BSAD 110 INTERNATIONAL MARKETING Lars Perner, Instructor 1 International Marketing Trade policy Culture Consumer buying power Product strategies

BSAD 110 INTERNATIONAL MARKETING Lars Perner, Instructor 2 Obstacles to Trade: Protectionism Differing interests of consumers and manufacturers Benefits of trade tend to be more diffused than benefits to specific groups of protectionism

BSAD 110 INTERNATIONAL MARKETING Lars Perner, Instructor 3 Approaches to Protectionism Tariffs Quotas “Voluntary” export restrictions Subsidies to domestic producers/exporters Non-tariff barriers legal obstacles differential treatment

BSAD 110 INTERNATIONAL MARKETING Lars Perner, Instructor 4 Cultural Lessons Diet Coke is named Light Coke in Japan-- dieting was not well regarded Red circle trademark was unpopular in Asia due to its resemblance of Japanese flag Packaging of products is more important in some countries than in U.S. Advertisement featuring man and dog failed in Africa--dogs were not seem as man’s best friend

BSAD 110 INTERNATIONAL MARKETING Lars Perner, Instructor 5 More Cultural Lessons... Cologne ad featuring a man “attacked” by women failed in Africa Food demonstration did well in Chinese stores but not in Korean ones--older women were insulted by being “taught” by younger representatives Pauses in negotiations Level of formality

BSAD 110 INTERNATIONAL MARKETING Lars Perner, Instructor 6 Product Strategies Extent of product change Standardization: Attempt at global product Customization: Specific product for each market Adaptation: Some changes made to product Physical: Product changes (e.g., voltage, size, taste) Communications: Positioning More issues when we considered product strategy in general

BSAD 110 INTERNATIONAL MARKETING Lars Perner, Instructor 7 Physical Product vs. Communication Adaptations

BSAD 110 INTERNATIONAL MARKETING Lars Perner, Instructor 8 CONSUMER INCOMES AND BUYING POWER Measuring country wealth gross domestic product “purchase parity” vs. nominal Government role in the economy Tax burden Services provided by the Government— e.g., health care, education

BSAD 110 INTERNATIONAL MARKETING Lars Perner, Instructor 9 Nominal vs. Purchase Parity Adjusted GNPs--Examples Source: World Bank (

BSAD 110 INTERNATIONAL MARKETING Lars Perner, Instructor 10 Market Entry Strategies Exporting Low investment Low control of promotion Licensing Low investment Low control of promotion, positioning, and quality Able to benefit from existing distribution and market knowledge Joint venture Considerable investment More control Able to benefit from partner’s experience Must work with partner Direct investment Large investment Risky Greater control May lack knowledge of market

BSAD 110 INTERNATIONAL MARKETING Lars Perner, Instructor 11 U.S. Laws of Interest to firms with U.S. Involvement Anti-trust Foreign Corrupt Influences Anti-boycott laws Trading With the Enemy