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.
Scotland’s top export category is information technology.
The skimming pricing strategy is appropriate in the mature phase of the product life
cycle.
Apple’s success with the iPhone prompted Samsung and others to enter the market. This
is an example of the “perfect competition.”
The Customs Trade Partnership Against Terrorism (C-TPAT) recognizes that U.S.
Customs and Border Protection (CBP) is responsible for screening import cargo
transactions.
Many countries took issue with the U.S. system of antidumping laws, in part because
historically, the U.S. Commerce Department almost always ruled in favor of the U.S.
company that filed the complaint.
A company that has developed a successful local product or brand cannot implement an
adaptation strategy.
Sony entered into a strategic partnership with Samsung in order to produce flat-panel
TV screens due to the high product development costs.
In China, regulations require foreign franchisers to directly own two or more stores for
a minimum of one year before franchising.
Westerners doing business in the Middle East must be careful not to reveal the soles of
their shoes to hosts or pass documents with the left hand.
Nike dropped its well-known tag line “Just do it” in advertising women’s clothing in
Europe and replaced it with slogan “Here I am” since college-age women in Europe are
not as competitive about sports as men are.
By the end of 2012, Groupon had more than 40 million users in 48 countries. More than
half of Groupon’s Web site visitors live in the United States.
A global company possesses the unique opportunity to develop leverage.
In South Korea, the Netherlands, Greenland, the UAE, Bahrain, and Qatar, more than
90 percent of the population is online.
The reason why Saks Fifth Avenue has licensed stores in the Middle East is to limit
their risk when targeting unfamiliar, difficult-to-enter markets.
Chile decided to become only an associate member of Mercosur and hence participates
in the free trade area aspect of Mercosur as well as the customs union.
Starbucks dropped the word “Coffee” from its logo when it acquired a juice maker and
a bakery. This is an example of “diversification.”
India, Pakistan, Malaysia, Korea, and Japan have common-law jurisdictions.
Late movers in global markets can never succeed even by developing innovative
business models.
According to the recent import regulations in the United States, action figures that
represent non-human creatures such as monsters or robots are categorized as toys and
qualify for lower duties than human figures that are classified as dolls.
A lesson that can be learned from Anheuser-Busch’s experience in Japan is that it is
better to give control to a local partner via a licensing agreement rather than making a
major investment.
Microsoft’s extensive base of Windows operating systems and applications presented a
formidable entry barrier for many years.
In an effort to facilitate exports, countries are designating certain areas as “free trade
zones” (FTZ) or ‘special economic zones” (SEZ).
Microsoft and Intel are two companies that illustrate the concept of “bargaining power
of suppliers” in Porter’s five forces model of industry competition.
British Petroleum, British Airways, and Rolls-Royce were some of the companies that
were privatized under so-called Thatcherite economics.
The challenge of encoding and decoding slogans and taglines in different national and
cultural contexts can lead to unintentional errors.
According to the worldwide revenue figures for 2014, Omnicom Group is the world’s
largest advertising organization.
Companies using “rigid cost-plus pricing” set prices with adjustments to reflect market
conditions outside the home country.
The terms “export selling” and “export marketing” are interchangeable.
In Michael Porter’s model, “buyers” refers to manufacturers (e.g., GM) and retailers
(e.g. Walmart), rather than consumers.
Free alongside ship (FAS) named port is the Incoterm for a transaction in which the
seller places the shipment alongside the vessel upon which the goods will be
transported out of the country.
Japanese keiretsu executives can legally sit on each other’s boards, share information,
and coordinate prices in closed-door meetings of “presidents’ councils.”
Which of the following correctly reflects marketing expert David Arnold’s
recommendations for companies engaged in global market research?
A) use multiple indicators
B) develop customized measures specific to an industry or product
C) conduct comparative assessments in neighboring countries
D) observation should be weighted more heavily than statements of purchase intention
E) all of the above
A logo can be all of the following except:
A) Word Mark
B) Non-word Mark
C) Brand symbol
D) Brand equity
E) Trade Mark
Implementation of the Central American Free Trade Agreement with the United States
created a free trade area known as DR-CAFTA.
The export and import process can entail red tape and bureaucratic delays. In an effort
to facilitate exports, countries are designating certain areas as:
A) import control zones.
B) special tariff zones.
C) global business zones.
D) free trade zones.
E) duty free zones.
________issometimes called a mother hen, a piggyback exporter, or an export vendor
A) Export broker
B) Export merchant
C) Cooperative exporter
D) Export manager
E) Manufacturer’s agent
Insisting on competitive bidding can cause complications in:
A) low-context cultures
B) high-context cultures.
C) low and high context cultures.
D) Korean cultures.
E) Japanese cultures.
Examples of effective global marketing by McDonald’s include both standardized and
localized marketing mix elements. Which of the following does not represent a
localized element?
A) It serves McAloo tikki potato burger in India.
