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832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 130
Impact of Globalization to
International Marketing
Presented by Ireneo Cantildeete JrAurora Cendana
Marketing Management ndash Dr Ed Garrovillas
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 230
Reference
Marketing Management 11th
editionby Philip Kotler
Out of the Box Marketing Principles that workand make sense by Dr E Garrovillas
wwwworldbankorg
Kotler on Marketing
ldquoToday you have to run faster to stay in
placerdquo
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 330
Objectives
Focus on the following questions
What factors should a company review before decidingto go abroad
How can companies evaluate and select foreignmarkets to enter
What are the major ways of entering a foreign market To what extent must the company adapt its products
and marketing program to each foreign country
How should the company manage and organize its
international activities
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 430
Globalization
According to Friedman (1999) Globalization isthe inexorable integration of markets nationstates and technologies to a degree neverwitnessed before- in a way that is enabling
individuals corporations and nation-states toreach around the world farther faster deeperand cheaper than before the spread of free-market capitalism to virtually every country
around the world
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 530
Pros And Cons Of Globalization
Globalization is a new term that has found a significantplace in the lives of the people By globalization wemean shedding down the walls of distrust and thebarriers of suspicion in between countries to make abridge where ideas and beliefs can cross the borders
Though globalization today primarily covers the
economical side the impact is not limited to theeconomy only It actually affects every aspect of lifelike cultural social psychological and of coursepolitical
While globalization is seen as a sign of a hopeful future
by some there are others who believe that it can causetremendous disaster for the world economy Read on to find the pros and cons of globalization
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 630
Pros Of Globalization With globalization there is a global market for companies to trade their
products and a wider range of options for people to choose from amongthe products of different nations
Developing countries benefit a lot from globalization as there is a soundflow of money and thus a decrease in the currency difference
To meet the increasing demands that follow globalization there is anincrease in the production sector This gives loads of options to themanufacturers as well
Competition keeps prices relatively low and as a result inflation is less
likely to occur The focus is diverted and segregated among all the nations No countryremains the single power head instead there are compartmentalizedpower sectors The decisions at higher levels are meant for the people atlarge
Communication among the countries is on the rise which allows for betterunderstanding and broader vision
As communication increases amongst two countries there is interchangeof cultures as well We get to know more about the others culturalpreferences
As we feed to each others financial needs the ecological imbalance isalso meted out Governments of countries show concern about eachother
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 730
Cons Of Globalization Globalization is causing Europeans to lose their jobs as work is
being outsourced to the Asian countries The cost of labor in theAsian countries is low as compared to other countries
The high rate of profit for the companies in Asia has resulted in apressure on the employed Europeans who are always under thethreat of the business being outsourced
Companies are as opening their counterparts in other countriesThis results in transferring the quality of their product to othercountries thereby increasing the chances of depreciation in termsof quality
There are experts who believe that globalization is the cause forthe invasion of communicable diseases and social degeneration incountries
The threat that the corporates would rule the world is on high asthere is a lot of money invested by them
It is often argued that poor countries are exploited by the richercountries where the work force is taken advantage of and lowwages are implemented
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 830
Appraising the Global Marketing
Environment A company has to examine many issues deciding
whether and where to sell abroad The company has to acquire a thorough understanding
of the international marketing environment Significant changes in past 2 decades
Substantial speedup of international transportationcommunication and financial transactionsIncrease of strategic alliances bw major
international companiesGrowth of global brands in autos food clothing
electronics and many other categoriesRising economic power of Japan and several FarEastern countries in world markets
Strategies for Global
Market Penetrationppt
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 930
Competing on a Global Basis
Global industry Global firm
Major Decisions inInternational Marketing
Deciding whether to
go abroad
Deciding which marketsto enter
Deciding how to enterthe market
Deciding on the marketing
program
Deciding on the marketingorganization
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1030
Deciding Whether To Go Abroad
Factors drawing companies into the internationalarena
Global firms offering better products or lower pricescan attack the companyrsquos domestic market
The company discovers that some foreign marketspresent higher profit opportunities than the domesticmarket
The company needs a larger customer base to achieveeconomies of scale
The company wants to reduce its dependence on anyone market
The companyrsquos customers are going abroad and needservicing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1130
Deciding Whether To Go Abroad
Before going abroad the company must weigh severalrisk
The company might not understand foreign customerpreferences and fail to offer a competitively attractiveproduct
The company might not understand the foreigncountryrsquos business culture or know how to dealeffectively with foreign nationals
The company might underestimate foreign regulationsand incur unexpected costs
The company might realize that it lacks managers withinternational experience
The foreign country might change its commercial lawsdevalue its currency or undergo a political revolutionand expropriate property
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1230
Blunders in International Marketing
Hallmark cards failed when they were introduced in France The
French dislike syrupy sentiment and prefer writing their own cards
Philips began to earn a profit in Japan only after it had reduced thesize of its coffeemakers to fit into smaller Japanese kitchens andits shavers to fit smaller Japanese hands
Coca-Cola had to withdraw its two-liter bottle in Spain afterdiscovering that few Spaniards owned refrigerators with largeenough compartments to accommodate it
General Foodsrsquo Tang initially failed in France because it waspositioned as a substitute for orange juice at breakfast TheFrench drink little orange juice and almost none at breakfast
Kelloggrsquos Pop-Tarts failed in Britain because the percentage ofBritish Pop- homes with toasters was significantly lower than in theUnited States and the product was too sweet for British tastes
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1330
Deciding Which Markets to Enter
How many markets must a company enter
The candidate countries should be initially rated on 3 majorcriteriaMarket attractiveness ndash GNPcapita work force pop growth
Competitive advantage ndash business dealings
Risk ndash stability in political currency repatriation rules
High Med Low
H China
LM Czech
L EastGermany
H Poland
HM Romania
L
CompetitiveAdvantage
Competitive Advantage
Risk
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1430
Deciding Which Markets to Enter
Prepare a financial analysis of top 3 countries Fivesteps involved in estimating the probable rate of return
on investment
Estimate of Current Market Potential ndash estimate totalindustry sales in each market task calls for using published data and primarydata collected through company surveys
Forecast of Future Market Potential and Risk ndash forecast future industry sales (difficult task) requires predicting economic andpolitical developments and impact on industry sales
Forecast of Sales Potential ndash estimating the companyrsquos salesrequires forecasting its probable market share based on its competitiveadvantage (another difficult task)
Forecasts of Costs and Profits ndash cost will depend oncompanyrsquos entry strategy company subtracts estimated costs from estimatedsales to derive company profits
Estimate of Rate of Return on Investment ndash forecastedincome stream should be related to investment stream to derive implicit rate ofreturn should be high enough to cover firmrsquos normal target return on its
investments and the risk of marketing in that country
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1530
Deciding Which Markets to Enter
Regional free trade zones
The European Union
NAFTA
MERCOSUL
APEC
Evaluating potential markets
Psychic proximity
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1630
Deciding How to Enter the Market
Five Modes of Entry intoForeign Markets
Direct Investment
Joint Ventures
Licensing
Direct Exporting
Indirect Exporting A m o u n t o f c o m m i t m e n t r i s k c o n t r o l a n d
p r o f i t p o t e n t i a l
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 230
Reference
Marketing Management 11th
editionby Philip Kotler
Out of the Box Marketing Principles that workand make sense by Dr E Garrovillas
wwwworldbankorg
Kotler on Marketing
ldquoToday you have to run faster to stay in
placerdquo
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 330
Objectives
Focus on the following questions
What factors should a company review before decidingto go abroad
How can companies evaluate and select foreignmarkets to enter
What are the major ways of entering a foreign market To what extent must the company adapt its products
and marketing program to each foreign country
How should the company manage and organize its
international activities
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 430
Globalization
According to Friedman (1999) Globalization isthe inexorable integration of markets nationstates and technologies to a degree neverwitnessed before- in a way that is enabling
individuals corporations and nation-states toreach around the world farther faster deeperand cheaper than before the spread of free-market capitalism to virtually every country
around the world
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 530
Pros And Cons Of Globalization
Globalization is a new term that has found a significantplace in the lives of the people By globalization wemean shedding down the walls of distrust and thebarriers of suspicion in between countries to make abridge where ideas and beliefs can cross the borders
Though globalization today primarily covers the
