INTERNATIONAL MARKETING MANAGEMENT SESSION 14: DEVELOPING GLOBAL MARKETING STRATEGY: FOCUSED STRATEGIES 1

Position and Resources of Business and A FRAMEWORK FOR GLOBAL STRATEGY Position and Resources of Business and Parent Company Global Strategy Geographic Scope Market Scope (Segmentation) Product Lines Degree of Strategy Integration Benefits/ Costs of Globally Integrated Strategy Industry Globalization Drivers Market Economic Environment Competitive Organization’s Ability to Implement a Global Strategy 2

Environmental Factors Potential for Global Strategy EXTERNAL DRIVERS OF INDUSTRY POTENTIAL FOR GLOBALIZATION Homogeneous market needs Global customers Shortening product lifecycle Transferable brands and advertising Internationalizing distribution channels Market Factors Economic Factors Environmental Factors Worldwide economies of scale in manufacturing or distribution Steep learning curve Worldwide sourcing efficiencies Significant differences in country costs Rising product development costs Falling transportation costs Improving communications Government policies Technology change Potential for Global Strategy Competitive interdependence among countries Global moves of competitor Opportunity to preempt a competitor’s global moves 3 Competitive Factors

ACHIEVING GLOBAL SYNERGIES LEVERAGING ASSETS AND POSITION STRATEGIC FLEXIBILITY Scale Efficiencies Coordination and Integration Transfer of Ideas, Experience and Know-how Production Shifting Multiple Sourcing Transfer Pricing Managing Cash Flow Global Strategy 4

COMPETITIVE STRATEGIES IN A GLOBAL INDUSTRY Locally Responsive Country Region Broad- Based Focused MARKET SCOPE Globally Integrated Global Segment National Niche HYBRID Degree of Integration 5

Level of Market Integration THE GEOGRAPHIC SCOPE OF THE MARKET Geographic Coverage REGION Regional-Urban Restricted Multi-Domestic Regional WORLD International-Urban Multi-Region Global COUNTRY Multi-Urban Domestic CITY Urban Level of Market Integration 6

National Niche Strategies Multiple Global Segments FOCUSED SEGMENT STRATEGIES National Niche Strategies Global Segment Multiple Global Segments e.g. Schweppes e.g. Rolex, Benetton e.g. L’Oreal 7

Clearly Defined Position Limited Resource Needs CHALLENGES How to Grow FOCUSED STRATEGIES ADVANTAGES Customer Focused Clearly Defined Position Limited Resource Needs CHALLENGES How to Grow Remaining Focused Responding to Market Changes 8

Need to determine market scope and degree of strategy integration IMPLICATIONS Need to determine market scope and degree of strategy integration Global focused strategies provide clear direction but pose growth issues Broad-based strategies typically more complex and pose integration challenges 9