marketing in the “new” economy internet marketing crm service marketing international marketing

Marketing in the “New” Economy

Internet MarketingInternet

Marketing

CRMCRM CRM CRM

Service MarketingService

Marketing

International

Marketing

International

Marketing

Critical Questions1. Why is international marketing an

important consideration for a purely domestic business?

2. If you were hired as the marketing consultant by a local/national company that is considering going international- what “factors” would you tell them they need to consider when formulating their international/global marketing strategy?

Critical Questions1. Why is international marketing an

important consideration for a purely domestic business?

2. If you were hired as the marketing consultant by a local/national company that is considering going international- what “factors” would you tell them they need to consider when formulating their international/global marketing strategy?

Levi’s “Global” Marketing Strategy

•Global in Concept•Local in Execution

The Marketing concepts, processes & considerations –

TargetTargetMarketMarket

Product Place

PromotionPrice

Product Place

PromotionPrice

Product Place

PromotionPrice

•CCompanyompany

•CConsumersonsumers

•CCompetitorsompetitors

•CConditionsonditions• PESTPEST

TGTTGT

Service

Growth, Growth, Competitive Competitive

& & Positioning Positioning StrategiesStrategies

Product Place

PromotionPrice

Product Place

PromotionPrice

Product Place

PromotionPrice

•CCompanyompany

TGTTGT

Service

Product Place

PromotionPrice

Product Place

PromotionPrice

Product Place

PromotionPrice

•CCompanyompany

TGTTGT

Service

Product Place

PromotionPrice

Product Place

PromotionPrice

Product Place

PromotionPrice

•CCompanyompany

TGTTGT

Service

Product Place

PromotionPrice

Product Place

PromotionPrice

Product Place

PromotionPrice

•CCompanyompany

TGTTGT

Service

essentially the same….

Just more layers…. w/ Controllables— less

controllable & Uncontrollables-- more perplexing

Challenges in ConductingDifficult to control & coordinate marketing programs across countries w/ different media & distribution systems

Challenges in PlanningGathering of data & conducting situation analysis– Lack of availability, validity, reliability and/or familiarity w/ international data sources

– Actual --but limited-- business experience w/ country may be used as substitute for organized research

Interpreting results

Int’l Marketing Same as Domestic just more

Challenging

– Lack sensitivity to differences in market conditions &/or consumer behavior caused by Ethnocentricity (AKA: the “Self-Reference Criterion”

In order to avoid simple

but costly Mistakes

Need to fully account for

any & all differences in

every new market

http://www.relojournal.com/sept96/tadpole.htm

Unfortunately, the Coke company did not discover until after thousands of signs had been printed that the phrase means 'bite the wax tadpole' or 'female horse stuffed with wax,' depending on the dialect. Coke then researched 40,000 Chinese characters and found a close phonetic equivalent, 'ko-kou-ko-le,' which can be loosely translated as 'happiness in the mouth.'

The name Coca-Cola in China was first rendered

as Ke-kou-ke-la

Pepsi’s slogan, “Come alive with the Pepsi Generation,” read as “Pepsi will bring your ancestors back from the dead,” in Taiwan.

The Kentucky Fried Chicken slogan, “finger- lickin’ good,” was translated as “eat your fingers off, ” in Chinese.

Clairol introduced the “Mist Stick” curling iron in Germany where mist is slang for manure. Not too many people had use for a manure stick.

Subtle & Not So Subtle factors accounted for

Marketing Failures

Cake mixes initially failed in both Britain and Japan

Subtle-Pictures on boxes were just too perfect for Britons--must be hard to make

Not so subtle- Few Japanese households had ovens

In Italy, an ad for “Schweppes Tonic Water” translated as “Schweppes Toilet Water.”

General Motors introduced the Chevy Nova in South America and was

unaware that Spanish in no va means it won’t go.

When Ford’s Pinto flopped in Brazil, Ford learned pinto was Brazilian slang for tiny male genitals. All the nameplates were changed to Corcel, which means horse.

Widely circulated, but on Feb. 15, 2003 taken from: http://www.library.ubc.ca/patscan/funny_trade.html

Colgate introduced a toothpaste in France called CUE, the name of a notorious porno magazine

English Translations made by Japanese firm added to labelsto increase prestige for their products being sold in China.

Product English Translation

Japanese Spam Liver Putty

Toilet Paper My Fanny Brand

Ready to Eat Pancakes Strawberry Crap

Antifreeze Spray Hot Piss Brand

Pediatrician’s Slogan Specialist in Deceased

Children

English Translations made by Japanese firm added to labelsto increase prestige for their products being sold in China.

