Chapter 1 – The Scope and Challenge of International Marketing

Impact of Globalization on US businesses
.The internationalization of American business is accelerating. The globalization of markets and competition necessitates that all managers pay attention to the global environment.
Definition of International Marketing
is the performance of business activities designed to plan, price, promote, and direct the flow of a company’s goods and services to consumers or users in more than one nation for a profit.
Differences between domestic and international marketing
the answer lies not with different concepts of marketing but with the environment within which marketing plans must be implemented. Unfamiliar foreign problems, variety of strategies necessary to cope with different levels of uncertainty encountered in foreign markets.
Controllable versus uncontrollable forces
– Product, price, promotion, distribution, research
– competition, politics, laws, consumer behavior
– A global awareness and sensitivity are the best solutions to these problems and they should be nurtured in the international marketing organization.
Adaption (of the marketing offer to international markets)
Marketers must be able to interpret effectively the influence and impact of each of the uncontrollable environmental elements on the marketing plan for each foreign market in which they hope to do business.
Self-reference criterion,
unconscious reference to ones own cultural values, experiences, and knowledge as a basis for decisions.
Ethnocentrism
the notion that people in ones own company, culture, or country know best how to do things.
The stages of international marketing involvement
– No direct foreign marketing
– Infrequent foreign marketing
– Regular foreign marketing
– International marketing
– Global Marketing
N/A
12 Years Ago…
Technology
Enron
WorldCom Scandals
911
2003 SARS
Indian Ocean Tsunami of 2004
Oil Prices
Nasa Budget Cuts
2007 Housing Market
N/A
Trends affecting global business today
1. The rapid growth of the World Trade Organization and new free trade agreements around the world.
2. The trend towards acceptance of the free market system among developing countries in Latin America, Asia, and Eastern Europe.
3. The burgeoning impact of the internet, mobile phones, and other global media on the dissolution of national borders.
4. The mandate to manage the resources and global environment properly for the generations to come.
Which of the following is the reason why the international marketer’s task is more complicated than that of the domestic marketer?
The international marketer must deal with at least two levels of uncontrollable uncertainty instead of one.
Which of the following is a controllable element in the environment of an international marketer?
Research activities
Elements such as geography and infrastructure, level of technology, and cultural forces in the marketing environment of an international marketer are regarded as
uncontrollable elements
Denimen Group, a clothing brand, is looking to establish itself in Northern Ireland and is devising a plan to market its products. A lot of factors in the domestic environment can have an impact on their success. Which of the following elements in the market can be altered by the team to adjust to market conditions?
Pricing strategies
A person’s _____ can prevent him from being aware of the existence of cultural differences or from recognizing the importance of those differences.
self-reference criterion
Justin, who works as a manager in a global enterprise with a diverse workforce, is of the opinion that the employees from his country are more time-conscious and good at taking decisions. He always allots responsible positions to people from his country and trusts them more compared to other employees. This notion of Justin is referred to as _____
ethnocentrism
To be _____ is to be tolerant of cultural differences and to have knowledge of cultures, history, world market potential, and global economic, social, and political trends
globally aware
Which of the following factors favors faster internationalization?
Firms with key managers well networked internationally.
A company in the _____ stage of international marketing involvement sells its goods to foreign markets only when there is a surplus due to variations in production levels. Such a company has little or no intention of maintaining continuous market representation.
infrequent foreign marketing
A company at the stage of international marketing:
sells products that are a result of planned production for markets in various countries.