economical side the impact is not limited to theeconomy only It actually affects every aspect of lifelike cultural social psychological and of coursepolitical
While globalization is seen as a sign of a hopeful future
by some there are others who believe that it can causetremendous disaster for the world economy Read on to find the pros and cons of globalization
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 630
Pros Of Globalization With globalization there is a global market for companies to trade their
products and a wider range of options for people to choose from amongthe products of different nations
Developing countries benefit a lot from globalization as there is a soundflow of money and thus a decrease in the currency difference
To meet the increasing demands that follow globalization there is anincrease in the production sector This gives loads of options to themanufacturers as well
Competition keeps prices relatively low and as a result inflation is less
likely to occur The focus is diverted and segregated among all the nations No countryremains the single power head instead there are compartmentalizedpower sectors The decisions at higher levels are meant for the people atlarge
Communication among the countries is on the rise which allows for betterunderstanding and broader vision
As communication increases amongst two countries there is interchangeof cultures as well We get to know more about the others culturalpreferences
As we feed to each others financial needs the ecological imbalance isalso meted out Governments of countries show concern about eachother
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 730
Cons Of Globalization Globalization is causing Europeans to lose their jobs as work is
being outsourced to the Asian countries The cost of labor in theAsian countries is low as compared to other countries
The high rate of profit for the companies in Asia has resulted in apressure on the employed Europeans who are always under thethreat of the business being outsourced
Companies are as opening their counterparts in other countriesThis results in transferring the quality of their product to othercountries thereby increasing the chances of depreciation in termsof quality
There are experts who believe that globalization is the cause forthe invasion of communicable diseases and social degeneration incountries
The threat that the corporates would rule the world is on high asthere is a lot of money invested by them
It is often argued that poor countries are exploited by the richercountries where the work force is taken advantage of and lowwages are implemented
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 830
Appraising the Global Marketing
Environment A company has to examine many issues deciding
whether and where to sell abroad The company has to acquire a thorough understanding
of the international marketing environment Significant changes in past 2 decades
Substantial speedup of international transportationcommunication and financial transactionsIncrease of strategic alliances bw major
international companiesGrowth of global brands in autos food clothing
electronics and many other categoriesRising economic power of Japan and several FarEastern countries in world markets
Strategies for Global
Market Penetrationppt
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 930
Competing on a Global Basis
Global industry Global firm
Major Decisions inInternational Marketing
Deciding whether to
go abroad
Deciding which marketsto enter
Deciding how to enterthe market
Deciding on the marketing
program
Deciding on the marketingorganization
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1030
Deciding Whether To Go Abroad
Factors drawing companies into the internationalarena
Global firms offering better products or lower pricescan attack the companyrsquos domestic market
The company discovers that some foreign marketspresent higher profit opportunities than the domesticmarket
The company needs a larger customer base to achieveeconomies of scale
The company wants to reduce its dependence on anyone market
The companyrsquos customers are going abroad and needservicing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1130
Deciding Whether To Go Abroad
Before going abroad the company must weigh severalrisk
The company might not understand foreign customerpreferences and fail to offer a competitively attractiveproduct
The company might not understand the foreigncountryrsquos business culture or know how to dealeffectively with foreign nationals
The company might underestimate foreign regulationsand incur unexpected costs
The company might realize that it lacks managers withinternational experience
The foreign country might change its commercial lawsdevalue its currency or undergo a political revolutionand expropriate property
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1230
Blunders in International Marketing
Hallmark cards failed when they were introduced in France The
French dislike syrupy sentiment and prefer writing their own cards
Philips began to earn a profit in Japan only after it had reduced thesize of its coffeemakers to fit into smaller Japanese kitchens andits shavers to fit smaller Japanese hands
Coca-Cola had to withdraw its two-liter bottle in Spain afterdiscovering that few Spaniards owned refrigerators with largeenough compartments to accommodate it
General Foodsrsquo Tang initially failed in France because it waspositioned as a substitute for orange juice at breakfast TheFrench drink little orange juice and almost none at breakfast
Kelloggrsquos Pop-Tarts failed in Britain because the percentage ofBritish Pop- homes with toasters was significantly lower than in theUnited States and the product was too sweet for British tastes
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1330
Deciding Which Markets to Enter
How many markets must a company enter
The candidate countries should be initially rated on 3 majorcriteriaMarket attractiveness ndash GNPcapita work force pop growth
Competitive advantage ndash business dealings
Risk ndash stability in political currency repatriation rules
High Med Low
H China
LM Czech
L EastGermany
H Poland
HM Romania
L
CompetitiveAdvantage
Competitive Advantage
Risk
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1430
Deciding Which Markets to Enter
Prepare a financial analysis of top 3 countries Fivesteps involved in estimating the probable rate of return
on investment
Estimate of Current Market Potential ndash estimate totalindustry sales in each market task calls for using published data and primarydata collected through company surveys
Forecast of Future Market Potential and Risk ndash forecast future industry sales (difficult task) requires predicting economic andpolitical developments and impact on industry sales
Forecast of Sales Potential ndash estimating the companyrsquos salesrequires forecasting its probable market share based on its competitiveadvantage (another difficult task)
Forecasts of Costs and Profits ndash cost will depend oncompanyrsquos entry strategy company subtracts estimated costs from estimatedsales to derive company profits
Estimate of Rate of Return on Investment ndash forecastedincome stream should be related to investment stream to derive implicit rate ofreturn should be high enough to cover firmrsquos normal target return on its
investments and the risk of marketing in that country
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1530
Deciding Which Markets to Enter
Regional free trade zones
The European Union
NAFTA
MERCOSUL
APEC
Evaluating potential markets
Psychic proximity
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1630
Deciding How to Enter the Market
Five Modes of Entry intoForeign Markets
Direct Investment
Joint Ventures
Licensing
Direct Exporting
Indirect Exporting A m o u n t o f c o m m i t m e n t r i s k c o n t r o l a n d
p r o f i t p o t e n t i a l
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 330
Objectives
Focus on the following questions
What factors should a company review before decidingto go abroad
How can companies evaluate and select foreignmarkets to enter
What are the major ways of entering a foreign market To what extent must the company adapt its products
and marketing program to each foreign country
How should the company manage and organize its
international activities
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 430
Globalization
According to Friedman (1999) Globalization isthe inexorable integration of markets nationstates and technologies to a degree neverwitnessed before- in a way that is enabling
individuals corporations and nation-states toreach around the world farther faster deeperand cheaper than before the spread of free-market capitalism to virtually every country
around the world
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 530
Pros And Cons Of Globalization
Globalization is a new term that has found a significantplace in the lives of the people By globalization wemean shedding down the walls of distrust and thebarriers of suspicion in between countries to make abridge where ideas and beliefs can cross the borders
Though globalization today primarily covers the
economical side the impact is not limited to theeconomy only It actually affects every aspect of lifelike cultural social psychological and of coursepolitical
While globalization is seen as a sign of a hopeful future
by some there are others who believe that it can causetremendous disaster for the world economy Read on to find the pros and cons of globalization
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 630
Pros Of Globalization With globalization there is a global market for companies to trade their
products and a wider range of options for people to choose from amongthe products of different nations
Developing countries benefit a lot from globalization as there is a soundflow of money and thus a decrease in the currency difference
To meet the increasing demands that follow globalization there is anincrease in the production sector This gives loads of options to themanufacturers as well
Competition keeps prices relatively low and as a result inflation is less
likely to occur The focus is diverted and segregated among all the nations No countryremains the single power head instead there are compartmentalizedpower sectors The decisions at higher levels are meant for the people atlarge
Communication among the countries is on the rise which allows for betterunderstanding and broader vision
As communication increases amongst two countries there is interchangeof cultures as well We get to know more about the others culturalpreferences
As we feed to each others financial needs the ecological imbalance isalso meted out Governments of countries show concern about eachother
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 730
Cons Of Globalization Globalization is causing Europeans to lose their jobs as work is
being outsourced to the Asian countries The cost of labor in theAsian countries is low as compared to other countries
The high rate of profit for the companies in Asia has resulted in apressure on the employed Europeans who are always under thethreat of the business being outsourced
