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Chapter 1:Introduction to global marketing

1.What are the basic goals of marketing? Are these goals relevant to global

marketing?

Basic goals:Marketing activities center on an organization efforts to satisfy customers wants and needs with products and services that offer competitive value and the essence of marketing is to surpass the competition at the task of creating perceived value for customers.

The difference between marketing and global marketing is the scope of activities. Global marketing activities are outside the home-country market. So these goals are relevant to global marketing.

And the guide line is the value equation-Value = Benefits / Price (Money, Time, Effort, Etc.).Global marketing

2.What is mean by “global localization”? Is Coca-Cola a global product? Explain.

In a nutshell, the phrase “global localization”means that a successful global marketer must have ability to “Think globally, act locally.”

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

Essence of segmentation (standardization :Essence of mass marketing)

Most people will agree that Coca-Cola is a global product by virtue of the fact that it is available in more than 195 countries in red cans bearing the distinctive signature style. It must be noted, however, that customer service efforts are adapted to the needs of particular markets, e.g., vending machines in Japan. Thus, Coca-Cola is both global and local.

3. A company’s global marketing strategy (GMS) is a crucial competitive tool.

Describe some of the global marketing strategies available to companies. Give examples of companies that use the different strategies.

Global marketing strategies: 1. Global marketing participation is the extent to which a company has operations in major world markets; 2. Standardization versus adaptation is the extent to which each marketing mix element can be standardized or adapted in various country markets; 3. Concentration of marketing activities is the extent to which activities related to marketing mix are performed in one or a few country locations; 4. Coordination of marketing activities is the extent to which activities related to marketing mix are performed interdependently around the globe; 5. Integration of competitive moves is the extent to which a firm’s competitive marketing tactics in different parts of world are interdependent.

Examples:

1. Coke is the best-known, strongest brand, as the Coca-Cola Company,

supporting its Coke, Fanta, and Powerade brands with marketing mix elements both that are globe and local, is adapt at adapting sales promotion, distribution,

and customer service efforts to local needs.;

2. McDonald’s business model is a restaurant system that can be set up virtually

anywhere in the world and offers core menu items-hamburgers, French fries, and soft drinks-in most countries, and the company also customizes menu offerings according to local eating customs.

4.Describe the difference between ethnocentric, polycentric, regiocentric, and

geocentric management orientations

Ethnocentric orientation: Mind set home country is superior to the rest of the world, sees similarities in foreign countries, leads to a GMS standardized or extension approach; Called domestic company and international company

Polycentric orientation: mind set the opposite of ethnocentrism, each country in which a company does business is unique, sees differences in foreign countries, GMS leads to localized or adaptation approach.Called multinational company The difference between the Ethnocentric orientation and Polycentric orientation are the mind-set,name of companies called and GMS.

Regiocentric orientation: a region becomes the relevant geographic unit;

management’s goal is to develop an integrated regional strategy;

Geocentric orientation: views the entire world as a potential market and strives to develop integrated world market strategies.

The difference between the regiocentric orientation and Geocentric orientation are the market area.

But they have lots of similarities.Market opportunities are pursued using both extension and adaptation strategies. The regiocentric and geocentric orientations are characteristic of global transnational companies.

5.Identify and briefly describe some of the forces that have resulted in increased

global integration and the growing importance of global marketing.

Driving Forces:regional economic agreements, Markets needs and wants, Technology, Transportation and communication improvements. Product development costs, Quality, World economic trends, Leverage.

Restraining Forces:Management myopia(目光短浅), Organizational culture, National controls(tariffs and nontariff barriers) , opposition to globalization.

Chapter 2:The Global Economic Environment

1.Explain the difference between market capitalism, centrally planned capitalism,

centrally planned socialism, and market socialism. Give an example of a country that illustrates each type of system.

The main differences across four economic systems are combinations of resource allocation( market or command )and resource ownership(private or state) .

Market capitalism(Anglo-Saxon Model)is an economic system in which individuals and firms allocate resources and production resources are privately owned.

