Ch.1 Intro. to Global Marketing – Flashcards

Marketing activities represent an organization's efforts to satisfy customer wants and needs by offering products and services that create value. These goals are relevant in virtually every part of the world; however, when an organization pursues market opportunities outside of its home country (domestic) market, managers need an understanding of additional conceptual tools and guidelines in order to do business in these other countries - in other words, to create value and satisfy consumer needs and wants. -An organization that engages in global marketing focuses it resources and competencies on global market opportunities and threats -Must use marketing tools (Product, price, place and promotion) -Global vs. Regular Marketing - "scope of activities" are outside the home country market

"think globally, act locally, and manage regionally" Coca-Cola is a global product by virtue of the fact that it is available in more than 195 countries in red cans bearing the distinctive signature style. It must be noted, however, that customer service efforts are adapted to the needs of particular markets (for example, vending machines in Japan). Thus, Coca-Cola is both global and local.

Strategies include: 1.Global branding: (Coca-Cola, Marlboro) 2.Product design :(McDonald's restaurants and menu items) 3.Positioning: (Harley-Davidson) 4.Packaging: (Gillette Sensor) 5.Distribution: (Benetton) 6.Customer service: (Caterpillar) 7.Sourcing: (Toyota, Gap).

Burberry pg. 11 Ch.1 Product: Boost sales of handbags, belts, accessories - product whose sales are less cyclical than clothings. Price: More expensive than coach, less expensive than prada. "affordable luxury" is central to value proposition Place: Intends to open more independent stores in key cities including NY and HK. Such locations generate more than half the company's revenue and profit Promotion: Roll out new logo "plaid overexposure". Use social media and project to provide exposure for emerging music talent.

Ch.1 pg. 15 Harley-Davidson motorcycles are known the world over as "the" all-American motorcycle. Harley's mystique and heritage are associated with America. The company backs up this positioning with exports from two U.S. manufacturing locations. By contrast, Toyota builds some models (e.g. Camry) for the U.S. market in the U.S., a fact that Toyota stresses in its American advertising. Thus, Harley-Davidson serves global markets while sourcing locally, while Toyota's strategy calls for serving world markets and using the world as a source of supply.

Ethnocentric: home country products and management processes are superior. An ethnocentric company that neither sources inputs from, nor seeks market opportunities in the world outside the home country may be classified as an international company. A company that does business abroad while still presuming the superiority of the home country may be classified as an international company. Such a company would rely on an extension strategy whereby it would export, without adaptation, products designed for the domestic market. Polycentric: predominates at a multinational company leads to a view of the world in which each country markets is different from the others. Local country managers operating with a high degree of autonomy adapt the marketing mix in a polycentric, multinational company. Managers who are regiocentric or geocentric in their orientations recognize both similarities and differences in world markets. Market opportunities are pursued using both extension and adaptation strategies. The regiocentric and geocentric orientations are characteristic of global transnational companies.

DRIVING FORCES Regional agreements: Market needs and wants and IT: Transportation and communication: Product Development Costs: Quality : -R&D as a percent of sales -World economic trends - 2008 global crisis - Growing middle class in China, India, Brazil, etc. - Rapid growth in China pre-2008 - Movement to free markets worldwide Leverage: - Experience transfers - Scale economies - Resource utilization - Global strategy

Some type of advantage that a company enjoys by virtue of the fact that it has experience in more than one country. Allows a company to conserve resources when pursuing opportunities in new geographical markets. Enables a company to expend less time, less effort, and/or less money. A global company can take advantage of several types of leverage in pursuit of corporate goals such as profit or revenue growth. These include experience transfers, scale economies, enhanced resource utilization, and global strategy.

Each student's answer will vary but their answers should incorporate such terms as global marketing, marketing mix strategy, value chain, V = B/P, strategic focus, global marketing strategy, extension, adaption, ethnocentric, polycentric, regiocentric, or geocentric orientations in their responses. Perhaps, a phrase that could be said to each of these chief executives is "think globally, act locally".

Getting existing customers to buy more of existing products. Loyalty Cards, Rewards Program

Taking existing products into new markets. SB will source coffee beans in India and open cafes in upscale hotels in India.

Developing new products and placing them in existing markets. Starbucks created instant coffee to enable customers to enjoy coffee at the office & other locations.

Developing new products for new markets. Starbucks launched new ventures, CDs, and movie production. Revamping stores to serve as wine bars to attract new customers in the evening.

Activity, set of institutions and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.

Scope of activities outside the home market.

Economic globalization constitutes integration of national economies into the international economy through trade, direct foreign investment (by corp. and multinationals), short-term capital flows, international flows of workers and humanity generally, and flows of technology.

An industry is global to the extent that a company's industry position in one country is interdependent with its industry position in another country. 80% of Coca Cola's sales come from outside the US.

1. Home country is superior to the rest of the world. 2. Associated with national arrogance or feelings of national superiority. 3. At some companies, the ethnocentric orientation means that opportunities outside of the home country are routinely ignored (domestic companies). 4. Ethnocentric companies that conduct business outside their home country are known as international companies - they believe products that succeed in the home country are superior. 5. Leads to a standardized or extension approach - the belief that products can be sold everywhere without adaptation. 6. Foreign operations or markets are viewed as inferior or subordinate to the home market. 7. Headquarters knowledge is applied everywhere; local knowledge is viewed as unnecessary.

Each country is unique Each subsidiary develops its own unique business and marketing strategies Often referred to as multinational Leads to a localized or adaptation approach that assumes products must be adapted to local market conditions

A region is the relevant geographic unit Ex: The NAFTA or European Union market Some companies serve markets throughout the world but on a regional basis Ex: General Motors had four regions for decades

-Entire world is a potential market -Strives for integrated global strategies -Also known as a global or transnational company -Retains an association with the headquarters country -Pursues serving world markets from a single country or sources globally to focus on select country markets -Leads to a combination of extension and adaptation elements