Chapter 1: Scope, Concepts, and Drivers of International Marketing
TRUE/FALSE
1. The U.S. consumes more than 25% of worldwide products and services.
2. International companies such as General Motors, Mitsubishi, Microsoft, and Exxon earn profits greater
than the Gross Domestic Product of many developing countries.
3. Companies from small countries have difficulty in succeeding internationally, as their income cannot
be supported by a large market at home.
4. In the future, postal services might constitute the new competitive territory of international companies.
5. A company engaging in domestic marketing has the least commitment to international marketing.
6. A company engaging in export marketing has the least commitment to international marketing.
7. Export marketing requires a substantial focus on consumers in the international target market.
8. International marketing is defined as the processes involved in the creation, production, distribution,
promotion and pricing products, services, ideas and experiences for international markets.
9. Global marketing activities are not coordinated across different countries, nor across different regions.
10. Firms with an ethnocentric orientation are guided by a domestic market extension concept.
11. Firms with an ethnocentric orientation consider that the purpose of their international operations is to
identify markets that could absorb surplus domestic production.
12. Disney has an ethnocentric philosophy that is manifest in its international operations.
13. Polycentric firms are likely to be highly centralized.
14. Firms with a regiocentric orientation are guided by a multidomestic market concept.
15. Firms with a polycentric orientation are guided by a multidomestic market concept.
16. Each subsidiary in an ethnocentric organization has its own marketing plans and objectives and
operates autonomously as an independent profit center on an individual country basis.
17. Firms with a regiocentric or a geocentric orientation are guided by a global marketing concept.
18. Firms with a regiocentric or a polycentric orientation are guided by a global marketing concept.
19. The objective of a geocentric company is most often to achieve a position as a low-cost manufacturer
and marketer of its product line.
20. McDonald’s has been successful because of its ethnocentric philosophy.
21. IBM has always had a geocentric orientation.
22. Organizing the firm on the basis of function, rather than on the basis of country of operations,
demonstrates a geocentric internationalization philosophy.
23. Local firms targeting their products to local consumers are dependent on equipment, parts, and/or raw
materials originating abroad.
24. Competition, regional economic integration, and technology are examples of Business Environment
Drivers.
25. Competitive pressure is frequently a driver of internationalization.
26. Economic integration does not benefit companies from non-member states.
27. A subsidiary of a company from the United States incorporated in any country of the European Union
is a corporate citizen of the European Union.
28. Much of the outsourcing of customer service to developing countries is largely attributed to
improvements in telecommunication.
29. Economic growth is not an important driver of internationalization.
30. Emerging economies in general are less open to foreign trade and severely limit international firms
operating in these markets.
31. An important outcome of the transition of the former Eastern Bloc countries to a market economy has
been the deregulation and privatization of former government monopolies.
32. Companies investing in large transition economies, such as China, reap the greatest return on their
investment.
33. Uniform consumer segments worldwide are every marketer’s hope. However, it is impossible to have
uniform segments as long as consumer preferences are so diverse.
34. Although the product life cycle is an important marketing consideration in domestic marketing, it has
little affect on the international expansion of a firm.
35. A main driver of international expansion is a firm’s attempt to prolong the life cycle of its products.
36. New Product Development costs are not at all related to the product life cycle.
37. During the introduction stage of the product lifecycle, the core product is likely to achieve a standard
in a particular industry.
38. The U.S. market is very large. As a result, companies are likely to quickly recover their product
development costs and make a profit as well, if its sales are limited to the U.S.
39. Firms in the introductory stage of the product life cycle are most likely to move manufacturing
operations and facilities abroad, to developing countries, in an attempt to take advantage of
significantly lower labor costs.
40. Colgate-Palmolive developed its successful Axion paste for washing dishes by hand after observing
the dish washing behavior of Latin American women.
41. Experience transfers are limited to product manufacturers.
42. It is important for the firm to adapt to the local business environment in order to serve the needs of
local consumers.
43. Companies attempting to establish and maintain an international presence are likely to encounter
obstacles to internationalization both from within the company and from outside.