Companies are as opening their counterparts in other countriesThis results in transferring the quality of their product to othercountries thereby increasing the chances of depreciation in termsof quality
There are experts who believe that globalization is the cause forthe invasion of communicable diseases and social degeneration incountries
The threat that the corporates would rule the world is on high asthere is a lot of money invested by them
It is often argued that poor countries are exploited by the richercountries where the work force is taken advantage of and lowwages are implemented
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 830
Appraising the Global Marketing
Environment A company has to examine many issues deciding
whether and where to sell abroad The company has to acquire a thorough understanding
of the international marketing environment Significant changes in past 2 decades
Substantial speedup of international transportationcommunication and financial transactionsIncrease of strategic alliances bw major
international companiesGrowth of global brands in autos food clothing
electronics and many other categoriesRising economic power of Japan and several FarEastern countries in world markets
Strategies for Global
Market Penetrationppt
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 930
Competing on a Global Basis
Global industry Global firm
Major Decisions inInternational Marketing
Deciding whether to
go abroad
Deciding which marketsto enter
Deciding how to enterthe market
Deciding on the marketing
program
Deciding on the marketingorganization
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1030
Deciding Whether To Go Abroad
Factors drawing companies into the internationalarena
Global firms offering better products or lower pricescan attack the companyrsquos domestic market
The company discovers that some foreign marketspresent higher profit opportunities than the domesticmarket
The company needs a larger customer base to achieveeconomies of scale
The company wants to reduce its dependence on anyone market
The companyrsquos customers are going abroad and needservicing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1130
Deciding Whether To Go Abroad
Before going abroad the company must weigh severalrisk
The company might not understand foreign customerpreferences and fail to offer a competitively attractiveproduct
The company might not understand the foreigncountryrsquos business culture or know how to dealeffectively with foreign nationals
The company might underestimate foreign regulationsand incur unexpected costs
The company might realize that it lacks managers withinternational experience
The foreign country might change its commercial lawsdevalue its currency or undergo a political revolutionand expropriate property
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1230
Blunders in International Marketing
Hallmark cards failed when they were introduced in France The
French dislike syrupy sentiment and prefer writing their own cards
Philips began to earn a profit in Japan only after it had reduced thesize of its coffeemakers to fit into smaller Japanese kitchens andits shavers to fit smaller Japanese hands
Coca-Cola had to withdraw its two-liter bottle in Spain afterdiscovering that few Spaniards owned refrigerators with largeenough compartments to accommodate it
General Foodsrsquo Tang initially failed in France because it waspositioned as a substitute for orange juice at breakfast TheFrench drink little orange juice and almost none at breakfast
Kelloggrsquos Pop-Tarts failed in Britain because the percentage ofBritish Pop- homes with toasters was significantly lower than in theUnited States and the product was too sweet for British tastes
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1330
Deciding Which Markets to Enter
How many markets must a company enter
The candidate countries should be initially rated on 3 majorcriteriaMarket attractiveness ndash GNPcapita work force pop growth
Competitive advantage ndash business dealings
Risk ndash stability in political currency repatriation rules
High Med Low
H China
LM Czech
L EastGermany
H Poland
HM Romania
L
CompetitiveAdvantage
Competitive Advantage
Risk
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1430
Deciding Which Markets to Enter
Prepare a financial analysis of top 3 countries Fivesteps involved in estimating the probable rate of return
on investment
Estimate of Current Market Potential ndash estimate totalindustry sales in each market task calls for using published data and primarydata collected through company surveys
Forecast of Future Market Potential and Risk ndash forecast future industry sales (difficult task) requires predicting economic andpolitical developments and impact on industry sales
Forecast of Sales Potential ndash estimating the companyrsquos salesrequires forecasting its probable market share based on its competitiveadvantage (another difficult task)
Forecasts of Costs and Profits ndash cost will depend oncompanyrsquos entry strategy company subtracts estimated costs from estimatedsales to derive company profits
Estimate of Rate of Return on Investment ndash forecastedincome stream should be related to investment stream to derive implicit rate ofreturn should be high enough to cover firmrsquos normal target return on its
investments and the risk of marketing in that country
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1530
Deciding Which Markets to Enter
Regional free trade zones
The European Union
NAFTA
MERCOSUL
APEC
Evaluating potential markets
Psychic proximity
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1630
Deciding How to Enter the Market
Five Modes of Entry intoForeign Markets
Direct Investment
Joint Ventures
Licensing
Direct Exporting
Indirect Exporting A m o u n t o f c o m m i t m e n t r i s k c o n t r o l a n d
p r o f i t p o t e n t i a l
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 430
Globalization
According to Friedman (1999) Globalization isthe inexorable integration of markets nationstates and technologies to a degree neverwitnessed before- in a way that is enabling
individuals corporations and nation-states toreach around the world farther faster deeperand cheaper than before the spread of free-market capitalism to virtually every country
around the world
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 530
Pros And Cons Of Globalization
Globalization is a new term that has found a significantplace in the lives of the people By globalization wemean shedding down the walls of distrust and thebarriers of suspicion in between countries to make abridge where ideas and beliefs can cross the borders
Though globalization today primarily covers the
economical side the impact is not limited to theeconomy only It actually affects every aspect of lifelike cultural social psychological and of coursepolitical
While globalization is seen as a sign of a hopeful future
by some there are others who believe that it can causetremendous disaster for the world economy Read on to find the pros and cons of globalization
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 630
Pros Of Globalization With globalization there is a global market for companies to trade their
products and a wider range of options for people to choose from amongthe products of different nations
Developing countries benefit a lot from globalization as there is a soundflow of money and thus a decrease in the currency difference
To meet the increasing demands that follow globalization there is anincrease in the production sector This gives loads of options to themanufacturers as well
Competition keeps prices relatively low and as a result inflation is less
likely to occur The focus is diverted and segregated among all the nations No countryremains the single power head instead there are compartmentalizedpower sectors The decisions at higher levels are meant for the people atlarge
Communication among the countries is on the rise which allows for betterunderstanding and broader vision
As communication increases amongst two countries there is interchangeof cultures as well We get to know more about the others culturalpreferences
As we feed to each others financial needs the ecological imbalance isalso meted out Governments of countries show concern about eachother
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 730
Cons Of Globalization Globalization is causing Europeans to lose their jobs as work is
being outsourced to the Asian countries The cost of labor in theAsian countries is low as compared to other countries
The high rate of profit for the companies in Asia has resulted in apressure on the employed Europeans who are always under thethreat of the business being outsourced
Companies are as opening their counterparts in other countriesThis results in transferring the quality of their product to othercountries thereby increasing the chances of depreciation in termsof quality
There are experts who believe that globalization is the cause forthe invasion of communicable diseases and social degeneration incountries
The threat that the corporates would rule the world is on high asthere is a lot of money invested by them
It is often argued that poor countries are exploited by the richercountries where the work force is taken advantage of and lowwages are implemented
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 830
Appraising the Global Marketing
Environment A company has to examine many issues deciding
whether and where to sell abroad The company has to acquire a thorough understanding
of the international marketing environment Significant changes in past 2 decades
Substantial speedup of international transportationcommunication and financial transactionsIncrease of strategic alliances bw major
international companiesGrowth of global brands in autos food clothing
electronics and many other categoriesRising economic power of Japan and several FarEastern countries in world markets
Strategies for Global
Market Penetrationppt
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 930
Competing on a Global Basis
Global industry Global firm
Major Decisions inInternational Marketing
Deciding whether to
go abroad
Deciding which marketsto enter
Deciding how to enterthe market
Deciding on the marketing
program
Deciding on the marketingorganization
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1030
Deciding Whether To Go Abroad
Factors drawing companies into the internationalarena
Global firms offering better products or lower pricescan attack the companyrsquos domestic market
The company discovers that some foreign marketspresent higher profit opportunities than the domesticmarket
The company needs a larger customer base to achieveeconomies of scale
The company wants to reduce its dependence on anyone market
The companyrsquos customers are going abroad and needservicing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1130
Deciding Whether To Go Abroad
Before going abroad the company must weigh severalrisk
The company might not understand foreign customerpreferences and fail to offer a competitively attractiveproduct
The company might not understand the foreigncountryrsquos business culture or know how to dealeffectively with foreign nationals
The company might underestimate foreign regulationsand incur unexpected costs
The company might realize that it lacks managers withinternational experience
