MKTG 440
How are Internet, social media, big data, and MIS used in global enterprises?
Big Data: massive volumes of data are gathered and analyzed to gather consumer insights They are used to gather information about their consumers, track their spending habits and so on to get to know them to further succeed with their marketing and products down the line. MIS is used to help employees communicate with each other as well as outside vendors
Understand compulsory licensing under TRIPS.
-Compensatory Licensing allowed for life-saving medicines for use by less developed countries. -A government may grant compensatory licensing to someone else (or itself) without the consent of the patent-holder. -Ex: aids drug was very expensive - small fee for patent to produce good.
What are different mark types and their respective trademark eligibility for protection?
-Fanciful mark: A term coined solely for the purpose of identifying a particular product- nothing to do with characteristics- no meaning ex: EXXON -Arbitrary mark: an ordinary word that is used on a product in a totally non-descriptive way ex: Apple -Suggestive mark: subtly indicates something about a product- a consumer needs their imagination to infer the products attributes. Ex: airbus, playboy, citibank -descriptive mark: immediately conveys one or more qualities or attributes of a product without requiring use of imagination ex: cold and creamy -ice cream
Understand the differences between local and foreign regulatory environments discussed in the lecture slides.
-multiple countries → multiple laws → more complex -Japan is the most regulated developing country -Many products cannot be legally imported into the US (ex: short barrel pistol, drugs, counterfeit money, certain animals -most regulated industries- banking, insurene, natural resources -US has the most strict products liability laws Negligence Breach of warranty Misrepresentation of material facts Strict liability: reasonable unintended law -facebook and google are restricted or completely blocked in china -registering commercial property in Nigeria is 18 steps and 3 steps in Finland. -officially designated universities have more status in Japan and few foreign universities are officially recognized.
What is brand name consolidation and what are different ways of accomplishing it?
-too many names and consolidate them into one -fade-in /fade out: Step 1: shrunk euro and added land Step 2: dropped euro and renamed Disneyland Paris -Co-branding or umbrella branding: Datsun- a product of nissan became nissan eventually - Transparent forwarding- have warning -Summary axing: replacing old name
What steps can a MNC take to manage political risks in a foreign market?
-local partners/ share ownership -minimize asset risk -stimulate local economy- create jobs and politicians won't touch you (buying local and buying local labor) -employment of national -be civic minded -behind-the-scenes lobbying
"Why Wal-Mart is worried about a discount German grocer," What steps is Wal-Mart taking to compete with Aldi and Lidl?
Become more convenient, trying new system→ allows shoppers to scan products on phones, express lines
Understand the five rules of international research.
1.Before you begin your research, ask yourself six questions: What info do I need? Where can I get the info? Why do I need this info? When do I need this info? What is this info worth to me in dollars? What would be the cost of not getting the info? 2.Start with desk research, your own files, libraries, online databases 3.Identify the type of info that is available from overseas sources. 4.Know where to look. If you do not know, go to someone who does. 5.Do not assume that the info you get is comparable or accurate. Check everything.
(b) What are the three provisions of the Paris Union (Paris Convention) or the International Convention for the Protection of Industrial Property (1883) discussed in the lecture slides.
1.Priority Rights: Register patent in one member country , have one year from the date of filing to do the same in other member countries. 2. National Treatment: For member nations' applications. No discriminated by nations 3. Independence of Patents: Revocation or expiration in the country of original filing has no effect on its validity in other countries.
"How global brands compete," What do the authors mean by "global culture" and how is it created? Does this global culture lead to consumers sharing the same tastes or values?
A global culture is when people from different nations, with conflicting viewpoints, participate in a shared conversation, drawing upon similarities. One of the key symbols in that conversation is the global brand. Although people may love or hate transnational companies, they can't ignore them.
Distance Still Matters: The hard reality of global expansion," Why do companies often overestimate the attractiveness of foreign markets?
Companies often overestimate the attractiveness of foreign markets because they become dazzled by the sheer size of an untapped market in a foreign country. When companies do this, they lose sight of the vast difficulties that come with pioneering new, often very different territories. Managers use tools that consistently underestimate the cost of investing in business internationally. To expand, the Country Portfolio Analysis (CPA) places all emphasis on potential sales, and ignores the costs and risks of doing business internationally!