44. The self-reference criterion helps the firm to adapt as it expands operations to international markets.
45. In Japan, similarly to the U.S., looking one’s counterpart in the eyes conveys directness and honesty.
46. The first step in minimizing the impact of the self-reference criterion is selecting appropriate personnel
for international assignments.
47. Local content requirements are sometimes used by national governments to restrict or impede the
entrance of international firms.
48. Members of regional economic integration agreements such as NAFTA frequently use tariffs as a
means of restricting international expansion of companies in the countries’ territories.
49. Competition can be both a driver of internationalization and a barrier to new entrants in a market.
50. Marlboro’s primary defensive marketing strategy in foreign countries is to decrease prices by as much
as one-third.
MULTIPLE CHOICE
1. The United States provides about ____ of the worldwide products and services
a.
5%
c.
25%
b.
15%
d.
35%
2. Recently, privatization in countries where government monopolies have dominated for decades has
made it possible for multinationals to compete in each of the following industries EXCEPT:
a.
airlines
c.
railway
b.
postal services
d.
telecommunications
3. In which type of marketing does a firm have the least commitment to international marketing?
a.
Domestic marketing
c.
International marketing
b.
Export marketing
d.
Global marketing
4. The firm is most likely to have an ethnocentric orientation when it engages in ____.
a.
Export marketing
c.
Multinational marketing
b.
International marketing
d.
Global marketing
5. Which type of marketing best describes a company’s approach to international marketing if the
company is present in different countries with sales offices, subsidiaries, or is an active partner in
strategic alliances with local companies and that does not coordinate activities across the different
countries or regions.
a.
Domestic marketing
c.
International marketing
b.
Export marketing
d.
Global marketing
6. Which of the following approaches to international marketing involvement best describes a company
that coordinates activities across different countries or regions?
a.
Domestic marketing
c.
International marketing
b.
Export marketing
d.
Global marketing
7. Which type of marketing involves marketing activities across different countries without focusing
primarily on national or regional segmentation?
a.
Domestic marketing
c.
Multinational marketing
b.
Export marketing
d.
Global marketing
8. The EPRG Framework of international orientation stands for:
a.
economics, psychographics, regulations, & geographics
b.
enter, produce, react, & group
c.
ethnicity, polychronic, regulations, & global expansion
d.
ethnocentric, polycentric, regiocentric, & geocentric
9. Eli Lilly is a(n):
a.
ethnocentric firm
c.
polychronic firm
b.
polycentric firm
d.
regiocentric firm
10. When a company believes that domestic strategies, techniques, and personnel are superior to foreign
ones it is using a(n):
a.
ethnocentric orientation
c.
regiocentric orientation
b.
polycentric orientation
d.
geocentric orientation
11. Firms that view international markets solely as markets where they could unload excess production
have a(n):
a.
ethnocentric orientation
c.
regiocentric orientation
b.
polycentric orientation
d.
geocentric orientation
12. Firms with a polycentric orientation are guided by a:
a.
domestic market extension concept
c.
global marketing concept
b.
multidomestic market concept
d.
none of the above
13. Firms with a regiocentric orientation are guided by a:
a.
domestic market extension concept
c.
global marketing concept
b.
multidomestic market concept
d.
none of the above
14. Companies view world regions as distinct markets that share economic, political, and/or cultural traits
such that they would be viable candidates for a regionwide marketing approach.
a.
ethnocentric orientation
c.
regiocentric orientation
b.
polycentric orientation
d.
geocentric orientation
15. Firms where top management adopts a geocentric orientation perceive the world:
a.
to be similar to the home country
b.
to have regional segmentation possibilities
c.
to lack national and regional distinctions
d.
to have heterogeneous preferences
16. Firms with a geocentric orientation:
a.
pursue a differentiation strategy
b.
position themselves as a low-cost manufacturer
c.
frequently need to engage in “guerilla” marketing
d.
none of the above
17. When Ford stopped making the Escort look different in every market and moved to an identical look
for all markets, it moved from a polycentric strategy to this kind of strategy.
a.
ethnocentric orientation
c.
regiocentric orientation
b.
polycentric orientation
d.
geocentric orientation