Consumer decide goods what they desire.Firms determine what and how much to produce. Market oriented

Government’s role is to promote competition among firms and ensure consumer protection.(US, Canada,GB)

Centrally planned capitalism() is an economic system in which command resource allocation is utilized extensively in an environment of private resource ownership. (Sweden)

Centrally planned socialism, in this type of economic system, the state has broad powers to serve the public interests as it sees fit.

States decides what goods and services are produced and in what quantities.

Government owns entire industries and controls distribution, enterprises are centrally planned socialism.

Little reliance on product differentiation, advertising, pricing strategy.

(Former Soviet Union)

Market socialism: in such a system, market allocation policies are permitted within an overall environment of state ownership. (China)

2.Why are Brazil, Russia, India and China (BRIC) highlighted in this chapter?

Identify the current stage of economic development for each BRIC nation?

These four country markets are particularly dynamic and represent important opportunities.In fiscal 2008, the software giant’s collective revenues grew 54%, compared with overall global revenue growth of 18%.And experts predict that the BRIC nations will be key players in global trade even as their track records on human rights, environmental protection, and other issues come under closer scrutiny by trade partners.

Brazil:upper-middle-income country

Russia:upper-middle-income country

India:low-income country

China:lower-middle-income country

3.Mistake assumption for BOP(bottom of pyramid) In LDC(least- developed country)

1.The poor have no money.

2.The poor will not “waste”money on non-essential goods.

3.Entering developing markets is fruitless because goods there are too cheap to make

a profit.

4.People in BOP (bottom of the pyramid) countries cannot use technology.

5.Global companies doing business in BOP countries will be seen as exploiting the poor.

Chapter 3: Social and cultural Environment

1.What are some of the elements that make up culture? How do these find

expression in your native culture?

Culture is made up by material culture and non material culture and as the collective programming of mind distinguish one society from another.

Material culture is referred to physical culture like clothing and tools.

Non material culture includes intangibles such religion, perception,attitudes,beliefs and values.

Culture is acted out in social institutions, such as, family, education, religion, government, business.

2.What is The difference between a low-context culture and a high-context

culture? Give an example of a country that is an example of each type, and provide evidence for your answer.

High Context:(高语境)less information is contained in the verbal part of a message.Much more Information resides in context; Emphasis on background, basic values, societal status; Less emphasis on legal paperwork; Focus on personal reputation. (Saudi Arabia, Japan)

Evidence:A builder in Japan is likely to say,” What has that piece of paper got to do with the situation?If we can not trust each other enough to go ahead without it, why bother it?”

Low Context:(低语境)Messages are explicit and specific; Words carry all information; Reliance on legal paperwork;Focus on non-personal documentation of credibility. (Switzerland, U.S., Germany)

Evidence:In US, one tries to make the specifications so precise that the threat of legal sanction forces a builder to do a good job.

3.How can Hofstede’s cultural typologies help Western marketers better

understand Asian culture?

Hofstede’s social values typology helps markets understand culture in terms of power distance, individualism versus collectivism, masculinity versus femininity, uncertainty avoidance, and long- versus short-term orientation.

As for Asian countries, they have higher power distance and lower trust in the first dimension.And companies in high PDI culture prefer sole ownership of

subsidiaries because it provides them with more control.

In the second dimension, low individualism is the characteristic of Japanese and other Asian culture patterns. The collectivism culture makes all society’s members are integrated into cohesive in groups.

In the third dimension, Asian companies more prefer masculinity.Overall they like aggressive, achievement-oriented people to work for them and in the company, the leaders are almost old men.

In Asia , people is more contemplative,relativistic,and tolerant.So they have high uncertainty avoidance ability.

Asian countries have long term values, but the presence of these values by themselves is not so sufficient to lead to economic growth.

4.Explain the self-reference criterion. Go to the library and find examples of

product failures that might have been avoided through the application of the SRC.

