global marketing round 2

Data Analysis

Are data comparable across samples so that multi-country analysis can be performed? Usually some amount of data editing/cleaning will be needed (outliers, acquiescence, etc.) Tabulation is the arrangement of data in tabular form Suppose Nielsen surveyed video gamers about their perceptions of advergaming. Nielsen could cross tabulate males and females to see if differences exist. If females are equally or more responsive than males, video game companies can persuade companies to target selected products at this segment

Current issues in global marketing research

Comparability means that research can be used for valid comparisons between countries Emic analysis studies a culture from within Etic analysis is detached & used in multi-country studies

demographic segmentation

Study of people's vital statistics, such as age, race and ethnicity, and location

Chinese segmentation

Super elite Newly rich Govt officials

interpretation and presentation

The report should clearly link to the problem or opportunity identified in Step 1 Use language with which managers are comfortable Simplify complex quantitative analysis

Recourse

The traditional, yet weak remedies for American companies operating in countries such as China are: Engaging or complaining to local officials Registering IP with the appropriate agencies pursue negotiations and alternative dispute resolution complain to the U.S. government and World Trade Organization (WTO) resolving off the books they can do it again and then you have to pay them again and again and again WTO is the best way because they have more enforcement

Pluralization of Consumption

Thesis that in different consumers in different countries increaslingt seek variet and that the same new segments are likely to show up in multiple national markets ethnic or regional foods might be in demand anywhere in the world provides an opportunity for marketers to pursue one or more segments on a global scale. ex: MTV's success in Asia Based on the premise that companies should attempt to identify consumers in different countries who share similar needs and desires. exception: people may like pizza but like diff toppings on their pizzas

Ethnic segmentation

US: African black americns Asan americans Hispanic americans Subcultures: groups of people within a culture with shared value systems based on common life experiences and situations (nationalities, racial groups, geographic regions, or even diet commonalities such as vegans)

Business revolution

United States: FCPA Strengthened policies on bus men Extraterritorial Don't just prosecute American countries Not just companies bus men are under fire and can serve time Ethical unawareness to what is really happening Becomes impossible to break out Small bribes can be the gateway Siemens:biggest case of corruption in 20 yrs Huge fines 1.3 bill euros under the table Dialogues, what are your daily interests, are you facing daily dillemas Anesthetized innovation policy Lack of innovation high risk of corruption, make ppl buy your prod Spent 1 bill to reform org No such thing as zero risk

Framework for selecting target markets

It would be extremely useful to have formal tools or frameworks available when assessing emerging country markets Ex: market potential vs. market size and competitive advantage

Perceptual Mapping

Multidimensional scaling (no less than 8) help marketers identify their competition (Louis Vuitton/Prada and Chanel/Burberry are comparable) Have perceptions of luxury brands changed? For an up and coming designer, where is the most sustainable position?

Similarity scales

Multidimensional scaling is useful when consumers have difficulty verbalizing perceptions and when there are many alternatives to choose (luxury brands) Burberry can use this info to identify new industry realities and shifts in consumer perceptions of the brand and its competitors. This info can be used to generate a perceptual map

Extortion

Payments are extracted under duress by someone in authority from a person seeking only what they are lawfully entitled (Minister of Finance demands heavy payments under threat that a contract for millions of dollars will be cancelled) Most extreme

Licensing

a contractual agreement in which a licensor allows a licensee to use patents trademakrs trasecrets tech or other intangible assets in return for royalty payments or other forms of compensation The duration of the licensing agreement and the amount of royaltiesa company can receive are considered a matter of commercial negotiation between licensor and licensee there is no govt restrictions on remittances of royalties abroad Considerations - What assets may be licensed and in what countries to avoid direct competition - Royalty payments - How long? - How to price assets - Rights granted (right to "use/sell" or right to "make", sublicensing rights, etc.) May limit the licensee to selling only in its home country May also contractually bind the licensee to discontinue use of the tech after the contract as expired They can mismake Licensors should be careful to ensure that their own competitive positions remain advantages requiring continuous innovation

The court who decides disputes applies

a. international conventions, whether general or particular, establishing rules expressly recognized by the contesting states b. international custom, as evidence of a general practice accepted as law c. the general principles of law recognized by civilized nations d. subject to the provisions of Article 59, judicial decisions and the teachings of the most highly qualified publicists of the various nations, as subsidiary means for the determination of rules of law

Efficient consumer response

an effort to work more closely with vendors on stock replenishment Can minimize aspects of the supply chain to benefit customers

Political sensitive products

any that have an effect on the environment: water bottles, straws, masking emmisions culture (Barbie), coffee exchange rates national and economic security (high tech manufacturers) public health (EU banned genetically modified beef from the US but some question whether this was done to protect local beef industry)

Real time enterprises

big companies that leverage big data

private international law

body that applies to disputes arising from commercial transactions between companies of diff nations

Choose unit of analysis

can be a single country, geographic region, city, state or province

Foreign consumer culture positioning

can be important to communicate the fact that a brand is imported

Demographic trends

can create opportunities for marketing innovation ex: people had less time to stop at each and every individual stores so Carrefour created a one stop shop ex: shopping malls in U.S.: "dying culture" Takes a lot of time to shop at the mall and cost to rent out space The internet has brought the worlds stores into American homes However, the increase in Hispanic pop in Atlanta revitalizes Plaza Fiesta