Product English Translation

Japanese Spam Liver Putty

Toilet Paper My Fanny Brand

Ready to Eat Pancakes Strawberry Crap

Antifreeze Spray Hot Piss Brand

Pediatrician’s Slogan Specialist in Deceased

Children

SOURCE: “Some Strawberry Crap Dessert, dear?” South China Morning Post, December 9, 1996 p. 12.

US Marketers aren't the only ones making mistakes-

International Marketing Blunders

The Scandinavian vacum manufacturer Electrolux used the following in an

American campaign:

Nothing Sucks like an

Electrolux

Some Unique Brand names

Fockink – liqueur: Netherlands

Green Piles – lawn fertilizer: Japan

Homo Sausage – Japan

Krapp – toilet paper: Sweden

Last Climax – paper tissues: Japan

Pansy – men’s underwear: China

Pschitt – soft drink: France

Zit – soft drink: Greece

Fockink – liqueur: Netherlands

Green Piles – lawn fertilizer: Japan

Homo Sausage – Japan

Krapp – toilet paper: Sweden

Last Climax – paper tissues: Japan

Pansy – men’s underwear: China

Pschitt – soft drink: France

Zit – soft drink: Greece

How you sell a product must equate with how the consumer

sees the product:

U.S.: Hot dish

France: Salad component

U.K.: Sandwich filler; pasta topping

Korea: Sprinkled over ice cream (sweet)

Japan: After school snack

Hallmark cards failed when introduced in France- French dislike syrupy sentiment and prefer writing their own cards.

Philips began to earn a profit in Japan only after reduced the size of its coffeemakers to fit into smaller Japanese kitchens and its shavers to fit smaller Japanese hands.

Coca-Cola had to withdraw its two-liter bottle in Spain after discovering that few Spaniards owned refrigerators large enough compartments to accommodate it.

General Foods’ Tang initially failed in France because it was positioned as a substitute for orange juice at breakfast. The French drink little orange juice and almost none at breakfast.

Kellogg’s Pop-Tarts failed in Britain because the percentage of British homes with toasters was significantly lower than in the United States and the product was too sweet for British tastes.

Do Your Home work:

Every new country and every new market one enters brings with it- it’s own set of laws, rules, regulations, standards, requirements, policies, procedures, guidelines, documents, stamps, taxes, fees, licenses, etc., etc. etc.

Political-Legal & Regulatory Variables: Must be constantly monitored as gov’ts constantly alter their countries trade policies, commercial laws & business regulations

Everything is regulated…

What you can sell, how much you can sell

When you can sell

How & to whom you can sell

And how much you can sell it for…

What . . .What . . .Products Products you can advertise?you can advertise?Appeals Appeals that can be used?that can be used?TimesTimes products may be promoted? products may be promoted?Rules regarding foreign Rules regarding foreign language language use?use?TaxesTaxes levied against advertising? levied against advertising?

Before you begin to formulate your promotional strategy you need to know for every country & market

Can you use:

Ads directed to children?

Foreign words in ads?

National symbols in ads?

Belgium

no references to dieting.

France

no child endorsements.

United Kingdom

no candy as meals.

no Snickers for lunch!Germany

no comparative advertising.

Examples of Differences in Regulation Of Children’s Ads across Europe

Austria No advertising of war toys.

Belgium Ads for candy on TV must show a stylized toothbrush.

Denmark No advertising of prizes for children.

Finland No ads during children’s programs.

France No deceptive packaging or contents & No Child endorsements

Germany No ads that encourage children to beg parents to buy product.

Greece All toy ads banned on TV from 7a.m.-1p.m.

Ireland Ads should not encourage the consumption of alcohol.

Italy Ads aimed at adults not allowed in children’s programming.

Netherlands No candy ads before 7:55p.m.

Portugal Ads must not exploit the inexperience of children.

Source: Lucy Rouse, Dilip Subramanian, Ia Wadendall, and Fiona McHugh, "A Question of Child Care," Marketing & Media Europe 1996, March 1996, 34-35.

Regulatory ChallengesIn the U.K., all advertising is allowed if not specifically forbidden…In Germany, everything is forbidden if not specifically allowed… In Italy, everything is allowed, even if forbidden… In Belgium, nobody knows what’s forbidden…

Other Political- Legal &

Regulatory Concerns

Political StabilityRespect for “Rule-of-Law”Favorable Trade & Investment

EnvironmentNondiscriminationAccess To Markets# Regulatory HurdlesNationalism & NationalizationView of Profits

Political StabilityRespect for “Rule-of-Law”Favorable Trade & Investment

EnvironmentNondiscriminationAccess To Markets# Regulatory HurdlesNationalism & NationalizationView of Profits

Governmental Methods of Trade Regulation

RestrictionPromotion

Govt’l Methods Promoting & Restricting Trade

Trade Promotion Trade Restriction

Subsidies TariffsExport Financing QuotasForeign Trade Zones

Special Agencies

Embargoes

Local Content Requirements

Admin Policies

Currency Controls

Trade Restriction Local Content Requirements

Laws stipulating that producers in the domestic market must supply a specified amount of a good or service.