The foreign country might change its commercial lawsdevalue its currency or undergo a political revolutionand expropriate property
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1230
Blunders in International Marketing
Hallmark cards failed when they were introduced in France The
French dislike syrupy sentiment and prefer writing their own cards
Philips began to earn a profit in Japan only after it had reduced thesize of its coffeemakers to fit into smaller Japanese kitchens andits shavers to fit smaller Japanese hands
Coca-Cola had to withdraw its two-liter bottle in Spain afterdiscovering that few Spaniards owned refrigerators with largeenough compartments to accommodate it
General Foodsrsquo Tang initially failed in France because it waspositioned as a substitute for orange juice at breakfast TheFrench drink little orange juice and almost none at breakfast
Kelloggrsquos Pop-Tarts failed in Britain because the percentage ofBritish Pop- homes with toasters was significantly lower than in theUnited States and the product was too sweet for British tastes
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1330
Deciding Which Markets to Enter
How many markets must a company enter
The candidate countries should be initially rated on 3 majorcriteriaMarket attractiveness ndash GNPcapita work force pop growth
Competitive advantage ndash business dealings
Risk ndash stability in political currency repatriation rules
High Med Low
H China
LM Czech
L EastGermany
H Poland
HM Romania
L
CompetitiveAdvantage
Competitive Advantage
Risk
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1430
Deciding Which Markets to Enter
Prepare a financial analysis of top 3 countries Fivesteps involved in estimating the probable rate of return
on investment
Estimate of Current Market Potential ndash estimate totalindustry sales in each market task calls for using published data and primarydata collected through company surveys
Forecast of Future Market Potential and Risk ndash forecast future industry sales (difficult task) requires predicting economic andpolitical developments and impact on industry sales
Forecast of Sales Potential ndash estimating the companyrsquos salesrequires forecasting its probable market share based on its competitiveadvantage (another difficult task)
Forecasts of Costs and Profits ndash cost will depend oncompanyrsquos entry strategy company subtracts estimated costs from estimatedsales to derive company profits
Estimate of Rate of Return on Investment ndash forecastedincome stream should be related to investment stream to derive implicit rate ofreturn should be high enough to cover firmrsquos normal target return on its
investments and the risk of marketing in that country
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1530
Deciding Which Markets to Enter
Regional free trade zones
The European Union
NAFTA
MERCOSUL
APEC
Evaluating potential markets
Psychic proximity
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1630
Deciding How to Enter the Market
Five Modes of Entry intoForeign Markets
Direct Investment
Joint Ventures
Licensing
Direct Exporting
Indirect Exporting A m o u n t o f c o m m i t m e n t r i s k c o n t r o l a n d
p r o f i t p o t e n t i a l
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 530
Pros And Cons Of Globalization
Globalization is a new term that has found a significantplace in the lives of the people By globalization wemean shedding down the walls of distrust and thebarriers of suspicion in between countries to make abridge where ideas and beliefs can cross the borders
Though globalization today primarily covers the
economical side the impact is not limited to theeconomy only It actually affects every aspect of lifelike cultural social psychological and of coursepolitical
While globalization is seen as a sign of a hopeful future
by some there are others who believe that it can causetremendous disaster for the world economy Read on to find the pros and cons of globalization
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 630
Pros Of Globalization With globalization there is a global market for companies to trade their
products and a wider range of options for people to choose from amongthe products of different nations
Developing countries benefit a lot from globalization as there is a soundflow of money and thus a decrease in the currency difference
To meet the increasing demands that follow globalization there is anincrease in the production sector This gives loads of options to themanufacturers as well
Competition keeps prices relatively low and as a result inflation is less
likely to occur The focus is diverted and segregated among all the nations No countryremains the single power head instead there are compartmentalizedpower sectors The decisions at higher levels are meant for the people atlarge
Communication among the countries is on the rise which allows for betterunderstanding and broader vision
As communication increases amongst two countries there is interchangeof cultures as well We get to know more about the others culturalpreferences
As we feed to each others financial needs the ecological imbalance isalso meted out Governments of countries show concern about eachother
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 730
Cons Of Globalization Globalization is causing Europeans to lose their jobs as work is
being outsourced to the Asian countries The cost of labor in theAsian countries is low as compared to other countries
The high rate of profit for the companies in Asia has resulted in apressure on the employed Europeans who are always under thethreat of the business being outsourced
Companies are as opening their counterparts in other countriesThis results in transferring the quality of their product to othercountries thereby increasing the chances of depreciation in termsof quality
There are experts who believe that globalization is the cause forthe invasion of communicable diseases and social degeneration incountries
The threat that the corporates would rule the world is on high asthere is a lot of money invested by them
It is often argued that poor countries are exploited by the richercountries where the work force is taken advantage of and lowwages are implemented
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 830
Appraising the Global Marketing
Environment A company has to examine many issues deciding
whether and where to sell abroad The company has to acquire a thorough understanding
of the international marketing environment Significant changes in past 2 decades
Substantial speedup of international transportationcommunication and financial transactionsIncrease of strategic alliances bw major
international companiesGrowth of global brands in autos food clothing
electronics and many other categoriesRising economic power of Japan and several FarEastern countries in world markets
Strategies for Global
Market Penetrationppt
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 930
Competing on a Global Basis
Global industry Global firm
Major Decisions inInternational Marketing
Deciding whether to
go abroad
Deciding which marketsto enter
Deciding how to enterthe market
Deciding on the marketing
program
Deciding on the marketingorganization
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1030
Deciding Whether To Go Abroad
Factors drawing companies into the internationalarena
Global firms offering better products or lower pricescan attack the companyrsquos domestic market
The company discovers that some foreign marketspresent higher profit opportunities than the domesticmarket
The company needs a larger customer base to achieveeconomies of scale
The company wants to reduce its dependence on anyone market
The companyrsquos customers are going abroad and needservicing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1130
Deciding Whether To Go Abroad
Before going abroad the company must weigh severalrisk
The company might not understand foreign customerpreferences and fail to offer a competitively attractiveproduct
The company might not understand the foreigncountryrsquos business culture or know how to dealeffectively with foreign nationals
The company might underestimate foreign regulationsand incur unexpected costs
The company might realize that it lacks managers withinternational experience
The foreign country might change its commercial lawsdevalue its currency or undergo a political revolutionand expropriate property
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1230
Blunders in International Marketing
Hallmark cards failed when they were introduced in France The
French dislike syrupy sentiment and prefer writing their own cards
Philips began to earn a profit in Japan only after it had reduced thesize of its coffeemakers to fit into smaller Japanese kitchens andits shavers to fit smaller Japanese hands
Coca-Cola had to withdraw its two-liter bottle in Spain afterdiscovering that few Spaniards owned refrigerators with largeenough compartments to accommodate it
General Foodsrsquo Tang initially failed in France because it waspositioned as a substitute for orange juice at breakfast TheFrench drink little orange juice and almost none at breakfast
Kelloggrsquos Pop-Tarts failed in Britain because the percentage ofBritish Pop- homes with toasters was significantly lower than in theUnited States and the product was too sweet for British tastes
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1330
Deciding Which Markets to Enter
How many markets must a company enter
The candidate countries should be initially rated on 3 majorcriteriaMarket attractiveness ndash GNPcapita work force pop growth
Competitive advantage ndash business dealings
Risk ndash stability in political currency repatriation rules
High Med Low
H China
LM Czech
L EastGermany
H Poland
HM Romania
L
CompetitiveAdvantage
Competitive Advantage
Risk
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1430
Deciding Which Markets to Enter
Prepare a financial analysis of top 3 countries Fivesteps involved in estimating the probable rate of return
on investment
Estimate of Current Market Potential ndash estimate totalindustry sales in each market task calls for using published data and primarydata collected through company surveys
Forecast of Future Market Potential and Risk ndash forecast future industry sales (difficult task) requires predicting economic andpolitical developments and impact on industry sales
Forecast of Sales Potential ndash estimating the companyrsquos salesrequires forecasting its probable market share based on its competitiveadvantage (another difficult task)
Forecasts of Costs and Profits ndash cost will depend oncompanyrsquos entry strategy company subtracts estimated costs from estimatedsales to derive company profits
Estimate of Rate of Return on Investment ndash forecastedincome stream should be related to investment stream to derive implicit rate ofreturn should be high enough to cover firmrsquos normal target return on its
investments and the risk of marketing in that country
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1530
Deciding Which Markets to Enter
Regional free trade zones
The European Union
NAFTA
MERCOSUL
APEC
Evaluating potential markets
Psychic proximity
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1630
Deciding How to Enter the Market
