Intenational Marketing-Essay – Flashcards

The only difference between domestic marketing and international marketing is that the activities take place in more than one country. Therefore, the marketing task is the same throughout the world.

The first phase includes those domestic firms which have no foreign business activity except those sales made to foreign customers who come directly to the firm. The second phase includes domestic firms which have temporary surpluses which are sold abroad. Therefore, sales are made on an availability basis with little or no intention for continuing market representation. The third phase includes the domestic firms that have permanent productive capacity which is utilized to produce goods which are sold on a continuing basis in foreign markets. The fourth phase includes the international company that produces a product for the world market.

The main distinction between a global and a multinational company is that a global company assumes there are segments across countries which have the same needs and wants and designs a standardized, high quality, reasonably priced product for those segments and markets it as if there are no differences among the country markets. On the other hand, a multinational company operates in a number of countries and adjusts its products and marketing practices for each market. The multinational company has a specific marketing plan and adapts products for each country market. The philosophy for the multinational company is that there are cultural differences among countries that require specific adaptations for those markets. This is contrasted with the global company which sees the entire world, or major regions of it, as a single entity requiring no specialized adjustments. This distinction may be more myth than fact and reflects Professor Levitt's opinion.

Student exercise. A minimum would be a reading list plus some commitment to study different countries.

A global orientation means operating as if all the country markets in a company's scope of operations (including domestic market) are approachable as a single global market and to standardize the marketing mix where culturally feasible and cost effective or to adapt the marketing mix where culturally required and cost effective. A global orientation does not mean to follow a single strategy of standardization without regard for cultural differences nor does it imply that the marketing effort must be adapted to every cultural difference. Instead, it means looking for market segments with similar demands that can be satisfied with the same product, standardizing the components of the marketing mix that can be standardized, and, where there are significant cultural differences that require parts of the marketing mix to be culturally adapted, adapting.

The U.S. economy has played a major role in globalization due to the petro-dollar (U.S. dollar) being the world's reserve currency for well over 70 years. This has resulted in great dominance and power for the U.S. economy. And it has shown to be very advantageous in the U.S. financial market compared to other economies, which have to buy, sell, and transact business with the U.S. dollar. The U.S. dollar as the world's currency has allowed for substantial negotiation power for U.S. corporations, which birthed multinational corporations. The dominance of the petro-dollar into other countries birthed what is known as globalization. Trade, negotiations, and relationships were established based on the use of the U.S. dollar through collaborations by force and/or threat. This created more buying power and value for the dollar and lessened the value of other countries' currencies, which resulted in poverty-stricken economies. For example, if X country grew bananas in abundance and wanted to sell their bananas to Z country, they would purchase and sell with U.S. dollars. A currency's value is increased based on its use. Therefore, over decades or longer, other countries were persuaded in one way or the other to use the U.S. dollar created by the privately-owned Federal Reserve Bank.

America's involvement in the global economy has passed through two distinct periods: a development era during which the United States sought industrial self-sufficiency in the eighteenth and nineteenth centuries, and a free-trade in the early and middle twentieth century during which open trade was linked with prosperity. Now America has entered a third, more dangerous era—an age of global economic interdependence. With surprising swiftness, the United States has shifted from relative economic self-sufficiency to global interdependence. In 1960, trade accounted for only 10 percent of the country's GNP; by the mid-1980s, that figure had more than doubled. American farmers now sell 30 percent of their grain 164 production overseas; 40 percent of U.S. farmland is devoted to crops for export. In fact, more U.S. farmland is used to feed the Japanese than there is Japanese farmland. American industry exports more than 20 percent of its manufacturing output, and one out of every six manufacturing jobs in the U.S. depends on foreign sales. More than 70 percent of American industry now faces stiff foreign

In a free market economy the price of different products gives information about the demand and supply of the products. The price of products increases when the demand rises as there are more buyers willing to pay a larger amount for the same product. Price also goes up when the number of producers supply a smaller amount of the product as they are in a position to demand a larger amount for the same product. The demand and supply in a free market is also a function of the price. As the price increases the demand goes down and the supply increases. On the other hand when the price goes down the demand rises and the supply decreases. The result of this feedback loop is the determination of an equilibrium price at which the buyers are willing to buy a particular quantity of the product and sellers are willing to sell the same quantity of the product. Adam Smith is widely believed to be a proponent of the free market economy where competition drives prices up or down and the government has no role to play either in controlling prices or in helping producers. A more detailed study of his writing reveals that this is not the case and he in fact believed that governments should intervene when required to protect producers, buyers and keep prices within reasonable limits.

