International Marketing Management CM QUIZZES 1-7

Organizations following a key customer or responding to a foreign sales opportunity will likely find identifying foreign target markets easier than those following a proactive approach to foreign market expansion.

True

Paradoxically, the very nature of an identifiable brand, including look and feel, can potentially be an impediment in a foreign market.

True

Perceived Value (PV) is the willingness to pay for a product or service based on what the customer believes (i.e., perceives) it to be worth.

True

Products designed for highly specific target customers in the home market are often rendered useless in foreign markets.

True

Research has shown that internal barriers to international expansion are at least as great as the more easily identified external factors.

True

Though often overlooked, internal issues associated with foreign expansion are equally important to success.

True

Typically, the task of developing and refining a value proposition is initially driven by the home market.

True

Ultimately, the entry mode decision is about how a company can best gain access to the new international market.

True

Understanding how much a firm is willing to invest upfront in the market is fundamental when considering how to enter a foreign market.

True

Usually, the vast majority of potential customers in the foreign target market do not know the brand that is being introduced into their country.

True

When choosing an entry mode into a foreign market, establishing local manufacturing provides the greatest control possible to the expanding firm.

True

When considering expansion to a large foreign market, rather than exporting what might be considered an insignificant amount given the market size volume, a company might prefer to carry out market research.

True

When considering foreign market expansion opportunities, both management and investors are often concerned with the possible lack of marketing focus and market acumen regarding potential sales and financial performance.

True

When considering using competition-based pricing in a new foreign market, it is imperative to conduct research on brands currently available in the new market, as well as the likelihood that other competitors may enter.

True

When entering a market by way of joint venture, the local company may have a recognized brand name that can be used to enter the market more quickly than would be possible if using a new and non-local brand name.

True

When obtaining data for country attractiveness analyses, typically the more industry-specific the data, the less likely it will be accessible for free.

True

When seeking internal approval, it is essential to strike the right balance between recognizing and accounting for the foreign target market needs while simultaneously projecting positive financial and strategic outcomes.

True

What is NOT a common requirement when researching foreign markets for expansion opportunities?

assessing awareness of manufacturer home-market brand in target market

Which of the following is NOT a common driver of international expansion?

avoiding having to pay corporate taxes in the home market

Which cost is NOT typical related to activities of retail placement when entering new foreign markets?

buyer bonus (or gift)

What is NOT a legitimate reason firms may desire to have consistent and predictable conversion between the foreign and home market currencies?

innovation development

As illustrated by the Medi-Cult example in the text, expanding firms must bring to the new foreign market __________ that provide customers with ____________ not found in existing offerings.

innovative products and services; benefits

Which of the following is NOT necessary for the international marketer to initially identify and vet?

internal human resources

Any path taken to enter a new market can ultimately be categorized under one of several major approaches. Which of the following is NOT one of those approaches?

licensing your brand or technology

International sales is often characterized by a "take it or leave it" approach, meaning the foreign customer must comply with a variety of requirements. Which of the following is NOT one of those requirements?

purchase seller's excess inventory

Generally speaking, the larger the foreign market, the more likely exporting to it will be successful.

False

What is NOT a common characteristic of most companies' patterns of international expansion?

?

When considering developing a new product to meet an identified need in a target foreign market, the international marketer, unlike their home market counterpart, must often contemplate which question?

?

Which concerns would lead a company to set up their own marketing and sales subsidiary rather than partner with an export distributor?

?

Which issue below should be considered when assessing a firm's internal preparedness for international expansion regarding Attitude?

?

Which of the following is NOT a legitimate benefit to consider when setting customer value-based pricing in a country where labor costs are significantly lower than in the home market?

?

An easily overlooked and potentially costly mistake for an expanding firm is not properly understanding the margin expectations of channel partners in the new foreign market. What is a possible reason an intermediary in a new foreign market might have different expectations from home market intermediaries?

All of the above are legitimate reasons.

Which Tude definition below is incorrect?

Attitude - the way employees think and feel about our company

Which country is NOT among the top 15 when measured by GDP?

Belgium

Firms with strong and clear indications of pursuing international growth are typically excellent at making sure their ex-pats (or initiative team leaders) are offered continued deserved challenges and career advancement upon their return to the home office.

False

Foreign market segments can often resemble those found in the home market.