Purpose - force companies from other nations to employ local resources in their production processes—particularly labor

Laws stipulating that producers in the domestic market must supply a specified amount of a good or service.

Purpose - force companies from other nations to employ local resources in their production processes—particularly labor

We’re taught to Play by the Rules….

Problem is--No Universal Rules— No International Law/Courts specializing in Commercial disputes

Our Rules (English-Common Law System) – more the exception than the rule

EVERYONE

The United Kingdom and its former colonies all follow a legal system based on common law.

.. law based on the cumulative wisdom of judges' decisions on individual cases through history.

Thus each country's legal system evolves as individual cases set precedents.

Common law

.. the world's most common form of legal system.

It is based on a detailed listing, or codification, of what is, and is not, permissible.

-civil law system judge takes on many of investigative & inquisitorial tasks that would be completed by lawyers in a common law system.

Civil law

Law is based on the Koran &

rules governing the faith and practice of Muslims

Islamic law

http://www.droitcivil.uottawa.ca/world-legal-systems/eng-monde.html

With no Global law– Legal Issues & Disputes in International Business

Resolved thru: Contracts Arbitration WTO

Disputes settled— By Jurisdictional Clauses Included In Contract

Where Contract entered into Where provisions of

Contract Performed

Contract- Determine Legal Jurisdiction

International Arbitration

In order to avoid Courts in settling international trading disputes…Ensure that Contracts have arbitration clause inserted that specifies:

Country of arbitrationThe arbitrator& Rules of arbitration

In past 10 years WTO emergedas principle arbiter of Int’l trade

Formed in 1995 - GATT-Uruguay Round - Most comprehensive trade agreement in history-

“ (WTO) is the only international organization dealing with the global rules of trade between nations. Its main function is to ensure that trade flows as smoothly, predictably and freely as possible.”

(Extract from WTO website)

WTO -World Trade Policeman?

104 disputes brought to WTO in 1st three years.

196 handled by GATT during its 50 year history.

US is biggest WTO user - 34 disputes.

Do Your Home work

Fish Where the Fish are…

Economic Variables Counties level & rate of economic development

Per capita income & income distribution

Expenditure patterns for goods & services

CaracasMoscow

ManilaShanghai

Mexico CityBogota

WarsawBangkok

Sao PaoloJohannesburg

SingaporeParis

Kuala LumpurLondon

FrankfurtNew York

WORKING TIME REQUIRED TO BUY A BIG MAC

00 2020 40 40 60 60 80 10080 100 120 120

Minutes

Evolving Middle Income Households- Buying Boom for

Asia, 1995-2000

Millions of households approaching $18,000 per year buying power Indexed to Singapore prices

1991 1995 2000

What the added Between 1993 andmiddle class 1995 2000buy (In millions)

Bedrooms 32 116

Living Rooms 16 58

Kitchens 16 58

Bathrooms 32 116

Living space (sq.m.) 1,200 4,350

Large appliances 16 58

Televisions 24 87

Telephones 24 87

Cars 16 58

Emerging - NIC’s & BEM’s*

75% growth in world trade coming from 130 Newly Industrialized Countries ---but ½ of that from:

Big Emerging Market’s

Have more than ½ of the world’s population

Account for 25% world’s GDP (@$2Trillion)

2010- China = world’s largest economy

BEMs: Big Emerging Markets

Indonesia

South Korea

Brazil

Mexico

Argentina

South Africa

Poland

Turkey

Low Income Countries

GNP per capita of $785 or less

CharacteristicsLimited industrialization

High percentage of population involved in farming

High birth rates

Low literacy rates

Heavy reliance on foreign aid

Political instability and unrest

Of these, only China and India are BEMs

Lower Middle Income Countries

GNP per capita between $786 and $3,125

Sometimes called less-developed countries (LDCs)

CharacteristicsEarly stages of industrialization

Cheap labor markets

Factories supply items such as clothing, tires, building materials, and packaged foods

3 BEMs: Poland, Turkey, Indonesia

Upper Middle Income Countries

GNP per capita between $3,126 to $9,655

CharacteristicsRapidly industrializing

Rising wages

High rates of literacy and advanced education

Lower wage costs than advanced countries

Sometimes called newly industrializing economies (NIEs)