B) It uses the advertising slogan “I’m lovin’ it.”
C) It operates themed dining cars on the Swiss national rail system.
D) It has home delivery service in India.
E) It has slang nicknames such as MakDo in the Philippines and McDo in France.
Building layers of advantage is one of the elements of Hamel and Prahalad’s framework
for:
A) quality advantage.
B) positioning.
C) competitive innovation.
D) marketing management.
E) innovation leadership.
Which of the following is arranged starting with the highest level of environmental
sensitivity and ending with the lowest level?
A) food→computers→integrated circuits
B) integrated circuits→food→computers
C) integrated circuits→computers→food
D) computers→food→integrated circuits
E) none of the above
Tata Motors (India) acquired the following auto company:
A) Volkswagen AG (Germany).
B) Volvo (Sweden).
C) Jaguar (UK).
D) Toyota (Japan).
E) Hyundai (South Korea).
A company’s efforts to effectively communicate with customers is very important. All
of the following are major difficulties which can compromise an organization’s attempt
to communicate with customers except:
A) the message does not reach the intended recipient.
B) the message reaches the intended recipient but is misunderstood.
C) the message reaches the intended recipient and is understood, but the recipient may
fail to take action.
D) the message is distorted by noise.
E) the message is only in one language.
Marketing that involves creating the same marketing mix for a broad mass market of
potential buyers is referred to as:
A) differentiated target marketing.
B) standardized global marketing.
C) concentrated global marketing.
D) competitive global marketing.
E) target benefit marketing.
Lawyers are more important in:
A) low-context cultures.
B) high-context cultures.
C) Indian cultures.
D) Korean cultures.
E) Japanese cultures.
In a study entitled “The Euroconsumer: Marketing Myth or Cultural Certainty?”
researchers identified different lifestyle groups. The segment that is concentrated in
high-crime, inner-city neighborhoods were classified as:
A) Successful Idealists.
B) Affluent Materialists.
C) Disaffected Survivors.
D) Trendy Teens.
E) Comfortable Belongers.
Avon Products uses ________ to enter developing markets.
A) franchising and licensing
B) joint venture and licensing
C) acquisition and franchising
D) licensing and franchising
E) acquisition and joint ventures
The choice between demonstration, slice-of-life, straight sell, and other advertising
forms is a matter of the:
A) creative strategy.
B) advertising appeal.
C) selling proposition.
D) creative execution.
E) big idea.
One of the problems with Web site sales is credit card fraud. All of the following
countries are those where fraud is rampant except:
A) Indonesia.
B) Russia.
C) Croatia.
D) Japan
E) Bosnia.
The sale of merchandise in export markets at unfair prices is known as:
A) dumping.
B) countervailing.
C) tariff.
D) ad valorem.
E) transaction.
Managers must decide how well a company’s product fits the country market by asking
all of the following questions except:
A) Will adaptation be required?
B) Will import restriction drive up the product price?
C) Is it advisable to source locally?
D) Will strong home currency have an adverse impact on product price?
E) Will it be possible to neglect home-country regulations?
________ is the phrase global marketers use to describe ads with common design
elements into which localized elements are inserted for individual country markets.
A) “Pattern advertising”
B) “Template advertising”
C) “Cookie-cutter advertising”
D) “Model advertising”
E) “Stereotype advertising”
Suppose a company selling in various country markets makes statements such as “we
know what the customer wants, and he or she will have to pay for it.” This is an
indication of a(n) ________ approach to setting prices.
A) ethnocentric
B) polycentric
C) regiocentric
D) geocentric
E) adaptation
The country which boasts the world’s fastest average Internet speed is:
A) Russia.
B) China.
C) South Korea.
D) India.
E) Japan.
A company with a polycentric orientation is likely to employ host-country nationals in
all but which of the following selling situations?
A) selling high-tech products in developed countries
B) selling high-tech products in less-developed countries
C) selling low-tech products in developed countries
D) selling low-tech products in less-developed countries
E) none of the above
Global marketers must understand the importance of visual aesthetics embodied in the
color or shape of a product, label, or package. Which of the following statements is not
true regarding the use of color in selected countries?
A) The yellow color on Caterpillar’s earthmoving equipment is acceptable worldwide.
B) Packaging aesthetics are particularly important to the Japanese.
C) The color white is associated with death and bad luck in some Asian countries.
D) The red Marlboro color had to be changed in some Asian countries.
E) The Chinese consider the color red to be lucky.
Promotions designed to increase product availability in distribution channels are known
as:
A) sales promotions.
B) price promotions.
C) trade sales promotions.
D) consumer sales promotions.
E) nonprice promotions.
Categories of political risk listed by EIU (Economist Intelligence Unit) include all of
the following except:
A) war.
B) political turmoil.
C) bureaucracy.
D) corruption.
E) crime.
In a contest of 45 different languages covering 60 countries, marketers for Axe Apollo
invited consumers to fill out an “astronaut profile.” This is an example of:
A) promotion of different types for marketing.
