Chapter 11
11-0
Global Marketing
Management
Planning and Organization
Irwin/McGraw-Hill
©The McGraw-Hill Companies, Inc., 1999
A Comparison of Assumptions About
Global and International Companies
11-1
Application
International Companies Global Companies
Product Life Cycle
Global product life cycles.
All consumers want the
most advanced products.
Products are in different
stages of the product life cycle
in each nation.
Design
International performance
criteria considered during
design stage.
Adjustments to products
initially designed for domestic
markets.
Adaptation
Products are adapted to
global wants and needs.
Restrained concern for
product suitability.
Product adaptation is
necessary in markets
characterized by national
differences.
Market
Segmentation
Segments reflect group
similarities. Group similar
segments together.
Segments reflect differences.
Customized products for each
segments.
Fewer standardized
markets.
Expansion of segments into
worldwide proportions.
Many customized markets.
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Acceptance of
regional/national differences.
©The McGraw-Hill Companies, Inc., 1999
A Comparison of Assumptions About
Global and International Companies
11-2
Application
International Companies Global Companies
Competition
Ability to compete in national
markets is affected by a
firm’s global position.
Globally standardized
production.
Adaptations are handled
through modular designs.
Domestic/national competitive
relationships.
The Consumer
Global convergence of
consumer wants and needs.
Preferences reflect national
differences.
Product
Emphasis on valueenhancing distinction.
Products differentiated on the
basis of design, features,
functions, style, and image.
Price
Consumers prefer a globally
standardized good if it
carries a lower price.
Consumers willing to pay
more for a customized
product.
Production
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Standardization limited by
requirements to adapt
products to national tastes.
©The McGraw-Hill Companies, Inc., 1999
A Comparison of Assumptions About
Global and International Companies
11-3
Application
International Companies Global Companies
Promotion
Global product image,
sensitive to national
differences and global
needs.
National product image,
sensitive to national needs.
Place
Global standardization of
distribution.
National distribution channels.
SOURCE: Adapted with the authors’ permission from Gerald M. Hampton and Erwin
Buske. “The Global Marketing Perspective,” Advances in International Marketing, vol. 2.
S. Tamer Cavusgil. Ed. (Greenwich. Conn.: JAL Press. 1987). P. 265-66.
Irwin/McGraw-Hill
©The McGraw-Hill Companies, Inc., 1999
Benefits of Global Orientation
11-4
Economies of Scale in Production & Marketing
Transfer of Experience and Know-How across Countries
Uniform Global Image
Control and Coordination of Operations
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©The McGraw-Hill Companies, Inc., 1999
Product Development Process
United States and Japan
11-5
UNITED STATES
JAPAN
Market Research
Market Research
Product Characteristics
Product Characteristics
Design
Planned selling price less
desired profit
Engineering
TARGET COST
Supplier Pricing
Design
Engineering
Supplier Price
Cost
If cost too high return to
design phase
Target costs for each component forces
marketers, designers, and engineers from all
departments and suppliers to negotiate tradeoffs
Manufacturing
Manufacturing
Periodic cost reduction
Continuous Cost Reduction
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SOURCE: Adapted from Ford S.Worthy, “Japan’s
Smart Secret Weapon,”
August
12, 1991,
p.73.
©The Fortune,
McGraw-Hill
Companies,
Inc.,
1999
International Planning Process
11-6
Information derived from each phase, market research, and evaluation
of program performance
Phase 1
Preliminary analysis and
screening: Matching
company/country needs
Environmental uncontrollables, company character,
and screening criteria
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Phase 2
Adapting the
marketing mix to
target markets
Phase 3
Developing the
marketing
plan
Phase 4
Implementation and
control
Matching mix
requirements
Marketing plan
development
Implementation,
evaluation, and
control
©The McGraw-Hill Companies, Inc., 1999
International Planning Process
11-7
Phase 1
Phase 2
Company Character
Product







Philosophy
Objectives
Resources
Management style
Organization
Financial limitations
Management and
marketing skills
 Products
 Other
Home Country Constraints

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

Political
Legal
Economic
Other
Host Country(s) Constraints

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

Adaptation
Brand name
Features
Packaging
Service
Warranty
Style
Price
 Credit
 Discounts
Phase 3
Phase 4
 Situation
analysis
 Objectives and
goals
 Strategy and
tactics
 Budgets
 Action
programs
 Objectives
 Standards
 Assign
responsibility
 Measure
performance
 Correct for error
Promotion





Advertising
Personal selling
Media
Message
Sales promotion
Economic
Distribution
Political/legal
 Logistics
Competitive
 Channels
Level of technology
Culture
Structures of distribution
Geography
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©The McGraw-Hill Companies, Inc., 1999
Alternative Market Entry Strategies
• Exporting
11-8
• Internet
• Contractual Agreements
• Licensing
• Franchising
• Joint Ventures
• Consortia
• Direct Foreign Investment
• Strategic International Alliances
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©The McGraw-Hill Companies, Inc., 1999
Schematic Marketing Organization Plan Combining
Product, Geographic, and Functional Approaches
11-9
Company President
Vice President Marketing
Director:
Passenger car
marketing
Director:
Truck
marketing
Research
Research
Manager
N. American
distribution
Manager
European
distribution
Manager
African
distribution
Manager
N. American
distribution
Manager
S.American
distribution
Manager
African
distribution
Adv.
Adv.
Adv.
Adv.
Adv.
Adv.
Sales
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Sales
Sales
Sales
Sales
Sales
©The McGraw-Hill Companies, Inc., 1999