3 BEMs: Argentina, Brazil, Mexico, South Africa

High Income Countries

GNP per capita above $9,656

Sometimes referred to as post-industrial countries

CharacteristicsImportance of service sector, information processing and exchange, and intellectual technology

Knowledge as key strategic resource

Orientation toward the future

Do Your Homework

C U L T U R E

The Int’l Marketer’sQuandary

“I BELIEVE I UNDERSTAND

WHAT YOU THINK YOU WANT

**BUT I AM NOT SURE YOU REALIZE THAT WHAT YOU

WANTIS WHAT I SELL”

Communication & language (inc. non-verbal) Dress & appearance Food & eating habits Time & time consciousness Rewards & recognitions Relationships Values & norms Sense of self & space Mental process & learning Beliefs & attitudes

Perhaps no other set of variables more daunting &

complex

C U L T U R E

Definition of Culture

The integrated sum total of learned behavioral traits that are manifest & shared by members of a society”

the man-made part of our environment… the distinctive life style of a people acquired thru learned behavior …

C U L T U R E

Evident and Deep Culture

Iceberg Theory

Just as 9/10 of ic

eberg is out of si

so is 9/10 of culture out of conscious

awareness of th

e members of th

culture.

C U L T U R E

Elements of Culture:LLanguageAAesthetics

Graphic & Structural Arts Folklore Music, Drama, Dance

MMaterial CultureTechnology

Economics

BBelief Systems Humans and The Universe

SSocial Institutions Political Structures Education Social Organization

C U L T U R E

Evident Culture.. customs, language, art, artifacts & behavior

the first cultural phenomena you recognize as a foreigner.ie “siesta“ in Mexico, being punctual in Germany, “job hopping“ in the U.S., driving on the left in UK, bull fights in Spain.

Evident Culture.. customs, language, art, artifacts & behavior

the first cultural phenomena you recognize as a foreigner.ie “siesta“ in Mexico, being punctual in Germany, “job hopping“ in the U.S., driving on the left in UK, bull fights in Spain.

Deep Culture

.. the underlying aspects of a culture, i.e. values, norms, cause -effect relationships, views of the world, -- very difficult to change

Deep Culture

.. the underlying aspects of a culture, i.e. values, norms, cause -effect relationships, views of the world, -- very difficult to change

Definitions

C U L T U R E

fine arts literature drama classical music

popular music folk-dancing games cooking dress language rituals techniques laws customs

notions of modesty concept of beauty ideals governing child-rearing rules of descent

cosmology relationship to animals patterns of superiorityrelations definition of sin courtship practices concept of justice

incentives to work notions of leadership tempo of work patterns of group decision making concept of cleanliness attitudes toward the dependent

theory of disease approaches to problem solving concept of status mobility eye behavior nature of friendship concept of self ordering of time Roles

in relation to status by age, sex, class, occupation, kinship, and so forth. conversational patterns in various social contexts concept of past and future

definition of insanity patterns of visual perception preference for competition or cooperation body language Social interaction rate notions of adolescence notions about logic and validity patterns of handling emotions

facial expressions arrangement of physical space community sense myths values assumptions …etc!…

EVIDENTCULTURE

DEEPCULTURE

C U L T U R E

Cultural Research(ers) w/ Marketing Applications

HALLHofstedeTrompenaars

C U L T U R E

Edward T. Hall

The Silent Language, - 1959 The Hidden Dimension, -1966 Beyond Culture, - 1976 The Dance of Life, The Other

Dimension of Time, - 1983 Hidden Differences: Studies in

International Communication-, 1983, 1984, 1985

Hidden Differences: Doing Business with the Japanese, - 1987

Understanding Cultural Differences, Germans, French and Americans - 1990

C U L T U R E

MONOCHRONIC vs. POLYCHRONIC TIME

M-time is one-thing-at-a-time Monochronic cultures stress a high degree of

scheduling and an elaborate code of behavior built around

promptness in meeting obligations and appointments

Americans are mostly monochronic

P-time is many-things-at-a-time human relationships and interactions are valued

over arbitrary schedules and appointments. Many things may occur at once (since many

people are involved in everything), and interruptions are frequent.

P-time is common in Mediterranean and Colonial-Iberian-Indian cultures.

C U L T U R E

HIGH vs. LOW-CONTEXT CULTURES

…terms refer to the fact that when people communicate, they take for granted how much the listener knows about the subject under discussion.

