Flashcards and Answers – Global market
Unlock all answers in this set
Unlock answersquestion
-decline of economic protectionism by individual countries -economic integration and free trade among nations. -Global competition among global companies for global customers. -Development of networked global marketspace.
answer
what are the four trends in the past decade that have affected world trade? PICM
question
shielding one or more industries within a country's economy from foreign competition, usually through the use of tariffs or quotas
answer
Protectionism
question
tax on goods or services entering a country. Because a tariff raises the price of an imported product, tariffs give a price advantage to domestic products competing in the same market.
answer
tariff
question
restriction placed on the amount of a product allowed to enter or leave a country.
answer
quota
question
discourageworld trade WTO to address trade issues
answer
what do tariffs and quota do
question
Regional Trade Groupings (RTGs) transnational trade groups or signed trade agreements - to promote free trade and enhance individual economies
answer
what have countries with similar economic goals formed?
question
Eu(1993, removed barriers free flow of goods and services, single market) NAFRA ASEAN free trade areas (east asia, eg reduced tarriffs)
answer
3 best types of agreement
question
Closer relations agreement
answer
what agreement exist between NZ and austrlia
question
global competition among global companies for global consumers - borderless economic world
answer
what is world trade drive by - why
question
when firms originate, produce and market their products and services worldwide.
answer
global competition
question
cars, pharmaceutical, clothing, electronics, aerospace, telecommunications eg pepsi over 190 countries quarter of all soft drink sold international.
answer
examples of industries within global compeititon
question
broadens the competitive landscape for marketers
answer
what does global compeititon do
question
international firms multinational transnational
answer
3 types of comapnies that compete in the global marketplace
question
marekt existing products and services in other countries the same as it does at home eg Avon
answer
international firm
question
world consist on unique regions and therefore markets to each region or country differently
answer
multinational
question
world is one market and emphasises universal consuemers needs and wants more than differences
answer
transantional
question
people who are employed from different countries and have many administrative, marketing and manufacturing operations
answer
what are divisions or subsidiares
question
multinationals, producing many different product variations, brand names and advertising programs as countries or region in which they do business
answer
what is a multidomestic marketing strategy - who is it used by
question
multipurpose cleaner known as Mr Clean in North America and Asia is sold under different names in different parts of the world eg Mastro Limpio in Latin American and Mr propert in Africa and Europe
answer
example of multidomestic strategy
question
transnational firms - adapting standarised marketing activities, popular among business to business marketers eg mcdonalds, gilette, motorola
answer
global marketing strategy - who is it used by
question
a brand marketed under the same name in multiple countries with similar and centrall co-ordinated marketing programs
answer
global brand
question
the havethe same product formulation service concept deliver the same benefits to consumrs consistent advertsing across multiple countries and cultures adaption is only used when necessary to better connect the brand to consumers in different markets eg mds serving beer in germany
answer
what is similar about global brands and there home countries
question
customers living around the world who have similar needs or seek similar benefits from products or services
answer
global consumers
question
a tool for exchanging goods, services and infromation on a global scale - promote world trade
answer
what has internet been used for
question
exchange of goos, ervices and info from comapnies anywhere to customer anywhere at any time at a lower cost - only if possess the telecommunications infrastructure necessary to support internet/web based technology - prospective buyers on every continent - different language websites
answer
what has the networked global marketspace enabled
question
social economic technological competitive regulatory forces
answer
what environmental, global comapanies scan
question
cultural economic political variables
answer
3 types of uncontrollable environment variable
question
- sensitive to cultures to for sucessful exchnge relationships with consumers - undertake a cross-cultural analysis - understand values , customs language and cultural symbols
answer
marketers - cultural diversity
question
studyingsimilarities and differences among consumers in two or more nations or societies
answer
cross-cultural analysis
question
represent socially preferable modes of conduct or states of existence that tend to persist over time eg honestly eg mcdonalds does not sell hamburgers in india because cow is considered sacred by 85% of population
answer
values
question
what is considered normal and expected about the way people do things in a specific country. eg expectations about giving gifts, however bribes or payoffs to commit illegal acts is considered corrupt in most socities eg japense women give japense men chocolate on valentines day in nz anti corruption legilsation, makes it a criminal offence however in greece, bribes paid to foreign companies are tax deductible expense
answer
customs
question
things that represent ideas or concepts - difffernt cultures attach different meanings to things western culture superstious about number 13 tiffany and co sells fine glassware in japan in set of 5 not four because four means death - postively tie symbolism to products and services to increase attractiveness
answer
cultural symbols
question
- basic of native tonuge - around 3000 differently spoken - 11 in EU english spanish and french = principle language - best to communicate in own lanague 17 in india - known unique expressions Vicks in US is slang for sexual intimacy in germany so is called Wicks
answer
language
question
assessment of the economic infrastructure in different countries ( transportation, financial and distribution systems, assumed to be in place, telephones, radio and internet may be limited in developing countrie) measurement of consumer income in different countries (1998 nz 16000 however less than 200 n developing countries, effect purchasing power) recognition of a country's currency exchange rates. (eg fluxtuation, must aquire more money to purhcase goods from overseas, or may have more to spend)
answer
economic scans of the global market place should consider 3 things IIC
question
identifying current climate but how long a favoruable or unfavoruable climate will last - analysis of poltcal stability and trade regulations
answer
assessing political - regulatory climate - SR
question
middle east, money last due to war, careful selection of political stable countries eg governement ideas about comapnies and trade
answer
political stability
question
rules that govern business practises eg malaysia government, advertising cannot promote an excessively aspiration lifestyle
answer
trade regulations
question
means of market entry
answer
what happens once a company has decided to enter the global marketplace
question
exporting licensing joint venture direct investment
answer
4 mens of market entry
question
exporting licensing joint venture direct investment
answer
list from the firms least financial commitment to most in terms of market entry strategies
question
producing goods in one country and selling them in another country.
