DATE 04 0815 Course Title Introduction to Marketing Course MKTG 2201 CRN 34372 The Global Marketplace Chapter 17 The Impact of Culture on Marketing Strategy Companies that understand cultural nuances can o Avoid expensive and embarrassing mistakes o Take advantage of cross cultural opportunities o Can use them to their advantage in the global markets Ex IKEA customers in China want a lot more from its stores than just affordable Scandinavian design furniture Deciding Whether to Go Global Factors Attack on a company s home market by global competitors Expanding customer base in international markets o Ex McDonalds Better opportunities for growth Market At Work Coca Cola has emphasized international growth in recent years to offset stagnant or declining U S soft drink sales o Looing at emerging markets such as Africa to meet its ambitious growth goals Its African distribution network is rudimentary but effective Deciding which markets to enter Company should o Define its international marketing objectives and policies o Decide what volume of foreign sales it wants o Choose in how many countries it wants to market o Decide on types of countries to enter o Carefully evaluate each country Page 1 of 3 Market Entry Strategies Figure 17 2 DATE 04 0815 Exporting o Indirect o Direct Joint venturing o Licensing o Contract manufacturing o Management manufacturing o Joint ownership Direct Investment o Assembly facilitates o Manufacturing facilities Exporting Entering foreign markets by selling goods produced in the company s home country often with little modification o Indirect exporting o Direct exporting Involves less investment because the firm does not require an overseas marketing organization or network Investment and risk are greater in this strategy but so is the potential return Entering foreign markets by joining with foreign companies to produce or market a Joint venturing product or service Types of Joint Ventures Licensing o Entering foreign markets through developing an agreement with a licensee in the o Company contracts with manufacturers in a foreign market to produce the foreign market Contract manufacturing product or provide its service Management contracting Page 2 of 3 DATE 04 0815 o Domestic firm supplies the management knowhow to a foreign company that supplies the capital Direct investment Advantage Improved image in the host country o Lower costs o o Deeper relationships o Full control over investments o Restricted or devaluated currencies o Falling markets Disadvantages Adapted global marketing International marketing approach that adjusts the marketing strategy and mix elements to each international target market which creates more costs but hopefully produces a larger market share Page 3 of 3
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