Summary International Marketing Management KULeuven MBA ()
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Course
International Marketing Management
Institution
Katholieke Universiteit Leuven (KU Leuven)
Complete and clear summary of the course International Marketing Management given by M. Kotschedoff. The summary contains all slides from the lectures, supplemented with own notes.
INTRODUCTION TO INTERNATIONAL MARKETING ........................................................................................... 2
EVOLUTION OF GLOBAL MARKETING ............................................................................................................................ 2
STANDARDIZATION VERSUS ADAPTATION...................................................................................................................... 7
WHAT IS CULTURE ................................................................................................................................................. 11
CULTURAL CLASSIFICATION ...................................................................................................................................... 14
MARKETING IMPLICATIONS OF CULTURE..................................................................................................................... 22
INTERNATIONAL SEGMENTATION .............................................................................................................................. 24
INTERNATIONAL TARGETING AND POSITIONING ............................................................................................................ 27
INTERNATIONAL ENTRY ................................................................................................................................. 29
MARKET SELECTION ............................................................................................................................................... 29
MODE OF ENTRY ................................................................................................................................................... 35
ALLOCATING RESOURCES DURING ENTRY .................................................................................................................... 39
INTERNATIONAL ENTRY AND NEW PRODUCT GROWTH ................................................................................ 40
TIMING AND ORDER OF ENTRY .................................................................................................................................. 40
PRODUCT DIFFUSION.............................................................................................................................................. 45
GLOBAL VERSUS LOCAL BRANDS ................................................................................................................................ 50
COUNTRY OF ORIGIN EFFECT .................................................................................................................................... 56
INTERNATIONAL ADVERTISING ...................................................................................................................... 59
GLOBAL ADVERTISING ............................................................................................................................................. 59
DEVELOPING A GLOBAL ADVERTISING STRATEGY ........................................................................................................... 61
INTERNATIONAL PRICING .............................................................................................................................. 70
BASICS OF GLOBAL PRICING ..................................................................................................................................... 70
GLOBAL PRICING STRATEGIES.................................................................................................................................... 79
MANAGEMENT OF FOREIGN EXCHANGE RISKS.............................................................................................................. 82
INTERNATIONAL MARKET RESEARCH ............................................................................................................. 83
IMPORTANCE INTERNATIONAL MARKET RESEARCH ........................................................................................................ 83
GUIDELINES.......................................................................................................................................................... 83
1
,INTRODUCTION TO INTERNATIONAL MARKETING
EVOLUTION OF GLOBAL MARKETING
The globalization of markets
Globalization = the increasing interdependence, integration and interaction among people,
companies, and governments of different nations around the world. The increasing
interdependence leads to converging commonalities across the globe.
Drivers of globalization
1. Technological changes: global connectivity
2. Political arrangements
3. Technological and legal harmonization
4. Globalization of economy and trade
5. Financial globalization
Technological changes: global connectivity
- Global telecommunication infrastructure
o Increase in information flows between geographically distant locations.
- ICT including (broadband) Internet, communication satellites, wireless telephony,
submarine fiber optic cables, …
o Facilitates communication between companies and consumers.
- Web 2.0: content websites is created by the users
➔ Information and experience can be shared more easily
Digital divide
- Gap between western world and developing areas (Africa, Asia, Latin America)
- Big differences in terms of mobile subscribers, especially Africa and South-Asia stay
behind
2
,Political arrangements
Political arrangements and unification process
- Since WWII: creation of different supra-national political organization
o Examples: North Atlantic Treaty Organization (NATO) or the United Nations
(UN)
- International trade organization and agreements to promote the trade of products and
services
o Examples: World Trade Organization (WTO), General Agreement on Tariffs
and Trade (GATT) at the worldwide level, MERCOSUR for Latin-America,
North American Free Trade Agreement (NAFTA) between United States,
Canada and Mexico, and the European Union between 28 European
countries
- Monetary unions such as the Euro zone
o Easier to do business, same currency... ➔ very supporting
➔ High political arrangements make it easier for companies to work around the world
Technological and legal harmonization
- Increase in the number of standards applied globally
o Example: copyright laws and patents
- A lot of lobbying in favor of an international criminal court and international justice
movements ➔ security that you are measured by the same laws
o Example: price kartels lead to jail time in some countries and fines in other
countries
o Same justice system means less risks
Globalization of economy and trade
- Increase in volume and variety of transactions across borders
o More depending on other countries due to imports and exports
o Products and services
o Example: value of daily trade between EU and US is 1 billion euro
- Volume of global trade has multiplied by 20 since 1950
- Rise and success of multinational companies
Intra and extra-regional exports
Light purple: export inside region
(e.g. Inside Europe)
Dark purple: export to other regions
3
, Leading exporters
1. China
2. US
3. Germany
Leading importers
1. US (net importer = higher imports than exports)
2. China (net exporter = higher exports than imports)
3. Germany
China exports by importing region
➔ China is the main supplier of the world
➔ Factory of the world
Financial globalization
- Emergence of worldwide financial markets
- Better access to external financing for corporate, national and sub-national borrowers
- Free international capital flows
- Globalization of financial crises too…
➔ The more integrated, the higher risks regarding financial crisises, but also the more
you can reap the benefits
Marketing globalization
- Rise of consumerist society around the world (buying of material goods)
- Started in US after WOII
- Gradually spread out across the world (mainly western world)
- Consumerism came to be equated to success and status
The evolution of international marketing
4
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