0. International Marketing

1. Introduction to International Marketing

2. Top 10 U.S. Players in the Global Game
Foreign
Revenues
($ Mil)
Foreign
Revenues
(% of Total)
Foreign
Profits
(% of Total)
Foreign
Assets
(% of Total)
Company
ExxonMobil
IBM
Ford Motor
General Motors
General Electric
Texaco
Citigroup
Hewlett-Packard
Wal-Mart Stores
Compaq Computer
115,464
50,377
50,138
46,485
35,350
32,700
28,749
23,398
22,728
21,174
71.8
57.5
30.8
26.3
31.7
77.1
35.1
55.2
13.8
55.0
62.7
49.6
N/A
55.3
22.8
54.1
58.0
8.2
101.4
63.9
43.7
44.2
38.0
47.4
45.2
41.0
51.5
36.0
28.2
1-4
SOURCE: Adapted from Brian Zajac, “Global Giants”. Forbes, July 24, 2000
Irwin/McGraw-Hill

3. Foreign Acquisitions of U.S. Companies
U.S. Companies Foreign Owner
Bestfoods (foods) U.K.
Ben & Jerry’s (ice cream) U.K.
Alpo (pet food) Swiss
Pillsbury (food) U.K.
Burger King (fast food) U.K.
Random House (publishing) Germany
Chrysler (autos) Germany
TV Guide (magazine) Australia
New York Post (newspaper) Australia
LA Dodgers (sports) Australia
Arco (gasoline) U.K.
CompUSA (retailing) Mexico
Seagram (alcoholic beverages) France
1-2
Irwin/McGraw-Hill
SOURCE: Adapted from Kuri Badenhausen. “Name Game”, Forbes. Jul 24, 2000

4. Leading World Trading Countries, 1997 ($ billions)
Country* Exports Imports Total
EU-15 $2,723.5 $2,565.4 $5,289.9
U.S.A , ,007.4
Germany
Japan
United Kingdom
France
Italy
Canada
Netherlands
Belgium/Luxembourg
China
Spain
South Korea
Mexico
Switzerland
3-12
SOURCE: Statistic Report of Import and Export Trade Ministry of foreign Trade and Economic Cooperation, China and National Accounts, Foreign Trade by Commodities, OECD 2000.
Irwin/McGraw-Hill

5. Domestic Policy Repercussions
Influences in the U.S.
1 out of every 3 U.S. farm acres is producing for export
1 of every 6 U.S. manufacturing jobs produces for export
$1 of every $7 of U.S. sales goes abroad
1 of every 3 cars, 9 out of 10 TVs, 2 out of 3 suits, and every VCR sold in the U.S. is imported.
Travel and tourism is the #1 source of U.S. foreign exchange.
$1 of every $4 of U.S. bonds & notes is issued to foreigners.

6. The Scope and Challenge of International Marketing
I. The Internationalization of U.S. Business
II. International Marketing
International Marketing - is concerned with planning and conducting transactions across international borders to satisfy the objectives of individuals and organizations.

7. The Scope and Challenge of International Marketing
- Q: Why Study International Marketing?
- A: There is a trend toward a global economy.
No longer enough to look at domestic market
Markets across the world being sought after by more competitors
Explosion of international trade
Global linkages become important

8. Global Linkages
Global linkages bind countries, institutions, and individuals more closely than ever.
World trade opens up entirely new business horizons.
A freeze in Brazil and its effects on coffee production are felt around the world as coffee becomes scarce and its price rises.
A decline in the value of the Mexican peso affected financial markets in all emerging economies and impacted Poland, Hungary, and the Czech Republic.

9. The Changing Face of Exporting
New Chart Fig. 1.3
Source: The World Bank, World Development Report, 1999.

10. The Scope and Challenge of International Marketing
“If we only distributed pictures in the U.S., we’d lose money. It takes the whole world now to make the economics of movie-making work”
- William Mechanic
President, 20th Century Fox

11. The Scope and Challenge of International Marketing
“Half the people in the world have yet to take their first picture. The opportunity is huge, and it’s nothing fancy. We just have to sell yellow boxes of film.”
- George M.C. Fisher
CEO, Eastman Kodak Company

12. Invented Here, Made Elsewhere
U.S. Invented Technology
9 0%
Phonographs 1%
1-3
9 0%
Color TVs
1 0%
4 0%
Audiotape Recorders 0%
N O W
1 0%
Videotape Recorders 1%
9 9%
Machine Tools
3 5%
Telephones
9 9%
2 5%
Semiconductors
8 9%
6 4%
Computers
9 8%
7 4% 20 40 60 80
100
Irwin/McGraw-Hill

13. World Trade Flows ( in billions of dollars )
WESTERN EUROPE
Intra-Trade: 1,230
Exports: 481
Imports: 473
160
128
162
170
143
AMERICAS
Intra-Trade: 221
Exports: 364
Imports: 455
253
ASIA
Intra-Trade: 394
Exports: 491
Imports: 360
160
191 40 72 44
REST OF WORLD
Intra-Trade: 57
Exports: 255
Imports: 303 68
1992
Source: International Trade Statistics General Agreement on Tariffs and Trade Geneva 1993

14. The Scope and Challenge of International Marketing
III. Comparing Domestic and International Marketing
Similarity:
- Both carry out transactions that meet the needs of individuals and organizations
Differences:
- International markets have greater growth potential
- Some tasks associated with international marketing not included (or less intense ) than in domestic marketing (e.g., cultural research, political factors, exchange rates, trade laws, long distance distribution.)

15. The Scope and Challenge of International Marketing
Why U.S. Share of Trade is Declining:
- Lack of awareness of importance of world markets
- More intense foreign competition (more modern production facilities and lower costs than in past)
How the U.S. Can Compete (given high labor costs):
- Modernization and automation (investment in R&D)
- Focus on high capital/labor ratio industries
- Manage services
- Use foreign labor in manufacturing industries
- Do effective marketing research

16. The Scope and Challenge of International Marketing
IV. Being International
V. International Marketing Concepts

17. International Marketing Concepts
EPRG Schema
Domestic Market Extension (Ethnocentric)
Multi-Domestic Market (Polycentric)
Global Marketing (Regio/Geocentric)

18. The Scope and Challenge of International Marketing
Figure 1.1: International and Global Marketing
Multi-Country Marketing Global Marketing

19. The Scope and Challenge of International Marketing
Business
Figure 1.2: International and Global Marketing and Related Fields of Study
International
Marketing
International
Management
International
Trade
International
Finance

20. The Scope and Challenge of International Marketing
Business
Figure 1.2: International and Global Marketing and Related Fields of Study
International
Marketing
International
Trade
International
Management
Global
Marketing
International
Finance