1、Scope, Concepts, and Drivers of International MarketingDana-Nicoleta LascuChapter 1Chapter ObjectivesDefine international marketing and identify the different levels of international involvement.Describe the different company orientations and philosophies toward international marketing.Identify envi

2、ronmental and firm-specific drivers that direct firms toward international markets.Identify obstacles preventing firms from successful international ventures.Importance of International MarketingInternational marketing helps companies reach their full potential and the maximum return for their stock

3、holders.Many companies find that, to keep up with competition, they must reach for new international consumers.For many companies, an international presence is essential to their success. Exxon, General Motors, Microsoft and Mitsubishi earn profits higher than the gross domestic product of many e co

4、untries. Many small businesses can attribute their success and even survival to international markets. Companies with products in late stages of the product life cycle find that emerging markets offer them new lifePrivatization in countries where government monopolies had dominated for decades has m

5、ade it possible for multinationals to compete for local energy, airline, railway, and munications industries.Domestic marketing: The firm has the least commitment to international marketingFocus on domestic consumers and on the home-country environment. Export marketing: The firm is indirectly or di

6、rectly involved in exporting. The firm considers the international market as an extension of the domestic market.International marketing: The firm focuses on international consumers in one or more countries. Firms sales offices, subsidiaries, joint ventures are in different countries.International a

7、ctivities are not coordinated across different countries. Global marketing: The firm coordinates its marketing activities across different countries without focusing primarily on national or regional segmentation. The strategy is possible due to the emergence of uniform global consumer segments.The

8、strategy entails an efficient global allocation of company resources.Levels of International Marketing InvolvementLevels of International Marketing Involvement (summarized)Domestic MarketingExport MarketingInternational MarketingGlobal Marketing Low or no international commitment Domestic focus Limi

9、ted international commitment Direct or indirect exporting Substantial internationalcommitment Focus on countries or regions Extensive internationalcommitment Focus on market segments rather than countries or regionsInternationalization PhilosophiesHuman ResourcesFinanceManagement internationalizatio

10、n philosophy affects all functional areas of the corporation.Impact on resource allocation, response to global threats/opportunitiesEthnocentric OrientationGuided by domestic market extension concept.Domestic strategies, techniques, and personnel are perceived as superior.International markets are s

11、econdary, regarded primarily as outlets for surplus domestic production.International marketing plans are developed in-house by the international division.Disneyland Resort Paris emphasizes a U.S. (domestic) theme: Main Street USA.Polycentric OrientationGuided by the multidomestic marketing concept.

12、Focuses on the importance and uniqueness of each international market.Firms establish independent businesses in each target country.Fully decentralized, minimal coordination with headquarters.Marketing strategies are specific to each country es: no economies of scale.duplicated functions.higher fina

13、l product costs.Regiocentric OrientationGuided by the global marketing concept.Considers world regions that share economic, political, and/or cultural traits as distinct markets .Divisions are organized based on location.Regional offices coordinate marketing activities, using a region-wide marketing

14、 approach.Example: Regional brands such as Unilevers Domestos (household cleaning agent containing bleach, sold in Central Europe)Geocentric OrientationGuided by the global marketing concept.Marketing strategies aimed at market segments, rather than geographic locations.Maximizes efficiencies worldw

15、ide and provides standardized product or service throughout the world.Example: Visa.Visa is omnipresent in world markets.This ad suggests to French consumersthat Visa is widely used.International Expansion: Drivers in the Business EnvironmentThe primary drivers in the business environment are:Compet

16、itionRegional Economic and Political IntegrationTechnologyImprovements in Transportation and municationEconomic GrowthTransition to a Market EconomyConverging Consumer NeedsDrivers in the Business Environment (contd.)CompetitionCompetitive pressure from international companies will force the company

17、 to expand to new markets, even less profitable ones. Example: McCann Erickson, the advertising agency, followed longtime client, Coca Cola, Inc., to all countries where Coke was present until recently.Drivers in the Business Environment (contd.)Integration facilitates international trade for compan