False

When considering competition-based pricing, in order to be consistent with the overall positioning strategy, which question is NOT relevant to ask?

Do we want to price based on the amount of value we bring to the customer?

A key difference between an export distributor and an export agent is that the agent takes ownership of the products to be sold internationally while the distributor does not.

False

An important objective of in-depth screening is to expand the number of markets available for due diligence analysis.

False

At the root of any segmentation exercise is the development and refinement of the firm's business model.

False

Because companies typically understand the higher-than-normal risks involved in undertaking international expansion initiatives, managers charged with developing and implementing them take on little career risk.

False

Firms that primarily view international expansion opportunistically are guaranteed to fail.

False

Imagine that the exchange rate between the USD (United States Dollar) and the CNY (Chinese Yuan Renminbi) goes from 1 USD = 6.48 CNY to 1 USD = 6.81 CNY, yet the local currency revenue (i.e., sales) of McDonald's in China stays the same. In this case, McDonald's will now be able to repatriate more proceeds to the US headquarters.

False

In the common scenario where a brand is believed to make up a significant part of the product's value equation in the home market, an international marketer should assume that the brand also brings at least some value to the product in the target foreign market.

False

Marketing can be characterized as a process, while international marketing can be characterized as an activity.

False

Most international marketers are naturally indifferent to entry mode options, choosing the best one based on the facts.

False

Once a firm has decided to enter a foreign region (i.e., multiple countries), it is recommended that they follow a standardized entry mode for each of the countries in the region.

False

Regarding Latitude and questions of internal flexibility, differences in approach among managers are mainly reflective of personal preference.

False

TEV stands for Total Economic Value.

False

The more developed the country, the more difficult the business environment tends to be.

False

Typically, only about half of all foreign market entry initiatives succeed.

False

Unlike product development-related expectations, which are known to vary significantly among markets, service-related expectations tend to be more similar.

False

When carrying out international marketing, services are harder to adapt to local market conditions than products are.

False

When considering customer segments in a foreign target market, a good approach is to imagine that the market structure and dynamics of the foreign market will be similar to those of the home market.

False

When entering new international markets, firms should make sure to get the best sales team possible so they can guarantee never having to give up more margin to intermediaries than the existing competitors.

False

When it comes to the analysis of foreign market entry modes, whether a firm sells a product or a service is not of much import.

False

When nationalistic trends strengthen, corporate leaders feel more motivated to show they can successfully grow into foreign markets.

False

When undertaking an international expansion initiative, it is critical to understand that gaining internal support is more important than gaining customers in the foreign target market

False

While important, the task of choosing which materials to adopt and translate or customize for the foreign market is not as important as the selection of product and service offerings.

False

What sets international marketing and expansion apart from its domestic counterpart is the ____________ the opportunity.

Foreignness of

Understanding how a brand name will be accepted by the target foreign market is important. Which statement below is NOT true of the use of brand names in foreign markets?

Global brand equity is increased by using a locally recognized brand.

As with any business development initiative, when considering international expansion and where in the world to go, the international marketer must ask all of the classic business model questions. Which of the following is NOT one of those questions?

How difficult of a country is this to do business in? (as ranked by Ease of Doing Business rating)

What question is NOT important to consider when contemplating whether to expand into a new international market?

How do other companies get their product to market?

Which of the following marketing activities is unique to the international marketing context?

How much customization of products is required to enter this market?

Which list correctly ranks the displayed countries from largest to smallest GDP?

Japan, France, Russian Federation, Korea

Why does the "export paradox" exist?

Larger countries tend to have larger economies, which can produce or already access most of the goods needed by their societies.

Which Tude definition below is incorrect?

Latitude - the ability to achieve geographical proximity with target location selection

What is NOT a common reason companies seek to expand abroad?

Managers seek opportunities for company-paid international travel

When considering altering decisions regarding the 4 Ps prior to foreign market entry, which statement is NOT true?

Price (for similar products) should be similar to that of the home market price to avoid potential distributor conflict.

Which decision should be made first when making key international expansion decisions?

Should we expand?

All of the below statements are true, EXCEPT:

South Africa has the largest economy in Africa

Which location is NOT a typical hub for regional management?

Tel Aviv for Middle Eastern countries

A brand name that is described as a good one for the home market of the U.S. may not be appropriate in a foreign market. When considering the transferability of the brand name "Windex," which reason below is NOT considered uniquely valuable to the US market?

