Global Marketing and R&D
Discussion Section
April 13, 2007
Brian Chen/Sanny Liao
Globalization


Last week: globalization of production
This week: globalization of market
Identifying markets



Def: Market segmentation refers to
•
identifying distinct groups of consumers whose purchasing
behavior differs from others in important way (e.g
geography, demography, social-cultural factors)
Examples:
•
Toyota/Lexis, Old Navy/Gap/Banana Republic, anything
else?
Can market segmentation extend beyond
national borders?
•
Yes.
What factors should firms consider
in order to target each market
segment?




Product attributes
Distribution strategy
Communication strategy
Pricing strategy
How do product attributes differ
across markets?

Cultural Differences

Economic Development Differences

Product and technical standards/(Market
Segmentation)
• Hamburgers do not sell in Islamic countries
• Kodak sells a lower end camera in Russia
• Different DVD regional coding
How do firms adjust their
distribution strategy across different
markets?

The US has less concentrated urban areas and extensive
use of cars; Japan has a highly concentrated population,
little use of cars in urban centers, and government
protection of small retailers
•
 more small retailers, and fewer large chains and malls in
Japan. I.e. less retail concentration
•
•

Other factors that may affect retail concentration:
economic development (car ownership), transportation systems, etc.
You are a toothpaste manufacturer in China who sells to
millions of small retailers, is it worthwhile for you to
contact and supply to each retailer?
•
No.  fragmented retail systems are more likely to use
intermediaries (longer channel length)
•
•
Other factors that may affect channel length:
internet shopping, large discount superstores such as Wal-Mart
Distribution strategies – cont’d

In Japan, relationships between
manufacturers, wholesalers, and retailers often
go back decades
•
 very hard for outsider to break into. Japan has high
channel exclusivity
• Outsiders can break into the Japanese market more
easily with new products

Developing countries often have lower quality
downstream retailers
•

 poor channel quality
Which distribution strategy to take?
•
Benefit and cost analysis.
How do firms adjust their
communication strategy to different
markets?
BARRIERS TO INTERNATIONAL COMMUNICATION
 Cultural barriers
•
•


A Benetton ad campaign features a black woman breastfeeding a white baby, and a another one shows a black man
and a white man handcuffed together – fared well in France
but accused of promoting white racial domination in U.S.
Matsushita and the cartoon Internet guide fiasco
Source and country of origin effects
•
Made in Japan, Made in China stickers carry different
connotations to buyers
Noise Levels
•
Competition from other advertisers
Communication strategy, cont’d
PUSH VS. PULL STRATEGIES
 Push strategy: emphasizes on selling
•
•

Requires a large sales force
Good for complex products or when firms need to
educate potential consumers about the features of the
product
Pull strategy: emphasizes on creating demand
•
•
•
•
Less costly when the potential market is big
More effective if there is little need to educate
customers
More effective when channel length is short
More cost-effective when media is widely available
How do firms adjust their pricing
strategy to different markets?



Def: price discrimination exists
•
when consumers in different countries/markets are
charged different prices for the same product.
Why?
What are the necessary conditions for this to
be successful?
•
•
Ability to keep markets separate
Difference price elasticity of demand (firms can usually
charge a higher price in inelastic markets)
Pricing strategies, cont’d

Other pricing strategies:
•
•
•

Predatory pricing:
• price out the competitor
Multipoint pricing:
• compete in different markets
Experience curve pricing:
• economies of scale
Regulatory influences
•
•
Antidumping regulations
• Under GATT, 2 criteria – “less than fair value” and
“material injury to a domestic industry”
Competition policies – penalizes monopolistic practices
Finally

Importance of new product development

How to achieve fast product
development
• Creative destruction
• Location of R&D
• Integration of R&D, marketing and production
• Cross functional teams
• Building global R&D capabilities
Discussion: The globalization of
Japanese Anime日本製アニメの国際化

Anime (アニメ) is an abbreviation of the
word "animation". Outside Japan, the
term most popularly refers to animation
originating in Japan. To the West, not all
animation is considered anime; and
anime is considered a subset of
animation.
Death Note

Death Note (デスノート) is a Japanese
manga series originally written by
Tsugumi Ohba (大場つぐみ）and
illustrated by Takeshi Obata（小畑健）.
The series primarily centers around a
high school student who decides to rid
the world of evil with the help of a
supernatural notebook.
Characters 主人公
Light Yagami/夜神月
Misa Amane/弥 海砂
L/エル
Near/ニア
Ryuk/リューク
Rem/レム
Internationalization??国際化？？
Mello/メロ
Madonna in “Jump”
Death Note Episode 1
デスノート エピソード１

http://video.yahoo.com/video/play?vid=1
111677233&fr=slv8-msgr
Discussion Questions討論質問





Is the success of Japanese anime in countries like the
United States indicative of the emergence of a global
youth culture?
Are there any product attributes that may hinder crosscultural comprehension?
What social and technological forces are making it
possible for Japanese anime to transcend national
borders?
How does the development of the new series of cartoons
differ from the way Japanese anime has traditionally been
developed? Why is this change being made?
Do you think that Death Note will be successful in your
country? Why? Why not?