SRC are the unconscious reference to one’s own cultural values and will create cultural myopia(近视)。

Nearly no example will success.P82*

5.Diffusion Theory

Adoption Process: Awareness Interest Evaluation Trial Adoption

Characteristics of Innovations: Relative advantage Compatibility Complexity Divisibility Communicability

Adopter Categories:

marketing

6.Environmental sensitivity: reflects the extent to which products must be adapted to the culture-specific needs of different national markets

marketing

Environment Sensitivity

Chapter 4:The political,legal,and regulatory Environments

1.What is sovereignty? Why is it an important consideration in the political

environment of global marketing?

Sovereignty(主权)can be defined as independent political authority.

A sovereign state was considered free and independent. It regulated trade,

managed the flow of people into and out of its boundaries, and exercised undivided jurisdiction over all persons and property within its territory. It had the right, authority, and ability to conduct its domestic affairs without outside interference and to use its international power and influence with full discretion.

2.Describe some of the sources of political risk. Specifically, what forms can

political risk take?

Sources of political risk: societal and system attributes, government actions and economic function.

Forms: 1.War 2. Social unrest, fractionalized by language, ethnic and/or religious groups 3.Orderly political transfer 4.Politically motivated violence 5.Change in government/pro-business orientation 6.Social conditions (population density and wealth distribution) 7.Corruption, nepotism 8.Crime http://www.wendangku.net/doc/cf026376700abb68a982fb8e.htmlbor costs 10.Tax discrimination 11.Exchange controls, tariff barriers

Primarily occurs in lower and lower-middle income countries

-Indonesia and economic crisis

When political risk occurs in high income countries, it is generally due to a long-standing conflict

-Northern Ireland

3.Briefly describe some of the differences between the legal environment of a

country that embraces common law and one that observes civil law. International Law:The rules and principles that nation-states consider binding among themselves

A civil law country:Legal system reflects the structural concepts and principles of the Roman Empire.

The codes in which private law is cast are formulated in broad general terms and are thought of as completely comprehensive, that,is, as the all inclusive source of authority by reference to which every dispute case must be referred for decision. Companies are formed by contract between two or more parties who are fully liable for the actions of the company

A common Law country: many disputes are decided by reliance on the authority of past judicial decisions.

Code law is used in only a few areas; (the U.S. Canada)

Companies are legally incorporated by state authority

4.Seizure of Assets

Expropriation(征用)–governmental action to dispossess a foreign company or

investor

Confiscation(没收)occurs when no compensation is provided

Nationalization(国有化)–a government takes control of some or all of the enterprises in an entire industry

Creeping expropriation(逐步征用)–limits economic activities of foreign firms

Chapter 5Global Information Systems and Market Research

1.Explain how information technology puts powerful tools in the hands of global

marketers.

Modern IT tools provide the means for a company’s marketing information system and research functions to provide relevant information in a timely, cost-efficient, and actionable manner.

Intranet is a private network that allows authorized company, personnel or outsiders to share information electronically in a secure fashion without generating mountains of paper.It allows a company’s information system to server as a 24-hour nerve center, Dell operates as a real time enterprise.

Electronic data interchange (EDI) allows business units to submit orders, to issue invoices, to conduct business electronically, Wal-Mart legendary for its EDI, save time and money, enables retailers to improve in inventory management.

Transaction formats are universal.

Efficient Consumer Response (ECR). T his is in addition to EDI, an effort for retailers and vendors to work closely on stock replenishment. ECR can be defined as a joint initiative by members of a supply chain to work toward improving and optimizing aspects of the supply chain to benefit customers.

Intranet, Electronic Point of Sale (EPOS), Data Warehouses are also helping businesses improve their ability to target consumers and increases loyalty.

2.Outline the basic steps of the market research process.

1.Identify the information requirement

2.Define the problem and overcome the SRC

3.Choose a unit of analysis

4.Examine data availability

5.Assess value of research

6.Design the research

7.Analyze the data

8.Present the findings

3.What is the difference between existing, latent, and incipient demand? How

might these differences affect the design of a marketing research project?

