International Marketing Nicos Rodosthenous PhD 06/10/ /10/2014Dr Nicos Rodosthenous1

Define the field of International Marketing. State the importance of global marketing 1. Introduction to Global Marketing Consider the following proposition: We live in a global marketplace, where McDonald’s, Sony digital TVs, Swatch watches etc are found everywhere on the planet. Global companies like American auto giants General Motors and Ford are in a competitive struggle with Toyota, Hyundai as well as with European companies such as Volkswagen. 06/10/2014Dr Nicos Rodosthenous2

Define the field of International Marketing. State the importance of global marketing What Is Marketing? A. Marketing is the process by which companies create value for customers and build strong customer relationships to capture value from customers in return. B. Marketing is an organizational function responsible for identifying; analyzing, anticipating, and satisfying human needs and wants with product and services by applying market-driven strategies, that offer competitive value to customers with profit. 06/10/2014Dr Nicos Rodosthenous3

Define the field of International Marketing. State the importance of global marketing The marketing mix of the 4P’s(Product, Price, Place and Promotion) comprises a contemporary marketer’s primary tools. Marketing is regarded as a universal discipline. Global Marketing: Organizations engage in global marketing focus their resources and competencies on global market opportunities and threats. 06/10/2014Dr Nicos Rodosthenous4

Define the field of International Marketing. State the importance of global marketing Definition of a Market: people or organizations that are both able and willing to buy. If a company is able to offer superior product, distribution, or promotion benefits and lower prices that the competition then it will gain competitive advantage. i.e. Toyota, Nissan Japanese automakers offered cars in American market in 1980 with higher quality and lower prices than those of General Motors, Ford and Chrysler. 06/10/2014Dr Nicos Rodosthenous5

Define the field of International Marketing. State the importance of global marketing Superior value proposition for customers. Create value for customers by improving benefits or reducing price: – Improve the product – Find new distribution channels – Create better communications – Cut monetary and non-monetary costs and prices. Value equation: Value=Benefits/Price (money, time, effort) 06/10/2014Dr Nicos Rodosthenous6

Define the field of International Marketing. State the importance of global marketing Globalization-Global Industries The integration of markets, states, technologies that enable the world to reach individuals, corporations and nations faster, deeper and cheaper than ever before. An industry is global to the extent that a company’s industry position in one country is interdependent with its industry position in another country. 06/10/2014Dr Nicos Rodosthenous7

Define the field of International Marketing. State the importance of global marketing Indicators of globalization: – Ratio of cross-border trade to total worldwide production – Ratio of cross-border investment to total capital investment – Proportion of industry revenue generated by companies that compete in key world regions. i.e. Nestle’ SA., IBM. 06/10/2014Dr Nicos Rodosthenous8

Define the field of International Marketing. State the importance of global marketing Global Marketing: What It Is and What It Isn’t 06/10/2014Dr Nicos Rodosthenous9 Single Country Marketing Strategy Choose a Target Market and Develop a Marketing Mix – Product – Price – Promotion – Place

Define the field of International Marketing. State the importance of global marketing Global Marketing Strategy Global Market Participation in world markets Marketing Mix Development – 4 P’s: Adapt or Standardize? Concentration of Marketing Activities Coordination of Marketing Activities Integration of Competitive Moves 06/10/2014Dr Nicos Rodosthenous10

Define the field of International Marketing. State the importance of global marketing Standarization versus Adaptation The Faces of Coca-Cola Around the World 06/10/2014Dr Nicos Rodosthenous11 Arabic Read right to left Chinese “delicious/happiness”

Define the field of International Marketing. State the importance of global marketing Coke is the best –known strongest brand in the world. Companies engaged in global marketing do not necessarily conduct business in every one of the world’s 200-plus country markets. i.e. in the $30 billion market for recorded music, 12 countries-including the USA, Japan UK and France-account 70% of sales. 06/10/2014Dr Nicos Rodosthenous12

Define the field of International Marketing. State the importance of global marketing Global marketing made Coke a worldwide success. Coca-Cola achieved success in Japan by spending a great deal of time and money to become insider. Thus, global localization means that a successful global marketer must have the ability to “think globally and act locally”. 06/10/2014Dr Nicos Rodosthenous13

Define the field of International Marketing. State the importance of global marketing A global product may be the same product everywhere and yet different. Some companies say the new world requires homogeneous products everywhere and others say special products for every region. The best companies realize it’s neither and it’s both. Some examples: Coca-Cola, Nokia, Marlboro. 06/10/2014Dr Nicos Rodosthenous14

Define the field of International Marketing. State the importance of global marketing The success of Toyota and Honda was initially based on exporting cars from Japan. Now the have invested in producing cars in USA, Asia and Europe. The Importance of Going Global The larger market in the world in terms of national income is the USA with 25% of the total world market. 06/10/2014Dr Nicos Rodosthenous15