Trade secrets

confidential info or knowledge that has commercial value and is not in the public domain and for which steps have beet taken to keep it secret Ex: manu processes, formulas, designes, and customer lists The licensing of unpatented trade secrets should be linked to confidentiality contracts with each employee who has access to the protected info In the US trade secrets are protected by state law and have adopted the UTSA Provides trade secret liability against third parties that obtain confidential information through an intermediary NAFTA was the first international trade agreement with provisions for pretecting trade secrets

Newly rich

consists of Chinese whose wealth only dates back on generation o Typically grew up in rural areas and do not have college educations o Largely self taught o Not as affluent o Spends electively as well as splurges o Invest heavily in children education due to the fact that they themselves did not go to college o aware of less exclusive brands like LV Gucci etc

Super elite

consists of individuals who seized entrepreneurial opp in the 1980s when Beijing instituted economic reform policies and began to open chinas market o Educated influential and well respected o favor luxury brands that reflect the buyers superior taste

Conventional vs. unconventional wisdom

conventional: might assume that consumers in Europe and Latin America are interested in the world cup whereas those in America are not might assume bc the per capita income in india is about $1570 all Indians have low incomes unconventional: note that the global jock segment exists in many countries including the united states the potential base for mcdonalds or a subway is larger than the size of entire developed countries

Electronic point of sale

data gathered by checkout scanners to help retailers identify product sales patterns and ow the ECR system is gaining traction in Europe.

Antitrust

designed to combat restrictive business practices and encourage competition Enforced by US federal trade commission Japans fair trade commission And European commission The pressure of global competition have resulted in an increased incidence of price fixing and collusion among companies The competition authority of the European commission has ahd the power to prohibit agreements and practices that prevent restrict and distort commission Has jurisdiction over European based companies as well as non eiropean based one that generate significant revenues in Europe In 2013, the FTC blocked plans for a merger between US Airways and American Airlines on grounds that 4 major airlines (American, Delta, Southwest and United) already control 80% of the domestic market

Business intelligence

enables interactive access to data, as well as manipulation and analysis of these data. By analyzing historical and current data, situations and performances, decision makers get valuable insights upon which they can base more informed and better decisions

Corporate taxation

encourage many enterprises to engage in cash or barter transactions which are off the books and sheltered from the eyes of tax authorities Companies attempt to limit tax liability by shifting location or income Ex: russia: if you are in with putin you don't pay taxes

Seizure of assets

expropriation confiscation and nationalization

Big Data

extremely large data sets that can be subjected to computation analysis to reveal patterns and trends The cost of data collection has dropped so dramatically that a company can amass data irrespective of a particular question, problem, or purpose that it marketer might have Ex: Netflix has collected more than 10 billion move ratings from subscribers. They gather data about all subscribers including age gender and place of residence.

behavior segmentation

focus on whether people buy and use a product as well as how often and how much they use or consume usage rates heavy: often a small slice but account for a high percentage of total consumption. Heavy beer drinkers account for 87% of beer consumption. Marketers would rather attract one heavy user than several light users (Philip Morris). **Heavy users are not necessarily loyal customers. Research shows they tend to be extremely loyal to one brand or never loyal to any brand, constantly looking for the lowest price. **What appears to be brand loyalty may reflect habit, a low price, a high switching cost, or the unavailability of other brands, so don't assume!! medium light nonusers: key to attract is to understand why they are not using (life events) ex users regulars first timers users of competitors products 80/20 Suggests that 80% of a company's revenues or profits are accounted for by 20% of a firms products or customers

Cyber terrorism and cyber crime

in its infancy, but the internet provides a vehicle for terrorist and criminal attacks (Russia) Internet Virus attacks can disrupt businesses • The infamous "I Love You" worm caused estimated damage of $25 billion worldwide • Blocking phone services and internet (North Korea hacking Sony and US retaliating by cutting electricity) Hard to control due to the easy and widespread use of the internet

Cross-cultural marketing

is the practice of including ethnic themes and cross-cultural perspectives within mainstream marketing (Bloomingdales targets this segment through themed merchandise, events and promotions during Chinese New Year, and by hiring Mandarin speaking salespeople)

consumer products companies

need to convene focus groups consisting of people over 50 years old who are nearing retirement. Will also have to target Brazil Mexico Vietnam and other developing country markets to achieve growth objectives in the years to come

Gender Segmentation

need to ensure that opportunities for sharpening the focus on the needs and wants of one gender or the other do not go unnoticed some companies offer lines for exclusively women or men, some offer both Gender roles: society's expectations regarding appropriate attitudes behaviors and appearance for men and women

Confiscation

no compensation is provided

Customer relationship management

one fo the business tools that help companies leverage the data they collect A philospophy that values two way communication between the company and the customer. Touchpoints: any point of contact between the two, an opportunity to collect data Ex: websites, warranty cards, credit card payments Everytime a spotify user clicks plaay a data point is generated Allow companies to determine which customeers are most valuable and to react ina timely manner with customized product and service offerings that closely match customer needs Can make employees more productive and echance corp profitability. Provides customers with value added products and services Ex: Amazon bundle Ex: Tesco uses their rewards program to group customers into clusters.

