MKT 3620
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MKT 3620. Name: Surej P John Office : MSM 3 rd floor, Cabin# 01 Email : [email protected] Website: http://surejpjohn.com/global-marketing /. Mark Allocations. Quiz 1 Announcement. Online quiz at SCIT Building 2 nd Floor Date Friday 6 th January, 2012 Time

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MKT 3620

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Mkt 3620

MKT 3620


Mkt 3620

Name: Surej P John

Office: MSM 3rd floor, Cabin# 01

Email: [email protected]

Website: http://surejpjohn.com/global-marketing/


Mark allocations

Mark Allocations

Surej P John


Quiz 1 announcement

Quiz 1 Announcement

  • Online quiz at SCIT Building 2nd Floor

  • Date

    • Friday 6th January, 2012

  • Time

    • Sec 406– 9.00-12.00

    • Sec 407– 12.00-16.00

  • All students can choose their preferred time (1 hour ) for taking this exam


Online resources

Online resources

  • Course syllabus, project outline, power points are all available in www.lms.au.edu

  • Enrollment key: mkt 03

  • All students are requested to register online to make use of the online resources.

Surej P John


Chapter 1 introduction to global marketing

Chapter 1Introduction toGlobal Marketing


Introduction

Introduction

  • Global versus “regular” marketing

    • Scope of activities are outside the home-country market

Product/market growth matrix


Market penetration

Market Penetration

Started the first shop in 2004

In 2009, the number of shops reached 41 including 8 University campuses

Surej P John


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Market Development


Product development

Product Development

Surej P John


Diversification

Diversification

  • Diversification is developing new products for new markets

Surej P John


Global marketing

Global Marketing

  • Create value for customers by improving benefits or reducing price

    • Improve the product

    • Find new distribution channels

    • Create better communications

    • Cut monetary and non-monetary costs and prices

Value = Benefits/Price


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Surej P John


Globalization

Globalization

  • Globalization is the inexorable integration of markets, nation-states & technologies to a degree never witnessed before—

  • in a way that is enabling:

  • individuals, corporations & nation-states to reach around the world farther, faster, deeper & cheaper than ever before, &

  • in a way that is enabling:

  • the world to reach into individuals,corporations & nation-states farther, faster, deeper & cheaper than ever before.


Competitive advantage and global industries

Competitive Advantage and Global Industries

  • Competitive advantage:

    • When a company succeeds in creating more value for customers than its competitors, that company is said to enjoy more competitive advantage.

  • Global industry

    • A global industry is one in which competitive advantage can be achieved by integrating and leveraging operations on a world wide

      OR

    • An industry is global to the extent that a company’s industry position in one country is interdependent with its industry position in another country


Degree of industrial globalization

Degree of Industrial Globalization

Surej P John


Competitive advantage

Competitive Advantage

Surej P John


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Global Marketing:

What it is & What it Isn’t???

  • Global Marketing Strategy (GMS)

  • Global market participation

  • (companies have operations in more than one market)

  • Marketing mix development

    • 4 P’s: adapt or standardize?

  • Concentrationof marketing activities.

  • Coordinationof marketing activities.

  • Integrationof competitive moves. (Eg. Lenovo)

p. 43-4


Standardization versus adaptation

Standardization versus Adaptation

  • Globalization (standardization)

    • Developing standardized products marketed worldwide with a standardized marketing mix

    • Essence of mass marketing

  • Global localization (adaptation)

    • Mixing standardization and customization in a way that minimizes costs while maximizing satisfaction

    • Essence of segmentation

    • Think globally, act locally


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Change in the Slogan of Nike in European market

Surej P John


Standardization versus adaptation1

Standardization versus Adaptation

Arabic

read right to left

Chinese

“delicious/happiness”

The faces of Coca-Cola around the world


Mcdonald s global marketing

McDonald’s Global Marketing

Marketing Mix Element StandardizationLocalized

McAlooTikka potato burger (India)

Slang ’Macca’s (Australia)

MakDo (Philippines)

McJoymagazine, “Hawaii Surfing Hula” promotion (Japan)

Home delivery (India)

Swiss rail system dining cars

$5.21 (Switzerland)

$1.31(China)

Big Mac

Brand name

Advertising slogan “I’m Loving It”

Free-standing

Big Mac is $3.10 in U.S. and Turkey

Product

Promotion

Place

Price


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In India, there are no Big Macs because the Hindu people don't eat beef.

However, they have the Maharaja Mac, which is a Big Mac made of lamb or chicken meat. There is also a vegetarian burger, the McAlooTikki.


