978-0134129945 Chapter 1 Lecture Note Part 3

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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. Thompson, Jennifer L. Aaker; Harish Manwani; Simon Clift; Masaaki Mike Kotabe.

“Mary Kay Inc: Asian Market Entry (B)”, John A. Quelch. HBS 509067.

Video: This article is from Management International Review, March 2011. It is titled “Effective

Global Strategy Implementation: Structural and Process Choices Facilitating Global Integration

and Coordination.”

The abstract states that this article offers “a contingency framework of global strategy

implementation effectiveness on firm performance. The research question we seek to address is

what the structural and process requirements are for MNEs to successfully implement global

strategy through increased efficiency and effectiveness of integration and coordination across

world markets. Our central premise is that MNEs’ capabilities in establishing supporting

structural and process mechanisms will enhance the effectiveness and efficiency of implementing

their global strategies which would, in turn, lead to better firm performance.”

Link: http://www.freepatentsonline.com/article/Management-International-

Review/256930786.html and here is a different link to the PDF of this document:

http://www.springerlink.com/content/12181r4440117312/

This next video is just a quick two-minute video showing Pepsi’s marketing throughout the

world, and how they differentiate packaging and advertising to adapt to the region in which they

are marketing. It provides a good example to show how companies cater their products to

different regions.

Film: Assign “The Gods Must Be Crazy.” This classic, humor-filled movie examines the life of a

bushman unaware of white culture who finds a Coca-Cola bottle in the Kalahari (dropped by a

passing pilot) and promptly has his life turned around by this mystical object. It shows how our

simplest acts can have far-reaching impacts. This is a great introduction to global awareness.

Out-of-Class Reading: Zou, Shaoming and S. Tamer Cavusgil, “The GMS: A Broad

Conceptualization of Global Marketing Strategy and Its Effect on Performance.” Journal of

Marketing 66 (October 2002) pp. 40-56.

Internet Exercise: Fortune magazine profiled the world’s richest man

(http://money.cnn.com/2007/08/03/news/international/carlosslim.fortune/). Have students read

and summarize this piece and use this as the basis for an in-class discussion on the changing face

of world business.

Full Semester Research Assignment and Activity

This is a full semester cultural and marketing plan project designed for individuals or groups.

Students should choose a country and a product / service that is not currently found in the

targeted country and devise a cultural analysis and marketing plan for the chosen country.

For example, students can choose to market an automobile from the United States into a foreign

country or can choose to market an automobile into the United States that is not currently

available here.

At the Instructors discretion, this project can be spread over the entire semester or used as a “take

home” final exam, collected in sections as the material is covered in class or any combination

deemed.

Foreign students are especially encouraged to find products / services that they’ve been

accustomed to or enjoyed (a favorite type of food product) here in the United States and wish to

“export” to their home country.

Cultural Analysis: The data suggested in the cultural analysis includes information that helps the

marketer make market-planning decisions. However, its application extends beyond product and

market analysis to being an important source of information for someone interested in

understanding business customs and other important cultural features of the country. This

cultural analysis is composed of two parts: information on the cultural makeup of the country

and the economic analysis of the country.

The information in this analysis must be more than a collection of facts. In preparing this

material, you should attempt to interpret the meaning of cultural information. With that said,

your country analysis should contain at least one paragraph on each of the following areas:

Per the instructor’s discretion, this section could be collected either before or after Part 2 of the

text has been discussed in class (Part 2 is chapters 2, 3, 4, and 5).

PART I: Introduction to the Culture of the Country

I. Include short profiles of the company, the product to be exported and the country with

which you wish to trade.

II. Brief discussion of the country’s relevant history

III. Geographical setting

a) location

b) climate

c) topography

IV. Social institutions

a) Family

i) The nuclear family

ii) The extended family

iii) Dynamics of the family

(1) Parental roles

(2) Marriage and courtship

b) Education

i) The role of education in society

(1) Primary education (quality, levels of development, etc)

(2) Secondary education (quality, levels of development, etc.)

