Global Marketing 9th Edition

CHAPTER 1 INTRODUCTION TO GLOBAL MARKETING SUMMARY A. Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders. A company that engages in global marketing focuses resources on global market opportunities

Management Orientations (Learning Objective #5) The form and substance of a companys response to global market opportunities will depend greatly on its managements assumptions and beliefs both conscious and unconscious - about the nature of the world. The world view of a companys personnel can be described as ethnocentric, polycentric, regiocentric,

TEACHING TOOLS AND EXERCISES Additional Cases: "GENICON: A Surgical Strike into Emerging Markets" by Allen H. Kupetz; Adam P. Tindall; Gary Haberland. June 2010, HBS: 910M41-PDF-ENG. "Market Stretch" by Gavin Price and Margaret Sutherland. June 2009. HBS: 909M46-PDF- ENG. Global Brand Face-Off, HBR Case Study and Commentary RO 306A. Anand P. Raman, Peter M.

DISCUSSION QUESTIONS 1-1. What are the basic goals of marketing? Are these goals relevant to global marketing? Marketing activities represent an organizations efforts to satisfy customer wants and needs by offering products and services that create value. These goals are relevant in virtually every part of the world; however, when an organization

CHAPTER 10 BRAND AND PRODUCT DECISIONS IN GLOBAL MARKETING SUMMARY A. The product is the most important element of a companys marketing program. Global marketers face the challenge of formulating coherent product and brand strategies on a worldwide basis. A product can be viewed as a collection of tangible and intangible attributes

EXTEND, ADAPT, CREATE: STRATEGIC ALTERNATIVES IN GLOBAL MARKETING (Learning Objective #5) To capitalize on opportunities outside the home country, company managers must devise and implement appropriate marketing programs. Depending on organizational objectives and market needs, a particular program may consist of extension strategies, adaptation strategies, or a combination of the two. The

DISCUSSION QUESTIONS 10-1. What is the difference between a product and a brand? A product can be defined as a collection of tangible and intangible attributes. The former include physical features, design attributes, and packaging. The chrome on a Harley- Davidson motorcycle is a physical attribute, as are cup holders in a minivan.

CHAPTER 11 PRICING DECISIONS SUMMARY A. Pricing decisions are a critical element of the marketing mix that must reflect costs, competitive factors, and customer perceptions regarding value of the product. In a true global market, the law of one price would prevail. Pricing strategies include market skimming, market penetration, and market holding. Novice

GLOBAL PRICING: THREE POLICY ALTERNATIVES (Learning Objective #5) There are three alternative positions a company can take on worldwide pricing. Extension or Ethnocentric The first can be called an extension or ethnocentric pricing policy. An extension or ethnocentric pricing policy calls for the per-unit price of an item to be the same

DISCUSSION QUESTIONS 11-1. What are the basic factors that affect price in any market? What considerations enter into the pricing decision? One factor is the price floor, which can be linked to product cost or some other consideration. For example, in the fall of 1996, Florida tomato growers concerned about cheap tomatoes

CHAPTER 12 GLOBAL MARKETING CHANNELS AND PHYSICAL DISTRIBUTION SUMMARY A. A channel of distribution is the network of agencies and institutions that links producers with users. Physical distribution is the movement of goods through channels. Business to-consumer marketing uses consumer channels; business-to-business marketing employs industrial channels to deliver products to manufacturers or other

PHYSICAL DISTRIBUTION, SUPPLY CHAINS, and LOGISTICS MANAGEMENT (Learning Objective #4) In Chapter 1, marketing was described as one of the activities in a firm's value chain. The distribution P of the marketing mix is a critical value chain activity. Physical distribution consists of activities involved in moving finished goods from manufacturers to customers.

