G.O.A.T IV

What are Country of Origin Effects?

Country of Origin Effects are a subset of source effects, or the extent to which the place of manufacturing influences product evaluations

What is Cultural Myopia?

Cultural Myopia is the firm's failure to understand host-country cultural differences that require different approaches to marketing and management

What is Distribution Strategy?

Distribution Strategy is how the firm chooses to deliver the product to the consumer

What is Dumping?

Dumping occurs whenever a firm sells a product for a price that is less than the cost of producing it

What is Expatriate Failure?

Expatriate Failure is the premature return of an expatriate manager to his or her home country

What is International Communication?

International Communication occurs whenever a firm uses a marketing message to sell its products in another country

What is the most common approach to expatriate pay? Describe it.

The most common approach to expatriate pay is the Balance Sheet Approach, which attempts to provide expatriates with the same standards in their host countries that they enjoy at home

True or False: MANAGEMENT Development Programs are designed to increase the overall skill levels of managers through a mix of ongoing management education and rotations of managers through a number of jobs within the firm to give them varied experiences

True

Describe Hardship Allowance vs Housing Allowance vs Cost-of-Living Allowance vs Education Allowance

1. A Hardship Allowance is paid when the expatriate is being sent to a difficult location aka a location where schools/health care are grossly deficient compared to at home. 2. A Housing Allowance is normally given to ensure that the expatriate can afford the same quality of housing in the foreign country as at home. 3. A Cost-of-Living Allowance ensures that the expatriate will enjoy the same standard of living in the foreign posting as at home. 4. An Education Allowance ensures that an expatriate's children receive adequate schooling

What are the components of the typical expatriate compensation package? (5) Describe them.

1. Base Salary (Should be in same range as domestic salary) 2. Foreign Service Premium (Extra pay the expatriate receives for working outside his or her country of origin) 3. Allowances (Hardship/Housing/Cost of Living/Education) 4. Tax Differentials (May be taxed twice) 5. Benefits (Usually receive same benefits that you would receive at home)

There is a tendency for greater retail concentration in developed countries, what are the three factors that contribute to this?

1. Car Ownership 2. Number of Households with refrigerators and freezers 3. The number of two-income households

What are the three different types of training for expatriate managers? Describe them.

1. Cultural Training (Seeks to foster an appreciation for the host country's culture) 2. Language Training (English is language of business but attempting to speak the host country's language can build rapport) 3. Practical Training (Aimed at helping the expatriate manager and family ease themselves into day-to-day life in the host country)

What are the 6 International Market Research steps? Describe them.

1. Defining Research Objectives (Define the problem and set objectives for international market research) 2. Determining the Data Source (Primary vs Secondary Data) 3. Assessing the costs and benefits of the research (Relates to the cost of collecting primary data that can address the research problem and objectives directly versus using available secondary data) 4. Collecting the Data (Refers to gathering data via primary or secondary methods) 5. Analyzing and Interpreting the Research (Begins when the data have been collected) 6. Reporting the Research Findings (A way to communicate the overall results of the international market research project)

What are the two issues that are raised in every discussion of compensation practices in an international business?

1. How compensation should be adjusted to reflect national differences in economic circumstances/compensation practices 2. How expatriate managers should be paid

What are the two major reasons for American expatriate failures?

1. Inability of spouse to adjust (No friends in new country/language barrier/cannot get a job) 2. Manager's inability to adjust

What are the three aspects of Strategic Pricing?

1. Predatory Pricing 2. Multipoint Pricing 3. Experience Curve Pricing

What are the four main differences between distribution systems worldwide?

1. Retail Concentration 2. Channel Length 3. Channel Exclusivity 4. Channel Quality

What are the four dimensions that predict success in a foreign posting? Describe them.

1. Self-Orientation (Does the manager have self-confidence?) 2. Others-Orientation (Managers willingness to communicate with others in new country) 3. Perceptual Ability (The ability to understand why people of other countries behave the way they do aka to empathize) 4. Cultural Toughness (Refers to the relationship between the country of assignment and how well an expatriate adjusts to a particular posting)

What are the four major tasks of the HRM function?

