MKTG 301 1 1st Edition Lecture 8 MKTG Chapter 5 1 Developing a Global Vision 1 Social 2 Demographic 3 Economic 4 Technological 5 Political Legal 6 Competitive IMPORTANT reference chapter 4 for details 2 Rewards of Global Marketing 1 Having a global vision means 1 Recognizing and reacting to international marketing opportunities and aware of threats from foreign competitors 2 The US derives 14 of Gross Domestic product GOP from world trade 3 Negatives w global trade 1 Millions of Americans have lost jobs 2 Vulnerability to operations moving offshore 4 Benefits of global trade 1 Expand economic freedom 2 A rising tide lifts all boats tends to expand economic opportunity for everybody 3 Offers access to foreign capital global export markets and advanced technology 4 Promote labor environmental standards 5 Discuss the impact of multinational firms on the world economy 1 Multinational Invests significantly doing business w multiple nations not just it s own 6 Stages of Global Business Development 1 Companies operate in one country and sell into others 2 Set up foreign subsidiaries to handle sales 1 Subsidiary A company within another company in other words a Strategic business unit 2 Higher risk higher profit return 3 Operate an entire line of business in another country 1 More applicable or better received in another nation depends on consumers wants and needs 4 Virtual operation 7 Global Marketing Standardization 1 More and more internationally reasons for efficiency costs in saving 2 Popular brand name These notes represent a detailed interpretation of the professor s lecture GradeBuddy is best used as a supplement to your own notes not as a substitute 8 Multi domestic Strategy 1 Fits its products to each country in which it does business 2 Ex McDonalds in the business for marketing Sandwiches differ from culture to culture worldwide 9 External Environment Facing Global Marketers 1 Culture 2 Natural Resources 3 Economic technological development 4 Political Structure 5 Demographic Make up 10 Continuum1 Beginning to end look different think a stick Both ends look similar but the distance between them are different 2 Countries w different social governmental structure Marketers have to take these into account DON T NEED TO KNOW LEGAL CONSIDERATIONS 3 Political Legal Considerations 1 General agreements on tariff and trade 4 Natural Resources What does a nation have what does the Middle East have that the world needs Oil Saudi Arabia also needs other resources they don t have trade 11 Global Marketplace1 Export 2 Licensing and Franchising 3 Contract Manufacturing 4 Joint Venture 5 Direct Investment 1 Buyer for export Assumes all ownership risks and sells globally for its own account 2 Export Broker IMPORTANT They are similar to an agent by bringing buyer and sellers together 3 Export Agent 12 Exchange rates 1 Reflect the price of one s currency in terms of another country s currency 13 Countertrade a form of trade in which all or part of the payment for goods or services in the form of other goods or services