1. International Marketing Strategy
Introduction
Domestic and international marketing principles are similar
Environmental differences often cause managers to apply these principles differently abroad
Market Size Analysis
Total market potential—estimate of the possible sales of a product for all companies, and the estimate of your own company’s market-share potential
Present income and population are the major indicators for potential sales of most products
As incomes change, product demand may change
Other factors affect demand

2. Gap Analysis
Method for estimating a company’s potential sales by identifying market segments it is not serving adequately
Sales potential exists when sales are lower than the estimated market potential
Usage gap
Distribution gap
Product line gap
Competitive gap

3. Standardization vs. Adaptation
Definition
standardisation: use same marketing mix across nations
it is matter of degree
Ex: Snapple

4. Standardization vs. Adaptation (cont’)
Standardization is favourable when
a. Target country is
Culturally similar
eg) Europe
Economically similar
b. Products are
Industrial product
High-tech product
eg) semiconductor, computers
Core/tangible products are more likely to be standardised than augmented product.

5. Standardization vs. Adaptation (cont’)
c. Target consumers
have similar life style/taste
highly mobile
eg) Urban life style
d. Firm wants
close control
consistent brand image (eg. global brands)
eg) Levis
e. Competitors are marketing
standardised products

6. International Pricing
Price Setting (influencing factors)?

7. Price Setting (cont’) Relationship between domestic and export price
can be higher (Why?)
can be lower (Why?)

8. Price Escalation
Price difference b/t the exporting country and the import country.
Ex: An American-Built Jeep Cherokee Makes the Trip to Japan

9. Strategic Options to Deal With Price Escalation
???
shorten distribution system
eliminate costly features
assemble in foreign market (eg. free trade area)
eliminate costly features. repackage for low tariff classification
foreign production and sourcing

10. International Distribution Decisions
Distribution is a process in which the ownership
of the goods is transferred from the producer to
the consumer by means of physical handling and
movement.
Channel of Distribution is an organized network of agencies and institutions which, in combination, perform all the activities required to link producers with users to accomplish the marketing task.

11. Channel System 1. Long vs. Short Distribution
a. Short: specialised, efficient, large size, large coverage
eg) Mfg  (Wholesale)  Retail  consumer
eg) direct Marketing; Mfg  consumers (Ex?)
b. Long: general, less efficient, small size. limited coverage: fragmented
eg) mfg.  wholesaler1  wholesaler2  retailer1 retailer2  consumer
eg) Italy, Japan
small (fewer employees), fragmented (complex) channel structure
eg) "Mom & Pop" type of stores

12. Channel System (cont’)
2. Direct vs. Indirect Channel
a. Advantages of going direct (??)
eg) Toys R Us and Dell in JPN market
b. Disadvantages (??)

13. Channel System (cont’)
When to go direct? Compare and Justify.
consumer vs. industrial market: industrial: direct/short
manufacturing goods vs. service (direct, short)
concentrated (short, direct) vs. fragmented market

14. Basic Model of Communication
International Marketing Communication Decisions
Source/
Sender
Encoding
Message/
Channel
Decoding
Receiver
Noise
Feedback
Response
Basic Model of Communication

15. International Communication Process
Cultural Context A
Cultural Context B
Message channel
Encoding
Advertising Media and or personal sales force
Message translated into appropriate meaning
Noise
Competitive acti-vities, other sales-people, confusion and so on
Decoding
Encoded message interpreted into meaning
Feedback
Information source
Evaluation of communications process and measure of action by receiver
Receiver
Markerer with a product
Action by consumer responding to decoded message

16. Globalized vs. Localized Campaigns
Globalized campaigns: using the same message and creative execution across all (or most) international markets.
Localized campaigns: applying different messages and creative executions for each foreign market a firm has entered.
Pattern campaign: designing from the start to accept modification to fit local national market conditions, yet still keeping some common elements across all foreign countries.
Qs: what promotes companies to use globalized campaigns? How about localized campaigns?

17. Coca-Cola: “Pattern Advertising”
Basic approach
Specific communication strategy
Specific Audience
Local adjustments
Words and the lyrics are translated
Basic adjustments made to the copy
Visual adjustments made to the copy

18. International Advertising Campaigns
Standardization whenever possible
When do you know it is possible and how to do it?
When your product gets ready for it.
When the market gets ready for it.
Adaptation whenever necessary
When do you know it is necessary and how to do it?
When the cultural taboos tell you so.
When the culture perception tells you so.