Understand consumer ethnocentrism and consumer animosity
Consumer ethnocentrism: segment of customers who don't want to buy foreign products [Russian women and older consumers supposedly more ethnocentric] might change in hardships (war) Consumer animosity: political objections to purchasing products from a specific country
"How local companies keep multinationals at bay," How can MNCs beat locals at their own game?
Copy the strategies listed above that are used by local companies Develop strategies that can't easily be copied by local companies
What are the effects of country of origin on consumers?
Country to which a firm is associated- people might have bias towards that country, then will have bias towards the firm that can be negative.
"Branding in the age of social media," What is crowd culture and how has it changed the rules of branding?
Crowd-culture is a group of people who may only have one thing in common, but they rally behind that one thing. Crowd-culture changed the rules of branding because it allows companies to engage in distinctive ideologies that are meaningful to a group of people. There is a huge opportunity out there and companies that rely on traditional segmentation will always have trouble identifying opportunities.
"India's Biggest Competitors to Walmart and Amazon? Mom and Pop," What are the competitive advantages of kiranas compared to global giants?
Cheap cost structure, low wages and rent, instant delivery and interest free credit
What is GDPR and what are its various provisions discussed in the lecture slides?
GDPR- General Data Protection Rule European citizens consent required before collecting data Collect only the date needed to do a specific job Delete the data when done or when consumer asks for deletion If you buy data from vendors, the vendor must be in compliance or you will be liable
What are the host country political forces that may influence a multinational firm?
General instability Host country pressure group Host country government action
In what domains do home country pressure groups pressure MNCs?
Home country pressure group: special interest groups/ NGO pressure MNC for: -Choice of market ex: south america during apartheid-days -method of doing business -product strategies -pricing -environmental issues -boycotts
What is the difference between exploratory, descriptive, and explanatory (or causal) research?
Exploratory: want to determine something/ know more, consumer research, don't have definite hypothesis Descriptive: 2 things being related Ex: Insurance -most risky customer -least risky customer Explanatory: experiments, cause and effect A is the cause of B, A must proceed A and B should vary together' A is causing B→ eliminate all causes
Understand the various entry modes (e.g., exporting, licensing, franchising, manufacturing), and their advantages and disadvantages.
Exporting → advantages: minimal risk, one of the ways for a small company to enter a foreign market, economies of scale- more production designated for export, disadvantages: not always an optimal strategy- not paying attention to local market conditions, strategy functions poorly in times when home country currently is strong- foreign buyers find products to be more expensive; exports hurt Indirect exporting via intermediaries 1. Brokers 2. Export agent, people export for you, both don't take title/ownership 3. Export management: represents several non-competing clients, much wider market coverage, handles all aspects of exporting; can operate as an agent (no title) or merchant (take title) 4. Group export activity: an industry pooling its resources for export- effort, partially exempt from the US antitrust laws, provided its efforts do not restrain trade in the US 5. Trading company: large operations, usually take title Advantages and Disadvantages of Indirect Exporting: A→ little or no investment, no in house personnel needed, no knowledge of foreign market and domestic export rules and logistics needed D→ lack of control over marketing and distribution efforts in foreign markets, in case of brokers/agents, limited services and market coverage Direct Exporting Use of internet to export directly Company owned export department The Agent Intermediaries i. broker; limited services, primarily sales for commision ii. A manufacturer's representative: commission based, not title (better coverage) The Merchant Intermediaries (take title): handle several competing lines, have own sales forces, usually long term relationship Marketing Subsidiary: company owned, full control of marketing activities; expensive but keep more of the profits Licensing → an agreement in which a company assigns the rights to a copyright or patent, and/or a trademark to another company for a fee and/or royalty, a license could be exclusive to a territory; for varying time periods Advantages: protect trademark; penetrate closed markets; use when capital is scarce; when foreign country market potential too small; to make your technology (and prevent the competitors' technology from) becoming standard; minimized risk in foreign markets with uncertain economic and political environment Disadvantages: dependence on local licensee for revenue and hence royalties; profits shared with licensee; lack of quality control hurts brand; probability of nurturing a future competitor Franchising → a special form of licensing; more comprehensive - the franchisor makes a total marketing program available (fast food chains), issues: find the right franchisee, numerous complaints; fraudulent franchisors Master Franchisees: companies or very wealthy individuals who acquire exclusive rights to a whole city, country or region Manufacturing in the foreign market → cheaper resources, lower transportation costs, avoid import taxes and other trade barriers, local manufacturing may be the only way to enter the market, tax incentives Contract Manufacturing: Viable strategy in low volume potential markets, in markets with high tariffs, where the key success factors are R&D and/or marketing, where technology is standard Assembly: requires locating a portion of a company's manufacturing process in a foreign country; assembly is less capital and more labor Full Scale Integrated Production: maximum commitment (investment), risk and control. Viable in a large market, or when location is desirable
In case of a dispute arising in a foreign market, what is the role of "jurisdiction," i.e., where the disputes are to be resolved? Would plaintiffs and defendants like the same jurisdiction? Can a foreign national sue an American company for crimes committed overseas? Should an MNC prefer to settle a dispute via arbitration or via litigation? Why?
