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Samenvatting - international marketing
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international marketing - especially about globalization and glocalization across countries.
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International Marketing35 multiple choice questions, 1 open question: wrong answer -1/2
→ Important: general understanding, practical schemes & frameworks
Class 1: Global marketing in the firm
Can and should you internationalize?
Which markets to enter?
Which market entry strategies will you use?
How will you design your global marketing programme?
How will you implement and coordinate your global marketing programme?
Global Marketing
Global marketing = Scope (omvang) of activities are outside the home-country market
Product/market growth matrix
1. Market Penetration: Starbucks is building on its loyalty program, customers can pay
with an app, it’s easier to pay, customers can get a reward
2. Market development: Starbucks will source coffee beans in India and sell worldwide
and open café’s there
3. Product development: developing new products and placing them in existing markets
4. Diversification: developing products for new markets
Importance of going global
- Most of the world market is outside the home-country of the company
- Ex. 75% of Coca-Cola, 90% for Japanese companies, 94% for German companies
Globalization
- = A growing interdependence (onderlinge afhankelijkheid) of national economies
- = It involves customers, producers, suppliers and governments in different markets
- Companies who produce in different markets
Global marketing
- What?
o Reflects the trend of firms selling and distributing products and services in many
countries around the world
- Why and how?
o Governments reducing trade and investment barriers between countries
, o Firms manufacture in multiple countries
o Foreign firms increasingly competing in domestic markets
Forces affecting global integration & global marketing
- Multilateral trade agreements
• Converging market needs & wants and the information revolution (The more global,
the more people need the same things: for example, smartphones)
- Transportation and communication improvements e.g. Google, smartphones, airplanes
- Product development costs
o e.g. costs for a new drug, companies are forced to sell it to a lot of people to
make profit out of their product
Driving forces affecting global integration & global marketing
- Leverage (=invloed/macht)
o Experience transfers
▪ e.g. companies who already sell in another country already have the
experience to do it in more countries
o Scale economies
▪ e.g. the more you sell, the lower are your unit costs
▪ you need to divide the fixed costs by the amount of pieces you produce, so
your units costs go down
o Resource utilization
▪ See what is the best/cheapest way to source products, not only your own
market
o Global strategy
▪ If your competitors go global, you’re forced to do it to
Restraining forces affecting global integration & global marketing
- Management myopia
Myopia = what I think is right (Focusing on sth and forgot about yourself)
- Organizational culture
o You need open minded people that accept that people are different, have
different opinions
- National controls
o International companies create jobs
- Opposition to globalization
o You wear clothes that are made in China, but you know it’s probably made in bad
circumstances for a low cost
The Global Paradox
“The bigger and more open the world economy becomes, the more small and middle sized
companies will dominate.”
- First: economies of scale → Now: diseconomies of scale
- First: bigger is better → Now: bigger is inefficient, costly and wastefully bureaucratic,
inflexible and disastrous
- Big international players are slow
- Global context: the smaller and speedier players will prevail on a much expanded field.
,Result of The Global Paradox
- The differences in the global marketing behavior between small and big companies are
disappearing = convergence
o There must be a reason to go international
o You need to be sure you also create extra value for the company, not only extra
costs, create advantages e.g. reduce the units costs
The need for competitive advantage
- Going international = expensive in terms of money, time and commitment
- Must generate added value for the company beyond extra sales
- The company needs to gain a competitive advantage by going international
Key? A successful global marketing program
- Think globally, act locally: combination of coordination and local adaptations
Decision model in global marketing
Purpose of a global marketing plan = create sustainable competitive advantages in the global
marketplace
5-stage decision model = systematized approach to developing a global marketing plan:
1. The decision whether to internationalize (Why)
2. Deciding which markets to enter (Who)
3. Market entry strategies (How)
4. Designing the global marketing program
5. Implementing and coordinating the global marketing program
Should the company internationalize at all?
- Globalization
= trend of firms buying, developing, producing and selling products and services in most
countries and regions of the world
- International expansion
o New and potentially more profitable markets
o Helps increase competitiveness
o Access to new product ideas, innovations and latest technology
- BUT internationalization not likely to be successful unless the firm prepares in advance
- Solberg’s 9 strategic windows framework !!!
Determines conditions under which a company should ‘stay at home’ or ‘strengthen the
global position’ based on 2 dimensions:
o Industry globalism
▪ Degree of industry globalism mainly determined by international marketing
environment
, ▪ Strategic behavior of firm depends on the international competitive structure
within an industry
o Preparedness for internationalization
▪ Depends on firm’s ability to carry out strategies in international marketplace,
i.e. actual skills in international business operations
Preparedness: Onvolwassen-puber-volwassen
Immature: not much experienced
Development of the global marketing concept
Global marketing = the firms commitment
- To coordinate its marketing activities across national boundaries
- In order to find and satisfy global customer needs
- Better than the competition
This implies that the firm is able to:
- Develop a global marketing strategy, based on similarities and differences between
markets
- Exploit knowledge of headquarters (home organization) through worldwide diffusion
(learning) and adaptations
- Transfer knowledge and ‘best practices’ from any of its markets and use them in other
international markets
o E.g. Belgium campaign who gives a vaccine to a child if you buy a package of
Pamper, campaign was so successful that it went global
Entering a new market is not easy as it seems e.g. Albert Heijn
There is not just one way of doing it:
- Different views of business organizations
- Local; glocal; global
- Value chain
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