(3) Higher education (quality, levels of development, etc.)

ii) Literacy rates

c) Political System

i) Political structure

ii) Political Parties

iii) Stability of government

iv) Special taxes

v) Role of local government

d) Legal System

i) Organization of the judiciary system

ii) Code, common, socialist, or Islamic-law country?

iii) Participation in patents, trademarks and other conventions

e) Organizations

i) Group behavior

ii) Social classes

iii) Clubs, other organizations

iv) Race, ethnicity and subcultures

f) Business customs and practices

V. Religion and aesthetics

a) Religion and other belief systems

i) Orthodox doctrines and structures

ii) Relationship with the people

iii) Which religions are prominent?

iv) Membership of each religion

v) Any powerful or influential cults?

b) Aesthetics

i) Visual arts (fine arts, plastics, graphics, public arts, colors etc.)

ii) Music

iii) Drama, ballet, and other performing arts

iv) Folklore and relevant symbols

VI. Living conditions

a) Diet and nutrition

i) Meat and vegetable consumption rates

ii) Typical meals

iii) Malnutrition rates

iv) Foods available

b) Housing

i) Types of housing available

ii) Do most people own or rent?

iii) Do most people live in one-family dwellings or with other families?

c) Clothing

i) National dress

ii) Types of clothing worn at work

d) Recreation, sports, and other leisure activities

i) Types available and in demand

ii) Percentage of income spent on such activities

e) Social security

f) Health Care

VII. Language

a) Official language(s)

b) Spoken versus written language(s)

c) Dialects

VIII. Executive Summary

After completing all of the other sections, prepare a two-page (maximum length) summary of the

major points and place it at the front of the report. The purpose of an executive summary is to

give the reader a brief glance at the critical points of your report. Those aspects of the culture a

reader should know to do business in the country but would not be expected to know or would

find different based on his or her home country should be included in this summary.

IX. Sources of information

X. Appendixes

Per the discretion of the instructor, this part could be collected after Part 3 of the textbook has

been covered in the class. (Part 3 of the text includes chapter 6, 7, 8, and 9).

PART II: The Economic Analysis of the Country

The reader may find the data collected for the economics analysis guideline are more

straightforward than for the cultural analysis guideline. There are two broad categories of

information in this guideline: general economic data that serve as a basis for an evaluation of the

economic soundness of a country and information on channels of distribution and media

availability. As mentioned earlier, the guideline focuses only on broad categories of data and

must be adapted to the particular company and its product needs. With that said, write at least

one (1) paragraph for each of these sections.

Guideline

I. Introduction

II. Population

a) Total

i) Growth rates

ii) Number of live births

iii) Birth rates

b) Distribution of population

i) Age

ii) Sex

iii) Geographic areas (urban suburban, and rural density and concentration)

iv) Migration rates and patterns

v) Ethnic groups

III. Economic statistics and activity

c) Gross national product (GNP or GDP)

1. Total

2. Rate of growth (Real GNP or GDP)

a. Personal income per capita

b. Average family income

d) Distribution of wealth

i) Income classes

ii) Proportion of the population in each class

iii) Is the distribution distorted?

e) Minerals and resources

f) Surface transportation

i) Mode

ii) Availability

iii) Usage rates

iv) Ports.

g) Communication systems

i) Types

ii) Availability

iii) Usage rates

h) Working conditions

i) Employer-Employee relations

ii) Employee participation

iii) Salaries and benefits

i) Principal industries

i) What proportion of the GNP does each industry contribute?

ii) Ratio of private to publicly owned industries

j) Foreign Investment

i) Opportunities?

ii) Which industries?

k) International trade statistics

i) Major exports

(1) Dollar value

(2) Trends

ii) Major imports

(1) Dollar value

(2) Trends

iii) Balance-of-payments situation

(1) Surplus or deficit?

(2) Recent trends

iv) Exchange rates

(1) Single or multiple exchange rates?

(2) Current rate of exchange

(3) Trends

l) Trade restrictions

i) Embargoes

ii) Quotas

iii) Import taxes

iv) Tariffs

v) Licensing

vi) Customs duties

m) Extent of economic activity not included in cash income activities

i) Counter trades

(1) Products generally offered for counter trading

(2) Types of counter trades requested (i.e. barter, counter purchase, etc.)