1. Staffing Policy 2. Management Training and Development 3. Performance Appraisal 4. Compensation Policy

What are the three types of staffing policies in international businesses?

1. The Ethnocentric Approach 2. The Polycentric Approach 3. The Geocentric Approach

What are the two main issues that managers must be cognizant of when considering international market segmentation?

1. The differences between countries in the structure of market segments 2. The existence of segments that transcend national borders

Organized labor has responded to the increased bargaining power of multinational corporations by taking what three actions?

1. Trying to establish international labor organizations 2. Lobbying for national legislation to restrict multinationals 3. Trying to achieve international regulations on multinationals through such organizations as the United Nations

What are you going to get on this test?

100%

What is a Concentrated Retail System? (Developed nations)

A Concentrated Retail System is one in which a few retailers supply most of the market

What is a Diverse Workforce?

A Diverse Workforce is one that has a significant mix of both genders and in which cultural and ethnic minorities are well represented

What is a Fragmented Retail System? (Developing nations)

A Fragmented Retail System is one in which there are many retailers, none of which has a major share of the market

Describe the Geocentric Staffing Policy. What are its advantages and disadvantages? What strategy does this go with?

A Geocentric Staffing Policy seeks the best people for key jobs throughout the organization, regardless of nationality Advantages: -Uses human resources efficiently -Helps build strong culture and informal management networks Disadvantages: -National immigration policies may limit implementation -Expensive Goes with Global Standardization and Transnational

Describe the Polycentric Staffing Policy. What are its advantages and disadvantages? What strategy does this go with?

A Polycentric Staffing Policy requires host-country nationals to be recruited to manage subsidiaries, while parent-country nationals occupy key positions at corporate headquarters Advantages: -Alleviates cultural myopia -Inexpensive to implement Disadvantages: -Limits career mobility -Isolates headquarters from foreign subsidiaries Goes with Localization Strategy

Describe a Pull Strategy. When is it used? (3 things)

A Pull Strategy depends more on mass media advertising to communicate the marketing message to potential consumers 1. For consumer goods 2. When distribution channels are strong 3. When sufficient print and electronic media are available to carry the marketing message

Describe a Push Strategy. When is it used? (3 things)

A Push Strategy emphasizes personal selling rather than mass media advertising in the promotional mix. 1. For industrial products or complex new products 2. When distribution channels are short 3. When few print or electronic media are available

Describe the Ethnocentric Staffing Policy. What are the reasons firms pursue this approach? What strategy does this go with?

An Ethnocentric Staffing Policy is one in which all key management positions are filled by parent-country nationals. Advantages: 1. Overcomes lack of qualified managers in host nation 2. Unifies culture 3. Helps transfer core competencies Disadvantages: 1. Produces resentment in host country 2. Can lead to cultural myopia *Goes with International Strategy*

What is an Exclusive Distribution Channel?

An Exclusive Distribution Channel is one that is difficult for outsiders to access

What is an Expatriate Manager?

An Expatriate Manager is a citizen of one country who is working abroad in one of the firm's subsidiaries

What is an Intermarket Segment?

An Intermarket Segment is a segment that spans multiple countries, transcending national borders

What is Arbitrage?

Arbitrage occurs when an individual or business capitalizes on a price differential for a firm's product between two countries by purchasing the product in the country where prices are lower and reselling it in the country where prices are higher

What is Channel Length? What is Short vs Long Channel?

Channel Length refers to the number of intermediaries between the producer (or manufacturer) and the consumer A Short Channel is just from producer to consumer. A Long Channel exists when a producer sells through an import agent, wholesaler, or retailer

What is Channel Quality?

Channel Quality refers to the expertise, competencies, and skills of established retailers in a nation and their ability to sell and support the products of international businesses

What is Corporate Culture?

