Dr. Dina Preston-Ortiz
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Introductions
◦ Faculty
 Academic Background
 Small Business Owner
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U.S. Small Business Globalization
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Definition of Global Business
Major World Markets: Marketing Function
Economic Impact of SME Global Business
Global Environment Considerations
Market Entry Strategy
Global Marketing Mix Strategy
Global Marketing Exercise
◦ Summary
Formal Definition
 Integration of world economies
 Movement of labor and technology across
boarders
 Cultural, political, economic and environmental
dimensions
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Top U.S. Trading Partners (U.S. Census Bureau, 2013)
Rank
Country
Exports
Imports
Total Trade
Percent of
Total Trade
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Total, All Countries
513.1
727.9
1,241.0
100.0%
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Total, Top 15 Countries
349.4
542.4
891.7
71.9%
1
Canada
98.5
110.6
209.1
16.8%
2
China
37.1
130.3
167.4
13.5%
3
Mexico
73.5
91.0
164.5
13.3%
4
Japan
20.8
46.3
67.1
5.4%
5
Germany
15.8
35.7
51.6
4.2%
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Economic Level Effects Marketing Strategy
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Based on Wealth (Per Capita Income)
 High Income Markets: Per Capita Income greater than $11,115
 Upper Middle Income Markets: Per Capita Income of $11,115 or less but more than
$3,595
 Discretionary income (urban population, middle class)
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Lower Middle Income Markets: Per Capita Income of $3595 or lower but more than
$905
 Some urban/ rural requiring a mix of products
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Low Income Markets: Per Capita Income greater than $905 or less
 Requires basic substance product (sugar, water, coffee)
(World Bank as cited in Ebert & Griffin, p.54)
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Product Strategy (Demand of Goods)
Distribution & Technology Infrastructures
Pricing Considerations
Promotional Tool Availability
Potential Market Growth
 Emerging Markets such as China, India & Brazil support opportunities for
small business and overall new growth in world trade.
“Emerging economies will grow on average by
4.7 percent a year between 2011 and 2025.
Advanced economies, meanwhile, are forecast
to grow by 2.3 percent over the same period”
(World Bank, 2011, para.2)
According to the U.S. Small Business Administration
(2012), small firms represent:
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99.7% of all employers, generate 60% to 80% of new
jobs annually and account for 97% of all U.S. exporters.
The U.S. service exports have grown more than 289%
faster than exports of goods and play a major role in
fortifying the U.S. economy.
Since 1971, the U.S. service sector has generated a
trade surplus that has consistently reduced the U.S.
trade deficit. (p.1-8)
Examples of U.S. Export Services
Accounting
Advertising
Business services
Consulting
Engineering
Entertainment
Technical
Health Care
Financial
Professional Services
Public Relations
Telecommunications
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Economic
◦ Standard of living
◦ Population size and growth
◦ Stage of economic development
 Business cycles
 Supply and demand
 Competitive forces
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Legal/Political
◦ Political stability
◦ Regulatory issues
◦ Human rights
◦ Trade issues
Cultural
◦ Values
◦ Norms & customs
◦ Language
Technology
◦ Country’s infrastructure
◦ Technology training and access
Market Conditions
◦ Domestic demand
◦ Comparative advantage
◦ Potential abroad
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Licensing
Exporting or Importing
Franchising
Joint venture
Strategic alliances
Direct investments
Outsourcing/offshoring
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Marketing Mix
◦ Globalize (standardize marketing mix)
◦ Multidomesitc (adaptation marketing mix)
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You are a firm that would like to create a strategic
alliance with an American Entertainment Company.
Complete the following based on your knowledge of
Hungary’s Rock-Pop Music Market to share with your
American partners:
Who is your Target Audience?
What is your product positioning?
Product: What type of music or entertainment should the American
company export?
Do you recommend standardization or adaption of the product/service?
Why?
Price: How much should be charged? Why?
Placement: Where would you distribute the music or entertainment?
Promotions: How would you promote the music or entertainment? And
why?
(*Hint: Be sure to consider economic indicators of Hungary; legal/political,
cultural, technology and market conditions)
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Global Business
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Importance of World Markets
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Economic Impact of SME Global Business to U.S. Economy
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SME Global Environment Considerations
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SME Market Entry Strategy
◦ Integration of world economies
◦ Movement of labor and technology
◦ Embraces cultural, political, economic and environmental
dimensions
◦ Understand that the economic level of a country is the single most
important environmental element in a small business adjusting/ creating its
global marketing strategy.
◦ Jobs, innovation with a focus on services as a way to level the U.S. trade
deficient and help small business owners keep start-up cost low
◦ Address opportunities and barriers in market planning
◦ Entry choice will depend on a SMEs access to resources and tolerance for
risk. The steps are not sequential.
 Importance of creating strategic alliances
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SME Global Marketing Mix Strategy
◦ Marketing Mix (adaption /standardization)
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Ebert & Griffin (2011). Business Essentials. Upper Saddle, New Jersey: Prentice Hall
Small Business Administration. (2012). Export Business Planner for Your Small Business.
Retrieved from
http://www.sba.gov/sites/default/files/SBA%20Export%20Business%20Planner.pdf
World Bank (2011). Emerging Market Growth Poles are Redefining Global Economic
Structure, Says World Bank Report. Retrieved from
http://web.worldbank.org/WBSITE/EXTERNAL/NEWS/0,,contentMDK:22915632~pagePK:
64257043~piPK:437376~theSitePK:4607,00.html