DISCUSSION QUESTIONS 12-1. In what ways can channel intermediaries create utility for buyers? The major categories of channel utility are: place utility (the availability of a product or service in a location that is convenient to a potential customer), time utility (the availability of a product or service when desired by a

CHAPTER 13 GLOBAL MARKETING COMMUNICATIONS DECISION I: ADVERTISING AND PUBLIC RELATIONS SUMMARY A. Marketing communicationsthe promotion P of the marketing mix includes advertising, public relations, sales promotion, and personal selling. When a company embraces integrated marketing communications (IMC), it recognizes that the various elements of a company's communication strategy must be carefully coordinated. Advertising

Global Media Decisions (Learning Objective #4) The next issue facing advertisers is which medium or media to use when communicating with target audiences. Media availability can vary from country to country. Some companies use virtually the entire spectrum of available media; Coca-Cola is a good example. Other companies prefer to utilize

DISCUSSION QUESTIONS 13-1. In what ways can global brands and global advertising campaigns benefit a company? The Chapter 11 opening quotation by the Colgate executive applies here; You get a lot more benefit and you can do a lot more with a global brand than you can with a local brand. Fundamentally,

CHAPTER 14 GLOBAL MARKETING COMMUNICATIONS DECISIONS II: SALES PROMOTION, PERSONAL SELLING, SPECIAL FORMS OF MARKETING COMMUNICATION SUMMARY A. Sales promotion is any paid, short-term communication program that adds tangible value to a product or brand. Consumer sales promotions are targeted at ultimate consumers; trade sales promotions are used in business-to-business marketing. Sampling gives

SPECIAL FORMS OF MARKETING COMMUNICATIONS: DIRECT MARKETING, SUPPORT MEDIA, EVENT SPONSORSHIP, AND PRODUCT PLACEMENT (Learning Objective #3) The Direct Marketing Association defines direct marketing as any communication with a consumer or business recipient that is designed to generate a response in the form of an order, a request for further information,

DISCUSSION QUESTIONS 14-1. Briefly review how the main tools of sales promotion (e.g., sampling and couponing) can be used in global markets. What issues and problems can arise in different country markets? Sampling is likely to result in actual trial of the product in global markets. For example, in China, shoppers are

CHAPTER 15 GLOBAL MARKETING AND THE DIGITAL REVOLUTION SUMMARY A. The digital revolution has created a global electronic marketplace. The revolution has gained momentum over the course of 75-plus years, during which time technological breakthroughs included the digital mainframe computer; the transistor; the integrated circuit; the personal computer; the spreadsheet, the PC

NEW PRODUCTS AND SERVICES (Learning Objective #6) The digital revolution has spurred innovation in many different industries. Companies in all parts of the world are developing a new generation of products, services, and technologies. These include broadband networks, mobile commerce, wireless connectivity, and smartphones (Exhibit 15-6). Broadband A broadband communication system is

DISCUSSION QUESTIONS 15-1. Briefly review the key innovations that culminated in the digital revolution. What is the basic technological process that made the revolution possible? The origins of the digital revolution can be traced back to the mid-twentieth century; between 1937 and 1942, Atanasoff and Berry developed the electronic digital computer. In

CHAPTER 16 STRATEGIC ELEMENTS OF COMPETITIVE ADVANTAGE SUMMARY A. In this chapter we focused on factors that help industries and countries achieve competitive advantage. According to Porter's five forces model, industry competition is a function of the threat of new entrants, the threat of substitutes, the bargaining power of suppliers and buyers, and

Demand Conditions The nature of home demand conditions for the firm's products and services is important because it determines the rate and nature of improvement and innovation by the firms in the nation. Demand conditions are the factors that either train firms for world-class competition or that fail to adequately prepare

DISCUSSION QUESTIONS 16-1. Outline Porter's five forces model of industry competition. How are the various barriers to entry relevant to global marketing? The first force, the threat of new entrants, depends on the presence or absence of barriers to entry. As industries globalize, the threat on new entrants into national markets increases.