Five Modes of Entry intoForeign Markets
Direct Investment
Joint Ventures
Licensing
Direct Exporting
Indirect Exporting A m o u n t o f c o m m i t m e n t r i s k c o n t r o l a n d
p r o f i t p o t e n t i a l
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 630
Pros Of Globalization With globalization there is a global market for companies to trade their
products and a wider range of options for people to choose from amongthe products of different nations
Developing countries benefit a lot from globalization as there is a soundflow of money and thus a decrease in the currency difference
To meet the increasing demands that follow globalization there is anincrease in the production sector This gives loads of options to themanufacturers as well
Competition keeps prices relatively low and as a result inflation is less
likely to occur The focus is diverted and segregated among all the nations No countryremains the single power head instead there are compartmentalizedpower sectors The decisions at higher levels are meant for the people atlarge
Communication among the countries is on the rise which allows for betterunderstanding and broader vision
As communication increases amongst two countries there is interchangeof cultures as well We get to know more about the others culturalpreferences
As we feed to each others financial needs the ecological imbalance isalso meted out Governments of countries show concern about eachother
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 730
Cons Of Globalization Globalization is causing Europeans to lose their jobs as work is
being outsourced to the Asian countries The cost of labor in theAsian countries is low as compared to other countries
The high rate of profit for the companies in Asia has resulted in apressure on the employed Europeans who are always under thethreat of the business being outsourced
Companies are as opening their counterparts in other countriesThis results in transferring the quality of their product to othercountries thereby increasing the chances of depreciation in termsof quality
There are experts who believe that globalization is the cause forthe invasion of communicable diseases and social degeneration incountries
The threat that the corporates would rule the world is on high asthere is a lot of money invested by them
It is often argued that poor countries are exploited by the richercountries where the work force is taken advantage of and lowwages are implemented
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 830
Appraising the Global Marketing
Environment A company has to examine many issues deciding
whether and where to sell abroad The company has to acquire a thorough understanding
of the international marketing environment Significant changes in past 2 decades
Substantial speedup of international transportationcommunication and financial transactionsIncrease of strategic alliances bw major
international companiesGrowth of global brands in autos food clothing
electronics and many other categoriesRising economic power of Japan and several FarEastern countries in world markets
Strategies for Global
Market Penetrationppt
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 930
Competing on a Global Basis
Global industry Global firm
Major Decisions inInternational Marketing
Deciding whether to
go abroad
Deciding which marketsto enter
Deciding how to enterthe market
Deciding on the marketing
program
Deciding on the marketingorganization
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1030
Deciding Whether To Go Abroad
Factors drawing companies into the internationalarena
Global firms offering better products or lower pricescan attack the companyrsquos domestic market
The company discovers that some foreign marketspresent higher profit opportunities than the domesticmarket
The company needs a larger customer base to achieveeconomies of scale
The company wants to reduce its dependence on anyone market
The companyrsquos customers are going abroad and needservicing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1130
Deciding Whether To Go Abroad
Before going abroad the company must weigh severalrisk
The company might not understand foreign customerpreferences and fail to offer a competitively attractiveproduct
The company might not understand the foreigncountryrsquos business culture or know how to dealeffectively with foreign nationals
The company might underestimate foreign regulationsand incur unexpected costs
The company might realize that it lacks managers withinternational experience
The foreign country might change its commercial lawsdevalue its currency or undergo a political revolutionand expropriate property
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1230
Blunders in International Marketing
Hallmark cards failed when they were introduced in France The
French dislike syrupy sentiment and prefer writing their own cards
Philips began to earn a profit in Japan only after it had reduced thesize of its coffeemakers to fit into smaller Japanese kitchens andits shavers to fit smaller Japanese hands
Coca-Cola had to withdraw its two-liter bottle in Spain afterdiscovering that few Spaniards owned refrigerators with largeenough compartments to accommodate it
General Foodsrsquo Tang initially failed in France because it waspositioned as a substitute for orange juice at breakfast TheFrench drink little orange juice and almost none at breakfast
Kelloggrsquos Pop-Tarts failed in Britain because the percentage ofBritish Pop- homes with toasters was significantly lower than in theUnited States and the product was too sweet for British tastes
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1330
Deciding Which Markets to Enter
How many markets must a company enter
The candidate countries should be initially rated on 3 majorcriteriaMarket attractiveness ndash GNPcapita work force pop growth
Competitive advantage ndash business dealings
Risk ndash stability in political currency repatriation rules
High Med Low
H China
LM Czech
L EastGermany
H Poland
HM Romania
L
CompetitiveAdvantage
Competitive Advantage
Risk
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1430
Deciding Which Markets to Enter
Prepare a financial analysis of top 3 countries Fivesteps involved in estimating the probable rate of return
on investment
Estimate of Current Market Potential ndash estimate totalindustry sales in each market task calls for using published data and primarydata collected through company surveys
Forecast of Future Market Potential and Risk ndash forecast future industry sales (difficult task) requires predicting economic andpolitical developments and impact on industry sales
Forecast of Sales Potential ndash estimating the companyrsquos salesrequires forecasting its probable market share based on its competitiveadvantage (another difficult task)
Forecasts of Costs and Profits ndash cost will depend oncompanyrsquos entry strategy company subtracts estimated costs from estimatedsales to derive company profits
Estimate of Rate of Return on Investment ndash forecastedincome stream should be related to investment stream to derive implicit rate ofreturn should be high enough to cover firmrsquos normal target return on its
investments and the risk of marketing in that country
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1530
Deciding Which Markets to Enter
Regional free trade zones
The European Union
NAFTA
MERCOSUL
APEC
Evaluating potential markets
Psychic proximity
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1630
Deciding How to Enter the Market
Five Modes of Entry intoForeign Markets
Direct Investment
Joint Ventures
Licensing
Direct Exporting
Indirect Exporting A m o u n t o f c o m m i t m e n t r i s k c o n t r o l a n d
p r o f i t p o t e n t i a l
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 730
Cons Of Globalization Globalization is causing Europeans to lose their jobs as work is
being outsourced to the Asian countries The cost of labor in theAsian countries is low as compared to other countries
The high rate of profit for the companies in Asia has resulted in apressure on the employed Europeans who are always under thethreat of the business being outsourced
Companies are as opening their counterparts in other countriesThis results in transferring the quality of their product to othercountries thereby increasing the chances of depreciation in termsof quality
There are experts who believe that globalization is the cause forthe invasion of communicable diseases and social degeneration incountries
The threat that the corporates would rule the world is on high asthere is a lot of money invested by them
It is often argued that poor countries are exploited by the richercountries where the work force is taken advantage of and lowwages are implemented
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 830
Appraising the Global Marketing
Environment A company has to examine many issues deciding
whether and where to sell abroad The company has to acquire a thorough understanding
of the international marketing environment Significant changes in past 2 decades
Substantial speedup of international transportationcommunication and financial transactionsIncrease of strategic alliances bw major
international companiesGrowth of global brands in autos food clothing
electronics and many other categoriesRising economic power of Japan and several FarEastern countries in world markets
Strategies for Global
Market Penetrationppt
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 930
Competing on a Global Basis
Global industry Global firm
Major Decisions inInternational Marketing
Deciding whether to
go abroad
Deciding which marketsto enter
Deciding how to enterthe market
Deciding on the marketing
program
Deciding on the marketingorganization
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1030
Deciding Whether To Go Abroad
Factors drawing companies into the internationalarena
Global firms offering better products or lower pricescan attack the companyrsquos domestic market
The company discovers that some foreign marketspresent higher profit opportunities than the domesticmarket
The company needs a larger customer base to achieveeconomies of scale
The company wants to reduce its dependence on anyone market
The companyrsquos customers are going abroad and needservicing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1130
Deciding Whether To Go Abroad
Before going abroad the company must weigh severalrisk
The company might not understand foreign customerpreferences and fail to offer a competitively attractiveproduct
The company might not understand the foreigncountryrsquos business culture or know how to dealeffectively with foreign nationals
The company might underestimate foreign regulationsand incur unexpected costs
The company might realize that it lacks managers withinternational experience
The foreign country might change its commercial lawsdevalue its currency or undergo a political revolutionand expropriate property
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1230
Blunders in International Marketing
Hallmark cards failed when they were introduced in France The
French dislike syrupy sentiment and prefer writing their own cards
Philips began to earn a profit in Japan only after it had reduced thesize of its coffeemakers to fit into smaller Japanese kitchens andits shavers to fit smaller Japanese hands