Since the balance of payment is based upon system of double-entry book-keeping, the total debits must equal to total credits. This is because two aspects of each transaction recorded are equal in amount but appear on opposite sides of the balance of payments account. In this accounting sense, balances of payments for a country must always balance The debit side shows the use of total foreign exchange acquired in a particular period. The credit side shows the sources from which the foreign exchange is acquired during a particular period. Against every credit entry, there is an offsetting debit entry & vise-versa, so the receipts and payments on these two sides must be equal. Hence the two sides must necessary balance. If X imports from Y, Y would also import from X. Hence there would be a debit and credit entries in the balance of payments of both the countries X & Y. The individual items in the balance of payments may not balance. But the total credits of the country must be equals to its total debits. If there is any deficit in any individual account, it would be covered by a surplus in other accounts, if there is any difference between total debits and total credits, it would be settled under 'errors & omissions'. Hence in the accounting sense, the balance of payments of a country always balances.

"Support or refute each of the various arguments commonly used in support of tariffs"

Increased validity is being granted to the argument that it is better to have workers employed even if the consumer must pay more. Many economic trade models assume full employment but the "real world" does not necessarily reflect the theory.Protectionism is based on world trade; countries go forth reliever its markets from unlike companies diluting the home countries markets with unwanted goods by inducing tariffs, quotas, and nontariff barriers. These barriers rotter contain legal, exchange and psychological barriers. There argon however a few logic and sensible arguments for countries to establish more(prenominal) barriers change magnitude protectionism and unemployment is not one of them. There are many another(prenominal) alternatives to keep up employment and reduce unemployment in home countries. Countries experiencing periods of frugal suppuration need to capitalize on the opportunity for as yearn as that eon lasts so new jobs poop be created. These times generally arise when the demand for an roam of products is high, businesses consequently can expand their workforce. Increased awareness by population about incentives in paid work much(prenominal) as realise programs can increase employm ent and the go for to work. Training policies back up the unemployed to attain skills and expand their capabilities to provoke knowledge in multiple fields of work. By apply unemployment for a designer to lean on protectionism, it still convey that there will be an overall inadequate summate of resources in the region that will be implementing barriers. Being qualified to expand the measure of international trade countries should be satisfactory generate redundant revenue in the country to give the sack interior(prenominal) markets and unemployment situations. Arguments for preservative measures against infant industry can be recognized by underdeveloped countries when countries are afraid that domestic competition would not be able with withstand foreign competition. But when measures are taken to ensure protection to markets, it is frequently difficult to stumble protection barriers. In this case, when there is no ideal time of competition, domestic efficiency in these markets is neer improved. Other v! alid and logical arguments to use protectionism are for industrialisation and most tardily resource conservation in...If you want to micturate a bounteous essay,

Omnibus Trade And Competitiveness Act Of 1988 Legislation passed by the U.S. Congress in August 1988 and signed into law on August 23, 1988, to enhance the competitiveness of American industry. Its major purposes were to: authorize the negotiation of reciprocal trade agreements; strengthen U.S. trade laws; improve development and management of U.S. trade strategy; and through these actions, improve standards of living in the world. The act made many changes in U.S. trade law, inter alia, significant changes to Section 301 and the adoption of Section 301 variants: "Super" 301 (§ 1302 of the act) provisions required, in 1989 and 1990, the U.S. trade representative (USTR) to identify priority practices (trade distorting practices whose elimination might substantially increase U.S. exports) and priority countries (countries with the highest trade barriers and best markets for U.S. Exports) and to initiate Section 301 investigations of such practices; "Special 301" (§ 1303 of the act), requires USTR to identify and self-initiate expedited Section 301 investigations of countries which deny adequate protection of intellectual property rights; "Telecommunications 301" (§ 1377 of the act) requires USTR to review, on an annual basis, trade agreements which involve telecommunications products or services to determine whether the foreign country is failing to comply with the agreement or is otherwise denying opportunities to U.S. Telecommunication products and services. In March 1994, President Clinton signed an executive order reinstituting the Super 301 provision; under this order USTR will identify in 1994 and 1995 priority foreign practices which may be actionable under Section 301.

