The Global Marketplace

1. The Global Marketplace By Gavin, Lisbeth, Maura, Orlando, Trixie

2. Agenda

3. The International Trade System • Trade System Regulations • Tariffs/Quotas/Exchange Controls/Nontariff Trade Barriers • The World Trade Organization (WTO) • General Agreement on Tariffs and Trade (1947) • WTO (1955) • Regional Free Trade Zone • Economic Communities (Free Trade Zones) • European Union (EU) • North American Free Trade Agreement (NAFTA) • Central American Free Trade Agreement (CAFTA) • Union of the South American Nations (UNASUR)

4. Cultural Environment The Impact of Culture on Marketing Strategy The Impact of Marketing Strategy on Cultures

5. Political-Legal Environment Attitude towards International Buying and Selling Political Stability Government Bureaucracy Monetary Regulations

6. Economic Environment • Industrial Structures • Subsistence Economies • Raw Material Exporting Economies • Emerging Economies (Industrializing Economies) • Industrial Economies • Income Distribution • Low/Medium/High Income Households

7. Deciding Whether to Go Global Local Global Advantages: Opportunity for growth Disadvantages: “One-size-fits-all” approach • Advantages: Easier and safer • Disadvantage: Increase competition

8. Deciding Which Markets to Enter How Many Countries to Enter? What types of countries To Enter Products Geography Population Income Political Climate

9. Deciding How to Enter the Market • Exporting • Indirect and Direct exporting • Joint Venturing • Licensing • Contract Manufacturing • Management Contracting • Joint Ownership • Direct Investment

10. Deciding on the Global Marketing • Product • Three strategies are used for adapting a product: • Straight product extension – marketing a product without making any changes to it • Pros: Involves no additional product development costs, manufacturing changes or promotion changes • Cons: Can be costly in the long-run if products fail to satisfy consumers in a specific global market • Product adaptation – adapting a product to meet local conditions, needs, or wants • Product invention – creating a new product or service to match the local environment

11. PROMOTION Deciding on the Global Marketing Communication Strategy Home Market Use Localized Marketing Cultural Adjustments Communication Adaptation Differentiation Among Ads Media Internationally

12. Deciding on the Global Marketing Organization Price Poor countries (High vs Low Prices) Additional costs Modified products New brands with affordable price Internet Global Pricing Steve Madden Steve Madden: Madden Girl

13. Deciding on the Global Marketing Program • Distribution Channels • Whole Channel View • Global Value Delivery Network • Nation to Nation Variations • Intermediaries • New Distribution Structures

14. Deciding on the Global Marketing Organization • Companies manage international marketing in three steps: • Organize an Export Department • Create an Internal Division • Become a Global Organization • Geographical organizations - Country managers are responsible for sales people, sales branches, distributors, and licensees in their respective countries. • World product groups - Each operating unit is responsible for worldwide sales of different product groups. • International subsidiaries - Each unit is responsible for their own sales and profits.

15. MCDONALDS Product Promotion Price Distribution Channels