Defendants and plaintiffs want different jurisdictions. Plaintiff: Venue that gives them judicial advantage and maximum compensation. Defendants: Venue that will maximize damage to be paid. Arbitration: is quick, inexpensive and preserves business relationships. -Negotiation is best, then arbitration, and last resort is litigation Alien Tort Claims Act (1789)- Foreigners can sue in US courts for crimes committed overseas
What are the various strategies available to a local firm under attack from a MNC?
Defender Strategy: plan and prepare to defend your local market e.g. India, China, Chile (revamp their operations to go ahead of competition coming in), develop core competence to protect from competition Extender Strategy: extend your business in overseas market using competencies and practices learned from domestic market e.g. SAb, Televisa -Chinese don't use Google they are in control Contender Strategy: contend in overseas markets by first exploiting a segment underserved by their competitors e.g. Arcelik (Turkish) in British market for appliances, table top refrigerator → dominate market this way Dodger Strategy: if not enough resources to compete -- cooperate, e.g. sell out, become a local distributor or contract manufacturer for the MNC
What are the direct and indirect effects of terrorism?
Direct:-Create terror -effect on education -tourism industry Indirect: -increased government regulation -increased costs to secure supply chain -increased security of corporate personnel
Understand the role of keiretsus, state owned enterprises (SEOs), and local business groups that a MNC might have to compete in a foreign market.
Keiretsu: Japan, meaning "system or order" six keiretsus; type of informal business group that are loosely organized alliances with Japan's business community; cross-ownership of companies, keiretsu bank SEO: Advantages→ local market protection, cheaper financing Disadvantages→ less international experience; non commercial agendas of the government; general inefficiency; greater scrutiny of foreign governments Business groups: strongest competitors to MNCs; family owned dominated; almost exclusively home; participate in many industries; similar in characteristics to Japanese keiretsu
"Look Out, U.S Grocers, U.K.'s Free-for-All Heads Across the Pond," What is the nature of competition in the U.S. grocery industry?
Large range of expensive grocers (Whole Foods) to cheap grocers (Aldi and Walmart)
"How local companies keep multinationals at bay," What is the six-part strategy the authors' research revealed among the 50 successful local companies?
Local companies are not constrained by existing products or notions about consumer needs. They can customize products to meet the needs of customers. Their business models overcome roadblocks and yield competitive advantages Turn globalization to their advantage, deploy the latest technologies by developing or buying them. Find innovative ways to benefit from low-cost labor pools and overcome challenges of skilled-worker shortage Go national as soon as possible to prevent regional competitors from challenging them They possess management skills and talent that is underestimated by MNCs
"How local companies keep multinationals at bay," Why don't the strategies of the biggest and brightest corporations work well in developing countries?
Many corporations believe it's just a matter of time until emerging markets end up like the strong developed economies of the US, etc. However, it's just different. Emerging markets are so volatile that most MNC's can't apply the strategies that they have developed
"Branding in the age of social media," How is cultural branding different from mindshare branding and purpose branding?
Mindshare branding is different from purpose branding because mindshare branding treats a brand as a set of psychological associations. Purpose branding is a brand that has values or ideals that are similar to its consumer.
"Why Wal-Mart is worried about a discount German grocer," Do you think Aldi and Lidl will have similar success in the U.S. as they did in Europe? Why or why not?
No - Walmart is already big in the US, that's their market. Aldi and Lidl became big where Walmart wasn't
How do government regulations affect international marketing research?
No call lists, street/mall interviews may need license, opinion polls subject to government restrictions
"India's Biggest Competitors to Walmart and Amazon? Mom and Pop," What steps are the kiranas taking to stay competitive?