CHAPTER 17 LEADERSHIP, ORGANIZATION, AND CORPORATE SOCIAL RESPONSIBILITY SUMMARY A. To respond to the opportunities and threats in the global marketing environment, organizational leaders must develop a global vision and strategy. Leaders must also be able to communicate that vision throughout the organization and build core competencies on a worldwide basis. Global companies

LEAN PRODUCTION: ORGANIZING THE JAPANESE WAY (Learning Objective #3) In the automobile industry, a comparison of early craft production processes, mass production, and modern lean production provides an interesting case study of the effectiveness of new organizational structures in the twenty-first century. The advantage of the mass producers lasted until the Japanese

DISCUSSION QUESTIONS 17-1. Are top executives of global companies likely to be home-country nationals? In a truly global company, the person chosen to the top executive job should be the best person for that job, irrespective of nationality, however, this question states likely and since top executives are often chosen by Boards

CHAPTER 2 THE GLOBAL ECONOMIC ENVIRONMENT SUMMARY A. The economic environment is a major determinant of global market potential and opportunity. In todays global economy, capital movements are the driving force, production is uncoupled from employment, and capitalism has vanquished communism. Based on patterns of resource allocation and ownership, the world's economies can

Marketing Opportunities in LDCs and Developing Countries Despite many problems in LDCs and developing countries, it is possible to nurture long-term market opportunities. Although Nike sells only a small portion of its output in China, it clearly has the future in mind when it refers to China as a two-billion-foot market. Prahalad

DISCUSSION QUESTIONS 2-1. The seven criteria for describing a nations economy introduced at the beginning of this chapter can be combined in a number of different ways. For example, the United States can be characterized as follows: Type of economy: Advanced industrial state Type of government: Democracy with a multi-party system Trade

CHAPTER 3 THE GLOBAL TRADE ENVIRONMENT SUMMARY A. This chapter examines the environment for world trade, focusing on the institutions and regional cooperation agreements that affect trade patterns. B. The multilateral World Trade Organization, created in 1995 as the successor to the General Agreement on Tariffs and Trade, provides a forum for settling

ASIA-PACIFIC: The Association of Southeast Asian Nations (ASEAN) (Learning Objective #5) The Association of Southeast Asian Nations (ASEAN) was established in 1967 as an organization for economic, political, social, and cultural cooperation among its member countries. The original six members of ASEAN were: Brunei Indonesia Malaysia the Philippines Singapore Thailand Vietnam became

DISCUSSION QUESTIONS 3-1. Explain the role of the World Trade Organization. Why has the Doha Round of trade talks stalled? The World Trade Organization (WTO) is the successor to GATT. Based in Geneva, the WTO has a dispute-settlement body (DSB), representing all member countries, that mediates trade complaints concerning unfair trade

CHAPTER 4 SOCIAL AND CULTURAL ENVIRONMENTS SUMMARY A. Culture, a societys programming of the mind, has both a pervasive and changing influence on each national market environment. Global marketers must recognize the influence of culture and be prepared to either respond to it or change it. Human behavior is a function of a

THE SELF-REFERENCE CRITERION (Learning Objective #4) A persons perception of market needs is framed by his or her own cultural experience. A framework for reducing perceptual blockage and distortion was developed by James Lee. The unconscious reference to ones own cultural values is the self-reference criterion (SRC). To eliminate

DISCUSSION QUESTIONS 4-1. What are some of the elements that make up culture? How do these find expression in your native culture? This question can be especially interesting if there is multicultural representation among your students. Ask students from other countries to prepare a list of cultural anomalies that they have found

CHAPTER 5 THE POLITICAL, LEGAL, AND REGULATORY ENVIRONMENTS SUMMARY A. The political environment of global marketing is the set of governmental institutions, political parties, and organizations that are the expression of the people in the nations of the world. In particular, anyone engaged in global marketing should have an overall understanding of the

Innovation, Entrepreneurship, and the Global Startup Travis Kalanick and Uber Travis Kalanick is an entrepreneur. He developed an innovative product, created a brand, and started a company to market it. As is true with many entrepreneurs, Kalanicks idea was based on recognition of his own needs and wants. Garret Camp and Kalanick

DISCUSSION QUESTIONS 5-1. Describe some of the sources of political risk. Specifically, what forms can political risk take? Political risk increases when a country experiences a currency crisis, when there is civil disorder, or ethnic unrest. Political risk manifests itself in the form of various restrictions on organizational activities the most extreme