In low-context communication, listener knows very little & must be told practically everything

In high-context communication listener is already 'contexted' - does not need much background information

C U L T U R E

Contextual Background of Various Countries

High Context Implicit

Japanese

Arabian

Latin American

Spanish

Italian

English (UK)

French

North American (US)

Scandinavian

GermanSwiss

Low Context Explicit

C U L T U R E

Geert Hofstede

organizational psychologistIn 1991 surveyed IBM employees &

managers in 53 countries—Identified 5 dimensions that

national culture and explained 50% of the differences in respondents’ attitudes… especially significant because the

type of organization is held constant

1. Power distance

2. Uncertainty Avoidance

3. Individualism

4. Masculinity

5. Time Horizon

C U L T U R E

Geert Hofstede

1. Power distance

or the degree to which members of a society automatically accept a hierarchical or unequal distribution of power in organizations and the society

C U L T U R E

Geert Hofstede

2. Uncertainty avoidance

or the degree to which members of a given society deal with the uncertainty & risk of everyday life and prefer to work with long-term acquaintances and friends rather than with strangers

C U L T U R E

Geert Hofstede

3. Individualism

or the degree to which an individual perceives him- or her-self to be separate from a group and free from group pressure to conform

C U L T U R E

Geert Hofstede

4. Masculinity

or the degree to which a society looks favorably on aggressive and materialistic behavior

C U L T U R E

Geert Hofstede

5. Time horizon(short term to long term)

or the degree to which members of a culture are willing to defer present gratification in order to achieve long-term goals

C U L T U R E

Geert Hofstede’s - Cultural Values Index

IDVIDV

PDIPDI

MASMAS

UAIUAI

-HI=Individualist

Low= equality/knowledge is power

HI=power hierarchical/inherited Low--Group/

Collective

LO=Gender Equity

Macho-Man

HI= DogmaticLow=Tolerant of

diff./deviance/dissent

C U L T U R E

Power Distance Index

10 110

Small PowerDistanceCollectivist

Large PowerDistance Collectivist

Small Power DistanceIndividualist

Large PowerDistance

Individualist

1. Costa Rica2. Korea & Mexico3. Brazil & India4. Israel & Ireland5. Australia & U.S.A.6. France & Italy

Power Distance and Individualism-Collectivism

C U L T U R E

Weak UncertaintyAvoidance Feminine

Weak UncertaintyAvoidance Masculine

Strong UncertaintyAvoidance Feminine

Strong UncertaintyAvoidance Masculine

10 100Masculinity Index

1. Norway2. Malaysia3. Jamaica4. U.S.A.5. Taiwan6. Costa Rica7. Australia8. Mexico9. Japan10. Greece

Masculinity/Femininity and Uncertainty Avoidance

C U L T U R E

http://www.geert-hofstede.com/index.shtmlhttp://www.geert-hofstede.com/index.shtml

C U L T U R E

US Cultural IndicesUS Cultural Indices

C U L T U R E

Fons Trompenaars

7 dimensions of culture

Universalism vs. Particularism What is more important - rules or relationships? Individualism vs. CommunitarianismDo we function in a group or as an individual? Specific vs. Diffuse culturesHow far do we get involved? Affective vs. Neutral cultures Do we display our emotions? Achievement vs. AscriptionDo we have to prove ourselves to receive status or is it given to us? Sequential vs synchronic cultures Do we do things one at a time or several things at once? Internal vs External control Do we control our environment or work with it ?

7 dimensions of culture

Universalism vs. Particularism What is more important - rules or relationships? Individualism vs. CommunitarianismDo we function in a group or as an individual? Specific vs. Diffuse culturesHow far do we get involved? Affective vs. Neutral cultures Do we display our emotions? Achievement vs. AscriptionDo we have to prove ourselves to receive status or is it given to us? Sequential vs synchronic cultures Do we do things one at a time or several things at once? Internal vs External control Do we control our environment or work with it ?

C U L T U R E

both consumer & business…

…cultural traditions, norms beliefs & behaviors

need to be thoroughly understood & accounted for to fully succeed in any marketing endeavor

C U L T U R E

12 Questions

What’s yourInt’l Business

C U L T U R E

In Taiwan, giving what fruit is a good omen for a businessperson?

C U L T U R E

Q2What number in

Chinese-speaking countries (also in Japan) is as ominous as the number 13 in Western culture?

C U L T U R E

Q3The executive of a Chinese

company is celebrating their 65th birthday. Which of the following is not a appropriate gift?A: a silk tieB: a silver Mont Blanc

penC: a gold clockD: a crystal paperweightE: gold and jade cufflinks

C U L T U R E

Q4During a TV

commercial, the announcer gives the OK sign on camera. In which country does this mean something entirely different?A: AustraliaB: BrazilC: FinlandD: FranceE: Ireland

C U L T U R E

Q5In England, it is

inappropriate to discuss business after work over drinks. A: true B: false

C U L T U R E

Q6You’re creating a sales training

manual for employees doing business in Japan. When would you tell them NOT to discuss business?A: at dinnerB: over lunchC: on the golf courseD: at the start of a business

meetingE: in your superior’s office

C U L T U R E

Q7 The influence that a

country’s image/ stereotype has on consumer perceptions of the product

A. The Ethnocentric EffectB. The Self-reference criterionC. The Country of Origin EffectD. The Euro-factor

C U L T U R E

Your company would like to send its top sales representative aboard to meet with its distributors in August. In which country is this most likely to become a problem? A: Italy and France B: Ireland and

Sweden C: Japan and China D: Australia and New

Zealand E: Hungary and

Romania

C U L T U R E

Q9 At a business dinner in Korea,

your counterpart’s wine glass is half-empty. What should you do?