Corporate Culture is the organization's norms and value systems

Describe Firms and Consumers in highly-developed nations in terms of product preference

Firms based in highly developed nations build a lot of extra performance attributes into their products. Consumers in developed nations are often not willing to sacrifice their preferred attributes for lower prices

What are the arguments for and against Standardized Advertising?

For: 1. Has economic advantages aka lowers costs 2. Creative talent is scarce 3. Many brand names are global Against: 1. Cultural differences can cause problems 2. Advertising regulations may block it

What is Human Resource Management? (HRM)

Human Resource Management refers to the activities an organization carries out to use its human resources effectively

What is International Market Research? What are the two issues that separates International Market Research from domestic research?

International Market Research is defined as the systematic collection, recording, analysis, and interpretation of data to provide knowledge that is useful for decision making in a global company International Market Research involves 1. Translation of questionnaires and reports into appropriate foreign languages and 2. Accounting for cultural and environmental differences in data collection

Describe Theodore Levitt's Theory

Levitt said that technology is the driving force behind the fact that we now sell standardized products in completely standardized global markets. Everything is standardized.

What is Market Segmentation?

Market Segmentation refers to identifying distinct groups of consumers whose needs, wants, and purchasing behavior differ from others in important ways

What is Multipoint Pricing?

Multipoint Pricing refers to the fact that a firm's pricing strategy in one market may have an impact on its rivals' pricing strategy in another market

What is Noise?

Noise refers to the number of other messages competing for a potential consumer's attention, and this too varies across countries

What is Predatory Pricing?

Predatory Pricing is the use of price as a competitive weapon to drive weaker competitors out of a national market (and then once competitors leave, the firm can raise prices and enjoy high profits)

What is Price Discrimination? What are the two conditions necessary for profitable Price Discrimination?

Price Discrimination exists whenever consumers in different countries are charged different prices for the same product or for slightly different variations of the product 1. Firm must keep its national markets separate 2. There must be different price elasticities of demand in different countries

Describe Price Elasticity of Demand and then Describe Elastic vs Inelastic

Price Elasticity of Demand is a measure of the responsiveness of demand for a product to change in price. Demand is said to be Elastic when a small change in price produces a large change in demand. Demand is said to be Inelastic when a large change in price produces only a small change in demand

Firms that pursue Experience Curve Pricing on an international scale do what?

Price low worldwide in an attempt to build global sales volume and then after it moves down the experience curve it will have a cost advantage over competitors

What is Primary Data vs Secondary Data?

Primary Data refers to data collected by the global company and/or its recruited international market research agency for the purpose of addressing the research problem and objectives defined by the company. Secondary Data refers to data that have been collected previously by organizations, people, or agencies for purposes other than specifically addressing the research problem and objectives at hand

When should you use Short Channels vs Long Channels?

Short Channels are used when the retail sector is concentrated (and when businesses do not want to pay markups), while Longer Channels are used when the retail sector is fragmented

What is the big question with national differences in compensation in international businesses? What staffing policy is this question most present in?

Should the firm pay executives in different countries according to the prevailing standards in each country, or should it equalize pay on a global basis? Most present in Geocentric Staffing Policies

What are Source Effects?

Source Effects occur when the receiver of the message (the potential consumer) evaluates the message on the basis of status or image of the sender

What is Staffing Policy?

Staffing Policy is concerned with the selection of employees for particular jobs

What is the Marketing Mix?

The Marketing Mix is the set of choices the firm offers to its targeted markets

What is the best way to think about the Marketing Mix?

The Marketing Mix represents the tactical activities and behaviors that are implemented by a global company based on its international marketing strategy to offer the best possible "mix" of product, distribution, communication, and price to a specific target market in a country or region

What are the four elements of the Marketing Mix? The 4 P's?

The four elements of the Marketing Mix are Product Attributes, Distribution Strategy, Communication Strategy, and Pricing Strategy The four P's are product, place, promotion, and price

What is the goal of Market Segmentation?

The goal of Market Segmentation is to optimize the fit between the purchasing behavior of consumers in a given segment and the marketing mix, thereby maximizing sales to that segment

What is the most important aspect of cultural differences?

Tradition