The Global Marketplace

By Gavin, Lisbeth, Maura, Orlando,

Trixie

Agenda

Looking at global

marketing environment

Whether to go

global

Which markets to enter and

how

Deciding on the global marketing

program and organization

McDonalds

The International Trade System

• Trade System Regulations• Tariffs/Quotas/Exchange

Controls/Nontariff Trade Barriers

• The World Trade Organization (WTO)• General Agreement on

Tariffs and Trade (1947)• WTO (1955)

• Regional Free Trade Zone• Economic Communities

(Free Trade Zones)• European Union (EU)• North American Free Trade

Agreement (NAFTA)• Central American Free Trade

Agreement (CAFTA)• Union of the South American

Nations (UNASUR)

Cultural Environment The Impact of Culture on

Marketing StrategyThe Impact of Marketing

Strategy on Cultures

Political-Legal Environment

• Attitude towards International Buying and Selling

• Political Stability• Government Bureaucracy• Monetary Regulations

Economic Environment

• Industrial Structures

• Subsistence Economies• Raw Material Exporting Economies• Emerging Economies (Industrializing Economies)• Industrial Economies

• Income Distribution

• Low/Medium/High Income Households

Deciding Whether to Go Global

Local• Advantages: Easier and safer

• Disadvantage: Increase competition

Global

• Advantages: Opportunity for growth

• Disadvantages: “One-size-fits-all” approach

Deciding Which Markets to Enter• How Many Countries to Enter?• What types of countries To

Enter• Products• Geography• Population• Income• Political Climate

Deciding How to Enter the Market • Exporting

• Indirect and Direct exporting• Joint Venturing

• Licensing• Contract Manufacturing• Management Contracting• Joint Ownership

• Direct Investment

Deciding on the Global Marketing

Product• Three strategies are used for adapting a product:

1. Straight product extension – marketing a product without making any changes to it• Pros: Involves no additional product development costs, manufacturing

changes or promotion changes• Cons: Can be costly in the long-run if products fail to satisfy consumers in

a specific global market2. Product adaptation – adapting a product to meet local conditions,

needs, or wants3. Product invention – creating a new product or service to match the

local environment

PROMOTION•Communication Strategy

•Home Market Use•Localized Marketing

•Cultural Adjustments•Communication Adaptation

•Differentiation Among Ads•Media Internationally

Deciding on the Global Marketing

Deciding on the Global Marketing OrganizationPrice•Poor countries (High vs Low Prices)

•Additional costs•Modified products

•New brands with affordable price•Internet Global Pricing

Steve Madden Steve Madden: Madden Girl

Deciding on the Global Marketing Program

Distribution Channels• Whole Channel View• Global Value Delivery Network

• Nation to Nation Variations• Intermediaries• New Distribution Structures

International seller

Channels between nations

Channels within

nationsFinal user or

buyer

1. Companies manage international marketing in three steps:2. Organize an Export Department 3. Create an Internal Division 4. Become a Global Organization

• Geographical organizations - Country managers are responsible for sales people, sales branches, distributors, and licensees in their respective countries.

• World product groups - Each operating unit is responsible for worldwide sales of different product groups.

• International subsidiaries - Each unit is responsible for their own sales and profits.

Deciding on the Global Marketing Organization

MCDONALDS•Product•Promotion•Price•Distribution Channels