A: refill her glass immediately

B: sit back and let her refill her own glass

C: wait until her glass is empty and then refill it

D: fill your own glass and replace it with hers

C U L T U R E

Q10When writing

names in Korea, what color is not appropriate to use?

A: blueB: redC: blackD: none of the

C U L T U R E

In the Philippines, people indicate directions with their…A: forefingersB: mouths &

accompanying head movement

C: feetD: none of the above

C U L T U R E

Q12 (the last one) When you meet an Indonesian

businessperson for the first time, you should:

A: bow deeply at the waist

B: nod your head slightly w/ your hand in a praying position in front of your chest

C: shake hands loosely and state your name

D: kiss her on both cheeks

C U L T U R E

What’s yourInt’l Business EQ?

POP-Quiz

Answers

C U L T U R E

• In Taiwan, receiving a pineapple for a gift is a good omen for a businessperson

C U L T U R E

Cultural Give & Take-Do’s & Don’ts

Japan—Do not open in front of giver/ no bows, ribbons

Europe: avoid red & white /don’t wrap flowers; don’t spend too much

Arabia: Don’t give at outsetLatin Am.: Give after informal

meetingsChina: present privately; don’t

make a big deal of it

C U L T U R E

Q2• What number in

Chinese-speaking countries and also in Japan is as ominous as the number 13 in Western culture?

• A: 4

C U L T U R E

The number 7 is considered bad luck in Kenya, good luck in the Czech Republic and has a magical connotation in Benin, Africa.

The number 10 is bad luck in Korea.

The number 4 means death in Japan.

Other NumbersOther Countries

C U L T U R E

Q3 • The executive of a Chinese company is celebrating her 65th birthday. Which of the following is not appropriate?

• C: a gold clock

C U L T U R E

Q4• During a TV

commercial, the announcer gives the OK sign on camera. In which country does this mean something entirely different?

• B: Brazil

How about this in Australia?

C U L T U R E

Q5• In England, it is

inappropriate to discuss business after work over drinks.

• A: true

C U L T U R E

Q6• You’re creating a sales

training manual for employees doing business in Japan. When would you tell them NOT to discuss business?

• D: at the start of a business meeting

C U L T U R E

Q7 The influence that a

country’s image/ stereotype has on consumer perceptions of the product

C. The Country of Origin Effect

Any influence that “Country of Manufacturer” has on consumers positive or negative perception of product

C U L T U R E

StereotypesCuban_________

German________

Swiss__________

Russian________

Scottish________

Irish___________

Mexican________

Canadian_______

Alaskan_________

English________

French_________

Italian__________

Japanese_______

American_______

Jamaican_______

Australian_______

Iranian____________

C U L T U R E

Q8• Your company would like

to send its top sales representative aboard to meet with distributors in August. In which country is this most likely to become a problem?

• A: Italy and France

C U L T U R E

Q9• At a business dinner

in Korea, your counterpart’s wine glass is half-empty. What should you do?

• C: wait until her glass is empty and then refill it

C U L T U R E

Q10When writing names in Korea, what color is not appropriate to use?

B: red

Red represents witchcraft and death in many African countries.Red is a positive color in Denmark.

C U L T U R E

China - symbol of celebration and luck, used in many cultural ceremonies that range from funerals to weddings

India - color of purity (used in wedding outfits

C U L T U R E

YellowYellow Asia - sacred, imperial

Western cultures - joy, happiness.

C U L T U R E

BlueChina - associated

w/immortality.

Hindus - the color of KrishnaMiddle East - protective color* Note: Blue is often

considered to be the safest global color.

C U L T U R E

GreenChina - studies indicate this is not a

good color choice for packaging, green hats mean a man's wife is cheating

Arab world- the color of IslamIreland - religious significance Some tropical countries - associated

with dangerWestern cultures - indicates

environmental awareness

C U L T U R E

• In the Philippines, people indicate directions with their…

• B: mouths and accompanying head movement

C U L T U R E

Q12 (the last one)• When you meet an

Indonesian businessperson for the first time, you should:

• C: shake hands loosely and state your name

C U L T U R E

How did You do?