B) promotion of interest in space exploration.
C) people in different countries prefer different topics.
D) astronaut profile varies from country to country.
E) sales promotion by global marketer.
In contrast to the lean producers, U.S. mass producers typically maintain operations that
involve all of the following except:
A) less mechanization.
B) greater labor direct content.
C) divide employees with no overlap.
D) limited quality control.
E) employee teamwork.
Advertising, public relations, and other forms of communication are critical tools in the
marketing program and reflect the ________ (P) of the marketing mix.
A) Product
B) Promotion
C) Price
D) Place
E) Process
Which form of regional cooperation agreement, when fully implemented, entails
creation of a unified central bank, the use of a single currency, and common policies on
agriculture, social services, and welfare?
A) Free trade area
B) Customs union
C) Common market
D) Economic union
E) Dispute settlement body
NAFTA creates a free trade area, as opposed to a customs union or a common market,
due to the fact that:
A) the agreement does not leave the door open for discretionary protectionism.
B) the governments of all three nations decided to eliminate tariffs.
C) the issue of illegal immigration from Mexico to the United States is resolved.
D) restrictions are imposed on the use of goods, services, and investments.
E) restrictions are imposed on labor movements among members.
When a trained person is recording the items selected in a grocery cart or basket, the
research method is known as:
A) observation.
B) survey research.
C) focus study.
D) secondary data collection.
E) personal interviews.
Coca-Cola’s distinctive contour bottle, which is sold in many countries, illustrates the
point that packaging:
A) strategies can vary by country and region.
B) helps in storing large sizes in refrigerators.
C) strategies do not change by country and region.
D) appeals only to Asian consumers.
E) helps in brand identification.
Some people believe that marketing is relevant only in affluent, industrialized countries,
whereas others believe that the role of marketing is to identify people’s needs and wants
worldwide, irrespective of the economy. Giving examples of companies involved in
energy conservation and technology, support the latter argument.
Nestl in Brazil is using door-to-door selling to reach low-income neighborhoods; Dell
computers provides home delivery for its products; Avon is using sales representatives
and other companies are using other methods to reach consumers. Describe different
channels that can be used for reaching the customers.
Basic issues for companies that sell globally are the composition of the sales force in
terms of nationality. List choices that are available to companies for selecting a sales
force. Outline advantages and disadvantages of each choice.
The table below is taken from the Big Mac Index. After reviewing it, answer the
questions listed below.
What is meant by PPP? According to this table, which is the most overvalued and
undervalued currency? Fill the last column showing under or over valuation of local
currencies. Give reasons for your answer. What is the primary drawback of this index?
How can this be used?
What should be a leader’s role in practicing corporate social responsibility (CSR)? Give
examples of some firms known for initiating successful socially responsible corporate
programs.
As Walmart extends its reach around the globe, some observers are very skeptical and
consider it as an “assault” or “invasion.” Using Walmart in India as an example discuss
all impacting factors.
How does “Switch Trading” works in global marketing? What is the advantage of the
‘switching mechanism?” Comment on the logistics and fees involved in this type of
arrangement.
What are demand conditions? Why is the nature of home demand conditions for the
firm’s or industry’s products and services important?
What are important considerations that will result in a successful global strategic
alliance between two countries?
Why does the tariff system vary from country to country? Explain, giving examples of
tariffs imposed by the United States with particular emphasis on preferential tariffs.
What are the conditions under which GATT allows the use of preferential tariffs?
The ultimate threat a foreign government can pose toward a company is seizing assets.
South Korea nationalized Kia, the nation’s number three automaker, in the wake of the
Asian currency crisis. How does this nationalization differ from expropriation and
confiscation?
When devising a channel strategy, it is necessary to be realistic about the intermediary’s
motives. What is “cherry picking” and how does it affect careful selection of a channel
strategy?
What are some of the concerns if the European Union decides to sign a free trade
agreement with the United States?
An export administrator, Beth Dorrell, notes, “A commodity raw material from Africa
can be refined in Asia, then shipped to South America to be incorporated into a
component of a final product that is produced in the Middle East and then sold around
the world.” In light of this statement, describe supply chain, value chain, and logistics.
List and briefly describe the most important distribution activities.
Why is the “big idea” easier to illustrate than define? Explain the importance of big idea
in advertising strategy.
What are the assumptions about mass production compared to the Toyota Production
system?
Companies use corporate advertising; image advertising, and advocacy advertising
from time to time. How are these advertising methods? What are the circumstances
under which they are used?
GATT and the U.S. Congress have both defined “dumping.” What is the difference in
their definitions? Why is dumping a major issue in global marketing?
What are the major differences between global, foreign, and local consumer culture
positioning? Why are these differences significant? Give examples of how companies
are trying to lure customers using these positioning strategies.
Why are packaging aesthetics an important consideration in global product marketing?