Coca-Cola had to withdraw its two-liter bottle in Spain afterdiscovering that few Spaniards owned refrigerators with largeenough compartments to accommodate it
General Foodsrsquo Tang initially failed in France because it waspositioned as a substitute for orange juice at breakfast TheFrench drink little orange juice and almost none at breakfast
Kelloggrsquos Pop-Tarts failed in Britain because the percentage ofBritish Pop- homes with toasters was significantly lower than in theUnited States and the product was too sweet for British tastes
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1330
Deciding Which Markets to Enter
How many markets must a company enter
The candidate countries should be initially rated on 3 majorcriteriaMarket attractiveness ndash GNPcapita work force pop growth
Competitive advantage ndash business dealings
Risk ndash stability in political currency repatriation rules
High Med Low
H China
LM Czech
L EastGermany
H Poland
HM Romania
L
CompetitiveAdvantage
Competitive Advantage
Risk
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1430
Deciding Which Markets to Enter
Prepare a financial analysis of top 3 countries Fivesteps involved in estimating the probable rate of return
on investment
Estimate of Current Market Potential ndash estimate totalindustry sales in each market task calls for using published data and primarydata collected through company surveys
Forecast of Future Market Potential and Risk ndash forecast future industry sales (difficult task) requires predicting economic andpolitical developments and impact on industry sales
Forecast of Sales Potential ndash estimating the companyrsquos salesrequires forecasting its probable market share based on its competitiveadvantage (another difficult task)
Forecasts of Costs and Profits ndash cost will depend oncompanyrsquos entry strategy company subtracts estimated costs from estimatedsales to derive company profits
Estimate of Rate of Return on Investment ndash forecastedincome stream should be related to investment stream to derive implicit rate ofreturn should be high enough to cover firmrsquos normal target return on its
investments and the risk of marketing in that country
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1530
Deciding Which Markets to Enter
Regional free trade zones
The European Union
NAFTA
MERCOSUL
APEC
Evaluating potential markets
Psychic proximity
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1630
Deciding How to Enter the Market
Five Modes of Entry intoForeign Markets
Direct Investment
Joint Ventures
Licensing
Direct Exporting
Indirect Exporting A m o u n t o f c o m m i t m e n t r i s k c o n t r o l a n d
p r o f i t p o t e n t i a l
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 830
Appraising the Global Marketing
Environment A company has to examine many issues deciding
whether and where to sell abroad The company has to acquire a thorough understanding
of the international marketing environment Significant changes in past 2 decades
Substantial speedup of international transportationcommunication and financial transactionsIncrease of strategic alliances bw major
international companiesGrowth of global brands in autos food clothing
electronics and many other categoriesRising economic power of Japan and several FarEastern countries in world markets
Strategies for Global
Market Penetrationppt
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 930
Competing on a Global Basis
Global industry Global firm
Major Decisions inInternational Marketing
Deciding whether to
go abroad
Deciding which marketsto enter
Deciding how to enterthe market
Deciding on the marketing
program
Deciding on the marketingorganization
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1030
Deciding Whether To Go Abroad
Factors drawing companies into the internationalarena
Global firms offering better products or lower pricescan attack the companyrsquos domestic market
The company discovers that some foreign marketspresent higher profit opportunities than the domesticmarket
The company needs a larger customer base to achieveeconomies of scale
The company wants to reduce its dependence on anyone market
The companyrsquos customers are going abroad and needservicing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1130
Deciding Whether To Go Abroad
Before going abroad the company must weigh severalrisk
The company might not understand foreign customerpreferences and fail to offer a competitively attractiveproduct
The company might not understand the foreigncountryrsquos business culture or know how to dealeffectively with foreign nationals
The company might underestimate foreign regulationsand incur unexpected costs
The company might realize that it lacks managers withinternational experience
The foreign country might change its commercial lawsdevalue its currency or undergo a political revolutionand expropriate property
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1230
Blunders in International Marketing
Hallmark cards failed when they were introduced in France The
French dislike syrupy sentiment and prefer writing their own cards
Philips began to earn a profit in Japan only after it had reduced thesize of its coffeemakers to fit into smaller Japanese kitchens andits shavers to fit smaller Japanese hands
Coca-Cola had to withdraw its two-liter bottle in Spain afterdiscovering that few Spaniards owned refrigerators with largeenough compartments to accommodate it
General Foodsrsquo Tang initially failed in France because it waspositioned as a substitute for orange juice at breakfast TheFrench drink little orange juice and almost none at breakfast
Kelloggrsquos Pop-Tarts failed in Britain because the percentage ofBritish Pop- homes with toasters was significantly lower than in theUnited States and the product was too sweet for British tastes
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1330
Deciding Which Markets to Enter
How many markets must a company enter
The candidate countries should be initially rated on 3 majorcriteriaMarket attractiveness ndash GNPcapita work force pop growth
Competitive advantage ndash business dealings
Risk ndash stability in political currency repatriation rules
High Med Low
H China
LM Czech
L EastGermany
H Poland
HM Romania
L
CompetitiveAdvantage
Competitive Advantage
Risk
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1430
Deciding Which Markets to Enter
Prepare a financial analysis of top 3 countries Fivesteps involved in estimating the probable rate of return
on investment
Estimate of Current Market Potential ndash estimate totalindustry sales in each market task calls for using published data and primarydata collected through company surveys
Forecast of Future Market Potential and Risk ndash forecast future industry sales (difficult task) requires predicting economic andpolitical developments and impact on industry sales
Forecast of Sales Potential ndash estimating the companyrsquos salesrequires forecasting its probable market share based on its competitiveadvantage (another difficult task)
Forecasts of Costs and Profits ndash cost will depend oncompanyrsquos entry strategy company subtracts estimated costs from estimatedsales to derive company profits
Estimate of Rate of Return on Investment ndash forecastedincome stream should be related to investment stream to derive implicit rate ofreturn should be high enough to cover firmrsquos normal target return on its
investments and the risk of marketing in that country
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1530
Deciding Which Markets to Enter
Regional free trade zones
The European Union
NAFTA
MERCOSUL
APEC
Evaluating potential markets
Psychic proximity
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1630
Deciding How to Enter the Market
Five Modes of Entry intoForeign Markets
Direct Investment
Joint Ventures
Licensing
Direct Exporting
Indirect Exporting A m o u n t o f c o m m i t m e n t r i s k c o n t r o l a n d
p r o f i t p o t e n t i a l
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 930
Competing on a Global Basis
Global industry Global firm
Major Decisions inInternational Marketing
Deciding whether to
go abroad
Deciding which marketsto enter
Deciding how to enterthe market
Deciding on the marketing
program
Deciding on the marketingorganization
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1030
Deciding Whether To Go Abroad
Factors drawing companies into the internationalarena
Global firms offering better products or lower pricescan attack the companyrsquos domestic market
The company discovers that some foreign marketspresent higher profit opportunities than the domesticmarket
The company needs a larger customer base to achieveeconomies of scale
The company wants to reduce its dependence on anyone market
The companyrsquos customers are going abroad and needservicing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1130
Deciding Whether To Go Abroad
Before going abroad the company must weigh severalrisk
The company might not understand foreign customerpreferences and fail to offer a competitively attractiveproduct
The company might not understand the foreigncountryrsquos business culture or know how to dealeffectively with foreign nationals
The company might underestimate foreign regulationsand incur unexpected costs
The company might realize that it lacks managers withinternational experience
The foreign country might change its commercial lawsdevalue its currency or undergo a political revolutionand expropriate property
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1230
Blunders in International Marketing
Hallmark cards failed when they were introduced in France The
French dislike syrupy sentiment and prefer writing their own cards
Philips began to earn a profit in Japan only after it had reduced thesize of its coffeemakers to fit into smaller Japanese kitchens andits shavers to fit smaller Japanese hands
Coca-Cola had to withdraw its two-liter bottle in Spain afterdiscovering that few Spaniards owned refrigerators with largeenough compartments to accommodate it
General Foodsrsquo Tang initially failed in France because it waspositioned as a substitute for orange juice at breakfast TheFrench drink little orange juice and almost none at breakfast
Kelloggrsquos Pop-Tarts failed in Britain because the percentage ofBritish Pop- homes with toasters was significantly lower than in theUnited States and the product was too sweet for British tastes
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1330
Deciding Which Markets to Enter
How many markets must a company enter
The candidate countries should be initially rated on 3 majorcriteriaMarket attractiveness ndash GNPcapita work force pop growth
Competitive advantage ndash business dealings
Risk ndash stability in political currency repatriation rules
High Med Low
H China
LM Czech
L EastGermany
H Poland
HM Romania
L
CompetitiveAdvantage
Competitive Advantage
Risk
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1430
Deciding Which Markets to Enter
Prepare a financial analysis of top 3 countries Fivesteps involved in estimating the probable rate of return
on investment
Estimate of Current Market Potential ndash estimate totalindustry sales in each market task calls for using published data and primarydata collected through company surveys