Management orientations

MANAGEMENT ORIENTATIONS


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MANAGEMENT ORIENTATIONS

EPRG FRAMEWORK

  • Ethnocentric orientation/ INTERNATIONAL

  • Home country is superior to others

  • Sees only similarities in other

  • countries.

  • Assumes products & practices that

  • succeed at home will be successful

  • everywhere .

  • Leads to a standardized or

  • extensionapproach.

Home country

DO NOT adjust

To Host country!!

p. 52


Domestic going international

Domestic going International

New true coffee shops at Vientiane, Laos & Shanghai, China


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MANAGEMENT ORIENTATIONS

EPRG FRAMEWORK

2. Polycentric Orientations/

MULTINATIONAL

  • Each country is unique.

  • Each subsidiary develops its own

  • unique business & marketing strategies.

  • Leads to a localized or adaptation approach.

Focus is HOST country

p. 53


Multi national approach

Multi-National Approach

  • In Polycentric stage, subsidiaries are formed in each market and each subsidiaries operates independent of each other and formulates its own marketing strategies

  • Separate product lines are formed in each country and these products are modified to meet local needs ( Adaptation)

  • Sales force in each country is local nationals

  • Channels of distribution are those traditionally used by each country.


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MANAGEMENT ORIENTATIONS

EPRG FRAMEWORK

3. Regiocentric orientation

  • A region is the relevant geographic unit.

    • Ex: NAFTA (North American Free Trade

    • Agreement between: Canada, Mexico & U.S.)

Regional airline serving Malaysia and south-east Asian destinations

p. 53


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MANAGEMENT ORIENTATIONS

EPRG FRAMEWORK

4. GEOCENTRIC ORIENTATIONS/

GLOBAL OR TRANSNATIONAL

  • Entire world is a potential market.

  • Strives for integrated global strategies.

  • Retains an association with headquarters country

  • Pursues serving world markets from a single

  • country or sources globally to focus on select

  • country markets.

  • Leads to a combination of extension &

  • adaptation elements.

HD serves world

Markets from U.S.

p. 53


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DRIVING FORCES AFFECTING GLOBAL INTEGRATION & GLOBAL MARKETGING

Multilateral economic agreements

Converging market needs & the information revolution

Transportation & communication improvements

Product development costs

p. 56


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DRIVING FORCES AFFECTING GLOBAL INTEGRATION & GLOBAL MARKETGING

Quality

World economic trends

Leverage

p. 59


Leverage

Leverage

Scale economies.

  • The global company can take advantage of its greater manufacturing volume to obtain traditional scale advantages within a single factory.

  • Also, finished products can be produced by combining components manufactured in scale-efficient plants in different countries.

  • The larger scale of the global company also creates opportunities to improve corporate staff competence and quality.


Leverage1

Leverage

Experience transfers.

A global company can leverage its experience in any market in the world.

It can draw on management practices, strategies, products, advertising appeals, or sales or promotional ideas that have been tested in actual markets and apply them in other comparable markets.

ABB- 1400 subsidiaries in 140 countries.

Very famous for running the operations with the minimum number of staff

58 Million daily customers from 119 countries


Leverage2

Leverage

Global strategy.

  • The global company's greatest single advantage can be its global strategy.


Leverage3

Leverage

Resource utilization.

A major strength of the global company is its ability to scan the entire world to identify people, money, and raw materials that will enable it to compete most effectively in world markets.

For a global company, it is not problematic if the value of the "home" currency rises or falls dramatically, because for this company there really is no such thing as a home currency.


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RESTRAININGFORCES AFFECTING GLOBAL INTEGRATION & GLOBAL MARKETGING

Management myopia & Organizational culture

Opposition to globalization

National controls – (to protect local industries)

p. 62


Summary

Summary

  • Global marketing is the process of focusing resources on global marketing opportunities

  • Goal, to create customer value & competitive advantage by maintaining focus

  • Three classifications of management orientation: ethnocentric, polycentric, regiocentric, geocentric

  • Global marketing importance is shaped by a variety of driving & restraining forces


Group assignment no 1

Group Assignment No. 1

  • Make a detailed study on the Socio-Economic and Cultural factors of BRIC Nations and submit the assignment as a typewritten report.

  • All groups has to prepare a short presentation ( not more than 15 mins.) and one of the groups may be asked to do the presentation in the class!!

    IT MAY BE ANY OF YOU…..GOOD LUCK 


Looking ahead to chapter 2

Looking Ahead to Chapter 2

The global economic environment


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