Jurisdiction

pertains to global marketing as it concerns a courts authority to rul on particular types of issues arising outside of a nations borders or to excersice power over individuals or entities from different countries Jurisdiction is generally determined on the basis of either: 1. jurisdictional clauses included in contracts 2. where a contract was entered into, or 3. where the provisions of the contract were performed When operating in another country, it is important to have the supporting documents that clearly state the jurisdiction (if a dispute arises, understand whose laws apply)

Asian Americans

population growth is fueled by immigration. highest average family income of all groups ($67,000). About 50% of all Asian Americans have at least a bachelor's degree. Hold on firmly to their cultural values and like to shop at stores owned by other Asian Americans. Most brand conscious and fiercely brand loyal Buy the more luxurious brands

Information technology

refers to an orgs processes for creating storing exchanging using and managing info

Expropriation

refers to governmental action to dispossess a foreign company or investor Generally provide compensation Castro nationalized sugar industry and repaid in Cuban bonds

Govt taxation policies

rely on tax revenues for the funds necessart for social services the military and other expenditures Policies on the sale of goods and services frequently motivate companies and individuals to profit by not paying taxes High taxes can lead to increased smuggling and black market growth Can lead to border shopping

market segmentation

represents an effort to identify and categorize groups of customers and countries according to common characteristics

Positioning

required to differentiate the product or brand in the minds of target customers

Global market research

research carried outon a global scale Challenge is to recognize and respond to the important national differences that influence the way info can be obtained

Repatriation

restriction on you changing home currency to your currency

High tech

sophisticated technologically complex and or difficult to explain or understand Specialized needs or interests and rational motives Evaluated in terms of performance against established objective standards Typically posses or wish to acquire considerable technical info Marketing communications should informative and emphasize performance related attrivutes and features to establish the desire GCCP

euro consumers

successful idealists: 20-25%, consists of persons who have achieved professional and material success while maintain commitment to abstract or socially responsible ideals affluent materialists: status conscious up and comers, bus professionals, use conspicuous consumption to communicate success comfortable belongers: ¼- ½ of country's pop, conservative and most comfortable with the familiar. Content with the comfort of home family friends and community disaffected survivors: lack power and influence, harbors little hope for upward mobility and tends to be resentful or resigned. Concentrated in high crime inner city type neighborhoods, attitude tends to affect the rest of society

Sovereignty

supreme and independent political authority Considered free and independent. Regulated trade managed the flow of people into and out of it boundaries and exercised undivided jurisdiction over all persons and property within its territory Govt actions taken in the name of sovereignty occur in the context of two important criteria: A countrys stage in development and the political and economic systems in place in the country Some believe global market integration is eroding national economic sovereignty In the EU individual countries gave up their rights to a national currency and control over product standards in exchange for better market

Litigation

taking the dispute to court In the US A dispute with a foreign party is frequently in the home country jurisdiction The issue can be litigated in the US where the company and its attorneys might be said to enjoy home court advantage In foreign courts are moe complex because of differentces in language legal systems currencies and traditional business customs and patterns Last resort Negative outcomes of litigation include: Fear of creating a poor image Fear of unfair treatment in a foreign court Cost and time Loss of confidentiality

Positioning

the act of differentiating a brand in customers minds in relation to competitors in terms of attributes and benefits that the brand does and does not offer

Bribery

the corrupt business practice of demanding or offering some type of consideration when negotiating a cross border deal

Civil-law country

the legal system reflects the structural concepts and principles of the roman empire in the sixth century Found in Germany japan Italy and France Based on an all inclusive system of written rules of law and divided into 3 codes: commercial civil and criminal A contract between two or more parties who are fully liable for the actions of the company froms a company Agreements may not be enforceable uncles properly notorized or registered Acts of god are not necessarily limited to act of nature but include unforeseeable human acts such as labor strikes or riots

High touch

Consumers are generally energized by emotional motives rather than rational ones May feel emotional or spiritual connection Performance is subjective and aesthetic rather than objective Acquisition may represent an act of personal indulgence, reflect the users actual or ideal self imge or reinforce interpersonal reelationships between theuser and family members or friends Appeal to the senses Ex: fine champagne Can be linked with joy or pleasure found in lifes little moments

1895 UN Convention on the recognition and enforcement arbitral awards

(New York Convention) 107 countries When parties enter into agreements that provide for international arbitration the sifnatory countries can hold the parties to their pledge to use arbitration After arbitration has take place and the arbitrators have made an award the signatories recognize and can enfore the judegment The signatories agree that there are limited grounds for challenging arbitration decisions

Conciliation

(mediation) non binding agreement between parties to resolve disputes bu asking a third part to mediate differences Discussions between parties and mediator are confidential and statements made by either party may not be used in future litigation or arbitration The judgment of the conciliator is not legally binding. Conciliation is considered especially effective in resolving disputes in China as it is non-threatening

Potential competition

A market segment or country market characterized by strong competition may be a segment to avoid Have to understand how local competition works Incoming product could create an exciting new market Global recognition may make it easier to penetrate the local market If the competition is vulnerable in terms of price or quality disadvantages it is possible for market newcomer to make significant inroads Ex:Honda created the market for small displacement dirt bikes then moved upmarket with bigger bikes targeted at casual riders Ex: DHL tired to enter the US package delivery market but underestimated the dominance of fedex and ups and finally withdrew from the US

Counterfeiting privacy and infringement

Although developing countries have been making strides in reducing counterfeit products and piracy, it remains a serious problem (textbook publishing, music, software, movies, automotive, and pharmaceuticals) Policing piracy is difficult to enforce (IP detection, gov't involvement) The Chinese gov't was recently accused of monitoring board room discussions of international companies by accessing the recording features on phones remotely. Executives have since been advised to take the batteries out of their phones when in sensitive meetings. Firms spend millions of dollars establishing brand names or trademarks to symbolize quality and design but can still be counterfeited and pirated (Disney, KFC, Coach) Piracy and counterfeiting cost firms about $60 billion annually (ethics of piracy?) Every year, $6 billion worth of counterfeit pharmaceuticals are sold. Counterfeited pharmaceutical drugs can lead to death and bad publicity if not monitored closely. Companies like Microsoft may benefit from pirated software as it induces trial and may lead to future upgrades of the authorized version