Forecast of Future Market Potential and Risk ndash forecast future industry sales (difficult task) requires predicting economic andpolitical developments and impact on industry sales
Forecast of Sales Potential ndash estimating the companyrsquos salesrequires forecasting its probable market share based on its competitiveadvantage (another difficult task)
Forecasts of Costs and Profits ndash cost will depend oncompanyrsquos entry strategy company subtracts estimated costs from estimatedsales to derive company profits
Estimate of Rate of Return on Investment ndash forecastedincome stream should be related to investment stream to derive implicit rate ofreturn should be high enough to cover firmrsquos normal target return on its
investments and the risk of marketing in that country
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1530
Deciding Which Markets to Enter
Regional free trade zones
The European Union
NAFTA
MERCOSUL
APEC
Evaluating potential markets
Psychic proximity
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1630
Deciding How to Enter the Market
Five Modes of Entry intoForeign Markets
Direct Investment
Joint Ventures
Licensing
Direct Exporting
Indirect Exporting A m o u n t o f c o m m i t m e n t r i s k c o n t r o l a n d
p r o f i t p o t e n t i a l
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1030
Deciding Whether To Go Abroad
Factors drawing companies into the internationalarena
Global firms offering better products or lower pricescan attack the companyrsquos domestic market
The company discovers that some foreign marketspresent higher profit opportunities than the domesticmarket
The company needs a larger customer base to achieveeconomies of scale
The company wants to reduce its dependence on anyone market
The companyrsquos customers are going abroad and needservicing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1130
Deciding Whether To Go Abroad
Before going abroad the company must weigh severalrisk
The company might not understand foreign customerpreferences and fail to offer a competitively attractiveproduct
The company might not understand the foreigncountryrsquos business culture or know how to dealeffectively with foreign nationals
The company might underestimate foreign regulationsand incur unexpected costs
The company might realize that it lacks managers withinternational experience
The foreign country might change its commercial lawsdevalue its currency or undergo a political revolutionand expropriate property
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1230
Blunders in International Marketing
Hallmark cards failed when they were introduced in France The
French dislike syrupy sentiment and prefer writing their own cards
Philips began to earn a profit in Japan only after it had reduced thesize of its coffeemakers to fit into smaller Japanese kitchens andits shavers to fit smaller Japanese hands
Coca-Cola had to withdraw its two-liter bottle in Spain afterdiscovering that few Spaniards owned refrigerators with largeenough compartments to accommodate it
General Foodsrsquo Tang initially failed in France because it waspositioned as a substitute for orange juice at breakfast TheFrench drink little orange juice and almost none at breakfast
Kelloggrsquos Pop-Tarts failed in Britain because the percentage ofBritish Pop- homes with toasters was significantly lower than in theUnited States and the product was too sweet for British tastes
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1330
Deciding Which Markets to Enter
How many markets must a company enter
The candidate countries should be initially rated on 3 majorcriteriaMarket attractiveness ndash GNPcapita work force pop growth
Competitive advantage ndash business dealings
Risk ndash stability in political currency repatriation rules
High Med Low
H China
LM Czech
L EastGermany
H Poland
HM Romania
L
CompetitiveAdvantage
Competitive Advantage
Risk
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1430
Deciding Which Markets to Enter
Prepare a financial analysis of top 3 countries Fivesteps involved in estimating the probable rate of return
on investment
Estimate of Current Market Potential ndash estimate totalindustry sales in each market task calls for using published data and primarydata collected through company surveys
Forecast of Future Market Potential and Risk ndash forecast future industry sales (difficult task) requires predicting economic andpolitical developments and impact on industry sales
Forecast of Sales Potential ndash estimating the companyrsquos salesrequires forecasting its probable market share based on its competitiveadvantage (another difficult task)
Forecasts of Costs and Profits ndash cost will depend oncompanyrsquos entry strategy company subtracts estimated costs from estimatedsales to derive company profits
Estimate of Rate of Return on Investment ndash forecastedincome stream should be related to investment stream to derive implicit rate ofreturn should be high enough to cover firmrsquos normal target return on its
investments and the risk of marketing in that country
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1530
Deciding Which Markets to Enter
Regional free trade zones
The European Union
NAFTA
MERCOSUL
APEC
Evaluating potential markets
Psychic proximity
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1630
Deciding How to Enter the Market
Five Modes of Entry intoForeign Markets
Direct Investment
Joint Ventures
Licensing
Direct Exporting
Indirect Exporting A m o u n t o f c o m m i t m e n t r i s k c o n t r o l a n d
p r o f i t p o t e n t i a l
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1130
Deciding Whether To Go Abroad
Before going abroad the company must weigh severalrisk
The company might not understand foreign customerpreferences and fail to offer a competitively attractiveproduct
The company might not understand the foreigncountryrsquos business culture or know how to dealeffectively with foreign nationals
The company might underestimate foreign regulationsand incur unexpected costs
The company might realize that it lacks managers withinternational experience
The foreign country might change its commercial lawsdevalue its currency or undergo a political revolutionand expropriate property
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1230
Blunders in International Marketing
Hallmark cards failed when they were introduced in France The
French dislike syrupy sentiment and prefer writing their own cards
Philips began to earn a profit in Japan only after it had reduced thesize of its coffeemakers to fit into smaller Japanese kitchens andits shavers to fit smaller Japanese hands
Coca-Cola had to withdraw its two-liter bottle in Spain afterdiscovering that few Spaniards owned refrigerators with largeenough compartments to accommodate it
General Foodsrsquo Tang initially failed in France because it waspositioned as a substitute for orange juice at breakfast TheFrench drink little orange juice and almost none at breakfast
Kelloggrsquos Pop-Tarts failed in Britain because the percentage ofBritish Pop- homes with toasters was significantly lower than in theUnited States and the product was too sweet for British tastes
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1330
Deciding Which Markets to Enter
How many markets must a company enter
The candidate countries should be initially rated on 3 majorcriteriaMarket attractiveness ndash GNPcapita work force pop growth
Competitive advantage ndash business dealings
Risk ndash stability in political currency repatriation rules
High Med Low
H China
LM Czech
L EastGermany
H Poland
HM Romania
L
CompetitiveAdvantage
Competitive Advantage
Risk
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1430
Deciding Which Markets to Enter
Prepare a financial analysis of top 3 countries Fivesteps involved in estimating the probable rate of return
on investment
Estimate of Current Market Potential ndash estimate totalindustry sales in each market task calls for using published data and primarydata collected through company surveys
Forecast of Future Market Potential and Risk ndash forecast future industry sales (difficult task) requires predicting economic andpolitical developments and impact on industry sales
Forecast of Sales Potential ndash estimating the companyrsquos salesrequires forecasting its probable market share based on its competitiveadvantage (another difficult task)
Forecasts of Costs and Profits ndash cost will depend oncompanyrsquos entry strategy company subtracts estimated costs from estimatedsales to derive company profits
Estimate of Rate of Return on Investment ndash forecastedincome stream should be related to investment stream to derive implicit rate ofreturn should be high enough to cover firmrsquos normal target return on its
investments and the risk of marketing in that country
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1530
Deciding Which Markets to Enter
Regional free trade zones
The European Union
NAFTA
MERCOSUL
APEC
Evaluating potential markets
Psychic proximity
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1630
Deciding How to Enter the Market
Five Modes of Entry intoForeign Markets
Direct Investment
Joint Ventures
Licensing
Direct Exporting
Indirect Exporting A m o u n t o f c o m m i t m e n t r i s k c o n t r o l a n d
p r o f i t p o t e n t i a l
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1230
Blunders in International Marketing
Hallmark cards failed when they were introduced in France The
French dislike syrupy sentiment and prefer writing their own cards
Philips began to earn a profit in Japan only after it had reduced thesize of its coffeemakers to fit into smaller Japanese kitchens andits shavers to fit smaller Japanese hands
Coca-Cola had to withdraw its two-liter bottle in Spain afterdiscovering that few Spaniards owned refrigerators with largeenough compartments to accommodate it
General Foodsrsquo Tang initially failed in France because it waspositioned as a substitute for orange juice at breakfast TheFrench drink little orange juice and almost none at breakfast
Kelloggrsquos Pop-Tarts failed in Britain because the percentage ofBritish Pop- homes with toasters was significantly lower than in theUnited States and the product was too sweet for British tastes
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1330
Deciding Which Markets to Enter
How many markets must a company enter
The candidate countries should be initially rated on 3 majorcriteriaMarket attractiveness ndash GNPcapita work force pop growth
Competitive advantage ndash business dealings
Risk ndash stability in political currency repatriation rules
High Med Low
H China
LM Czech
L EastGermany
H Poland
HM Romania
L
CompetitiveAdvantage
Competitive Advantage
Risk
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1430
Deciding Which Markets to Enter
Prepare a financial analysis of top 3 countries Fivesteps involved in estimating the probable rate of return
on investment
Estimate of Current Market Potential ndash estimate totalindustry sales in each market task calls for using published data and primarydata collected through company surveys
Forecast of Future Market Potential and Risk ndash forecast future industry sales (difficult task) requires predicting economic andpolitical developments and impact on industry sales