answer
Exporting
question
- does not have to change products, its organisation or corperate goals
answer
what does exporting mean for the comapny
question
sells its domestically produced goods in a foreign country through an intermediary. - no oversaeas contacts but can market abroad - often a distributor, with know how resource eg botanic foods in US
answer
indirect exporting
question
firm sells its domestically produced goods in a foreign country without intermediaries. - only if they beleive their volume of sales will be large enough - more risk but increase profits
answer
direct exporting
question
company offers the right to a trademark, patent, trade secret or other similarly valued items of intellectual property in return for a royalty or a fee.
answer
licensing
question
- low rise - easy to enter foreign market with virtually no cost
answer
benefit of licensing for the licensor
question
- gain ifnromation that allows it to start with a competitive advantage - country gains employment by having the product manufactured locally `
answer
benefits of licensing for the liscensee
question
- give up control of the product - licensee can modify the product and enter the market with product and marketing knowledge gianed at the expense of the company that got them started - if liscee is a poor choice, could harm name or reptuation
answer
disadvantages to the liensor
question
keep linscees dependnat on them for improvement and sucessful operation
answer
what do licensors try to do to prevent disadvantages
question
franchising
answer
what is a varaition of licensing
question
company contracts with an individual to set up an operation to provide products or services under the company's established brand name,
answer
franching
question
its the fastest growing market entry strategy
answer
why do people franchise
question
2005 in aus = over 110 billion
answer
how big is the franchise market
question
foreign company and a local firm invest together to create a local business
answer
joint venture
question
ownership, control and profits of the new company
answer
what does the local firm and foreign company share in a joint venture
question
investing and buying share in the other or creating a third and sepeare entity
answer
how is investment made in joint ventures
question
ANZ banking group joined with ING group called ING Austrlia, largest fund managers in life insurers
answer
nz example of joint venture
question
-did not previously have financial, physical or managerial resources to enter a foreign market alone
answer
advantages of joint venture
question
Ericssson (telecommunications)(money and technology) and french switch maker( knowledge of the french market) made US 100 million,
answer
positve example of joint venture
question
- disagree about policies or courses of action - goverenmental bueraucaracy - may want to return profits to its host country
answer
disadvantages of joint venture
question
domestic firm actually investing in and owning a foreign subsidiary or division.
answer
direct investment
question
ernest and young, international accounting and management consulting firm entered hungary, establishing a joint venture with a local company, later aquired the company, making it a subsidary
answer
example of direct investement
question
cost saving - inderstanding local market condition - less location restrictuon - may outweigh the risks
answer
advantages of direct investment
question
customise its design based on evnrionemtn scan and experience and market reserach
answer
what must marketers do to to implemtn a sucessful marketing program
question
production extension product adaption product invention
answer
how do global comapnies match product and promotion efforts in global markets? 3 ways
question
Selling virtually the same product in other countries
answer
production extension
question
Changing a product in some way to make it more appropriate for a country's climate or consumer preferences
answer
product adaption
question
invent totally new products designed to satisfy common needs across countries.
answer
product invention
question
adapt product and promotion
answer
what is dual adaption
question
adapt promotion with same product
answer
what is communication adaption strategy
question
creating new product and either keeping or changing promotion
answer
what is product invention strategy
question
adapt product keep promotiion
answer
product adaption strategy
question
same promotion same product
answer
product extension strategy
question
the use and avaliability or retailer or wholesaler, transportation, communcation and warehousing facilities
answer
what can a countries economic infrastructure determine
question
seller (responsible for distribution to consumer)
answer
first step in distribution in global markets
question
moving the product from one country to another - can be handled by intermediaries eg merchant wholesalers who buy and sell the product or agent who bring buyers and sellers together or resdient buyer in foreign country
answer
second step in distribution in global markets
question
once in foreign nation, results in the countries distribution channels
answer
third step in distribution in global markets
question
place compeitive, political and legal contraints of pricing flexibility of global comapnies wal-mart told by german anti trust authories the prices were too low relative to competitors, facing fines for violating countries trade practises
answer
despite free trade agreements what can countries do
question
a firm sells a product in a foreign country below its domesitc price or below its actual cost
answer
what is dumping
question
when prices appear too low in a country and case face fines
answer
when does dumping occur
question
products are sold through unauthorised channels of distribution - individual buy products in a lower priced country from a manufactuers authorised retailer, ship them to a higher priced country and sell them below the manufactuers suggested retail price through unauthorised retailers
answer
what is grey market or parallel importing
