Global Marketing:
Principles,
Insights
&
Challenges
Insights
In Hong Kong, a German businessperson
is driving a Lexus; he’s wearing Bruno
Magli shoes, Irish cashmere socks, Calvin
Klein underwear, an Armani suit, with a
Gucci belt. He has a Mont Blanc pen, in
his Italian shirt. He’s going to meet an
American investor at a KFC restaurant, for
a Coke. After lunch, they stop for a
Baskins-Robbins (actually a foreign firm)
ice cream sundae. --- OK, that’s a stretch.
When he gets home, sitting on an
ottoman, he has an Absolut vodka
nightcap, while listening to American
country western music.
Challenges
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Huge Foreign indebtedness
Unstable governments
Foreign-exchange problems
Foreign entry and government
bureaucracy
Tariffs and other trade barriers
Corruption
E-commerce---doesn’t offer complete
solutions
Technological pirating
High cost of product and communication
adaptations
Global Marketing
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Marketing has become more complex.
Increases in new products, product
extensions, high cost of distribution and
shelf space.
Expansion of retailer control and power,
changing media habits, overload of
information, and array of communication
choices.
Ultimate goal of programs
Timing goals
Global Integration Forces
Driving Forces
 Technology
 Culture
 Market Needs
 Costs
 Free Markets
 Economic Integration
 Peace
 Strategic Intent
 Management Vision, Strategy and Action
Global Integration Forces
Restraining Forces
 Culture
 Market Differences
 Costs
 National Controls
 Nationalism
 Peace vs. War/ Stability
 Management Myopia
 Organization History
 Domestic Focus
Challenges
Markets can present higher profit
opportunities than present markets.
 Markets can offer size but not profits.
 Company needs a larger customer
base for economies of scale.
 Present customers are needing
service and products as they go
international.
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Major Decisions
Deciding to go abroad
 Deciding which markets
 Deciding how to enter markets
 Deciding on marketing programs
 Deciding on marketing organization
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Global Marketing
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Denotes the use of advertising and
marketing on a global basis.
Marketing is at the threshold of a new and
exciting era: e-business, e-commerce and
e-marketing
Business has two basic functions:
marketing and innovation (Drucker)
New era of competition, demanding
customers
More stakeholders (customers,
employees, media).
Global Marketing
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Companies need new set of guidelines,
values and insight
Marketing is a Strategic Business Concept
Marketing is too important to be left to the
Marketing Department. (David Packard)
Formulated, integrated, long-term
Hold to the responsibilities of customers,
employees, investors
Global Marketing
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Advantages, especially if the companies
emphasize selection, availability, quality,
reliability and lower prices.
 Economies of scale.
 Lower marketing and advertising costs in
planning and control. Lower advertising
production costs.
 Exploiting your best ideas on a worldwide
basis.
Global Marketing
Deciding How to Enter a Market
 Indirect Export-Thru export and thru
others.
 Direct Export-Handle own exports.
 Licensing-License a foreign company to
use trademark, manufacturing process,
trade secret, or other item for a fee or
royalty.
 Joint Ventures- Join with local investors
 Direct Investment- Direct ownership.
Global Marketing
Joint Ventures-- Join with local
investors to create venture. CocaCola and Nestle joined forces in
“ready to drink” coffee and tea.
 P&G with rival, Fater, in Italy and
Great Britain.
 Whirlpool formed venture with Dutch
electronic group Philip’s on whitegoods business to leapfrog into
European market.
Global Marketing
Direct Investment--Ultimate form is
direct ownership of foreign-based
assembly or manufacturing facilities.
 Can buy part or full interest in a local
company.
Global Marketing
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Principle of Research
Understand the consumer-behavior
perspectives.
Be sure you are asking right questions.
Use appropriate research techniques and
controls.
Present clear, comprehensive and
“actionable” results.
We study people using geographics,
demographics, psychographics, lifestyles,
and behaviors.
Global Marketing
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Bodily adornment, cooking, courtship, food
taboos, gift giving, language, marriage,
status, sex, and superstitions, in all
societies, although each society attaches
different values and traditions.
 The world, countries, regions, and
subcultures.