Personal relationships, having 1000s of products in a small store, accepting cashless payments, interacting with messaging apps, e-commerce
What are various trends in product invention and product development?
Product invention trends: when existing products of company are not suitable for one or more foreign markets -sometimes company tries to make global product to appeal to multi mkts Product development trends: -More decentralization of R&D for new product development -Lead markets' crucial role ex: columbia is the lead market for body armor and fashion in milan -To promote closer coordination between the domestic units and overseas subsidiaries project center concept is used -Strategic leader role: where one subsidiary with high competence in a leading market is assigned to the primary responsibility -Acquisition: to gain new technology or market entry -Alliance: for new product development
How does the secondary data differ from the primary data? What are the advantages and disadvantages of the secondary data?
Secondary Data: already exists while Primary Data: is data specifically collected for a project Advantages: Less expensive and less time consuming Disadvantages: 1. Obsolete 2. Unreliable 3. Comparability issues 4. Certain things can't be discovered while sitting in the home country Faking GDP data→ creditors won't bug them and think they will pay their debt back, chinese debt→ 250% of their GDP, shows unreliability of secondary data
(a) What are the various forms of intellectual property rights and how can each be protected? What is the duration of each protection within the U.S.? How does the WIPO work to get international trademark registration?
Intellectual property : a broad collection of innovations related to things such as works of authorships, inventions, trademarks, and trade secrets. Copyright: Protects against unauthorized copying of literacy, musical, dramatic, artistic works and similar expression of ideas- but not the idea itself. In the US a copyright lasts 70 years beyond the life of an artist. 95 years for copyrights owned by corporations in US and 50 years in EU WIPO Copyright Treaty: Deals with the protection of digital works ex software -databases are not protected under copyright law in the US. Patents: protects an invention of a scientific or technical nature. It is a statutory grant from the government to an innovator in exchange for public disclosure giving the patent holders exclusive rights to functional and design innovations. -Functional inventions (utility inventions): patent for 20 years ex: new printer, new toy -Design Inventions: Patent for 15 years (If filed before May 13, 2015, then 14 years) ex: coke bottle shape Patent Cooperation Treaty: open to signatories of the Paris Convention; multilateral treaty, file one "international" application simultaneously in member countries. -applicant files application in his/her nation or region of patent office, which acts at the PCT "receiving" office, or with WIPO (International Bureau of the World Intellectual Property) in Geneva. Remark: First to file v first to invent If you can prove you invented it first it invalidates the other patent ( not true in us) now it is just first to file in the US disclosure within 18 months Submarine patents: hidden within standards, does not surface until the standard is broadly adopted Patenting is expensive Initial fee and annual maintenance fee ( only for functional utility patents) Need evidence of continuous use (can't sit on it) In which market(s) to patent your products? Most important markets (US, China, India)
"Look Out, U.S Grocers, U.K.'s Free-for-All Heads Across the Pond," What are some things about Aldi and Lidl that annoy American customers?
Their frugal business model, their bare bones store set up, they only have a limited amount of products that are private brands only
Why might a firm exit a market and what are some consequences of doing so?
Tough competition, financial problems, operational difficulties, refocus on the home market Drawbacks include; market lost, emboldens competitors, loss of credibility in other markets (might not be seen as reliable), costly to close operations
What are the requirements for continued trademark protection? What are the reasons for transnational companies to "have been under virtual siege?"
Transnational companies "have been under virtual siege" because they're the most visible and vulnerable symbols of globalization's side effects like exploitative wages, pollution, and cultural imperialism. In 2002, 62 of the world's 100 most valuable global brands were American.
What are various brand naming strategies?
Solo Branding: each brand stands on its own Hallmark Branding: one brand name, usually corp one, to all products and serv ; no sub-brands Extension Branding: extending an estab brand to diff product Family Branding: marketing several different products under the same brand name --Sony playstation, Sony TV, etc
"Look Out, U.S Grocers, U.K.'s Free-for-All Heads Across the Pond," How are Aldi and Lidl able to keep their prices low?
Speedy deliveries, high turnover rate, use private brands, efficiency, convenience bc of store size and products to choose from
Why do MNCs prefer subsidiaries over branches in foreign markets?
Subsidiaries: a separate legal entity Branches: not a separate legal entity. Subsidiaries are preferred because: -Easy to recruit talent -Quick market access -Circumvent government restrictions -Tax advantages -Limited Liability
What are the different forms of takeovers by the foreign governments?