GATT: General Agreement on Tariffs and Trade- Trade shall be conducted on a nondiscriminatory basis, protection shall be afforded domestic industries through tariffs(not through such commercial measures as import quotas), and consultation will be the modus to solve trade problems TRIMs: Trade related investment measures, established the basic principle that investment restrictions can be major trade barriers and therefore are included under GATT procedures. An initial set of specific practices were prohibited. As a result of TRIMs, restrictions in Indonesia which prohibit foreign firms from opening their own wholesale or retail distribution channels can be challenged. And so investment restrictions in Brazil TRIPs:Trade Related aspects of Intellectual Property Rights- Another objective of the U.S from the Uruguay Round was achieved by agreement on trade related aspects of intellectual property rights. The TRIPs agreement establishes substantially higher standards of protection for a full range of intellectual property rights (patents, copyrights, trademarks, etc.) than are embodied in current international agreements and it provides for the effective enforcement of those standards both internally and at the border.

Whether or not the marketer is aware of it, he assumes the role of a change agent when he introduces into another culture new ideas or new products requiring some form of change in behavior for acceptance and use of the new idea or product. The international marketer must concern himself with the impact of his actions upon the new culture.

Marketers are constantly in the process of adjusting their efforts to the demands of the culture of their markets. Although in the long run they may affect their market's culture as a result of their efforts, most current activity involves reconciling marketing activity to the immediate culture.

A foreign marketer should study culture in order to avoid making blunders which would not be made if he or she had cultural knowledge. Culture should be studied because it affects the consumer's desire and ability to buy.

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cultural congruence-124 planned change-124 cultural borrowing-121 cultural sensitivity

A.MATERIAL CULTURE 1.technology-tech and know how to produce goods and services 2.Economics-Emplyment capabilities and resource B SOCIAL INSTITUTIONS 1.social organizations-family life, status, age. 2.Education-literacy and intelligence and how informed the public is 3.Political structures C. MAN AND UNIVERSE belief systems D. AESTHETICS 1.graphic and plastic arts folklore music and drama and dance

Resistance to cultural change will affect new product introduction in the respect that the greatest resistance will confront products which are farthest from the status quo, but this resistance can be lowered by gaining public interest. Lowering resistance in this situation means shortening the duration of the resistance. Domestic marketing is subject to the same resistance to change. Examples of this resistance in the domestic market are the introduction of contact lenses and using motorcycles as an acceptable means of recreation

Firstly, expropriate can create conflicts with other governments and could potentially take investors away from them. Moreover, if a country domesticates could achieve almost all of the benefits of expropriate and avoid issues with some other countries. More benefits are supposed to come and many problems could be avoid thanks to domestication. Expropriate-gvt seizes an investment but makes some compensation/reimbursement Domesticate-gradual transfer and mandating of foreign investment by host nation to national control through government decrees .

Radical shifts in government philosophy, pressure from nationalist and self-interest groups, weakened economic conditions, bias against foreign investment or conflicts between governments are all issues that can affect the stability of a government. Foreign business sometimes fear when governments change political party because they are concerned about the continuity of the set of rules or code of behavior and the continuation of the rule of law, regardless of which government is in power. When there are dominant political party/parties, it may become a foreign corporation concern because the party can alter prevailing attitudes. When there is nationalism, which means there is a sense of pride in one's own country. This pride can take an anti-foreign business bias, and minor harassment and controls of foreign investment