GLOBAL MARKETING

Marketing Strategy

• Strategy is integrated action in pursuit of competitive advantage

– Offering unique value to customers that cannot be duplicated by competitors.

Benefits of Strategy

• Coordinates activities among functional areas of organization

• Defines resource allocation

• Leads to a superior market position

Components of Strategy

Statement of objectives

Selection of strategic alternative(s)Selection of customer targets

Choice of competitor targets

Statement of core strategyDescription of supporting marketing mix

Description of supporting functional programs

Establish generaldirection of strategy

Positioning

Implementstrategy

Considerations for Global Strategy

• Political risk

• Market access

• Land, labor, and capital costs

• Shipping considerations

• Country infrastructure

• Foreign exchange

• Product fit

International Market Entry

• Sourcing– Should the firm export or produce locally?

• Licensing• Investment

– Joint ventures– Sole ownership

• Global strategic partnerships

Market Expansion Strategies

• Should the firm seek new markets in countries in which it already operates or seek new country markets for already identified and served market segments?

Narrow focus Country focus

Global diversification

Country diversification

Concentration

Diversification

Concentration Diversification

Market Segmentation

Cou

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Stages of Global DevelopmentCharacteristics Domestic International Multinational Global Transnational

Key assets Located in home country

Core centralized, others dispersed

Decentralized & self-sufficient

All in home country except marketing or sourcing

Dispersed interdependent & specialized

Role of country units

Single country

Adapting & leveraging competencies

Exploiting local opportunities

Marketing or sourcing

Contributions to company worldwide

Knowledge Home country

Created at center & transferred

Retained within operating units

Marketing or sourcing developed jointly & shared

All functions developed jointly & shared

Strengths NA Ability to exploit parent company's knowledge & capabilities thru worldwide diffusion of products

Flexible ability to respond to national differences

Global market or supplier reach, leveraging the home country organization, skills, & resources

Combines the strengths of each of the preceding stages in an integrated network, leveraging worldwide learning & experience

Generic Marketing Strategies

CostLeadership

Differentiation

FocusedDifferentiation

Cost Focus

Broad target

Narrow target

Lower cost DifferentiationCom

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Competitive Advantage

Broad Market Strategies

• Cost-leadership advantage– Low-cost producer– Experience curve– Need to obtain largest market share to

have lowest cost per unit in industry– Ability to offer lower prices and more value

to customers in competitive stages of product life cycle

• Differentiation– An actual or perceived uniqueness in

product offering– Ability to command premium price

Narrow Target Strategies

• Focused Differentiation– Offers a narrow target market the

perception of product uniqueness at a premium price

• Cost Focus– Offers a narrow target market lower prices

than the competition

• Differentiation– adding a set of meaningful and valued

differences to distinguish the firm’s offering from competitors’ offerings

– Criteria:• important • preemptive• distinctive • affordable• superior • profitable

• Differentiation Variables

Product Services Personnel Channel Image

Form Ordering ease Competence Coverage Symbols

Features Delivery Courtesy Expertise Media

Performance Installation Credibility Performance Atmosphere

Conformance Customer training Reliability Events

Durability Customer consulting

Responsiveness

Reliability Maintenance & repair

Communication

Repairability Miscellaneous

Style

Design

Implications of Product Life Cycle on Marketing Strategy

Introduction Stage

• Objective: Create awareness and product trialProduct—offer a basic product

Price—charge cost-plus

Distribution—selective

Communications—target advertising to early adopters and dealers to increase awareness; heavy sales promotion to stimulate trial

Growth Stage

• Objective: Maximize market share

Product—product extensions, warranties

Price—decrease prices to penetrate

Distribution—intensive

Communications—target advertising to mass market to increase awareness; reduce

sales promotions

Maturity Stage

• Objective: Maximize profit while defending market shareProduct—diversify products and brands

Price—match or best competitors’ prices

Distribution—more intensive

Communications—use advertising to stress brand differences and benefits;

increase sales promotions to encourage brand switching

Decline Stage

• Objective: Reduce expenditure and milk the brandProduct—phase out weak models

Price—cut price

Distribution—selective; phase out unprofitable outlets

Communications—reduce and target hard-core loyals; reduce sales

promotions to minimal levels