Takeovers: -Confiscation: business taken over with no compensation -Expropriation: some compensation- private enterprises are expropriated -Nationalization: some compensation- applies to entire industry -Domestication: an expropriated foreign business is given to locals to run -a nationalized business (run poorly by government) is given to the local private sector -Creeping expropriation: a set of actions whose cumulative effect is to deprive investors of their fundamental rights in the investment
What factors favor adaptation of a product to foreign markets?
differing physical (climate or use) consumer pref (foods) physical characteristics of consumers cost and price adaptations mandated by law
What are the reasons for having a local brand name?
gov pressure global name already take by local firm cultural barriers helpful in mkts where patriotism matters
What are the home country political forces that impact a firm's business in foreign countries?
home country pressure groups home country government action
What is a global brand and what are its advantages?
scale econs (max mktg impact and reduce ad cost) easy identification by travelers positive generalization
How is the trade policy of a country related to its various industries' competitiveness?
· Industry- firms producing close substitutes · Competition Trade Policy as a function of Competitive Strategy→ Shifting of resources to more productive use
What are intranets, real-time enterprises, electronic data interchanges, electronic point of sale systems, and efficient consumer response systems?
(MIS) Intranet: private computer network accessible to employees and authorized vendors RTE (real time enterprises): integrated intranets, enabling companies to operate as RTEs (Fedex, Walmart) so they can execute actions as soon as needed EDI (electronic data interchanges): using a universal transaction format, EDI enables a company to interact with outside vendors (e.g. submit orders, issue invoices) EPOs (electronic point of sale system): data gathered at checkout counters ECR (efficient consumer response system): stock replenishment by supply chain members using EPOs data
Understand the five host country government actions that can interfere with a foreign firm's operations there.
Jawboning: informational government intervention without a legal basis ex: voluntary export quotas Operations restrictions: import restrictions, local content rules, taxes, export requirements, regulations regarding health, pricing, packaging Transfer Risk: transfer of capital or profits out of the country Ownership restrictions: requiring part ownership of a foreign business in a country Takeovers: -Confiscation: business taken over with no compensation -Expropriation: some compensation- private enterprises are expropriated -Nationalization: some compensation- applies to entire industry -Domestication: an expropriated foreign business is given to locals to run -a nationalized business (run poorly by government) is given to the local private sector -Creeping expropriation: a set of actions whose cumulative effect is to deprive investors of their fundamental rights in the investment
When measurement scales are used for data collection, judge their suitability; (Consider reliability, validity, etic or emic approach, scalar biases, various response-style biases, and interpretation of scale numbers).
Likert Scales: intervals- extremely satisfied to extremely dissatisfied Semantic Differential Scale: How satisfied are you with our services? (extremely dissatisfied) 1 to 5 (extremely satisfied) Reliability: a reliable scale or measure provides the same response on each measurement occasion, assuming the object/construct being measured has not changed Validity: is the scale or instrument measuring what it is supposed to measure? The Reliability Index: higher the index, the better Etic: culture universal, may be used in other cultures Emic: specific to culture, group, location Scalar Bias: Courtesy Bias: respondents try to guess what the interviewer wants to hear Varying Response Bias: exhibit 2: response styles ex: Japan→ don't say no to your face Interpretation of Scale Numbers: for scales of 1 to 5 or 1 to 7, in some cultures 1=best. Better to spell it out. Illiteracy Problem
What are the requirements for continued trademark protection?
1. Renewal fee 2. Must exploit in good faith- not allowed to squat on name 3. Ensure that the name does not become generic
Understand the sequence of new product introductions?
1. Sprinkler Strategy: simultaneous introduction in multiple countries, short life cycle products, high R&D expenses 2. Waterfall Strategy: staggering intro across countries; enables learning from one country market before going to next 3. Physical Characteristics of Consumers: (eg Watchbands-Japanese have thinner wrists) 4. Cost and Price Issues: (eg Smaller size packages for the low income target customers, 4 oz shampoos) 5.Adaptations mandated by law (eg Yahoo had to block french users access to Nazi memorabilia on its US site; product safety standards)
What are some of the home country government actions that affect MNCs?
2. Home Country Government Actions -motives: ideological, political, national security -ex: embargos
"How global brands compete," Describe the four segments that emerged in terms of how consumers relate to global brands?
