1. International Marketing
Global Strategic Planning

2. Global Marketing Evolution
Core Business Strategy
Country A
Country B
Country C
Country D

3. Globalization Drivers
Market Factors
Cost Factors
Environmental Factors
Competitive Factors

4. Global Strategy Formulation
Assessment and Adjustment of Core Strategy
Market/Competitive Analysis Internal Analysis
Formulation of Global Strategy
Choice of Target Countries, Segments, and Competitive Strategy
Development of Global Marketing Program
Implementation
Organizational Structure Control

5. Understanding and Adjusting the Core Strategy
The SBU: Based on Product Market Similarities
Similar needs or wants to be met
Similar end user customers to be targeted
Similar products or services used to meet needs of specific customers

6. Analysis is the First Step
Market Analysis
Competitor Analysis
Internal Analysis

7. Formulating Global Marketing Strategy Starts With a Series of Decisions
Country-Market Choice
Choice of Competitive Strategy
Segmentation Choices
Concentration
Diversification

8. Factors in Country Selection
Choice of Competitive Strategy Alternatives
The stand-alone attractiveness of the market
Global strategic importance of the market
Possible synergies offered by the market
Cost leadership
Differentiation
Focus
Market Segment 3
Market Segment 2
Market Segment 1

9. Bases for Global Market Segmentation
Environmental
Variables
Marketing
Management
Variables
Geographic
Variables
Political
Variables
Economic
Variables
Cultural
Variables
Product
Variables
Promotion
Variables
Price
Variables
Distribution
Variables

10. Global Marketing Program Development Decisions
The degree of standardization in the product offering
The marketing program beyond the product variable
The location and extent of value-adding activities
Competitive moves to be made
The Product Offering :What degree of standardization or adaptation should be offered?

11. The Location of Value-Added Activities
Pooling production ( single design center for each chip - Intel)
Exploiting factor costs or capabilities
Strategic alliances
Concurrent engineering
Competitive Moves: Cross-subsidization
“…resources accumulated in one part of the world and used to fight a competitive battle in another…”
Implementing Global Marketing :Success will come from a balance between local and regional / global concerns.
The Challenges of Global Marketing and the Pitfalls to be Avoided:
Insufficient research
The tendency to overstandardize
Inflexibility in planning and implementation
The “Not-Invented-Here” Syndrome (NIH)

12. The Management Process
Localizing Global Marketing :Achieving a balance between country managers and global product managers at headquarters.
The Management Process
Enhancing the global transfer of communications
Personnel interchange to gain experience abroad
Headquarters should coordinate and leverage resources
Permit local managers to develop their own programs within defined parameters

13. How to Avoid the NIH Syndrome
Ensure that local managers participate in the development of global brand marketing strategies
Encourage local managers to develop ideas for regional or global use
Maintain a product portfolio that includes local as well as regional or global brands
Allow local managers control over marketing budgets to respond to local customer needs and counter global competition

14. Emerging Global Organization Structures
Global Account Management
Changes in the Corporate Culture for Going Global:
The World is Not One Single Market.
Planning and Executing Programs on a Worldwide Basis.
A Global Identity that Favors No Specific Country.
Product Choices Should Consider Individual Markets as well as Transfer Products from One Region to Another.

15. International Marketing
Global Pricing Strategies
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Transfer Pricing
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17. Objectives of Transfer Pricing
Competitiveness in the international marketplace
Reduction of taxes and tariffs
Management of cash flows
Minimization of foreign exchange risks
Avoidance of conflicts with home and host governments
Internal concerns - goal congruence or subsidiary manager motivation
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18. Use of Transfer Prices to Achieve Corporate Objectives
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19. Three Philosophies of Pricing have Developed
Cost-based philosophy
Every affiliate is a profit center
Market-based philosophy
It takes local conditions into account
Arm’s-length price
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20. Transfer Pricing Challenges
Internal to the MNC
External between the home and host country tax authorities
Performance Measurement: The effects of manipulating intra-corporate prices will cause major problems.
Taxation:Section 482 of the Internal Revenue Code (IRS has vast authority to reallocate income between controlled foreign operations and US parents)
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21. Determining Arm’s Length Price under Section 482
The comparable uncontrolled price method
The resale price method
The cost-plus method
Any other reasonable method
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22. Pricing Within Individual Markets is Determined by:
Corporate objectives
Costs
Customer behavior and market conditions
Market structure
Environmental constraints
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23. Corporate Pricing Objectives
Skimming
Penetration Pricing
Why Prices Change?
Foreign Exchange Rates
Market Strategies
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24. Costs - Frequently used as the basis of price determination.
Labor
Raw materials
Supplies
Utilities
Shipping
Demand and Market Factors:
Price elasticity of consumer demand
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25. Market Structure and Competition
Competition sets the price within the parameters of cost and demand.
Competitors under selling your company
Eroding Market share
Strategic Alliances
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26. Copyright © 1999 by Harcourt Brace & Company
Environmental Constraints: Price controls
Governments Influence Prices and Pricing Directly
Under Price Controls, the International Marketer must Operate as if in a Regulated Industry
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27. Arguments Against Price Controls
the maximum price becomes the minimum price
the wage-price spiral advances
labor turns against restrictions
non-inflationary wage increases are forestalled
government controls are difficult to enforce
less tax is raised because less money is made
governments may need to bail out companies to prevent bankruptcies and unemployment
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28. Copyright © 1999 by Harcourt Brace & Company
Parallel Imports will Surface in Any Markets Where Price Discrepancies Exist
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