Demand and profit potential, in turn, depend in part on whether the market being studied can be classified existing or potential.

Existing markets are those in which customer needs are already being served by one or more companies. In some instances, there is no existing market to

research and information may be readily available. But in countries where research is relatively new, data may be inconsistent.

A latent market is in essence, an undiscovered segment. It’s a market in which

demand would materialized if an appropriate product were made available.In a latent market,demand is zero before the product is introduced.

An incipient market is a market that will emerge if particular economic demographic, political, or sociocultural trend continues. A company is not likely to achieve satisfactory results if it offers a product in an incipient market before the trends have taken root.

Market growth, brand loyalty, market segment, product, sales promotion, pricing, distribution, will be different in marketing research project.

Chapter 6 Segmentation,Targeting,and Positioning(STP)

1.In a recent interview, a brand manager at Procter &Gamble noted,

“Historically, we used to be focused on discovering the common hopes and dreams within a country, but now we’re seeing that the real commonalities are in generations across geographic borders.”

What is the significance of this comment in terms of the “conventional” versus “unconventional”approaches to global market segmentation shown in Table 6-1

1.conventional wisdom assumes heterogeneity between countries

Unconventional wisdom assumes the emergence of segments that transcend national boundaries

2.conventional wisdom assumes homogeneity within any given country

Unconventional wisdom acknowledges the existence of within-country differences.

2.Identify the five basic segmentation strategies. Give an example of a company

that has used each one.

Demographics Segmentation(人口细分) Carrefour

Psychographic Segmentation(心理细分) Nokia

Behavior Segmentation(行为细分) McDonald

Benefits Segmentation(利益细分)Procter&Gamble

Ethnic Segmentation(种族细分) Famso

3. Explain the difference between segmenting and targeting.

Segmenting:Represents an effort to identify and categorize groups of customers and countries according to common characteristics

Targeting:The process of evaluating segments and focusing marketing efforts on a country, region, or group of people that has significant potential to respond and focus on the segments that can be reached most effectively, efficiently, and profitably.

Targeting is the next step of segmenting.It evaluates and compared segments and

select the greatest potential segment.

4. Compare and contrast standardized, concentrated, and differentiated global marketing. Illustrate each strategy with an example from a global company.

Standardized global marketing is analogous to mass marketing on a global scale with undifferentiated target marketing.It is served with a marketing mix of standardized elements. (Revlon International)

Concentrated global marketing,involves devising a marketing mix to reach a niche. A niche is simply a single segment of the global market. Look for global depth rather than national breadth. Ex.: Chanel

Differentiated global marketing,represents a more ambitious approach than concentrated target marketing with multi-segment targeting and two or more distinct markets. (Rover)

5. What is positioning? Identify the different positioning strategies presented in the chapter and give examples of companies or products that illustrate each.

Positioning:Locating a brand in consumers’ minds over and against competitors in terms of attributes and benefits that the brand does and does not offer.

Attribute or Benefit positioning strategies: exploits a particular product attribute,benefit,or feature.(BMW)

Quality and Price positioning strategies:Continuum from high price/quality and high price to good value(Stella Artois beer)

Use or User:Associates the brand with a user or class of users(Max Factor)

Competition: Implicit or explicit reference to competition(Dove)

Global consumer culture positioning:Identifies the brand as a symbol of a particular global culture or segment.(Sony)

6. What is global consumer culture positioning (GCCP)? What other strategic positioning choices do global marketers have?

Global consumer culture positioning:Identifies the brand as a symbol of a particular global culture or segment.

Foreign consumer culture positioning:Associates the brand’s users, use occasions, or product origins with a foreign country or culture

Local consumer culture positioning:Identifies with local cultural meanings.

7. What is a high-touch product? Explain the difference between high-tech product positioning and high-touch product positioning. Can some products be positioned using both strategies? Explain.