The Windex logo is set in a blue background.

One reason that distributor margin expectations may be different in a new foreign market is because over time, as unit volume grew, the manufacturer managed to get the home market partner to accept lower margins.

True

A key advantage of selling the same product in a foreign market as in the home market is that the company can exploit their product and customer knowledge in an efficient and financially rewarding way, without needing to seek out new business areas and markets.

True

A major reason that many organizations choose to export their products rather than establish operations in a foreign market is that they are simply unwilling to engage in any product customization at all.

True

A typical approach to cost-based pricing is calculating a price based on the variable costs and a desired margin that will cover fixed costs.

True

At its core, international marketing is about moving beyond export to establishing a subsidiary in a foreign market.

True

By clustering countries into regions, a firm may be able to access adequate scale of market to make the initiative financially attractive, whereas any individual market by itself might not be as attractive or viable.

True

Despite having the world's tenth largest economy, Canada represents only about two percent of the global economy.

True

Despite the commonly held belief that foreign countries are different from one's own, most people intuitively imagine that what their company will do abroad is basically the same as what they do at home.

True

Disparate attitudes toward international expansion within the same company often exist and tend to complicate the process.

True

Enthusiastic, internationally-oriented marketers often find it hard to accept, much less understand, that their colleagues may be less excited than they are about pursuing international expansion initiatives.

True

Exactitude addresses the company's stated acceptance of risk.

True

Exporting is typically the easiest way to enter a product into a new market.

True

Finding a foreign market opportunity that aligns with the firm's capabilities and goals is fundamental to success.

True

For a firm, deciding where to expand is often the most pivotal decision in determining foreign market entry success or failure.

True

For most companies, international expansion follows an approach that is generally proactive (seeking first-mover advantage or growth) or reactive (following key customers or by foreign inquiry and demand).

True

Generally speaking, it is easier to resolve a gap in internal resources and preparedness than it is to adjust an organization's collective attitude toward international expansion.

True

In discussing exactly what constitutes marketing beyond one's national borders, the terms "international marketing," "multinational marketing," and "global marketing" are often used as if they were interchangeable.

True

In new foreign markets, just as in the home market, PV can be more or less than TEV.

True

In-depth screening is the core of the market selection process.

True

Inflation occurs in most countries, most every year.

True

International marketing typically only takes place once local organizations have been established in one or more foreign markets.

True

Many managers see marketing abroad and international expansion as something of an anomaly and outside of the normal activities of the organization.

True

Many multinational companies don't consider individual markets as expansion targets but rather entire regions.

True

Marketing itself is, by definition, always a local activity, whereas international (or global) marketing is, by definition, always a regional or multinational activity.

True

Once a product is imported into a country market, channel intermediaries may still be needed.

True

One important challenge for the international marketer is being able to capture their fully landed costs in a new country market.

True

One of the most significant challenges when considering international expansion is determining if a company is willing to go beyond their existing product/service identity.

True

What format should marketing managers follow when developing a brand positioning statement for an international opportunity?

[your audience], [your brand], [benefit claim], [competitors], because [brand attributes supporting the benefit]

What resource within the expanding company is NOT typically immediately usable by the international marketer?

communication materials

Which issue below should be considered when assessing a firm's internal preparedness for international expansion regarding Magnitude?

correct scale for proper execution and delivery

Regardless of the country, marketing is all about ___________ value. Because international marketing includes managing value in multiple locations, it is too complex to be done ___________.

creating and capturing; independently

What is NOT a reason companies use to justify the additional investment and risk of establishing a local headquarters versus marketing through a foreign distributor?

desire for a guaranteed outlet for overstocked items from the home market

In order to maintain brand integrity, well-run marketing organizations usually provide guidelines that establish acceptable content marketing materials. Which of the following is NOT typically included?

distribution partner logos

In the preliminary screening stage for potential foreign market entry, countries are evaluated on a variety of macro-level indicators. Which of the following is NOT one of those indicators?

ease of obtaining an export license

Export merchants (or export trading companies) and export agents differ in many of the support functions they provide to the exporting firm. Which function do they both always provide?

establishing customers and distribution networks in the target country

Which of the following is NOT a key step in carrying out an in-depth country attractiveness analysis?

