Chapter 8
Global Marketing Strategies
Chapter 8
Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
1
Chapter Overview
1. Information Technology and Global
Competition
2. Global Strategy
3. Global Marketing Strategy
4. Regionalization of Global Marketing
Strategy
5. Competitive Analysis
Chapter 8
Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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Introduction
 On a political map, country borders are clear as
ever. But on a competitive map, financial,
trading, and industrial activities across national
boundaries have rendered those political
borders increasingly irrelevant.
 Not only firms that compete internationally but
also those whose primary market is considered
domestic will be affected by competition from
around the world.
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Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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1.
Information Technology and
Global Competition
 Today, we are observing the emergence of a
gross information product, and it dwarfs the
gross domestic product.
 Electronic Commerce (E-Commerce)
 Real-Time Management
 Online Communications
 “Internet” Organization
 Faster Product Diffusion
 Global Citizenship
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Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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2. Global Strategy
 Global Industry:
Those industries where a firm’s competitive
position in one country is affected by its
position in other countries.
The first question that faces managers is the
extent of globalization of their industry.
Every industry has global or potentially
global aspects.
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Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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2. Global Strategy (contd.)
Industry Globalization Drivers (Yip, G. S., Total Global Strategy, Prentice Hall,
1992).
Market Drivers
Cost
Drivers
Industry
Globalization
Potential
Government
Drivers
Competitive Drivers
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Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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2. Global Strategy (contd.)
 Industry Globalization Drivers (see Exhibit 8-1):
Market Globalization Drivers
1. Common customer needs
2. Global customer and channels
3. Transferable marketing
4. Lead countries
Cost Globalization Drivers
1. Global economies of scale and scope
2. Steep experience curve
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Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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2. Global Strategy (contd.)
3. Global sourcing efficiencies
4. Favorable logistics
5. Difference in country costs
6. High product development costs
7. Fast-changing technology
Government Globalization Drivers
1. Favorable trade policies
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Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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2. Global Strategy (contd.)
2. Compatible technical standards
3. Common Market Regulations
4. Government-owned Competitors
5. Government-owned Customers
 Competitive Globalization Drivers
1. High exports and imports
2. Competitors from different continents
and countries
3. Interdependent countries
4. Globalized competitors
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Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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2. Global Strategy (contd.)
 Competitive Structure
Cost leadership
Product differentiation
Niche strategy
Nature of Competitive Industry Structure (see
Exhibit 8-2):
»Industry competitors
»Potential entrants
Chapter 8
Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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2. Global Strategy (contd.)
»Bargaining power of suppliers
»Bargaining power of buyers
»Threats of substitute products or services
 Hypercompetition
Creative destruction
Cost and quality
Timing and know-how
Strongholds
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Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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2. Global Strategy (contd.)
Financial resources
 Interdependency:
Interdependency of modern companies
Example: Global computer industry
Governments also play a larger role, affecting
parts of the firm’s strategy.
Chapter 8
Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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3. Global Marketing Strategy
 Benefits of Global Marketing:
Cost Reduction
Improved Products and Program
Effectiveness
Enhanced Customer Preference
Increased Competitive Advantage
 Limits to Global Marketing:
Standardization vs. adaptation issues
Globalization vs. localization
Global integration vs. local responsiveness
Scale vs. sensitivity
Chapter 8
Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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4. Regionalization of Global
Marketing Strategy
 Regional strategies are the cross-subsidization
of market share battles in pursuit of regional
production, branding, and distribution
advantages.
Issues in regionalization of global marketing
strategy:
Cross-Subsidization of Markets
Identification of Weak Markets
Use of Lead Market Concept
Marketing Strategies for Emerging Markets
Chapter 8
Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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5. Competitive Analysis
 SWOT (Strengths, Weaknesses,
Opportunities, and Threats) Analysis (see
Exhibit 8-6)
A SWOT analysis divides the information
into two main categories: internal and
external factors.
Based on SWOT analysis, marketing
executives can construct alternative
strategies.
The aim of any SWOT analysis should be to
isolate the key issues that will be important
to the future of the firm and that will be
addressed by subsequent marketing
strategy.
Chapter 8
Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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