CHAPTER 6 GLOBAL INFORMATION SYSTEMS AND MARKET RESEARCH SUMMARY A. Information is one of the most basic ingredients of a successful marketing strategy. A company's management information system (MIS) and intranet provides decision makers with a continuous flow of information. Information technology is profoundly affecting global marketing activities by allowing managers to access

Issues in Data Collection The research problem may be more narrowly focused on marketing issues, such as the need to adapt products and other mix elements to local tastes and to assess demand and profit potential. Existing markets are those in which one or more companies are already serving customer

DISCUSSION QUESTIONS 6-1. Explain how information technology puts powerful tools in the hands of global marketers. Electronic data interchange (EDI), electronic point of sale (EPOS), efficient consumer response, and data warehouses are some of the new tools and techniques available. Speed, innovation, and efficiency are some of the imperatives driving global

CHAPTER 7 SEGMENTATION, TARGETING, AND POSITIONING SUMMARY A. The global environment must be analyzed before a company pursues expansion into new geographic markets. Through global market segmentation, a company can identify and group customers or countries according to common needs and wants. Demographic segmentation can be based on country income and population, age,

A Framework for Selecting Target Markets As one can infer from this discussion, it would be extremely useful to have formal tools or frameworks available when assessing emerging country markets. Table 7-6 presents a market selection framework that incorporates some of the elements just discussed. Using China, Russia, and Mexico

DISCUSSION QUESTIONS 7-1. In a recent interview, a brand manager at Procter & Gamble noted, Historically, we used to be focused on discovering the common hopes and dreams within a country, but now were seeing that the real commonalities are in generations across geographic borders. What is the significance of this comment

CHAPTER 8 IMPORTING, EXPORTING, AND SOURCING SUMMARY A. A companys first business dealings outside the home country often take the form of exporting or importing. Companies should recognize the difference between export marketing and export selling. By attending trade shows and participating in trade missions, company personnel can learn a great deal about

KEY EXPORT PARTICIPANTS (Learning Objective #5) Export participants include: purchasing agents, export brokers, and export merchants, who have no assignment of responsibility. Others, including export management companies, manufacturers export representatives, export distributors, and freight forwarders, are assigned responsibilities by the exporter. Foreign purchasing agents are variously referred to as buyer for

DISCUSSION QUESTIONS 8-1. What is the difference between export marketing and export selling? Export selling basically presents an extension strategy whereby products are offered for sale outside the home country without adaptation. The mindset of export selling is, Heres the product, take it or leave it. One symptom of export selling would

CHAPTER 9 GLOBAL MARKET ENTRY STRATEGIES: LICENSING, INVESTMENT, AND STRATEGIC ALLIANCES SUMMARY A. Companies that wish to move beyond exporting and importing can avail themselves of a wide range of alternative market entry strategies. Each alternative has distinct advantages and disadvantages associated with it; the alternatives can be ranked on a continuum representing

INTERNATIONAL PARTNERSHIPS IN DEVELOPING COUNTRIES (Learning Objective #4) Central and Eastern Europe, Asia, India, and Mexico offer opportunities to enter gigantic and largely untapped markets. An obvious strategic alternative for entering these markets is the strategic alliance. Potential partners trade market access for expertise. Assuming that risks can be minimized and

DISCUSSION QUESTIONS 9-1. What are the advantages and disadvantages or using licensing as a market entry tool? Give examples of companies from different countries that use licensing as a global marketing strategy. Licensing: Advantages: Low cost entry alternative Allows licensor to circumvent tariffs, quotas, or similar export barriers Limits political risk

After Fidel Castro took power in Cuba in 1959, his government seized control of American property without paying compensation. Coca-Cola, DuPont, Texaco, and dozens of other American companies have filed claims against Cuba seeking financial settlements. Which of the following terms most specificallydescribes the action Castro took against these companies? A)

Some company executives become so committed to a current, profitable technology that they fail to provide adequate levels of investment in new, apparently riskier technologies. Answer: TRUE Answer: TRUE Answer: TRUE Yong Nam, CEO of LG, recently stipulated that Chinese would be required throughout the company. He explained that the speed of innovation

