Chapter 12 Global Marketing Management: - PowerPoint Presentation

Chapter 12Global Marketing Management:Planning and Organization International Marketing 15th edition Philip R. Cateora , Mary C. Gilly , and John L. Graham

Global Marketing Management The trend back toward localization Caused by the new efficiencies of customization Made possible by the Internet Increasingly flexible manufacturing processesFrom the marketing perspective customization is always bestGlobal markets continue to homogenize and diversify simultaneously Best companies will avoid trap of focusing on country as the primary segmentation variable2Roy Philip

Benefits of Global MarketingWhen large market segments can be identifiedEconomies of scale in production and marketingImportant competitive advantages for global companiesTransfer of experience and know-how Across countries through improved coordination and integration of marketing activitiesMarketing globally Ensures that marketers have access to the toughest customersMarket diversity carries with it additional financial benefits Firms are able to take advantage of changing financial circumstances3Roy Philip

International Planning ProcessRoy Philip 4Exhibit 12.1

Alternative Market-Entry Strategies (1 of 2)An entry strategy into international market should reflect on analysis Market characteristicsPotential salesStrategic importanceStrengths of local resourcesCultural differencesCountry restrictions Company capabilities and characteristicsDegree of near-market knowledgeMarketing involvementManagement commitment 5Roy Philip

Alternative Market-Entry StrategiesRoy Philip 6Exhibit 12.2

Companies most often begin with modest export involvement A company has four different modes of foreign market entryExportingContractual agreementsStrategic international alliancesDirect foreign investmentsAlternative Market-Entry Strategies (2 of 2) 7Roy Philip

Contractual Agreement (1 of 2)Contractual agreements Long-term, Nonequity association between a company and another in a foreign marketLicensing A means of establishing a foothold in foreign markets without large capital outlaysA favorite strategy for small and medium-sized companiesLegitimate means of capitalizing on intellectual property in a foreign market 8Roy Philip

Contractual Agreement (2 of 2)FranchisingFranchiser provides a standard package of products, systems, and management servicesFranchise provides market knowledge, capital, and personal involvement in managementExpected to be the fastest-growing market-entry strategy Two types of franchise agreementsMaster franchise Gives the franchisee the rights to a specific area with the authority to sell or establish subfranchisesLicensing 9Roy Philip

Strategic International Alliances Four characteristics define joint ventures: JVs are established, separate, legal entitiesThe acknowledged intent by the partners to share in the management of the JVThere are partnerships between legally incorporated entities such as companies, chartered organizations, or governments, and not between individuals Equity positions are held by each of the partners10Roy Philip

Strategic International Alliances ConsortiaSimilar to joint ventures and could be classified as such except for two unique characteristicsTypically involve a large number of participantsFrequently operate in a country or market in which none of the participants is currently active Consortia are developed to pool financial and managerial resources and to lessen risks11Roy Philip

Direct Foreign InvestmentFactors that influence the structure and performance of direct investmentsTimingThe growing complexity and contingencies of contractsTransaction cost structuresTechnology transferDegree of product differentiation The previous experiences and cultural diversity of acquired firmsAdvertising and reputation barriers12 Roy Philip