Global Marketing

Jul 3, 2024

Review flashcards

Chapter 8: Global Marketing

Introduction

  • Skipping some chapters to focus on key areas
  • Current focus: Global Marketing
  • Importance: We are in a global economy; national economies are interlinked
  • Different marketing strategies required for different regions

Case Study: Airbnb

  • A global marketer selling the travel experience
  • Needs local language listings and translations for international users
  • Uses various platforms to accommodate different countries' restrictions
  • Maintains consistent branding globally
  • Designs a global strategy focusing on travel experience

Components of a Country Market Assessment

  • Economic Environment: Wealth, market size, population growth, real income
  • Market size and population growth: Wealth impacts opportunity; metrics like GDP, GNI, and PPP (e.g., the Big Mac Index)
  • Infrastructure and Technological Capabilities: Transportation, distribution, communications, commerce
  • Governmental Actions: Tariffs, quotas, exchange control, trade agreements
  • Cultural Factors: Values, beliefs, cultural dimensions (Hofstede's cultural dimensions)

Economic Analysis Using Metrics

  • GDP: Market value of goods/services in a country per year
  • GNI: GDP + net income from investments abroad
  • PPP: Equal product cost in different countries when expressed in the same currency

Market Size & Population Growth

  • Global population growth, distribution of population (urban vs. rural), young populations
  • Impact on business: Urbanization and middle-class growth

Infrastructure and Technological Capabilities

  • Key elements: Transportation, distribution, communications, commerce
  • Challenges in rural vs. urban product delivery

Governmental Actions

  • Tariffs: Taxes on imports
    • Example: U.S. tariffs on Chinese goods impacting local businesses
  • Quotas: Maximum limits on imported goods
  • Exchange Control: Currency exchange regulation
  • Trade Agreements: Influence on international trade

Cultural Factors

  • Visible Artifacts vs. Underlying Values: Dress, symbols, customs vs. beliefs, morals
  • Hofstedeā€™s Cultural Dimensions: Power Distance, Uncertainty Avoidance, Individualism, Masculinity, Time Orientation, Indulgence
  • Cultural Classification Scheme: Helps understand market nuances

Market Entry Strategies

  • Exporting: Least risk, least control
  • Franchising: More control, less financial risk
    • Example: Global franchises like McDonald's, Starbucks
  • Strategic Alliances: Collaborative but independent firms
  • Joint Ventures: Equity-based partnerships
  • Direct Investment: Most control, highest risk (e.g., wholly-owned subsidiaries)

Choosing a Global Marketing Strategy

  • Segmentation, Targeting, Positioning (STP): More complex globally
  • Satisfying Competitive Advantage: Requires adaptation to new markets

Global Products/Services Strategies

  • Globalization: Same product, different marketing
  • Adaptation: Minor changes to products
    • Example: Ikea's local adaptations in India
  • Innovation: New products for new markets
    • Example: Various KitKat flavors in Japan

Global Pricing Strategies

  • Influenced by tariffs, quotas, exchange rates, competitive factors
  • Anti-dumping laws impact

Global Distribution Strategies

  • Complexity due to varying infrastructure
  • Costs increase with intermediaries

Global Communication Strategies

  • Literacy levels, language differences, cultural customs
  • Standardization vs. Localization: Adaptation needed for effectiveness
    • Example: What happens in Vegas stays in Vegas campaign

Case Studies

  • Huawei's global impact: Successful despite U.S. restrictions
  • Starbucks in Australia: Failed initially due to lack of cultural adaptation