The United States' growing trade deficit reflects a number of factors which exclude: A) increased imports from China. B) a seemingly insatiable consumer demand for imported goods. C) the enormous cost of military operations in the Middle East. D) the services trade surplus. E) record goods sales to developing countries. Answer: D Answer: D Answer: D A firm

The terminology used to describe the new forms of cooperation strategies varies widely and the phrases used include all of the following except: A) collaborative agreements. B) strategic alliances. C) global strategic partnerships. D) strategic international alliances. E) Greenfield operations. Answer: E Answer: E Answer: E Which of the following statements does not reflect the changes that have

According to the forecast regarding online retail sales among select European countries by the year 2018 Germany will be ranked at the top in the region. Answer: FALSE Answer: FALSE Answer: FALSE "Export selling" involves tailoring various elements of the marketing mix to global market requirements. Answer: FALSE Answer: FALSE Answer: FALSE Robust economic growth and

Secondary stakeholders include all of the following except: A) media. B) employees. C) local community groups. D) nongovernmental organizations. E) general business community. Answer: B Answer: B Answer: B Chinese direct-response television has learned that there are many obstacles that still need to be overcome, which include all of the following except: A) consumers' savings rate is very

Global market segmentation is based on the premise that companies should attempt to identify consumers in different countries who share similar needs and desires. Answer: TRUE Answer: TRUE Answer: TRUE In developing countries, globalization's opponents accuse companies of placing intellectual property rights ahead of human rights. Answer: TRUE Answer: TRUE Answer: TRUE A critical factor in

Michael Porter's generic strategy framework is derived from the basic types of competitive advantage and the scope of the target market served. Answer: TRUE Answer: TRUE Answer: TRUE If government restrictions prevent 100 percent ownership by foreign companies, the investing company will have to settle for a majority or minority equity stake. Answer:

Porsche relies on currency hedging rather than price increases to boost pretax profits on sales of its automobiles. What is the advantage of doing this, and how does hedging work? Answer: Hedging exchange rate exposure involves establishing an offsetting currency position suchthat the loss or gain of one currency position is

Every commercial transaction is based on a contract of sale, and the trade terms in that contract specify the exact point at which the ownership of merchandise is transferred from the seller to the buyer and which party in the transactions pays which cost. Answer: TRUE Answer: TRUE Answer: TRUE In global marketing

When Walmart came to Brazil in the mid-1990s, it discovered that local competitors did not have the technological infrastructure that allowed them to match its aggressive pricing policies. Answer: FALSE Answer: FALSE Answer: FALSE Licensing agreements offer limited market control since the licensee typically does not become involved in the licensor's marketing program. Answer:

Which of the following is not characteristic of direct marketing? A) A marketer relinquishes control of product when it is turned over to channel intermediaries. B) Advertising serves to generate an immediate inquiry or purchase. C) Repetition is used in individual advertisements. D) The customer perceives high risk. E) Direct response advertising is used. Answer:

In 2013, the 10 most populous countries in the world accounted for just over ________ percent of the world income. A) 20 B) 30 C) 40 D) 50 E) 60 Answer: E Answer: E Answer: E The sales of the Apple watch increased when customers were informed about various functions of the watch. This change in sales reflects

The use of the color ________ dates back millennia as seen by artisans in ancient Egypt, China, and Mayan civilizations and is now associated with royalty and divinity. A) red B) green C) blue D) orange E) brown Answer: C Answer: C Answer: C Which of the following methods of financing would be used if the exporting and

The term "polycentric" describes management's belief or assumption that each country in which a company does business is the same as the home country business. Answer: FALSE Answer: FALSE Answer: FALSE Being socially responsible is the only the right thing to do; it can distinguish a company from its industry peers. Answer: FALSE Answer: FALSE Answer:

When British entrepreneur Richard Branson opened the first Virgin Megastore in Japan, he did so by establishing a joint venture with the Marui retailing chain. This represents an inappropriate market-entry approach for a global retailer. Answer: FALSE Answer: FALSE Answer: FALSE GATT (General Agreement on Tariffs and Trade) agreement had no enforcement power since