 Different groups of people share
subcultures---values, customs, and
traditions.
 Geomarketing uses these differences in
foods, terminology, subculture identities.
Global Marketing
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Example: Global youth are notorious for
challenging norms and defying labels. A
study of 27K teenagers in 44 countries.
Insights and motivations.
 Six different segments.
 But remember that even in a specific
country the teenagers are not
homogeneous.
 Six segments in a Teen World values
research study.
Global Marketing
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Thrills and Chills. Driving principles---fun,
excitement, irreverence and friends.
Expect everything in life. Make it a goal to
get as much and as many good times.
Popular kids in schools. Brand loyal.
Mostly in Germany, England, Greece,
South Africa, Netherlands, US, Belgium
and Canada. 18%
 Resigned: Fun, Friends and Low
expectations. Little discretionary income.
Cynical. Denmark, Sweden, Korea,
Norway, Germany, Belgium, Argentina,
Canada and Turkey 14%
Global Marketing
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World Savers. Defining principles: Fun,
Humanism, and friends. Models of what
gives hope to next generation. Good kids,
who care. Technologically advanced.
Motivated by new and exciting. Attracted
by honest and sincere messages.
Sophisticated, sense of humor. Hungary,
Philippines, Venezuela, Brazil, Spain,
Argentina, Russia, France, Poland. 12%
 Quiet Achievers. Success, quiet, anti-individualism, social optimism. Have determination and restraint. Study hard. Do well
in school. Limit outside activities.
Thailand, China, Hong Kong, Korea,
Russia, Peru. 15%
Global Marketing
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Bootstrappers. Defining principles:
Achievement, Individualism, optimism,
determination, power. Try hard to please
parents. Determined to succeed. Positive
values. One in four in US; 14% overall.
Nigeria, Mexico, US, India, Chile, Puerto
Rico, Peru and Venezuela.
 Upholders. Family, tradition, respect for
individuals. Dreamy. Quiet. Good teens.
Follow their parents. Don’t like risks. Use
proven products. Vietnam, Indonesia,
Taiwan, China, Italy, Peru, India, 16%
Global Marketing
Principle of Integrated Marketing:
 Marketing is everyone’s business.
 “Marketing Community”
Examples:
 Coca-Cola, Merrill Lynch, Xerox,
American Express, British Airways,
Gillette.
Global Marketing
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When all of the departments work together
to serve the customer’s interests.
 Works on two different levels: All of the
various marketing functions work
together: sales force, sales promotion,
advertising, PR, Product development,
Marketing research
 Plus all of the departments work together.
They must “Think Customer.”
Global Marketing
Global Standardization or Adaptation
 Toyota built the Corolla on a world
platform. Ford with its Focus. McDonald’s
uses chili sauce (salsa) on its hamburgers
in Mexico. Coca-Cola is can be sweeter, or
less carbonated.
 Adaptation elements: Product features,
brand name, labeling, packaging, colors,
materials, prices, sales promotion,
advertising themes, media, execution.
 Marketing programs do work best when
they are tailored to each target group.
Global Marketing
An endless process or principle:
 Customer attraction
 Customer satisfaction
 Customer retention.
 CEO is also the Chief Marketing
Officer.
Global Marketing
Principle of Competition: Value War
 Create long-tern customer value.
 Continuously and consistently crated
customer value.
 Look at total customer benefits vs.
customer expenses
 Ultimate goal of project
 Relationship to other projects
 High-level timing goals
Global Marketing
Principle of Customer Satisfaction and
Retention
 Look at overall satisfaction and
customer loyalty
 Easier to retain a customer than to
gain or win a new one.
 Consistently improve customer value
to win the marketing war.
Global Marketing
Principle of Integration:
 Learn about the needs and wants.
 There are no “average” customers.
 Concentrate on the individual
differences while looking at
segmentation, targeting and
positioning.
Global Marketing
More on Integration:
 Plan for and review differences in
culture, markets, economic
development, consumer differing
needs, usage patterns, media
availability and legal restrictions.
Global Marketing
Principle of Anticipation and Being
Proactive. Not Reactive.