18、ies in member countries, and for companies from countries outside of the area.Example: Regional agreements such as NAFTA, MERCOSUR, and the European Union lower and eliminate barriers and promote trade within these markets. Subsidiaries can be established in these markets to take advantage of free t

19、rade within the region.Regional Economic and Political IntegrationDrivers in the Business Environment (contd.)TechnologyExamples:Media development exposes consumers worldwide to foreign programming.Consumers worldwide are exposed to similar products, services, and entertainment, and marketing commun

20、ications.The Internet offers small and medium enterprises in both high- and e countries unlimited international exposure. Technology offers a broad reach to these businesses whose advertising budget cannot cover the high cost of international broadcast and print advertising. Drivers in the Business

21、Environment (contd.)Lower cost and higher quality communication due to satellite technology, teleconferencing, and e-mail.Allow for frequent interaction between subsidiaries in foreign countries and the headquarters. Allow for outsourcing of customer service. The introduction of containers in interm

22、odal transportation and electronic communication between suppliers and customers greatly facilitates the transportation of physical goods.Transportation and municationsContainer ship in the port ofRotterdamDrivers in the Business Environment (contd.)Economic growth created markets of high potential

23、for international brands, while also opening previously closed markets. Emerging middle class with increasing buying power in big emerging markets such as those of Brazil and India.Opening of new markets that were previously closed, such as those of China and Vietnam, and those of the former Eastern

24、 Bloc.Economic GrowthDrivers in the Business Environment (contd.)Transition to a market economy created important new markets and opportunities to transform inefficient government-owned companies into successful enterprises.Poland, the Czech Republic, Slovakia, Slovenia, Hungary, Romania, and Bulgar

25、ia are members of the European Union.Slovenia is already a member of the European Monetary Union.China and Vietnam are opening doors to multinationals.Transition to a Market EconomyDrivers in the Business Environment (contd.)Consumers exposure (through media, travel) to global brands created demand

26、for global products and worldwide loyalty to international brands. The emergence of uniform consumer segments facilitates marketing strategies worldwide. Examples of consumer segments worldwide: global teenagersglobal eliteConverging Consumer NeedsFirm-Specific Drivers of International ExpansionThe

27、primary firm drivers for international expansion are:Product Life CycleHigh New Product Development CostsStandardizationEconomies of ScaleCheap LaborExperience TransfersFirm-Specific Drivers (contd.)Product Life Cycle Considerations: Companies prolong the product life cycle of their late-maturity br

28、ands by entering growth markets.SalesIntroGrowthMaturityDeclineProfitsSalesFirm-Specific Drivers (contd.)High New Product Development Costs:New-product-development costs are rapidly increasing and product life cycles are decreasing. As a result, firms must look beyond the home-country market to full

29、y recover the high product development costs and to make a profit. Price competition during the maturity stage of the product life cycle drives firm to new international markets in search of cheap labor. The firm lowers costs and prices as it takes advantage of: Economies of scale Standardization, a

30、nd Cheap labor.Firm-Specific Drivers (contd.)Standardization, Scale Economies, Cheap LaborFirm-Specific Drivers (contd.)Experience TransfersCompanies benefit from lessons they learn in different parts of the world and transfer their knowledge to other markets they serve.Obstacles to Internationaliza

31、tionThe primary obstacles to internationalization are the self-reference criterion, government barriers, and competitive barriers.Self-reference CriterionConscious and unconscious reference to own national culture and home-country norms while operating in the host country, which can prevent firms fr

32、om adapting to local business environments and serving the needs of local consumers. To counter the impact of the self-reference criterion, the corporation must:Select adaptable personnel for international assignments.Sensitize expatriates to the local culture.Obstacles to Internationalization (contd.)Government BarriersRestrictions placed on international corporations by impo