Benefit segmentation

Based on marketers euperior understanding of the problem a product solves the benefit it offers or the issue it addresses regardless of geography Ex: multiple kinds of toothpastes

Market selection framework

Company review of current and potential product offerings in terms of their suitability for the country market or segment Can create a product market grid that maps markets as horizontal rows on a spreadsheet and products as vertical columns

Protecting intellectual property

European patents are expensive because of the need to translate technical documents into all of the languages of the EU. More lenient. In the US, patent holders retain all rights for the life of the patent even if the product is never produced or sold In the US (common law), ownership of intellectual property is established by first use and registration, but in many code-law countries, ownership can be established simply by registration (Jordan)

Exploratory research

Exploratory research - results tend to be qualitative, nonnumeric information about consumers' attitudes, feelings and buying behavior. Projective techniques - provide an incomplete stimulus and ask respondents to complete it, or give them an ambiguous stimulus and ask them to make sense of it. Generally used to get at people's underlying feelings, especially when people are unwilling to express true reactions (Brawny) Ethnography - "living with subjects" (Volkswagen ran18 month campaign and found that American consumers need a place to store tissues and to put fast food storage while driving)

Problem definition

Eyes wide open, be aware of the impact that SRC and other cross-cultureal assumptiions can have Self-Reference Criterion is when a person's home-country values and beliefs influence the assessment of another country - Mattel execs thought Japanese girls would like Barbie just like American girls. They didn't. - Disney's detailed code about personal appearance was an insult to French culture, individualism, and privacy when Disneyland Paris opened (Mainland China)

Hispanic Americans

First generation Hispanic American consumers tend to be very brand loyal and favor brands that show special interest in them. Second generation are increasingly price sensitive and likely to switch brands. Pitches should be varied as differences exist between subsegments (Mexicans, Costa Ricans, Argentineans, or Cubans) share a common language can be segmented by place of origin dom republice cuba central America south America Puerto rico Mexico The various Hispanic American segments represent a great opportunity Mexican companies are moving into America to target the Hispanic market Honda Toyota and other Japanese automakers have been tarketing US Hispanics for years building up brand loyalty

Population segmentation

For cigarettes, soft drinks, candy and other consumer products that have a low per-unit cost population is often a more valuable segmentation variable than income 2/3 of the worlds GNI is generated in the Triad (US, Japan, Europe) only 12% of the worlds population is located in triad countries Huge segment for multinationals Can determine if your brand will be successful if successful in that country Need to sell the product where there are people High population= low income most of the time Products whose price is low enough population is a more important variable than income in determining market potential

Asses value of research

If secondary data are not available, managers may conduct primary research Assess the cost of research vs. what the information is worth Can the company enter the market without spending big money on research? The relatively low profit potential in smaller markets justifies only modest expenditures for marketing research. Use grassroots techniques that are in line with the market's profit potential

asses attractiveness of segments

Important when sizing up emerging country markets as potential targets Marketers should be mindful of several potential pitfalls associated with the market segmentation process 1) tendency to overstate the size and short term attractiveness of individual country markets especially when estimates are based primarily on demographic data such as income and population 2) tendency to target a country a country because shareholders or competitors exert pressure on management not to miss out on a strategic opportunity 3) danger that managements network of contacts will emerge as a primary criterion for targeting The result can be market entry based on convenience rather than rigorous market analysis To combat this marketers can asses o Current size of the segment o Anticipated growth potential o Competition o Compatibly with the company's overall objectives o Feasibility of successfully reaching a designated target

Lubrication

Involves a relatively small sum of cash, a gift, or a service given to a low-ranking official or worker in a country where such offerings are not prohibited by law (small payment made to dock workers to speed up their pace so that unloading a truck will take hours instead of all day) Not illegal More common

Subornation

Involves giving large sums of money—not properly accounted for—to entice an official to commit an illegal act on behalf of the one offering the bribe involves breaking the law (paying officials to look the other way or not do their jobs when a crime is being committed) Illegal

Current segment size

Is the market segment currently large enough to present a company with the opportunity to make a profit? As of 2018, India is the world's fastest growing smartphone market, expanding at an annual growth of 14% Samsung controls about 30% of smartphone market share in India, while Apple isn't even in top 5. Why? If the answer is 'no,' does it have significant growth potential to make it attractive in terms of a company's long-term strategy? With rising incomes and PPP in China, Visa anticipates huge growth potential in China as it targets consumers with a monthly salary of $300 In 2018, SUVs accounted for 42% of auto imports into China (sluggish growth abroad) From the perspective of a consumer packaged goods company low income and the absence of a distribution infrastructure offset the fact that 75% of indias population lives in rural areas The appropriate decision may be to target urban areas only even thought they are home to only 25% of the pop

Lessening political vulnerability

Joint ventures: pair with local bus, form relationship with locals, you can learn from them and they want to learn from you Expanding the Investment Base (including several local investors and banks in financing the operation to distribute risk) Planned Domestication (phasing out or gradual participation with locals in all aspects of operation, Gulf countries) Political Bargaining (Mattel was fined when their Chinese manufacturers were found to be using toxic paints. However, Mattel blamed their own design flaws to protect the head of their value chain) Political Payoffs (bribes)

International legal disputes

Legal disputes can arise in three situations: 1. between governments (trying war criminals) 2. between a company and a government 3. between two companies The name Budweiser originates from the beer producing Czech city of Budwis. In Europe, the Czech company of Budweiser, has the rights to the name. In the US, the Czech brand is sold as Budvar. The UK allows both companies to use the Budweiser brand. In recent years, Anheuser Busch has been courting the Czechs by investing in development projects in Budwis in hopes of the gov't privatizing the brand.