10-1210-12:

7-97-9:

3-63-6:

1-21-2:

Cultural CEO

Sr. Management

Mgt. Trainee

Corp. Toilet Cleaner

Your Fired!

Cultural Hot Spotshumorprestigeromancemusiccolorsvisual imageryVerbal/ Non-Verbal

A High International Business IQ is mandatory for anyone involved in International Advertising….

The Creative Challenge

Translation difficulties

Culture-bound assumptions & inferences-SRC

Identifying cross-cultural icons

Translation difficulties

Culture-bound assumptions & inferences-SRC

Identifying cross-cultural icons

Crafting an ADCrafting an AD

Even if get the words right…

Every other element of AD needs to be questioned

Questions about Aesthetics?

Production techniques used in commercials.

•Color•Sound, Music, SFX•Lighting•Angles

Production techniques used in commercials.

•Color•Sound, Music, SFX•Lighting•Angles

Question about People & PersonalitiesThe characters in commercials?

Questions about Non-Verbals

• gestures• expressions• make-up• body language

Questions aboutAre values being associated w/ product important; appropriate

Status appeals are stressed in Japanese advertisementsHong et al. (1987)

Individual determinism plays major role in

American advertisements

Is proper appeal being

Utilized –

Rational vs Emotional?

Mueller (1987) found Japanese magazines often use less rational

appeals

Examples of International Advertising

•http://www.summitawards.com/winners.html

•http://www.adeater.com/

•http://www.magindia.com/international/

Macro-Environmental

Conditions

GLOBALIZATION

Advancements in Communication &

Distribution technologies are the Precipitating Drivers

of Globalization Increased speed, efficiency, capacity & Decreased cost

Compunications: Computer Hard/Software interfaced w/ Satellite, Internet,

Fiber-optics…

Distribution: Jet travel, Containerization, Cross-docking, Global tracking, JIT

delivery systems…

Increased speed, efficiency, capacity & Decreased cost

Compunications: Computer Hard/Software interfaced w/ Satellite, Internet,

Fiber-optics…

Distribution: Jet travel, Containerization, Cross-docking, Global tracking, JIT

delivery systems…

GLOBALIZATION

Year: Sea Freight Air Transport Cross-Atlantic Telephone Call

1930 60 0.68 244.65

1960 27 0.24 45.86

1990 29 0.11 3.32

Average ocean freight and port charges per short ton of import and export cargo. Average air transport revenue per passenger mile. Three-minute New York-London call. Source: HufBauer, 1991

Falling Transport and Communication Costs 1930-1990 (constant 1990 US$)

Increased Speed & Decreased Costs

Average ocean freight / port charges per short ton cargo. Average air transport $$$ per passenger mile.

Three-minute New York-London call.Source: HufBauer, 1991

GLOBALIZATION

The Shrinking

1500-1840

1850-1930

Best average speed of horse-drawn coaches and

sailing ships, 10mph.

Steam locomotives average 65mph.

Steamships average 36mph.

Propeller aircraft 300-

400 mph.

Jet passenger aircraft 500-

700mph.

Internet= Instant

February 08, 2005 Lax Natarajan & Sully Romero Ordonez

Time, Mobility & Economic Growth

http://www.flexibility.co.uk/issues/transport/time-mobility.htm

Time, Mobility & Economic Growth

http://www.flexibility.co.uk/issues/transport/time-mobility.htm

GLOBALIZATION

1980 1990 2000

Lead Time - Days

Just in Time

Manufacturing supply chain has shrunk over the past 20 years.

Evolving Now into Just One Big Market: Evolving Now into Just One Big Market:

The Global EconomyThe Global Economy

Evolving Now into Just One Big Market: Evolving Now into Just One Big Market:

The Global EconomyThe Global Economy

…… the increasing tendency of economies around the world to interact w/ one another as one market instead of many national markets

For US- Presently about 1/3 of profits and 1/5 of economic growth are related to global business

World Market Connections

International Production

International

International Development

International & Global Marketing

International Finance

INTERNATIONAL LINKAGES

Trade Flows

Resource Flows

Goods & Services

Capital & Labor

Information &Technology

One Big World Market: One Big World Market: The Global EconomyThe Global Economy

The weekly volume of international trade in currencies

exceeds the annual value of trade in goods & services.

The weekly volume of international trade in currencies

exceeds the annual value of trade in goods & services.

• Daily international financial flows now exceed $1.2 trillion.

• From 1990 to 2000, world GDP grew ~ 30%– Total world exports of merchandise &

services increased by 80 %.

• This year- World exports of goods & services predicted to reach $11.4 trillion (24% of world GDP).

