons
1-6
Competitive Advantage, Globalization,
and Global Industries
Focus
Concentraton and attenton on core
busness and competence
!estle is focused" #e are food and beverages. #e
are not running bicycle shops. $ven in food we are
not in all fields. There are certain areas we do not
touch. . . . #e have no soft drinks because % have
said we will either buy &oca-&ola or we leave it
alone. This is focus.
'elmut (aucher, former chairman of !estl) *+
1-7
Global Marketing: What It Is and
What It Isnt
Single Country
Marketing
Strategy
Target market
strategy
Marketng mx
Product
Prce
Promoton
Pace
Global Marketing
Strategy
Goba market
partcpaton
Marketng mx
deveopment
4 Ps: adapt or
standardze?
Concentraton of
marketng actvtes
Coordnaton of
marketng actvtes
Integraton of
compettve moves
1-8
Standarization versus Adaptation
Gobazaton (standardzaton)
Deveopng standardzed products marketed
wordwde wth a standardzed marketng
mx
Essence of mass marketng
Goba ocazaton (adaptaton)
Mxng standardzaton and customzaton n
a way that mnmzes costs whe
maxmzng satsfacton
Essence of segmentaton
Thnk gobay, act ocay
1-9
Standarization
versus
Adaptation
Arabc
read rght to
eft
Chnese
decous/happne
ss
The faces of Coca-Cola around the
world
1-10
Mconalds Global Marketing
Marketing Mix Element Standardization Localized
Product
Promotion
Place
Price
Big Mac
Brand name
Advertising slogan
Im Loving It
Free-standing
Big Mac is $3.1 in
!.". and #ur$e%
McAloo #i$$a &otato 'urger
(India)
"lang Maccas (Australia)
Ma$*o (P+ili&&ines)
McJoy maga,ine- .a/aii
"ur0ing .ula &romotion
(1a&an)
.ome deliver% (India)
"/iss rail s%stem dining cars
$2.31 ("/it,erland)
$1.31(4+ina)
1-11
!he Importance o" Going Global
For U.S. companes, 70% of tota word
market for goods and servces s outsde
the country
Coca-Coa earns 75% of operatng ncome
and two-thrds of proft outsde of North
Amerca
For |apanese companes, 90% of word
market s outsde the country
94% of market potenta s outsde of
Germany for ts companes
1-12
Global Auto Industr#
Thousands of auto companes gobay
n the eary twenteth century
More than 500 of those producers were
n the Unted States
Today there are fewer than 20 n the
word
Toyota s the words most vauabe car
company and s eghth argest n
revenue gobay
1-13
Management $rientations
Ethnocentrc orentaton
Home country s superor to others
Sees ony smartes n other
countres
Assumes products and practces that
succeed at home w be successfu
everywhere
Leads to a standardized or extension
approach
1-14
Management $rientations
Poycentrc orentaton
Each country s unque
Each subsdary deveops ts own
unque busness and marketng
strateges
Often referred to as multinational
Leads to a localized or adaptation
approach that assumes products
must be adapted to oca market
condtons
1-15
Management $rientations
Regocentrc orentaton
A regon s the reevant geographc
unt

Ex: The NAFTA or European Unon market

Some companes serve markets
throughout the word but on a
regona bass

Ex: Genera Motors had four regons for

decades
1-16
Management $rientations
Geocentrc orentaton
Entre word s a potenta market
Strves for ntegrated goba strateges
Aso known as a global or transnational
company
Retans an assocaton wth the
headquarters country
Pursues servng word markets from a snge
country or sources gobay to focus on
seect country markets
Leads to a combnaton of extension and
adaptation elements
1-17
riving %orces A""ecting Global
Integration and Global Marketing
Regona economc agreements
Convergng market needs and
wants and the nformaton
revouton
Transportaton and communcaton
mprovements
Product deveopment costs
1-18
riving %orces A""ecting Global
Integration and Global Marketing
Ouaty
Word economc trends
Leverage
1-19
&estraining %orces A""ecting Global
Integration and Global Marketing
Management myopa
Organzatona cuture
Natona contros
Opposton to gobazaton
1-20
$vervie' o" (ook
Part I: Overvew of goba
marketng
Part II: Envronments of goba
marketng
Part III: Goba strategy
Part IV: Goba consderatons of
the marketng mx
Part V: Integratng the dmensons
of goba marketng
1-21
)ooking Ahead to Chapter *
The goba economc envronment