Step 1: info requirement

Market potential: Demand estimates, consumer behavior, review of products, channels, communication media Must be unbiased behavior online in store (purchases, heat maps), channels: distribution, retailers, important: takes too long, price, come in contact with end user (most important). DON'T OVER ESTIMATE CONSUMER DEMAND, base entirely on consumer behavior Competitor information: Corporate, business, and functional strategies resources and intention capabilities Get info, online, buying their products, checking out their stores, asking consumers how they feel about the prod/comp helpful for competitive advantage, especially global when you don't understand preferences foreign exchange: Balance of payments, interest rates, attractiveness of country currency, expectations of analysts More economic, understand global dynamics, currency, Prescriptive info: Laws, regulations, rulings concerning taxes, earnings, dividends in both host and home countries Resource info: Availability of human, financial, physical, and information resources Making that a part of the system, streamless, payroll in the company, sales ppl sold on importance (incentivize), immediate feed back and interact with competion, critical General conditions: Making that a part of the system, streamless, payroll in the company, sales ppl sold on importance (incentivize), immediate feed back and interact with competion, critical

Marketing intelligence

Marketing managers collect marketing intelligence from competitors, newspapers, trade publications, customers, suppliers, distributors, and monitoring social media/blogs In a resource intensive industry like oil and gas drilling, companies have a direct benefit to observing competition. The deeper the oil wells drilled by competitors, the less abundant oil is in the area, and the more costly it will be for them to bring to the surface. This knowledge is a distinct competitive advantage Environmental, industry competitior and intermediary info

Sources of market info

Personal sources: 2/3 of the info corps need Comes from executives based abroad in company subsidiaries affiliates and branches Have established communication with distr. Consumers customer suppliers and govt oficials A company executive oversees are the people who know best what is going on in their areas Direct sensory perception: provides a vital background for the info that comes from human and documentary sources It means using all the senses to find out what is going on in a particular country rather that getting second hand info Important when a global player dominates a companys domestic market 75% from face to face conversations

Research design

Primary data: Mail questionnaires- Adv. (Anonymity, low cost) Disadv. (time delays, low response rates, incentives, unclear who is responding, social desirability) Telephone interviews- Adv. (Fast, low cost) Disadv. (lack of cooperation, negative image-do not call list) Telemarketing image? Telephone directories or lists may not be available in all countries. In China, 77 % of households in coastal areas have at least one fixed-line telephone in rural areas, only 40 percent. Face-to-face interviews- Adv. (flexibility, control) Disadv. (expensive, interviewer bias, time consuming) Online research- Adv. (instantaneous, respondents are more open b/c of sense of privacy) Disadv. (can be expensive, length is based on cost, internet access, cultural differences) - Use multiple indicators rather than a single measure - Develop customized indicators specific to the industry, product market, or business model (Mary Kay uses the average wage of a female secretary in developing markets as a basis for estimating income potential for consultants) Always conduct comparative assessments in multiple markets (To understand beer consumption patterns in the Czech Republic, Budweiser might also conduct research in Ireland and Germany, where consumption is high) - Observations of purchasing patterns, other behavior should weigh more heavily that reports or opinions about purchase intention or price sensitivity

Examine data availability

Secondary data are existing data collected for another purpose (GM may purchase data from J.D. Power and Associates to determine the best places to advertise or open locations in another country) U.S. Government Resources - National Trade Data Base (Dept. of Commerce) - Bureau of Economic Analysis - Census Bureau Data gathered from different sources may be inconsistent. What is the level of soft drink consumption in China? Euromonitor International estimates 23 billion liters, whereas Coca Cola estimates 39 billion liters Big mac index

Issues in data collection

Standardization vs. Extension of Marketing Mix? Demand & profit potential may depend on whether the market is existing or potential Potential Markets - Latent: An undiscovered segment where demand would materialize if an appropriate product were made available (prime mover advantage) Marketer's job to convert latent needs into solutions - Something that you need buy you don't know what prod will fit that need, undiscovered demand - Incipient: A market will emerge if an economic, demographic, political, or sociocultural trend continues. After the trends have had a chance to take root, the incipient market will become latent (releasing before will be a miss rising income and demand for automobiles) Survey Research: Quantitative (How much would you buy?) vs Qualitative (Why would you buy?) - Back translation- after translating a survey into local language, a different translator translates it once again into the original language to look for discrepancies - Parallel translation- two versions by different translators Consumer Panel: Respondents behavior tracked over time (Nielsen tracks television audience measurement) Observation: Trained observers or a mechanical device (video camera) watch & record actual or potential consumers (people meters, mystery shoppers/patients) Marketers from Nestle's PowerBar observed how NYC marathon runners interact with single serve PowerGel packets. They found runners tear the top off with teeth while running so they redesigned the package When evolving into international do ppl understand what you are trying to deliver, survey translation Usefull but difficult to do international, compare across cultrues Back translation: into local lang, get different translater to translate back and compare and adjust Parallel translation: two versions from two different translaters and compare Do both but first is most effective bc direct comparison Consumer panel: neilson: who is watching what at what times. Diaries and people meters, Longitudinal data: regularly asses how people repond to an ad over time can asses brand perception over time, asses childrens perceptions over time Mystery shoppers: observe anonomously Focus Groups: Moderator leads 6-10 person discussion (culture shapes social desirability) A moderator of a Honda focus group may ask participants to describe a party where various auto brands were present. What is Nissan wearing, eating, and drinking? What kind of shoes does Ford have on? What are their personalities like? Who's shy? Who's loud? Who gets the girl/guy? Likert scale: beware of scalar bias (typical American scale would equate a high number such as 10 with "most" or "best" and 1 with "least," Germans prefer scales in which 1 is "most/best.") Probability sample uses statistical rules so that each member of the population under study has an equal chance of inclusion. One form of nonprobability sample is a convenience sample.