One Big World Market: One Big World Market: The Global EconomyThe Global Economy

World Bank

Borders Have Become Meaningless

& there’s no place to hide…Borders Have Become Meaningless

& there’s no place to hide…

Trans-National Cross-Cultural

High Speed/ Low Cost

Transportation & Communication

The entire globe is now tied together as a single community operating 24/7/365

After more than a century of electric technology, we have extended our central nervous system in a global embrace, abolishing both space & time”

-Marshall McLuhan, Understanding Media- 1955

The Global Village Driver

The further & faster people are able to

travel & communicate… the greater the

amount of interaction & influence

Rise of the “Global Village”Rise of the “Global Village”Rise of the “Global Village”Rise of the “Global Village”

…… not just the “shrinking” of time & space

The new electronic media have transcended time & space w/ “virtual mobility”

Cable TelevisionPay Television ServicesDirect Broadcast Satellite [DBS]MMDS and LMDSDigital TelevisionStreaming MediaDigital RadioMultimedia Computers and Video GamesThe Internet and World Wide WebInternet CommerceOffice TechnologiesVirtual RealityHome VideoDigital AudioDistance LearningWireless TelephonyBroadband NetworksResidential Gateways and Home NetworksSatellite Communications

source >> Future Technologies Inc. [www.fti.com]

Digital agecommunication

technologies

The Global Village

The Global Economy

The Global Corporation

Exporter Exporter

Multi-NationalMulti-National

Trans-NationalTrans-National

GlobalGlobal

Evolution of the International FirmEvolution of the International Firm

Mindless Approach to International Markets

Make no special Make no special provisionsprovisions

Domestic- Domestic- ExtensionExtension

ExportingExporting

Multinational corporations (MNCs) Companies that maintain significant operations in two

or more countries simultaneously but are based in one home country

Adapt to local Adapt to local conditions in each conditions in each

foreign marketforeign market

Multi-Domestic Multi-Domestic approachapproach

International Marketing

Transnational (TNC) corporation

A company that maintains significant operations in more than one country

simultaneously and decentralizes decision

making in each operation to the local country

Multinational Corporations

2/3s of world trade in goods and services is controlled by multinational companies.Of the 100 largest economies in the world, 51 are corporations.The sovereignty of nations will perhaps continue to weaken due to multinationals & increasing integration of world economies.

Multinational CorporationsMultinational Corporations

In 1970, of the 7,000 multinationals identified by the United Nations, more than 1/2 were from -- the United States & Britain.

By 1995, less than half of the 36,000 multinationals identified by the United Nations came from four countries: the United States, Japan, Germany, and Switzerland.

Multinational Corporations

At present, there are 65,000 MNCs* w/ 850,000 affiliates in foreign countriesMNCs’ total sales amount to almost $19 trillion.

http://www.nationmaster.com/

http://www.nationmaster.com/graph-T/eco_tra_cor_par#

Company takes an integrated approach across countries & regions -- Manages for worldwide business leverage & competitive advantage …

Leverage Leverage Commonalities into Commonalities into a global strategy a global strategy

(but where necessary- (but where necessary- allow for local allow for local

implementation)implementation)Global (Glocal)Global (Glocal)

MarketingMarketing

Global Marketing

Is a “Mind-set” of how to approach Int’l Markets• Not a matter of how big company is• Or- whether or not have a “global product”• Or- how many counties you operate in

Global CampaignsGlobal CampaignsGlobal CampaignsGlobal Campaigns

MessageMessage

MarketMarketAA

MarketMarketBB

MarketMarketCC

Adopted CampaignsAdopted CampaignsAdopted CampaignsAdopted Campaigns

Message 1Message 1Message 1Message 1 Message 2Message 2Message 2Message 2 Message 3Message 3Message 3Message 3

ACHIEVING GLOBAL SYNERGIES

LEVERAGING ASSETS

AND POSITION

Scale Efficiencies

Coordination and Integration

Transfer of Ideas, Experience and Know-how

Scale Efficiencies

Coordination and Integration

Transfer of Ideas, Experience and Know-how

Global Strategy

STRATEGIC

FLEXIBILITY

Production Shifting

Multiple Sourcing

Transfer Pricing

Managing Cash Flow

Production Shifting

Multiple Sourcing

Transfer Pricing

Managing Cash Flow

The Global CorporationThe Global Corporation

Global Vision Global Leverage Global Sourcing Global Competitive Moves Global Partnerships

Valuable W3 Resource

http://globaledge.msu.edu/index.asp

GlobalEDGE© is a global business knowledge web-portal that connects international business professionals worldwide to a wealth of information, insights, and learning resources on global business activities.

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