Ethnocentric pricing responds to the competitive and market conditions of national market. Answer: FALSE Answer: FALSE Answer: FALSE "Export price escalation" is the increase in the initial selling price of goods traded across borders. Answer: FALSE Answer: FALSE Answer: FALSE Aesthetic elements that are attractive, appealing, and in good taste are perceived as decent and accepted

Former Disney chairman Michael Eisner and other company executives were blinded by ethnocentrism. Avoiding the Self-Reference Criterion (SRC) requires a person to suspend assumptions based on prior experience and success and be prepared to acquire new knowledge about human behavior and motivation. Answer: TRUE Answer: TRUE Answer: TRUE Colgate discovered that in Spanish

Cultural influences are also quite apparent in food preparation and consumption patterns and habits. Domino's Pizza, the world's largest pizza-delivery company, pulled out of Italy because: A) its tomato sauce was too bold and competed with Italian products. B) people did not like to eat at home. C) Italians perceived its products to

Which of the following correctly characterizes the retailing strategy of Benetton, IKEA, and Gap? A) few product categories, own-label focus B) few product categories, manufacturer brand focus C) many product categories, own-label focus D) many product categories, manufacturer brand focus E) none of the above Answer: A Answer: A Answer: A Japan is Coach's second largest market, representing about

Brazil, China, and India are classified as upper-middle income countries, also known as industrialized or developing countries. Answer: FALSE Answer: FALSE Answer: FALSE An express warrantyis a written guarantee that assures the buyer that he or she is getting what he or she has paid for or that provides recourse in case a product's

The concentration of wealth in a handful of industrialized countries has significant implications for global marketers. After segmenting in terms of a single demographic variable"income" a company can reach the most affluent markets which does not include: A) half of the EU nations B) all of North America C) Canada and Mexico D) 90

The DMBB (D'arcy Massius Benton & Bowles) agency created a psychographic profile of the Russian market. The categories include all of the following except: A) Kuptsy. B) Cossacks. C) Elites. D) Students. E) Business Executives. Answer: C Answer: C Answer: C When a survey questionnaire in English is translated into Korean for use in South Korea and then

Anheuser-Busch, the brewer of Budweiser beer, lost its independence after years of focusing primarily on the U.S. market. Answer: TRUE Answer: TRUE Answer: TRUE Sometimes it is preferable to market to a particular age group rather than a mind-set; in such an instance, psychographic studies can help marketers arrive at a deeper understanding

Apple, Levi Strauss, Nike, Sony, well-known fashion design houses, and other companies with strong brands sometimes establish flagship retail stores as a means of obtaining marketing intelligence. Answer: TRUE Answer: TRUE Answer: TRUE The foreign exchange market consists literally of a buyer's and a seller's market where currencies are traded for both spot

The Swatch Group is the world's second largest watchmaker. This shows that in the low-cost segment, brands compete on price and value. Answer: TRUE Answer: TRUE Answer: TRUE An ad valorem duty is expressed as a percentage of the value of goods. Answer: TRUE Answer: TRUE Answer: TRUE Dove, a division of Unilever, traditionally targeted men

Red Bull energy drink manufacturer, Dietrich Mateschitz, hired a market research firm to assess the market potential for the drink. In the tests, consumers reacted negatively to the taste, the logo, and the brand name. The company ignored the research completely. Answer: TRUE Answer: TRUE Answer: TRUE Scotland's top export category is information technology.

Nokia's reversal of fortune at the hands of Apple and Google underscores the fact that today's executives must rethink the concept of the corporation if they wish to operationalize the concept of core competencies. Answer: TRUE Answer: TRUE Answer: TRUE Today, market capitalism is widely practiced around the world, most notably in North

To motivate shopkeepers to stock more of P&G's products, the company launched a: A) door-to-door program. B) retail store program. C) golden store program. D) hypermarket program. E) sole distributor program. Answer: C Answer: C Answer: C Competitive advertising may impair the effectiveness of the message due to the fact that it may: A) not reach the intended recipient. B)