Step to marketing research

Step 1: info requirement Step 2: problem defininity Step 3: choose unit of analysis Step 4: examine data availability Step 5: assess value of research Step 6: research design Step 7: data analysis Step 8: interpretation and presentation

Feasibility and compatibility

The feasibility of targeting a particular segment can be negatively impacted by various factors Ex: the regulatory hurdles may limit market access Managers must decide how well a company's product or business model fits the country market in question Must consider Will adaptation be required and if so is this economically justifiable in terms of the expected sales volume Will import restriction high tariffs or a strong home country currency drive up the price of the product in the target market currency and effectively dampen demand? Is it advisable to source locally? Would it make sense to source products in the country for export elsewhere in the region? Important to address the question of whether targeting a particular segment is compatible with the company's overall goals brand image or established sources of competitive advantage o Ex: should BMW add a mini van line?

Steps to quality research

Train sales force to scan for new developments -closest to the customer and competition (Grace Chemicals, an industrial adhesives company, asked its salespeople to observe how customers used its products in order to suggest new product ideas. They found that some were using their waterproofing adhesive to soundproof their cars and patch boots and tents. This led to seven new product lines) Motivate channel members to share intelligence collect information on global competition by consulting with retailers and distributors (ConAgra learned from retailer info that many mothers switched to time saving meals and snacks when school started, so it launched its "Season of Moms" campaign to adjust to the shift in needs real estate) Marketers can research global competitors' product strengths and weaknesses online through: Independent customer goods and service review forums (BizRate.com collects millions of consumer reviews of stores and products from its 1.3 million volunteer members around the world) Distributor or sales agent feedback sites - provide positive/negative product or service reviews and generally created by the organization itself to gauge the acceptability of product line (Amazon allows users to rate transactions/products which lowers risk associated with doing business. Sellers with consistently low marks may signal a problem for the organization's image) Customer complaint sites- provides a forum for dissatisfied customers to vent out (if the same issues are recurring, it needs a resolution)

Commercial law in socialist econs

Usually, a form of commercial law is used in socialist economies. This is a legal system based on the specific economic, political, and social climate of the state (China, Russia, etc.) As each country moves toward its own version of a free market system, a new commercial legal system is also evolving For example, China has strict Cyber Laws and prohibits access to certain websites such as Google and Facebook, but has formed its own social media site that the government can monitor called 'qq' Winnie the Pooh was blacklisted by the Chinese government as a search item b/c of references to Xi Jinping

Sanctions and Russia

Vladimir Putin may be the richest man in the world if all his financial assets could be verified (they haven't). Some estimates place him at $200 billion (tax embezzlement, laundering, etc.). Since 2000, more than a dozen journalists have been murdered in Russia (Pussy Riot) After annexation of Crimea, Russia was sanctioned by the EU, US, and Canada, and Norway. Russia responded by banning imports of European dairy products Russia's fuel and energy sectors are run by a handful of conglomerates and corruption is rampant. These sectors make up 40% of Russia's GDP. Despite all this, foreign direct investment has increased by 25% in 2018. IKEA is rapidly expanding into Russia, whereas other retailers like Carrefour, Wal Mart, and Tesco have stayed out due to a lot of political instability and risk

Examples of political risk

War: during NATO some Mcdonalds were vandalized because of association with the US. Mcdonals distanced itself from NATO and passed out free burgers at servvian nationalist parades Social unrest- minorities fractionalized by language, ethnic and/or religion 80% of pop is of African decent but whites are ruling the country in south Africa International disputes Change in government/pro-business orientation (Ukraine gas reliance, Arab Spring) Foreshadowing: violence, faltering econ Social conditions (population density and wealth distribution) Corruption, crime, and nepotism (Late president Suharto of Indonesia granted tax breaks and tariff privileges to a company established by his son) Labor costs Tax discrimination Exchange controls, tariff barriers Dependence on and/or importance to a major hostile power Repatriation restrictions Animosity toward particular countries (China/Japan islands dispute, North/South Korea, India/Pakistan, China/Tibet)

Cartel

a group of individual companies that collectively set prices control output or take other actions to maximize profits OPEC

Foreign Corrupt Practices Act

a legacy of the watergae scandal during Nixon Discovered more that 300 american companies had made undisclosed payments to foreign officials Publicy holds companies to institute internal accounting controls that would record all transactions Made it a crime fo US corps to bribe an official of a foreign govt or political party to obtain or retain business Prohibits payments to third parties when the company had reason to believe that part or allof the mone would be channeled to foreign officials Corps are subject to a fine of up to 2 mill. Officers directors stockholders employees and agents are subject to 100k fine and imprisonment up to 5 years Bribery payments are considered deductible bus expense in many eeuropean countries

Arbitration

a negotiation process that the two parties have by prior agreementcommitted themselves to using A fair process in the sense that the parties using it have created it themselves Involves a hearing of the parties before a three member panel