(3) Foreign aid received

n) Labor force

i) Size

ii) Unemployment rates

o) Inflation rates

IV. Developments in science and technology

a) Current technology available (computers, machinery, tools etc.)

b) Percentage of GNP invested in research and development

c) Technological skills of the labor force and general population

V. Channels of distribution (macro analysis)

This section reports data on all channel middlemen available within the market. Select a specific

channel as part of your distribution strategy for your marketing plan

a) Retailers

i) Number of retailers

ii) Typical size of retail outlets

iii) Customary markup for various classes of goods

iv) Methods of operation (cash/credit)

v) Scale of operation (large/small)

vi) Role of chain stores, department stores specialty shops

b) Wholesale middlemen

i) number and size

ii) Customary markup for various classes of goods

iii) Method of operation (cash/credit)

c) Import/Export agents

d) Warehousing

e) Penetration of urban and rural markets

VI. Media

This section reports data on all media available within the country or market. Select specific

media as part of the promotional mix and strategy for your marketing plan.

a) Availability of media

b) Costs

i) Television

ii) Radio

iii) Print

iv) Other media (cinema, outdoor etc.)

c) Agency assistance

d) Coverage of various media

e) Percentage of population reached by each of the media

VII. Executive summary

After completing the research for this report, prepare a two-page (maximum) summary of

the major economic points and place it at the front of the report

VIII. Sources of information

IX. Appendixes

Per the instructor’s discretion, this section can be used as a final exam, a take home writing

assignment or group work. It can / could be used in conjunction with Part 4 of the textbook,

which are chapters 10, 11, 12, 13, 14, and 15).

THE MARKETING PLAN

Market-oriented firms build strategic market plans around company objectives, markets and the

competitive environment. Planning for marketing can be complicated even for one country, but

when a company is doing business internationally, the problems are multiplied. Company

objectives may vary from market to market and from time to time; the structure of international

markets also changes periodically and from country to country; and the competitive,

governmental, and economic parameters affecting market planning are in a constant state of flux.

These variations require international marketing executives to be specially flexible and creative

in their approach to strategic marketing planning.

PART III: Market Audit and Competitive Market Analysis

Of the guidelines presented, this is the most product or brand specific. Information in the other

guidelines is general in nature, focusing on product categories, whereas data in this guideline are

brand specific and are used to determine competitive market conditions and market potential.

Two different components of the planning process are reflected in this guideline. Information in

Parts I and II, Cultural Analysis and Economic Analysis, serve as the basis for an evaluation of

the product or brand in a specific country market.

Information in this guideline provides an estimate of market potential and an evaluation of the

strengths and weaknesses of competitive marketing efforts. The data generated in this step are

used to determine the extent of adaptation of the company’s marketing mix necessary for

successful market entry and to develop the final step, the action plan.

The detailed information needed to complete this guideline is not necessarily available without

conducting a thorough marketing research investigation. Thus another purpose of this part of the

country notebook is to identify the correct questions to ask in a formal market study.

Write at least one (1) paragraph on each in each of these areas.

I. Introduction

II. The Product

A. Evaluate the product as an innovation as it is perceive by the intended market.

1. Relative advantage

2. Compatibility

3. Complexity

4. Trialability

5. Observability

B Major problems and resistance to product acceptance based on the preceding

evaluation

III. The Market

A. Describe the market(s) in which the product is to be sold

1. Geographical region(s)

2. Forms of transportation and communication available in that (those)

region(s)

3. Consumer buying habits

a. Product-use patterns

b. Product feature preferences

c. Shopping habits

4. Distribution of the product

a. typical retail outlets

b. Product sales by other middlemen

5. Advertising and promotion

a. Advertising media usually used to reach your target market(s)

b. Sales promotions customarily used (sampling, coupons, etc.)

6. Pricing strategy

a. Customary markup

b. Types of discounts available

B. Compare and contrast your product and the competition’s product(s).

1. Competitor’s product(s)

a. Brand name

b. Features

c. Package

2. Competitor’s prices

3. Competitor’s promotion and advertising methods

4. Competitor’s distribution channels

C. Market size

1. Estimated industry sales for the planning year

2. Estimated sales for your company for the planning Year

D. Government participation in the marketplace

1. Agencies that can help you.

2. Regulations you must follow

IV. Executive Summary

Based on your analysis of the market, briefly summarize (two-page maximum) the major

problems and opportunities requiring attention in your marketing mix, and place the summary at

the front of the report

V. Sources of information

VI. Appendixes