High-tech products are sophisticated technologically complex, and/or difficult to explain or understand, and frequently evaluated in terms of their performance against established objective standards. High-tech global consumer positioning also works well for special interest products associated with leisure of recreation.

High-touch products,consumers are generally energized by emotional motives rather than rational ones, and frequently evaluated in terms of their performance

against established subjective, aesthetic terms.

Some products can be positioned using both strategies, with both satisfying buyers’ rational criteria and evoking an emotional response. Nokia, for example, combines technical performance with a fashion orientation.

Chapter 7 Global Market Entry Strategies:licensing, investment,and strategic Alliances.

1.What are the advantages and disadvantages of using licensing as a market entry

tool? Give examples pf companies from different countries that use licensing as

a global marketing strategy.

Advantages to licensing

Provides additional profitability with little initial investment

Provides method of circumventing tariffs, quotas, and other export barriers

When appropriate,licensees are granted considerable autonomy and are free to adapt the licensed goods to local tastes.

Attractive ROI

Low costs to implement

Disadvantage to licensing

Limited participation

Returns may be lost

Lack of control

Agreement may have a short life

Licensee may become competitor

Licensee may exploit company resources

Eg: Hugo Boss(Germany) Coca-Cola(America)

2.What is foreign direct investment (FDI)? What forms can FDI take?

Partial of full ownership of operations outside of home country and the figures reflect investment flows out of the home country as companies invest in or acquire plants, equipment or other assets.

Forms: joint ventures

-Minority or majority equity stakes

-Outright acquisition

3.What is meant by the phrase global strategic partnership? In what ways does this

form of market entry strategy differ from more traditional forms such as joint ventures?

GSP:A sophisticated market entry strategy via an alliance with one more business partners for the purpose of serving the global market.

Differences

Participants remain independent following formation of the alliance

Participants share benefits of alliance as well as control over performance of

assigned tasks

Participants make ongoing contributions in technology, products, and other key strategic areas

4.Which strategic options for market entry or expansion would a small company

be likely to pursue? A large company?

Market entry strategy

A large company is likely to pursue any options for it has resources insured like exporting, licensing, FDI, strategic alliance.

A small company is likely to pursue 1. Exporting 2.licensing

Market expansion strategy

A large company is likely to pursue 1.country and market concentration 2.country concentration and market diversification.

A small company is likely to pursue 1.country diversification and market concentration 2.country and market diversification.

5.Keiretsu(经连会) in Japan

Inter-business alliance or enterprise groups in which business families join together to fight for market share

Often cemented by bank ownership of large blocks of stock and by cross-ownership of stock between a company and its buyers and non-financial suppliers

Keiretsu executives can legally sit on each others’boards, share information, and coordinate prices

Chapter 8 Strategic Elements of competitive advantage

1.How can a company measure its competitive advantage? How does a firm know

if it is gaining or losing competitive advantage? Cite a global company and its source of competitive advantage.

1) low cost and differentiation

2)When there is a match between a firm’s distinctive competencies and the

factors critical for success within its industry.

3)IKEA

2.Outline Porter’s five forces model of industry competition. How are the various

barriers to entry relevant to global marketing?

Porter’s five forces model:1.Threats of new entrants 2.Threats of substitute products 3.Bargaining Power of buyers 4.Bargaining Power of Suppliers 5.Rivalry Among competitors.

Barriers

1.economies of scale refer to the decline in per unit product costs as the absolute volume of production per period increases.This one will cause difficulties for potential new entrants.

2.Product differentiation is the extent of a product ‘s perceived uniqueness.Product differentiation and brand loyalty raise the bar for would be industry entrants.

3.Capital requirements is not only for fixed capital but also for financing R&D, advertising working capital etc.

4.Switching cost caused by the need to change suppliers and products.

5.Distribution channels.The new entrants need to invest time and money to gain access to existing channel or to establish new channels

http://www.wendangku.net/doc/cf026376700abb68a982fb8e.htmlernment policy. Government will restrict competitive entry.