Global Elites

affluent consumers who are well traveled and have the money to spend on prestigious products with an image of exclusivity price can imply certain things like quality, exclusivity etc durable goods: luxury automobiles nondurables: upscale beverages financial services: amex

Income segmentation

after considering those who are willing and able to buy Can target fewer than 20 nations to reach the most affluent markets Not reaching almost 90% of the worlds pop While providing some measure of mkt potential such macro level demographic data should not necessariy be used as the sole indicator of presence of a market opportunity Even though incomes may be smaller the purchasing power within countries is different Marketers should keep in mind that national income figures are averages It is possible to underestimate a markets potential

Electronic data interchange

allows a companys business units to submit orders issue invoices and conduct business electronically with other company units as well as with outside companies. Its transaction formats are universal Ex: Walmart has legendary EDI with vendors (must have same software to do bus with Walmart)

Conjoint analysis

allows researchers to determine the combination of features that will be most attractive to consumers (36 combinations possible from above) Each possible combination is printed on an index card and consumers rank in order of preference. Two attributes at a time is preferred for fatigue

Factor analysis

allows researchers to filter out numerous survey items into 2-3 factors that underlie the benefits across respondents. In this example, the items can be clustered into 2 main benefits "Easy to use" and "Aesthetic"

Standardized global marketing

analogous to mass marketing in a single country o Involves creating the same mm for a broad mass market of potential buyers o Based on the premise that a mass market exists around the world o That mass market is served with a mm of standardized elements o Product adaptation is minimized o intensive distribution ensures that the product is available in the mac number of retail outlets o The advantage is lower production costs

psychographic segmentation

grouping people in terms of their attitudes values and lifestyles funny looking cars like the kia soul and fiat 500 were designed for millennials but were very successful in the baby boomer generation instead people in one age bracket sometimes share attitudes and tastes with those in other age brackets sometimes preferable to market to a mind-set rather than a particular age Nokia once commanded 40% of the world's cell phone market but did not adapt to changing psychographics (Apple/Android) Porsche groups its consumers into the following psychographic groups: - Top Guns (27%)—ambition, power, control - Elitists (24%)—old money, car is just a car - Proud Patrons (23%)—car is reward for hard work - Bon Vivants (17%)—car is for excitement, adventure - Fantasists (9%)— car is form of escape

Bipolar

high touch and high tech

Creeping expropriation

limits economic activites of foreign firms Limits on repatriation of profits divs or royalties: convertning local currency to home currenct Increased local content laws: mandating a company to produce a certain part of that profuct domestically Quotas for hiring local nationals Price controls Discriminatory tariff and nontariff barriers Discriminatory laws on patents and trademarks

Conflict resolution

litigation Arbitration conciliation

Common law

many disputes are decided by reliance on the authority of past judicial decisions Based on the concept of precedent or stare decisis Rely on codification in certain areas Found in the commonwealth 1/3 of the worlds pop today lives in common law jurisdictions but the majority is civil law based Lousiana has adopted parts of the UCC but still heavily influenced by the French civil code Companies are legally incorporated into state authority Most agreements are binding as long as proof of the agreement can be established Impossibility of performance does not excuse non-compliance with the provisions of the contract unless It was an act of god

global companies

must be alert to the possibility that marketing strategies will have to be adjusted in response to the aging of the population and other demographic trends

Intellectual property

must be registered in each country where business is conducted Patent: a formal legal document that gives an inventor the exclusive right to make use and sell an invention for a specified period of time Trademark: a distinctive mark motto device or emblem that a manufacturer affixes to a particular product or package to distinguish it from goods produced by other manufacturers Used as a differentiator Copyright: establishes ownership of a written recorded performed or filmed creative work Usually abstract Counterfeiting: the unauthorized copying and production of a product Movies music Associative counterfit/imitation: uses a product name that differs slightly from a well known brand but is close enough that consumers will mistake it for the genuine product Piracy: the unauthoried publication or reproduction of copyrighted work Most abused in China and hard to protect Patents In Europe are expensive because of translating into many languages

Global consumer culture positioning

o A strategy that identifies a brand as a symbol of a particular global culture or segment o Effective for communication with global teens cosmopolitan elites globe trotting laptop warriors who consider themselves members of a transnational comer culture o High tech and high touch products o English can signify modernism and a cosmopolitan outlook o Brand symbols: interpretation defies aassociation with a specific country culture Ex: nike swoosh

Foreign consumer culture positioning

o Associates the brand users use occasions or production origins with a foreign country or culture

Attribute/benefit

o Economy, reliability, durability o Ex: volvo=safety o BMW=ultimate driving machine

Competition

o Implicit or explicit reference to competitors o Ex: dove campaign for real beauty challenged social perceptions

Concentrated global marketing

o Involves devising a mm to reach a niche o Ex: estee lauder and chanel target the upscale prestige segment of the market o Single segment o Define markets narrowly and strive for global depth rather than national breadth

Differentiated global marketing

o Multisegment targeting o Targeting two or more distinct market segments with multiple mm offerings o Allows a company to achieve wider market coverage

Quality/price

o Price can determine quality

Use/user

o Represent how product is used or associates the brand with a user or class of users

Local consumer culture positioning

o Strategy that associates the brand with local cultural meanings reflects the local cultures norms portrays the brands as consumed by local people in the national culture or depicts the product as locally produced for consumers Ex: Budweiser horses

