Buz M 300 Exam 4 Study Guide Lectures 15 17 Lecture 15 April 15th Global Companies or Global Consumers o Global competition exists when firms originate produce and market their products and services worldwide o Global companies consist of three types of companies many companies are a mixture of all three International firms These market their existing products and services in other countries the same way that they do in their home country o Example is avon which sells the same products using the same marketing campaigns Multinational firms View the world as consisting of unique parts and markets to each part differently Use a multi domestic marketing strategy which means that they have as many different product variations brand names and advertising programs as countries in which they do business Alter ads based on the consumer pool Examples are Unilever and P G Brands Transnational Firms View the world as one market emphasize cultural similarities across countries or universal consumer needs and wants more than differences Employ a global marketing strategy o The practice of standardizing marketing activities when there are cultural similarities and adapting them when cultures differ Market a global brand o A brand marketed under the same name in multiple countries with similar and centrally coordinated marketing programs Global consumers consist of customer groups living in many different countries that have similar needs or seek similar features and benefits from products or services Issues Facing Global Businesses o Cultural diversity sensitivity to the cultures of different societies is needed to create successful exchange relationships with global consumers o Values a society s values represent personally or socially preferable modes of conduct or states of existence that tend to persist over time McDonald s doesn t sell hamburgers in its restaurants in India o Customs are what is considered normal and expected about the way people do things in a specific country These can vary from country to country in Japan women give chocolates on Valentine s Day o cultural symbols are things that represent ideas and concepts in Japan the number 4 is bad just like the number 13 is bad in the US o Language English French and Spanish are the principal languages used in global diplomacy and commerce English is the recognized language for business in the global marketplace Global vs Multinational Strategies o Global marketing mix strategy uses a standardized marketing mix in all foreign markets Companies like to use this because it is cheaper Customer loyalty marketing brand equity operationally etc o Multinational marketing mix strategy customizes the marketing mix making the mix appropriate for each market More expensive o Companies decide which strategy to use based on their brand equity o The two strategies bound a continuum that ranges from a completely standardized marketing approach to entering new markets to one that completely customizes the entry Global is more standardized and companies have a higher brand equity Multinational is more customized and companies have low brand equity Most companies fall in the middle of the continuum Marketing Internationally o Before marketing internationally the firm must investigate international trade systems country by country o Trade barriers Tariffs taxes levied against foreign goods Revenue tariffs raises funds on the government Protective tariffs raises the price of a product to match or even exceed that of a domestic product Quotas limits on the amount of product that can be imported into a country Embargoes a quota that does not allow any product to be imported into a country o World trade organization an organization that seeks to enhance free trade Reducing quotas tariffs and embargoes Encouraging copyright and patent protection Reducing dumping or the practice of selling a product at below market prices in a foreign country Specific Entry Approaches in International Markets o Exporting sell to interested parties in another country Products are handled by middlemen o Licensing for a fee foreign company buys the right to use the company s manufacturing process trademark trade secret etc Franchising is a form of licensing o Contract manufacturing the international company contracts with a manufacturer in the host country to manufacture the product in the host country using the host s standards Unlike licensing the international firm has little control over the manufacturing process The host company owns the manufacturing facilities o Joint ownership one company joining with another to create a product or service o Direct investment foreign production and marketing The foreign company owns the production capabilities o Direct marketing manufacturing or assembling in one country and marketing in another Driven by the internet Lecture 16 April 17th Marketing Channels o A marketing channel consists of individuals and firms involved in the process of making a product or service available for use or consumption by consumers or industrial users o Marketing channels make possible the flow of goods from a producer through intermediaries to a buyer Some intermediaries purchase items from the seller store them and resell them to buyers Others represent sellers but do not take title to products o How do we get products to market o Why are marketing channels important They help to reach perspective buyers either directly or indirectly It is a prerequisite for successful marketing Create form time place and possession value for consumer Direct vs indirect channels o Direct Channel A marketing channel where a producer and ultimate consumers deal directly with each other o Indirect Channels Marketing channels where intermediaries are inserted between the producer and consumers and perform numerous channel functions Choosing a Marketing Channel o Target Market Coverage Selective Distribution Lies between these two extremes and means that a firm selects a few retail outlets in a specific geographical area to carry its products Intensive Distribution Means that a firm tries to place its product and services in as many outlets as possible Exclusive Distribution Is the extreme opposite of intensive distribution o Satisfying Buyer Requirements How should information be communicated to consumers Convenience proximity or driving time to a retail outlet or hours of operation Variety what breadth and depth of products should be carried by intermediaries Pre or