estimating financial costs of entry for each country

Which entry modes tends to involve the lowest costs and risks?

export

Because of the globalized nature of contemporary business, expanding internationally is universally seen as an expected part of a firm's ongoing business development undertakings.

false

Which of the following is NOT a common and legitimate cause of price escalation when exporting to a foreign market?

fines for improperly prepared import documents

Home market materials, such as photography, can have within them small differences versus the target market that can create an unwanted aura of foreignness, ultimately rendering them ineffective for the target market. Which of the following is NOT a common example of the types of differences identified?

fonts

Which step below is NOT part of the four-stage process of evaluating foreign markets for potential entry?

foreign country subsidiary headquarters location analysis

When developing and communicating a target foreign market marketing plan, which objective should be the first step?

gain internal approval

What is NOT a common approach managers take when considering pricing in foreign markets?

home market-based

When considering the "customization vs. standardization" decision an international marketing manager might have to make regarding a product or service, which concern is NOT legitimate?

number of employees the firm has in the local market

Which task is the international marketer NOT responsible for completing?

obtaining export licenses

what is the best description of international expansion as a business development strategy

offering existing products or services in new foreign markets

Exporting firms can be said to take a(n) _________ approach to expansion, exploiting opportunities as they become available.

opportunistic

Which of the Tudes below is not among the seven internal issues that should be reviewed prior to undertaking an international expansion initiative?

platitude

Which issue below should be considered when assessing a firm's internal preparedness for international expansion regarding Rectitude?

policies that are flexible and responsive to the legal and ethical requirements of the local market

Criteria such as ___________ can be used to assess demand. Similarly, existing ___________ can be used to assess ___________ .

population and disposable income; product availability and number of competitors; supply

Which issue below should be considered when assessing a firm's internal preparedness for international expansion regarding Exactitude?

possibility of unforeseen issues that may significantly affect results, despite our expertise in creating reasonably accurate predictions of the financial impact

Regardless of entry mode, when reviewing the ever-present 4 Ps as they pertain to the target foreign market, which "P" must be implicitly understood as viable in that market?

product

What are the "4 Ps" of marketing?

product (service), place, promotion, and price

When entering a new foreign market where hypermarkets are prevalent, the entry mode chosen must take into account the ________ of servicing the __________ purchasing agents of these __________ organizations.

requirements; highly demanding; powerful

For most companies considering international expansion, evaluation of ___________ typically precedes evaluation of the ____________ of the initiative itself.

risk of failure; cost-benefit analysis

Which of the following is NOT considered a market intermediary?

sales agent

The acronym "STP" is a tried-and-true framework to guide managers in creating and capturing value. What does this acronym stand for?

segmentation, targeting, and positioning

The first criterion in determining whether establishing a foreign subsidiary is a worthwhile pursuit is the _____________ of the opportunity.

size

Information used to assess foreign market opportunities is often organized into key success factors. Which of the following is NOT a typical success factor?

tariffs

The Big Mac index illustrates how the Big Mac burger sandwich is available to a common specification in many countries around the world at local McDonald's restaurants. Despite the composition and ingredients being standardized across markets, the prices (as expressed in USD) vary significantly. What is NOT one of the reasons for these price differences?

the number of calories in a Big Mac

Foreign exchange rates fluctuate daily, and many of the common factors that affect exchange rates, such as inflation rates, interest rates, and current accounts (the balance of trade) between the two countries, are monitored. However, some events may arise unexpectedly and have immediate and potentially lasting impact on exchange rates. Which of the following is NOT an example of such an event?

trade agreements

Which of the following is NOT required for foreign market entry success?

translatable brands

Which issue below should be considered when assessing a firm's internal preparedness for international expansion regarding Aptitude?

understanding of the geographic/demographic/political challenges in this new environment

Despite the fact that their brand may be ___________ in the foreign target market, understandably, it can be hard for a company to grasp that their brand __________ in another market.

virtually unknown; has no value, good or bad

When can it be said that international marketing occurs?

when a company starts actively marketing their products in another country

Which issue below should be considered when assessing a firm's internal preparedness for international expansion regarding Fortitude?

willingness of key players to take a career risk to make a new overseas initiative successful

Which issue below should be considered when assessing a firm's internal preparedness for international expansion regarding Latitude?

willingness to make changes in-country to accommodate distribution and service requirements