Nationalization

occurs when govt takes control of some or all of te enterprises in a particular industry International law recognizes this as a legitimate exercise of govt power as long as the act satisfies a public service and is accompanied by adequate payment Can lead to reactionary measures which can affect local bus Can occur thru restrictions on imports to nd from certain countries or specific product or health standards that only the countrys industries are able to comply with

Trademark squatting

occurs when someone in another country takes advantages of legal loopholes to use another company's brand (In 1997, an attorney in Moscow filed a petition in court to use Starbucks name because it was not currently operational in Russia. He was allowed to do so and offered to sell it back for $600,000. Won back rights in 2007)

Cybersquatting

practice of registering a domain name that is the trademark of another person or company. Existing internet law is vague on the protection of domain names and jurisdiction in cross-border transactions • Cybersquatters hope that the owner of the trademark will pay huge dollar amounts to acquire the URL • Microsoft refused to pay cybersquatters in Portugal for the Microsoft.pt name and registered Microsoft1.pt instead

Intranet

private network that allows authorized company personnel or outsiders to share info electronically in a secure fashion without generating mountains of paper. Can serve s a 24 hour nerve center: enables companies like Amazon Fed Ex Google etc. to operate as real time enterprises

Targeting

process of evaluating the segments and focusing marketing efforts on a country region or group of people that has significant potential to respond reflects the that a company should identify those consumers it can reach most effectively, efficiently and profitability

Sherman act of 1890

prohibits certain restrictive business practices including fixing prices, limiting production, restricting markets, or any other scheme designed to limit or avoid competition. Applies to the activites of US companies outside US boundaries as well as to foreign companies conducting business in the US

Management information system

provides managers and other decision makers with a continuous flow of info about company operations Can be used to refer to a system of hardware and software that a company uses to manage info Analyze trends, predict consumer behaviors, collect data to determine best action plan Intensified by global competition and big data

Political risk

the possibility of a change in a countrys political environment or govt policy that would adversely affect a companys ability to operate effectively and profitably Can deter a company from investing abroad when there are high levels of uncertainty in a countrys political environment Executives often fail to conceptualize political risk because they have not studied politicl science and lack exposure to issues that students of politics ask about the activities of global companies Must include current events and publications Companies can purchase insurance to offset potential risks arising from the political environment

Global Market Segmentation

the process of identifying specific segments of potential customers with homogeneous attributes who are likely to exhibit similar responses to company's marketing mix ex: personal computer can be separated into home users, corp users, and educational users. Started with corp users then expanded into other user demographic regions must determine whether a standardized or an adapted mm is required to best serve wants and needs

Marketing research

the project specific systematic gathering data

International law

the rules and principles that nation states consider binding upon themselves Pertains to property trade immigration and other areas that have traditionally been under the jurisdiction of individual nations Applies only to the extent that countries are willing to assume all rights and obligations int hese areas Disputes between nations are issues of public international law which are the rules and principles that nation-states consider binding among themselves (Geneva conventions POWs). Violators can be taken to the World Court in the Hague, judicial arm of the UN If a country refuses to abide by the World Court, the plaintiff country can seek recourse through the UN Security Council which has full power

Islamic law

the sharia is a comprehensive code governing muslim conduct in all areas of life including business Derived from two sources: the koran and the hadith He korn are analogous to code laws and the hadith corresponds to common law The Quran forms the basis for Islamic law. There is NO country or group in the world that operates fully on the basis of Islamic law. Islamic law grants women the right to vote, right to inherit money, right to own property, right to work, right to run for public office, and rights to land ownership and their own business. Restrictions on women's freedom and equality in the Muslim world are usually a result of repressive cultural norms, not religion The underlying objective of this system is social justice (For example, interest is prohibited. One can invest in the business of the borrower and share in risk and gains, but you cannot take advantage of the borrower's need for money. The borrower should only be responsible for paying back what he/she borrowed --or the equivalent at the time)

Qualitative research use

to provide consumer understanding to "get close" to the consumer To describe the social and cultural contexts of consumer behavior, including cultural, religious, and political factors that impact decision making To identify core-brand equity and "get under the skin" of brands To "mine" the consumer and identify what people really feel Word associations involve asking subjects what words come to mind when they hear the brand's name (top of the mind awareness) Brand personification- ask subjects what kind of person/animal they think of when the brand is mentioned (John Deere- rugged Midwestern male who is hardworking and trustworthy, Marlboro) Laddering- asking a series of increasingly more specific "why" questions that reveal deeper motivations and abstract goals

Bottom up analysis (David Arnold)

what are the key drivers of this marketing model marketing model drivers: key elements or factors require for a business to take root and grow in a particular country market environment are enabling conditions in place for this marketing model? Enabling conditions: structural market characteristics whose presence or absence can determine whether the marketing model can succeed Ex: refrigeration is not available in India What is the cost of entry? What is the cost of waiting? First mover advantage: the first company to enter a market has the best chance of becoming the market leader Is the risk/control trade off appropriate

Purchasing Power Parity

what the currency will buy in the country of issue Should be used with all measures of nat income converted to US dollars Ex: Mitsubishi redesigning SUV with the goal of creating a global vehicle that could be sold world wide with little adaption. Then recreated to make more American and attributed the change to the vibrancy and sher size of the American auto market

Global teens

young people between the ages of 12 and 19 Teens by virtue of their shared interests in fashion music and youthful lifestyle exhibit consumption behavior that is remarkable consistent across borders Young consumers may not have conformed to cultural norms except rebelling against them Universal wants needs desires and possible to reach the global teem segment with a unified marketing program Due to media and ease of info transfer