7.Cost advantages independent of scales.The established company enjoy the benefits like accessing to raw materials,a large pool of low cost labor etc.

http://www.wendangku.net/doc/cf026376700abb68a982fb8e.htmlpetitor response;If new entrants expect existing competitors to respond strongly to entry,their expectations about the rewards of entry will certainly be affected.

3.How does the five partners, or flagship model, developed by Rugman and

D’Aveni differ from Porter’s five force model?

Differences:

Porter is based on individualism and individual business transaction while flagship is a network.

Porter five model is a quiescent model and flagship is a dynamic model.

4.Briefly describe Hamel and Prahalad’s framework for competitive advantage.

Build layers of advantage

Search for loose bricks

Change the rules of engagement

Collaborating

5.How can a nation achieve competitive advantage?

1.Have a good understanding of factors conditions.

2.Related and supporting industry

3.Nature if a firm strategy,structure, and rivalry

4.Chance

http://www.wendangku.net/doc/cf026376700abb68a982fb8e.htmlernment

Low cost differentiation

Chapter 9 Brand and Product Decisions in Global Marketing

1.What is the difference between a product and a brand?

A product is a good, service, or idea with Tangible Attributes and Intangible Attributes that collectively create value for a buyer or seller.

Products are classified into Consumer goods and Industrial goods

A brand is a complex Bundle of images and experiences in the customer’s mind,

2.How do local, international, and global products differ? Cite examples.

Local Products is one that have achieved success in a single national market.Li Ning in

china.

International Products are offered in several markets in a particular region.

Honda 5-door hatchback auto is known as Fit in Japan and Jazz in Europe

Global Products meet the wants and needs of a global market and are offered in all world regions.(BMW)

3.What are some of the elements that make up a brand? Are these elements

tangible or intangible?

Tangible logo distinctive packaging brand names trade marks or services mark Nontangible intellectual property

4.What criteria should global marketers consider when making product design

decisions?

Packaging:labeling and aesthetics

Express warranty

In many instances, packaging is an integral element of product-related des ign decisions. Packaging is designed to protect or contain the product during shipping;Labeling provides consumers with various types of information; Aesth etics differ around the world. Global marketers must understand the importan ce of visual aesthetics; Product Warranties is a written guarantee that assures the buyer is getting what they paid for or provides a remedy in case of a product failure. Warranties can be used as a competitive tool

5.Briefly describe various combinations or product-communication strategies

available to global marketers. When is it appropriate to use each?

1.product-communication extension (dual extension) May be very profitable, simple Almost no adaptation Same advertising and promotional appeals Used with B2B or industrial products

2.Product Extension-Communications Adaptation Products may serve the same or different needs in different market No product changes reduce expense Costs in market research advertising, sales promotion, point-of-sale material

3.Product Adaptation-Communications Extension Adapt the product to local use but the message stays the same

4.Product- Communications Adaptation Both may need to change for legal, cultural or other environmental reasons Regional managers may simply act independently

5.Innovation

Important for reaching mass markets in less industrialized nations and certain segments in industrialized countries

Chapter 10 Pricing Decisions

1.What are the basic factors that affect price in any market? What considerations

enter into the pricing decision?

Basic factors: costs, regulation, and the intensity of the rivalry among industry member.

Considerations: costs, interest groups and conflict price objectives.

Environmental influence:currency fluctuation inflationary environment government control,subsidies and regulation competitive behavior using sourcing as a strategic pricing tool

In global marketing, the task of setting prices is complicated by fluctuating exchange rates. Currency fluctuations can create significant problems and opportunities for the classic inter national company that exports from the home country.

Inflation, or a persistent upward change in price levels, is a problem in many country markets. It can be caused by an increase in the money supply and currency devaluation. Governmental policies and regulations that affect pricing decisions include dumping legislation, resale price maintenance legislation, price ceilings, and general reviews of price levels.