Forecast of Sales Potential ndash estimating the companyrsquos salesrequires forecasting its probable market share based on its competitiveadvantage (another difficult task)
Forecasts of Costs and Profits ndash cost will depend oncompanyrsquos entry strategy company subtracts estimated costs from estimatedsales to derive company profits
Estimate of Rate of Return on Investment ndash forecastedincome stream should be related to investment stream to derive implicit rate ofreturn should be high enough to cover firmrsquos normal target return on its
investments and the risk of marketing in that country
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1530
Deciding Which Markets to Enter
Regional free trade zones
The European Union
NAFTA
MERCOSUL
APEC
Evaluating potential markets
Psychic proximity
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1630
Deciding How to Enter the Market
Five Modes of Entry intoForeign Markets
Direct Investment
Joint Ventures
Licensing
Direct Exporting
Indirect Exporting A m o u n t o f c o m m i t m e n t r i s k c o n t r o l a n d
p r o f i t p o t e n t i a l
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1330
Deciding Which Markets to Enter
How many markets must a company enter
The candidate countries should be initially rated on 3 majorcriteriaMarket attractiveness ndash GNPcapita work force pop growth
Competitive advantage ndash business dealings
Risk ndash stability in political currency repatriation rules
High Med Low
H China
LM Czech
L EastGermany
H Poland
HM Romania
L
CompetitiveAdvantage
Competitive Advantage
Risk
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1430
Deciding Which Markets to Enter
Prepare a financial analysis of top 3 countries Fivesteps involved in estimating the probable rate of return
on investment
Estimate of Current Market Potential ndash estimate totalindustry sales in each market task calls for using published data and primarydata collected through company surveys
Forecast of Future Market Potential and Risk ndash forecast future industry sales (difficult task) requires predicting economic andpolitical developments and impact on industry sales
Forecast of Sales Potential ndash estimating the companyrsquos salesrequires forecasting its probable market share based on its competitiveadvantage (another difficult task)
Forecasts of Costs and Profits ndash cost will depend oncompanyrsquos entry strategy company subtracts estimated costs from estimatedsales to derive company profits
Estimate of Rate of Return on Investment ndash forecastedincome stream should be related to investment stream to derive implicit rate ofreturn should be high enough to cover firmrsquos normal target return on its
investments and the risk of marketing in that country
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1530
Deciding Which Markets to Enter
Regional free trade zones
The European Union
NAFTA
MERCOSUL
APEC
Evaluating potential markets
Psychic proximity
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1630
Deciding How to Enter the Market
Five Modes of Entry intoForeign Markets
Direct Investment
Joint Ventures
Licensing
Direct Exporting
Indirect Exporting A m o u n t o f c o m m i t m e n t r i s k c o n t r o l a n d
p r o f i t p o t e n t i a l
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1430
Deciding Which Markets to Enter
Prepare a financial analysis of top 3 countries Fivesteps involved in estimating the probable rate of return
on investment
Estimate of Current Market Potential ndash estimate totalindustry sales in each market task calls for using published data and primarydata collected through company surveys
Forecast of Future Market Potential and Risk ndash forecast future industry sales (difficult task) requires predicting economic andpolitical developments and impact on industry sales
Forecast of Sales Potential ndash estimating the companyrsquos salesrequires forecasting its probable market share based on its competitiveadvantage (another difficult task)
Forecasts of Costs and Profits ndash cost will depend oncompanyrsquos entry strategy company subtracts estimated costs from estimatedsales to derive company profits
Estimate of Rate of Return on Investment ndash forecastedincome stream should be related to investment stream to derive implicit rate ofreturn should be high enough to cover firmrsquos normal target return on its
investments and the risk of marketing in that country
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1530
Deciding Which Markets to Enter
Regional free trade zones
The European Union
NAFTA
MERCOSUL
APEC
Evaluating potential markets
Psychic proximity
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1630
Deciding How to Enter the Market
Five Modes of Entry intoForeign Markets
Direct Investment
Joint Ventures
Licensing
Direct Exporting
Indirect Exporting A m o u n t o f c o m m i t m e n t r i s k c o n t r o l a n d
p r o f i t p o t e n t i a l
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1530
Deciding Which Markets to Enter
Regional free trade zones
The European Union
NAFTA
MERCOSUL
APEC
Evaluating potential markets
Psychic proximity
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1630
Deciding How to Enter the Market
Five Modes of Entry intoForeign Markets
Direct Investment
Joint Ventures
Licensing
Direct Exporting
Indirect Exporting A m o u n t o f c o m m i t m e n t r i s k c o n t r o l a n d
p r o f i t p o t e n t i a l
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1630
Deciding How to Enter the Market
Five Modes of Entry intoForeign Markets
Direct Investment
Joint Ventures
Licensing
Direct Exporting
Indirect Exporting A m o u n t o f c o m m i t m e n t r i s k c o n t r o l a n d
p r o f i t p o t e n t i a l
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1730
Deciding How to Enter the Market
Indirect and direct export
Indirect exporting
Occasional exporting
Active exporting
Domestic- Domestic-based export merchants
Domestic- Domestic-based export agents
Cooperative organizations
Export-management companies
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1830
Deciding How to Enter the Market
Companies can carry on direct exporting inseveral ways
Domestic-based export department or division
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 1930
Deciding How to Enter the Market
Licensing
Management contracts
Contract manufacturing
Franchising
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2030
Deciding How to Enter the Market
Joint ventures Direct investment
The Internationalization Process
Johanson and Wiedersheim-Paul identified fourstages in the internationalization process No regular export activities Export via independent representatives (agents) Establishment of one or more sales subsidiaries
Establishment of production facilities abroad
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2130
ASEAN countries Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
Brunei Darussalam 87839128 257635717 222184549 325586827 495720000
Cambodia 483209382 867288538 815180217 530151578 782597000
Indonesia 4914201435 6928480000 9318453649 4877369178 13303654878
Lao PDR 187310641 323520000 227770000 318598209 350000000
Malaysia 6076119971 8590185403 7375907979 1387393683 9102974458
Myanmar 278634106 257686000 283454600 322975866 756323000
Philippines 2921000000 2916000000 1544000000 1963000000 1713000000
Singapore 29347864395 37032936287 8588194480 15278566655 38638121023
Thailand 9452928923 11323987644 8531083130 4976284679 6306251509
Vietnam 2400000000 6700000000 9579000000 7600000000 8000000000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2230
ASEAN + 3 Source World Bank
Foreign Direct Investment net inflows (current US$)
Country Name 2006 2007 2008 2009 2010
China 124082036118 160051835203 175147650311 114214527413 185080744436
Japan -6783580857 22180067084 24551812047 11834116164 -1358906189
Korea Dem Rep -104620000 66730000 43800000 1970000 37656666
Korea Dem Rep 3586400000 1784400000 3310700000 2249000000 -150100000
Foreign direct investment are the net inflows of investment to acquire a lasting
management interest (10 percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor It is the sum of equity
capital reinvestment of earnings other long-term capital and short-term capital as
shown in the balance of payments This series shows net inflows (new investment
inflows less disinvestment) in the reporting economy from foreign investors
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2330
Deciding on the Marketing Program
Standardized marketing mix
Adapted marketing mix
Product
Straight Extension Product adaptation Product invention
Backward invention Forward invention
Promotion Communication adaptation Dual adaptation
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2430
Deciding on the Marketing Program
Price
Price escalation Companies have three choices Set a uniform price everywhere Set a market-based price in each country
market Set a cost-based price in each country cost
Transfer price
Dumping price
Armrsquos-length price
Gray market
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2530
Deciding on the Marketing Program
Place (distribution channels)
Sellerrsquos international marketing
headquarters
Channels between nations
Channels within foreign nations
Seller
Sellerrsquos international marketing headquarters
Channels betweennations
Channels within foreign
nations
Final buyers Whole-Channel Concept
for International Marketing
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2630
Deciding on the Marketing Organization
Export department
International division
Geographical organizations
World product groups
International subsidiaries
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2730
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2830
Deciding on the Marketing Organization
Global organization Bartlett and Ghoshal distinguish three organizational
strategiesA global strategy treats the world as a single
market
A multinational strategy treats the world as aportfolio of national opportunities A ldquoglocalrdquo strategy standardizes certain core
elements and localizes other elements
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 2930
Filipino companies who made globalJollibee Foods Corp 1974 - started with 2 branches
1984 - Php 500M Sales mark Top 500 Phil Corp 1987 - Top 1000 Phil Corp 1989 - 1st Phil Fast Food Chain to break Php 1B Sales mark In 32 years company has 600 local stores and over 50 international
stores USA 25
Vietnam 23 Brunei 11 Saudi Arabia 8 Qatar 1 Hongkong 1
Chowking 1985 - started with 2 branches Company has 400 local stores and 10 international stores
in USA Middle East Indonesia Revenue (2007) ndash Php 101B
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc
832019 Impact of Globalization to International Marketing
httpslidepdfcomreaderfullimpact-of-globalization-to-international-marketing 3030
Other Companies
Company Revenue Geographic Region
Toyota Motors (2011)
US $236B
Japan NorthAmerica EuropeAsia others
Mitsubishi Motors (2009)Y 1445616M
Japan NorthAmerica Phil BrazilThailand Netherlands
Hyundai Motors (2010)
US $336B
North AmericaEurope Turkey
China othersKia Motors (2010)
US $216B
S Korea NorthAmerica EuropeChina Vietnam etc