 Are you ready for change? Being adaptive
to the marketplace.
 Macroenvironment Changes. The high
income growth country has shifted from
Japan to US. Low to medium has been
concentrated in Southeast Asia and
southern Asia with China as a unique,
high-growth, large country in the region
and the world. Also look at Singapore,
Taiwan and South Korea.
Global Marketing
Principle of the Growth of Internet and
Information Technology.
Principles of:
– Marketing Planning
– Marketing Mix
– 7P’s
– Controls.
Global Marketing
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The old trade model is just old.
 It stated that as a product matures,
production would shift to low-wage
countries.
 Today, must look at transportation costs,
availability of skilled labor, market
responsiveness, market access and
innovation in product design and
manufacturing. Especially of products
with less than 15% of labor in total cost.
Global Marketing
Principle of Branding:
 The umbrella. Determines price and value.
Be more than a commodity.
 A brand is a name, term, sign, symbol, or
design or a combination of them to
identify the goods and services of a seller
and to differentiate them from the
competitors.
 Identifies seller or maker. We see a huge
increase in the global brands for autos,
food, clothing, electronics and more.
 Increasing number of cross-border
marketing alliances.
Global Marketing
Principle of Service:
 Service before, during and after sale.
 Create long-term value and connect
with customer.
 Both products and services. It’s
creating more value.
Global Marketing
Principle of Process:
 Commands the company to be the captain
of its supply-chain. It should manage from
raw materials to finish goods. Enhance
value-creating activities.
 Look at Strategic Alliances/Partners .
Can be suppliers, customers and even
parts of competitors. Benchmarking,
reengineering, outsourcing, mergers,
and acquisitions are examples.
 Brand, service and process are three
value-creating principles and drivers to
win customers and deliver market share.
Global Marketing
Principles of STP:
 Segmentation, Targeting and
Positioning
 Process of segmenting. Look at
demographics, geographics,
psychographics and behavior
variables.
 Look for market opportunities.
Global Marketing
Principle of Differentiation:
 Don’t be different just to be different.
 Design and plan for meaningful
differences versus the competitors.
 Design truly different and unique
products for customers.
Global Marketing
Principle of Marketing Mix:
 Integrate 4P’s and 7P’s.
 Offer, Logistics and Competition.
 The whole marketing concept.
Global Marketing
Principle of Selling:
 Integrate Company, Customers and
Relationships/Partnerships.
 Create long-term relationships with
customers.
 More than personal selling.
 Features and benefits of the product.
 AIDA: Awareness-Interest-Desire-Action.
 Manage communication.
Global Marketing
Principle of Balance:
 After focusing on the elements of
marketing---segmentation, targeting,
positioning (STP), differentiation,
marketing mix, selling, branding, service
and process, you need to balance the
strategies, tactics and implementation.
 Share of Heart and Mind. Share of Voice.
 Dynamic environment. Timing.
 High-level timing goals
Global Marketing
Principle of Positioning:
 The act of designing the product or
service (company’s offering and
image) to occupy a distinctive place
in the target market’s mind.
 Ultimate goal of product.
Differentiation
 Relationship to other products.
Global Marketing
Principle of Future:
 Manage today’s products by
managing a profit and by servicing
customers of today and tomorrow.
 Develop tomorrow’s products.
 Look at Marketing Myopia.
Global Marketing
Principle of Global Experience
 Counts for companies
 Counts in the job market for
employees.
 Marketing Audits.
 Marketing is not a destination, or a
goal. It’s a process. A moving target.
Wrap-up on Global
Marketing Principles
Companies cannot stay domestic
and expect to maintain their markets.
 Companies need to define their
global policies and objectives.
 Companies need to decide on how
much to adapt marketing mix.
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Wrap-up on Global
Marketing Principles
Market entry and market control
costs can be high.
 Product and communication
adaptation costs can be high.
 Dominant foreign firms can establish
high barriers of entry.
 Which types of markets and
countries?
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Global Marketing
Ultimate goal of project
 Relationship to other projects
 High-level timing goals
 Attractiveness influenced by the
product, geography, income,
population, political climate and
more factors.
 Review Forces:
---Driving and Restraining
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