The four segments that emerged in terms of how consumers relate to global brands are global citizens, global dreamers, anti-globals and global agnostics. Global citizens (55% of respondents) rely on global success as a sign of quality. They also are concerned with a firm's global corporate responsibility. Global dreamers (23% of respondents) see global brands as offering high quality products. They aren't nearly as concerned with a companies' social responsibilities as global citizens are. Anti-globals are skeptical about transnational companies. They believe that transnational companies don't deliver superior, high-quality products. Global agnostics don't base purchases on a global brand's attributes. They use the same evaluation process as they would for a local company.
What are the factors that favor standardization of a product across multiple markets?
(1) Common Customer Needs: Function performed by the product/similarity of needs/similarity of usage conditions Ex: Pepsi Max (people shunned diet drinks) (2) Global Customers: B to B (3) Scale Economies: manufacturing, purchasing, distribution (4) Time to Market: consolidating new product development reduces cycle time (5) Regional Market Agreement reduced trading barriers, favors pan regional brands (Mars consolidated its many brands in Europe: Marathon in UK became Snickers; the Raider bar in continental Europe, renamed Twix, the name used in UK) (6) Products with high R&D costs but short product life cycles
What is counterfeiting, and why controlling it has been so difficult? What steps can a company take to discourage intellectual property theft in general and counterfeiting in particular?
-Counterfeiting: Unauthorized, illegal copying of products -illegal to import in the US -It is hard to control because it is difficult to and time consuming to obtain a search warrant, law enforcement agencies don't make extra efforts, there needs to be proof that the goods are fake for US Customs to seize counterfeit items, and strong export potential for bogus merchandise makes the government look the other way. -US government action -U.S Trade representative's super 301 report: review of foreign countries' trade practices. -The Special 301 Report: flags countries that lack adequate IP protection or deny fair market access to American products that rely on IP protection. - other governments need to coordinate their actions. -educate people about the adverse effects of counterfeiting.
Know the various types of insurance offering protection from various risks (e.g., political risk)
-Most companies are self- insured -property expropriation is the most common "reason" for obtaining political insurance - most commonly used claim is for currency inconvertibility (does not equally evaluate) -coverage avalability for kidnapping, terrorism, creeping exploration - most types of insurance is available from private companies, political + commercial risk insurance
Understand the provisions of the Trade-Related Aspects of Intellectual Property Right (TRIPS).
-Patent shall be available for any invention. Whether product or process, in all fields of technology provide that they are new, involved an inventive step and are capable of industry application -An obvious invention is not patentable -Members may bar a patent on grounds of protecting human, animal, or plant life, or health, or environment.
What are the factors that determine the extent of competition in an industry?
-Threat of "New Entrants" (bring new capital, new capacity, new approach to serve customer needs and a desire to gain market share -Profit decline: Barriers to entry for new entrants: economies of scale (easier to start small businesses), product differentiation, capital requirement (require heavy investment) -Threat of Substitute Products (examine substitutes in relation to needs, wants and technology) Amazon being a delivery service; Walmart, Target delivering groceries -Macro Factors (economic, political, social, cultural, technological, evolve along predictable lines) Economic development -> incomes up, birth rate down because women start working -Micro Factors (Suppliers, Customers)
What are the two common errors in country selection?
1. Ignoring countries that offer good potential, due to psychic distance- belief that home market success is more easily transferable to similar markets- ex: Airfrance goes to Africa more than any other airline bc of lower psychic distance 2. Spending too much time researching poor prospect countries
"Branding in the age of social media," What is branded content? How do authors define branding?
Branded content was an approach to make brands famous. They used short-form storytelling, cinematic tricks, songs, and empathetic characters to win over audiences. Authors define branding as "a set of techniques designed to generate cultural relevance."
the various primary data collection methods and strengths and weaknesses of each.