Pricing decisions are bounded not only by cost and nature of demand but also by competitive action.

Competitive Behavior: If competitors do not adjust their prices in response to rising costs it is difficult to adjust your price to maintain operating margins; If competitors are manufacturing or sourcing I a lower-cost country, it may be necessary to cut prices to stay competitive

The global marketer has several options for addressing the problem of price escalation or the environmental factors described in the last section.

2.Define the various types of pricing strategies and objectives available to global

marketers.

1. Market Skimming and Financial Objectives:Charging a premium price May occur at the introduction stage of product life cycle Luxury goods marketers use price to differentiate products

2.Penetration Pricing and Non-Financial Objectives Charging a low price in order to penetrate market quickly Appropriate to saturate market prior to imitation by competitors

3.marketing holding strategy A pricing strategy that allows management to maintain market share prices are adjusted up or down as competitive or economic condition change

3.Why do price differences in world markets often lead to gray marketing?

Price differences reflects the need to compensate the foreign distributor for advertising and marketing.

Gray Market Issues Dilution of exclusivity Free riding Damage to channel relationships Undermining segmented pricing schemes Reputation and legal liability Because price differences in world markets lead to trademarked products are exported from one country to another where they are sold by unauthoriz ed persons or organizations

Gray marketing occurs when product is in short supply, when producers use.skimming strategies in some markets, and when goods are subject to sub stantial mark-ups

4.What is dumping? Why was dumping as such an important issue during the

Uruguay Round of GATT negotiations?

Dumping:Sale of an imported product at a price lower than that normally charged in a domestic market or country of origin.

5.What is a transfer price? Why is it an important issue for companies with

foreign affiliates? Why did transfer pricing in Europe take on increased importance in 1999?

Transfer Pricing Pricing of goods, services, and intangible property bought and sold by operating units or divisions of a company doing business with an affiliate in another jurisdiction

Importance:1. The transactions are happened in global market

2.The way costs are defined may have an impact in tariff and duties of sales to affiliates

Euro as EU currency.

Three major alternative approaches to transfer pricing decision

Cost-based transfer pricing

Market-based transfer pricing

Negotiated transfer pricing

6.What is the difference between ethnocentric, polycentric, and geocentric

pricing strategies? Which would you recommend to a company that has global market aspirations?

Global pricing: three alternatives

Extension or Ethnocentric:(价格延伸)Per-unit price of an item is the same no matter where in the world the buyer is located

Adaptation or Polycentric:(多及定价)Permits affiliate managers or independent distributors to establish price as they feel is most desirable in their circumstances Geocentric:(全球定价)Intermediate course of action and is based on the realization that several factors are relevant to pricing decision

Chapter 11 Global marketing channels and physical distribution

1.In what ways can channel intermediaries create utility for buyers?

1.Select distributors –don’t let them select you

2.Look for distributors capable of developing markets, rather than those with a few good customer contacts

3.Treat local distributors as long-term partners, not temporary market-entry vehicles

4. Support market entry by committing money, managers, and proven marketing ideas

5. From the start, maintain control over marketing strategy

6. Make sure distributors provide you with detailed market and financial performance data

7. Build links among national distributors at the earliest opportunity

Place utility–availability of a product or service in a location that is convenient to a potential customer

Time utility–availability of a product or service when desired by a customer

Form utility–availability of the product processed, prepared, in proper condition and/or ready to use

Information utility–availability of answers to questions and general communication about useful product features and benefits

2.What factors influence the channel structures and strategies available to global

marketers?

B2C

The characters of both buyers and products have an important influence on channel design. The number of individual buyers and their geographic dist ribution, income, shopping habits and different channel approaches. Products characters such as degree of standardization, perishability, bulk, servi ce requirements, and unit price have an impact as well.

Channels tends to be longer as the number of consumers to be served incre ases and the price per unit decreases. Bulky products usually require channel arrangements that minimize the shipping distances and the number of times products change hands before they reach the ultimate customer.

