International Business Final (CH 14)-More Depth

Levels of education and consumer protection

-Companies often have to adapt their products to satisfy laws and regulations -Many developing countries have fewer consumer protection laws creates ethical issues, consumers there are less educated therefore need protection

Brand Name

-Competitive advantage, central to a products personality and the image that it presents to buyers -Also functions as legal property that owners can protect from trespass by competitors

What are the characteristics of the most successful pan-European ads?

-Contain a great deal of visuals -Have few written or spoken words -Focus on the product and consumer (ex: ad for TAG Heuer watches)

National image

-The value consumers obtain from a product is heavily influenced by the image of the country in which it is designed, manufactured, or assembled -Affects buyers perceptions of quality and reliability -Can change

Product/communication adaptation (communication strategy IV-dual adaptation)

Adapt product and communications a) Rather uncommon b) Can be expensive c) Requires large profitable segment

Product adaptation, communication extension (communication strategy III)

Adapt product/extend communications a) Local infrastructure b) Local content laws c) Can be costly

Counterfeiting

Common among highly visible brand-name consumer goods, including watches, perfumes, clothing, movies, music, and computer software

Factors that affect the preferences of consumers:

Cultural environments Political environments Legal environments Economic environments

Selling Altoids in the U.S. as a breath mint is an example of what?

Cultural need

Exclusive channel

Distribution channel in which a manufacturer grants the right to sell its product to only 'one or a limited number' of resellers -Givers produce a great deal of control over the sale of their product by wholesalers and retailers -Helps a producer to constrain distributors from selling competing brands -Creates a barrier that makes it difficult or impossible for outsiders to penetrate the channel (ex: Mitsubishi dealerships cannot sell Toyotas, and General Motors dealers cannot sell Fords)

Intensive channel

Distribution channel in which a producer grants the right to sell its product to 'many resellers' -Provides buyers with location convenience because of the large number of outlets through which a product is sold -Does not create strong barriers to channel entry for other producers, however, nor does it provide much control over reseller decisions such as what competing brands to sell (large companies whose products are sold through grocery stores and department stores typically take an intensive channel approach)

Which factors influence the decision to use a push or pull strategy?

Distribution system Access to main media Type of product

Promotion Mix

Efforts by a company to reach distribution channels and target customers through communications, such as personal selling, advertising, public relations, and direct marketing -Promotional activities often receive the greatest attention among marketers because many people, even professional, tend to equate marketing with promotion

Product/communication extension (communication strategy I)

Extend product and communications a) Satisfies different need b) Serves different function c) Appeals to different buyer

Product extension, communication adaptation (communication strategy II)

Extend product/adapt communications a) Satisfies different needs b) Serves different functions c) Appeals to different buyers

The difficulties for worldwide pricing policy

Local production costs Export, distribution costs Low purchasing power Exchange rates

The __ a product's value density, the __ __ the distribution system.

Lower, More localized

Two-level channel

Made up of two intermediaries

The degree of offense in brand and product names

Names can be highly offensive if they are not carefully researched and selected -Words or phrases can mean different things in other countries and cultures

Brand Image

Needs to be consistent

One-level channel

Places only one intermediary between the producer and the buyer

Direct marketing (zero-level channel)

Producers sell directly to final buyers

Product Invention (communication strategy V)

Product invention: requires that an entirely new product be developed for the target market a) Purchasing power b) Economic development level c) Varying infrastructure

Pull Strategy

Promotional strategy designed to create buyer demand that will encourage channel members to stock a company's product -Buyer demand is generated in order to "pull" products through distribution channels to end users -EX: creating consumer demand through direct marketing techniques

Push Strategy

Promotional strategy designed to pressure channel members to carry a product and promote it to final users of the product -Manufacturers of products commonly sold through department and grocery stores often use -Often used for office products like computers and office furniture -A company's international sales force is the key to successfully implementing a push strategy abroad

What strategy was Proctor & Gamble using when it hired a fleet of trucks to drive through village squares and hand out free trial packages to potential end users?

Pull Strategy

Worldwide pricing policy

Single selling price for all international markets

The greater the number of intermediaries in a channel:

The more costly it becomes -Each additional member adds a charge for its services onto the product's total cost

Channel length

The number of intermediaries between the producer and the buyer

The role of technology in convergence of tastes and preferences:

Theodore Levitt said: "technology was already causing people's needs and preferences to converge throughout the world and urged companies to standardize"

Marketing internationally usually means what?

Translating promotional messages from one language into another