Focus Groups: between 6 to 8 people Strengths→ results not generalizable, less biased information Weaknesses→ 1. Government regulation of what can be asked, 2. In some cultures women participants are hard to find and men and women should not be in the same group, 3. In polychronic cultures, Some participants may not show up or be late, 4. In high power distance countries, young may not contradict older participants, 5. In high context cultures focus groups last much longer, as considerable time is spent up front in socialization Surveys: Strengths→ cheaper, can get to lots of people Weaknesses→ 1. Probability sampling: inadequate sampling frame, 2. Execution problems: Mail? Face to face? Online?, 3. Mail Surveys: non delivery problem for mail questionnaires; poor literacy rates; unwillingness to share information; social organization issues (decision-makers in an extended family?), 4. Face-to-Face interview: field staff well-trained?, 5. Online surveys, lost cost, fast results but leaves out those without PC, tablets, smartphone and are participants being truthful Questionnaires Strengths→ easy access Weaknesses→ translating from an alphabetical language (english) to a character based language will make the instrument longer and affect response rate, functional equivalence: is the product or service in question used for the same primary purpose in each country?, conceptual equivalence: are the words used conveying the same meaning? "Love;" "bitterness" = pungent spicy taste in Turkey = poison in Japan Backward Translation: Farsi speaker translation from English to Farsi, then translates Farsi to English and compare Parallel Translation: 2 bilinguals translating simultaneously
"Why Wal-Mart is worried about a discount German grocer," In what way are the consumer goods companies being affected by the U.S. grocers' attempt to compete with Aldi and Lidl?
Food price deflation→ eating into grocers earnings, failing sales
What is the role of core competencies (CCs) of a company in determining its competitive position?
Global Competition: Visible - Existing products, price/quality Invisible → at the CC level → cultivating and exploiting CCs for building anticipated products (Most managers think 1 not 2) Those who think 2 compete at core product level -- become OEMs e.g. Canon Advantages: revenue and feedback from all parts of the world, determines the pace at which CCs can be enhanced, learn and stay ahead of the experience curve while "hollowing out your competitors", may move from low OEM to high price manufacturer of end products e.g. Honda → Acura
How do multinational corporations (MNCs) compete with: (a) other MNCs (i.e., global vs. global MNCs) (b) local companies in various markets (i.e., global vs. local firms)?
Global vs Global MNCs → Cross-Country subsidiarization: using profit from one market to subsidize competitive activity in another Ex: calling company BIC and not including scripto (pens) Counterparry: defend against a competitive attack in one country by counter attacking another Ex: Fuji vs Kodak, fuji attacked Kodak in America, Kodak attacked Fuji in Japan Globally coordinated move: attack in multiple markets Target global competitors (actual and potential): acquire if small/vulnerable; co-operate if needed, Ex: trying to create monopoly when they buy/kill new competitors Ex: facebook vs google Examples: Coke's Dasani vs Danone's Evian in England and Argentina: Dasani had chemical that can cause cancer and was pulled out of England, company called Dasani "cancer water" and was sued by Coke Global vs Local Firms → Strength of global firm: awareness of product/brand recognition, economies of scales more experience Strength of local firms: know their market better, more managerial control, local community may trust you more
What factors influence global (vs. local) brand naming strategy?
Global:scale econs (max mktg impact and reduce ad cost) easy identification by travelers positive generalization Local:gov pressure global name already take by local firm cultural barriers helpful in mkts where patriotism matters
What are modular and core-product (common platform) approaches to standardization?
Modular approach: develop a range of product parts that can be used worldwide. Parts can be assembled into numerous product configurations; customizations Benefits: economies of scale- mass production of more or less standard product components at a few strategically located sites; design flexibility, shorter learning time Core Product approach: design a mostly uniform core product or platform Ex: renault (cars) uses the same body, engines, transmissions in different markets. Some changes; stronger heater in Nordic countries; standardization
"How global brands compete," What are the three characteristics that consumers associate with global brands?
Quality signal, global myth, and social responsibility are the three characteristics that consumers associate with global brands. People have noted that global brands usually mean higher quality product or service, but at a higher price. Consumers look to global brands as symbols of cultural ideas. Global brands make people feel like they're a part of something larger. Consumers expect that global companies should address social problems linked to what they sell and their business processes.
A company planning to enter a foreign market has to decide what type of market to pursue. Understand the various options such a company has and the selection criteria it can use to make that decision.
Standalone attractive markets (US, China, India) → large market size, higher growth rate, competitive position, government incentives Globally strategic markets → must win markets: crucial to global leadership + high potential for major profits, home market of global customers and competitors, lead markets: market for any product where innovations are happening - highly demanding customers (fashion; italy) Geographic Market Choices → analyzing groups of countries are one market e.g. developed nations (US, Canada, Western Europe and Japan, Australia and New Zealand), developing nations (China, India, Brazil, Philippines, Turkey), including transnational economies (Russia, Poland, Czech Republic) Transnational (combo b/t developed and developing) Selection Criteria: Stage 1: use macro-indicators (economic, geographic, sociopolitical) that reflect the total market size, growth rate, political risk to reduce the number of target countries. Stage 2: refine market size estimates further by use of micro-indicators; focus is on profitability; consider competition
Distance Still Matters: The hard reality of global expansion," What is the CAGE distance framework? What are its constituent parts? Discuss in detail.
