Chapter Questions
• What factors should a company review
before deciding to go abroad?
• How can companies evaluate and select
specific foreign markets to enter?
• What are the major ways of entering a
foreign market?
• Should the company adapt its products and
marketing program to each foreign country?
• How should the company manage and
organize its international activities?
21-1
Global Firm
A firm that operates in more than one
country and captures R&D, production,
logistical, marketing, and
financial advantages in its costs and
reputation that are not available to purely
domestic competitors.
21-2
Regional Free Trade Zones
•
•
•
•
European Union
NAFTA
MERCOSUL
APEC
21-3
Major Decisions in International Marketing
Deciding whether to go
Deciding which markets to enter
Deciding how to enter
Deciding on the
marketing program
Deciding on the
marketing organization
21-4
Choosing countries strategically
• 3 main criteria:
– market attractiveness,
– risk, and
– competitive advantage
• Developing countries offer a unique set of
opportunities and risks.
21-5
Four Stages of Internationalization
No regular export activities
Export via independent agents
Establish sales subsidiaries
Establish production
facilities abroad
21-6
Nescafe Markets in Russia
21-7
Five Modes of Entry into Foreign Markets
Indirect
exporting
Direct
exporting
Licensing
Joint
ventures
Direct
investment
Commitment, Risk, Control, Profit Potential
21-8
Indirect Exporting
• Contract with an import/export
company to manage the flow of goods
and money
21-9
Direct Exporting Methods
•
•
•
•
Domestic-based export department
Overseas sales branch or subsidiary
Traveling export sales representatives
Foreign-based distributors or agents
21-10
Licensing
21-11
Global Marketing
Advantages
• Economies of scale
• Lower marketing costs
• Power and scope
• Consistency in brand
image
• Ability to leverage
• Uniformity of
marketing practices
Disadvantages
• Differences in
consumer needs,
wants, usage patterns
• Differences in
consumer response to
marketing mix
• Differences in brand
development process
• Differences in
environment
21-12
21-13
21-14
21-15
21-16
21-17
21-18
21-19
21-20
Price Choices
• Set a uniform price
everywhere
• Set a market-based
price in each country
• Set a cost-based
price in each country
21-21
Whole-Channel Concept
Seller
International headquarters
Channels between nations
Channels within nations
Final buyers
21-22
Global Organization Strategies
World as Single Market
Multinational
“Global”
21-23
Marketing Discussion
 Think of some of your favorite
brands. Do you know where they
come from? Where and how they
are made or provided? Do you
think it would affect your perceptions
of quality or satisfaction?
21-24