Define the field of International Marketing. State the importance of global marketing U.S. companies that wish to achieve maximum growth potential must “go global”, because 70% of the total world market for goods and services is outside the country. – Coca-Cola earns 75% of operating income and 2/3 of profit outside of North America For Japanese companies, 85% of world market is outside the country. 06/10/2014Dr Nicos Rodosthenous16

Define the field of International Marketing. State the importance of global marketing 94% of market potential is outside of Germany for its companies Management Orientations The world view of company’s personnel can be: ethnocentric, polycentric, regiocentric and geocentric. (EPRG framework) Ethnocentric Orientation: When a person assumes that his home country is superior to the rest of the world. 06/10/2014Dr Nicos Rodosthenous17

Define the field of International Marketing. State the importance of global marketing Ethnocentric companies making business outside the home country are regarded as international companies. Today, ethnocentric orientation is one of the major internal weaknesses that must be overcome if a company is to transform itself into an effective global competitor. Polycentric Orientation: It is just opposite of ethnocentric. 06/10/2014Dr Nicos Rodosthenous18

Define the field of International Marketing. State the importance of global marketing Each country in which a company does business is unique. Each subsidiary develops its own unique business and marketing strategies to succeed Often referred to as multinational Leads to a localized or adaptation approach that assumes products must be adapted to local market conditions 06/10/2014Dr Nicos Rodosthenous19

Define the field of International Marketing. State the importance of global marketing Regiocentric Orientation: A region becomes the relevant geographic unit; and the management’s goal is to develop an integrated regional strategy. i.e. a European company that focuses its attention on Europe is regiocentric. Geocentric Orientation A company that views the entire world as a potential market and strives to develop integrated global strategies. 06/10/2014Dr Nicos Rodosthenous20

Define the field of International Marketing. State the importance of global marketing It is also known as a global or transnational company. i.e. GM’s regiocentric policies were gradually replaced by geometric approach. New global competitors emerge on the scene like Toyota, which sold more cars worldwide than GM and has surpassed GM in terms of profitability and market value. 06/10/2014Dr Nicos Rodosthenous21

Define the field of International Marketing. State the importance of global marketing At global and transnational companies decisions are made on the basis of ongoing research into market needs and wants. Thus, the geocentric orientation represents a synthesis of ethnocentric and polycentric; it is a “world view” that creates a global strategy that is responsive to local needs and wants. The multinational solution encounters problems to the implementation of a global strategy and 06/10/2014Dr Nicos Rodosthenous22

Define the field of International Marketing. State the importance of global marketing underestimating the impact of global competition. Global Market growth in the 21 st century Boeing forecast that Chinese airline companies will order up to 2,300 aircraft valued more than $180 billion till Chinese carriers will operate a total of 2,800 aircraft making China the second largest aviation in the world. Boeing will face tough competition from Airbus. 06/10/2014Dr Nicos Rodosthenous23

Define the field of International Marketing. State the importance of global marketing Driving Forces Affecting Global Integration and Global Marketing Regional economic agreements, converging market needs and wants, technology advances, pressure to cut costs, pressure to improve quality, developments in communication and transportation technology and global economic growth. 06/10/2014Dr Nicos Rodosthenous24

Define the field of International Marketing. State the importance of global marketing 06/10/2014Dr Nicos Rodosthenous25

Define the field of International Marketing. State the importance of global marketing i.e. the internet is an even stronger driving force: when a company creates a site on the internet, it automatically becomes global. The internet allows people everywhere in the world to buy and sell unlimited products and services. The new generation of jet aircraft revolutionized communication by making it possible foe people to travel around the world in less than 48 hours. 06/10/2014Dr Nicos Rodosthenous26

Define the field of International Marketing. State the importance of global marketing The cost of international calls has fallen due to e-communication developments such as e- mail, fax, mobiles, skype, Wi-Fi. Global companies “raise the bar” for all competitors in an industry. i.e. Toyota Prius. Global Strategy Global strategy is a design to create a winning offering on a global scale. i.e. Star alliance, One world in the Airline business. 06/10/2014Dr Nicos Rodosthenous27

Define the field of International Marketing. State the importance of global marketing The reward is not just success, it’s survival. Restraining Forces Affecting Global Integration and Global Marketing Management myopia Organizational culture In many cases management ignores opportunities to pursue global marketing. A company that is “nearsighted” and ethnocentric will not expand geographically. 06/10/2014Dr Nicos Rodosthenous28

Define the field of International Marketing. State the importance of global marketing Opposition to globalization For many people around the world, globalization and global marketing represent a threat. National controls Every country protects the commercial interests of local companies by keeping control over market access and entry in both low-and high-tech industries. 06/10/2014Dr Nicos Rodosthenous29

Define the field of International Marketing. State the importance of global marketing 06/10/2014Dr Nicos Rodosthenous30