Marketing Principles Chapter 8: Global Marketing

globalization
refers to the processes by which goods, services, capital, people, information, and ideas flow across national borders
trade deficit
results when a country imports more goods than its exports
trade surplus
occurs when a country has a higher level of exports than imports
gross domestic product (GDP)
defined as the market value of the goods and services produced by a country in a year, the most widely used standardized measure of output
gross national income (GNI)
consists of gdp plus the net income earned from investments abroad (minus any payments made to nonresidents who contribute to the domestic economy).
purchasing power parity (PPP)
a theory that states that if the exchange rates of two countries are in equilibrium a product purchased in one will cost the same in the other, expressed in the same currency
infrastructure
the basic facilities, services, and installations needed for a community or society to function, such as transportation and communications systems, water and power lines, and public institutions like schools, post offices, and prisons
tariff
a tax levied on a good imported into a country; also called a duty
duty
same as tariff
quota
designates the maximum quantity of a product that may be brought into a country during a specified time period
exchange control
refers to the regulation of a country’s currency exchange rate
exchange rate
the measure of how much one currency is worth in relation to another
trade agreements
intergovernmental agreements designed to manage and promote trade activities for specific regions
trading bloc
consists of those countries that have signed a particular trade agreement
exporting
producing goods in one country and selling them in another
franchising
a contractual agreement between a franchisor and a franchisee that allows the franchisee to operate a business using a name and format developed and supported by the franchisor
strategic alliances
a collaborative relationship between independent firms, though the partnering firms do not create an equity partnership; that is, they do not invest in one another
joint venture
formed when a firm entering a new market pools its resources with those of a local firm to form a new company in which ownership, control, and profits are shared
direct investment
when a firm maintains 100 percent ownership of its plants, opreation facilities, and offices in a foreign country, often through the formation of wholly owned subsidiaries
glocalization
the process of firms standardizing their products globally, but using different promotional campaigns to sell them
reverse innovation
when companies initially develop products for niche or underdeveloped markets, and then expand them into their original or home markets