B2B

As is true with consumer channels, product and consumer characteristics have an impact on channel structure. Three basic elements are involved: the manufacture's sales force, distributors or agents and wholesalers.

Channel strategy in a global marketing program must fit the company's c ompetitive position and overall marketing objectives in each national market. market factors: consumer profiles, market size and location of country.

http://www.wendangku.net/doc/cf026376700abb68a982fb8e.htmlpare and contrast the typical channel structures for consumer products and

industrial products.

4.Identify the four retail market expansion strategies discussed in the text. What

factors determine the appropriate mode?

Organic growth:Company uses its own resources to open a store on a greenfield site or acquire one or more existing retail facilities

Franchise:Appropriate strategy when barriers to entry are low yet the market is culturally distant in terms of consumer behavior or retailing structures

Chain Acquisition:A market entry strategy that entails purchasing a company with multiple existing outlets in a foreign country

Joint Venture:This strategy is advisable when culturally distant, difficult-to-enter markets are targeted

marketing

Chapter 12Advertising and Public Relations

1.In what ways can global brands and global advertising campaigns benefit a

company?

1) bring key company to share information ,insights and experience

2) Global campaigns with unified themes can help to build long-term product and brand identities

3) From product culture

4) add psychological value to a product or brand

5) offer companies economies of scale in advertising as well as improves access to carry its products channels.

2.How does the “standardized versus localized ” debate apply to advertising? Four dif ficulties that compromise an organization’s communication efforts

–The message may not get through to the intended recipient.

–The message may reach the target audience but may not be understood or may even be misunderstood.

–The message may reach the target audience and may be understood but sti ll may not induce the recipient to take the action desired by the sender.

–The effectiveness of the message can be impaired by noise.

3.What is the difference between an advertising appeal and creative execution? An advertising appeal:is the communications approach that relates the motives of the target customer.

creative execution:The way an appeal or proposition is presented

4.How does public relations differ from advertising? Why is PR especially

important for global companies?

Public relations (PR) is the department or function responsible for evaluating public opinion about, and attitudes toward, the organization and its products and brands. Public relations personnel also are responsible for fostering goodwill, understanding, and acceptance among a company’s various constituents and public.

One of the tasks of the PR practitioner is to generate favorable publicity. By definition, publicity is communication about a company or product for which the company does not pay.

Advertising is the sunset of PR, not the other way around.

Importance:Build consensus and understanding

Create harmony and trust

Articulate and influence public opinion

Anticipate conflicts and resolve disputes

5.What are some of the ways public relations practices vary in different parts of

the world?

Cultural traditions

Social and political contexts

Economic environments

Chapter 13 Sales Promotion

1.Briefly review how the main tools of sales promotion (e.g., sampling and

couponing) can be used in global markets. What issues and problems arise in different country markets?

Sampling: Provides consumer with opportunity to try product at no cost

Couponing: Printed certificates entitle the bearer to a price reduction or some other special consideration for purchasing a particular product

1.Fraud Pepsi promotion with Apple

2.Regulations vary by country

3.Cultural dispositions to coupons and other sales promotions Malaysians see

coupon usage as embarrassing Islam frowns on gambling so sweepstakes may not work

2.What potential environmental challenges must be taken into account by a

company that uses personal selling as a promotional tool outside the home country?

Personal selling:is Person-to-person communication between a company representative and a prospective buyer

Challenges:

Political Risks :unstable or corrupt governments change the rules for the sales team

Regulatory Hurdles:Governments can set up quotas or tariffs that affect the sales force

Currency Fluctuations:increase and decrease in local currencies can make certain products unaffordable

Market Unknowns :lack of knowledge of market conditions, the accepted way of doing business, or positioning of the product may derail the sales team’s efforts 3.How does management’s orientation (e.g., ethnocentric, polycentric, or

reg5iocentric) correlate with decisions about sales force nationally? What other factors affect sales force composition?

Expatriates host country natives sales agents

marketing