The CAGE Distance Framework stands for cultural, administrative, geographic, and economic. This framework allows managers to identify and assess the impact of distance on various industries. Cultural distance is a country's cultural attributes that determine how people interact with people, companies, and society. Cultures are different across all countries, languages, religions, and norms. Administrative or political distance means historical associations shared by countries can greatly affect trade between the two. Geographic distance just means, the farther you are from a country, the harder it'll be able to conduct business in that country. Not only distance, but the physical size of the country and other factors need to be considered. Economic distance is the wealth or income of consumers. Further, rich countries engage in more cross-border economic activities than poor-countries.
"How global brands compete," What recommendations do the authors make for managing global brands?
The author makes five key recommendations for managing global brands. First off, the author stresses that managers think globalness. Smart companies manage their brands as global symbols because that's what consumers perceive them to be. Secondly, managers should "manage the dark side." Thirdly, companies should build credible myths. Global success may allow companies to deliver value to consumers by affirming myths. The author's fourth recommendation is to treat anti-globals as customers because they are a large market globally. Finally, the fifth and final recommendation is to turn social responsibility into entrepreneurship. Look at meaningful ways to contribute to a critical issue in other countries, don't use it as a PR story.
"How global brands compete," Does the authors' view suggest that transnational brands should rid themselves of their national heritage?
The authors' view doesn't suggest that transnational brands should rid themselves of their national heritage. Globalness has become a stronger quality sign than nation of origin. Consumers expect global brands to tell their myths from the particular places that are linked with the brand.
How do home countries' of MNCs influence global competitiveness?
USA: competition→ good for consumers -lowers prices Europe: many governments allowed cartel behavior outlawed in the US; rare enforcement of antitrust laws Japan: Keiretsu
What ownership strategies are available to a firm in a foreign market and their advantages and disadvantages?
Wholly Owned Subsidiaries: fully owned by a foreign firm in a host country; can involve marketing, assembly or full scale integrated production operations Joint Ventures: 1. Host country government prevents wholly owned investments 2. Not enough resources for wholly owned subsidiary 3. Share business and political risks JV waned because people want to avoid dispute with partners, local partner may emerge as a competitor Strategic Alliance: is an alliance involving two or more firms in which each partner brings a particular - usually complimentary - skill or resources, typically used to enter multiple markets rapidly and/or gain access to assets and technologies that may be specific to certain countries, many fail, alliances between unequal partners are more likely to succeed Mergers and Acquisitions: provide quick market access - immediate market presence and market share, great strategy for late movers into international markets
Distance Still Matters: The hard reality of global expansion," How do various types of distance affect different industries in different ways?
tural distance has to do with how people interact with each other and with companies. Difference in religious beliefs, ethnicity and language can all create a large distance between two countries because those things are sometimes things people can't look past or things that prohibit people from communicating correctly. Trade between countries with the same language is much easier than countries that have a language barrier. Administrative or Political Distance has to do with different political beliefs or colonial ties. With anyone having different political beliefs can be something they will not look past, same with different countries that are looking to trade with each other. Having colonial ties with a country makes it easier to trade with them because it gives each country a connection with one another if they have something like that in common. Countries/companies are more likely to trade if they are large, seen as national champions, vital to national security, it produces staples, etc. Geographic Distance has to do with the physical distance between two countries. Being further away makes it harder to trade between them. This also includes the physical size of the country, access to water and other natural resources, transportation and communication infrastructures. Goods and services are affected by this section of attributes, the cost of transportation Economic Distance has to do with the wealth or income of a country. The article said that rich countries tend to do more trade across their borders with other countries that are the same size as well as having the same economic wealth. Poor countries also trade with rich countries more than other poor countries. Companies have to have similar supply chains and distribution channels to make it easier to trade.
What is the impact of competition on an industry?
· Expansion of world trade · Competition - MNCs (multinational companies), local · Trade policy as a function of competitive strategy