DIRECT MARKETING and e-COMMERCE

1

Chapter 7 THE INTERNATIONAL ENVIRONMENT
FOR PROMOTION and IMC 7.1
2
Cultural Communications

• Culture - Total Way of a People, the Social
  Legacy the Individual Acquires from His or Her
  Group
• Culture is Typically Invisible to Those Who are
  Immersed In It, Making Communication Across
  Cultures Difficult
• 7.2

3
Importance of International Communication

• Complex Social, Political Economic Changes
  Affect International Communications Environment.
• International Developments Relevant to the Rise
  in International Commercial Communications
• Development of Trading Blocs - May be Prelude to
  a Rise in Nationalism
• Loosening of Political and Economic Constraints
• 7.3

4
Importance and Rise of International
Communication (cont)

• Liberalization of the Flow of Labor and Increase
  in movements of Peoples Across Borders
• Growing Size of Ethnic Groups From Elevated Birth
  Rates
• Rise of Cultural Borders and Barriers even as
  Economic Barriers Begin to Fall
• 7.4

5
Overcoming Cultural Barriers in International
Promotion

• Barriers to Creating Successful International
  Promotions
• Ethnocentrism
• Self-Reference Criterion
• 7.5

6
How Might This American Ad Be Viewed as
Ethnocentric 7.6
7
Overcoming Cultural Barriers in International
Promotion (cont)

• Cross-Cultural Research Helps Overcome Barriers
• Secondary Data - Data Gathered by Someone Else
• for Some Other Purpose
• Primary Data - Specific Data Collection Unique to
  a Promotional Situation
• Economic Conditions
• Demographics Characteristics
• Values
• Custom Ritual
• Product Use Preference
• 7.7

8
Challenges in International Advertising

• Creative Challenge
• Media Challenge
• Media Availability Coverage
• Media Costs Pricing
• Regulatory Challenge
• 7.8

9
International Markets Prefer Different
Creative Executions
7.9
10
Challenges in International Sales Promotion,
Direct Marketing and e-Commerce

• CHARACTERISTICES OF THE PRODUCT
• Product Prevalence Use
• As Competitive Environment Becomes More
  Complex, Advertising Designed to Differentiate
  Brands will Become More Predominant
• Products Moving into Growth Stage will Need to
  be Differentiated
• 7.10

11
Challenges in International Sales Promotion,
Direct Marketing and e-Commerce (cont)

• LEVEL OF ECONOMIC DEVELOPMENT
• All Forms of Production Direct Marketing are
  Applicable in Highly Industrialized Markets
• In Less Developed Countries - Lack of Wide
  Range of Consumer Goods Low Income Make
  Promotion a Non Issue
• Few Competitors Serve these Markets
• Low Literacy Make Communication Difficult w/Print
  Media
• Without TV, Radio Newspaper, Direct marketing
  is Undermined
• Unsophisticated Mail Systems
• 7.11

12
Challenges in International Sales Promotion,
Direct Marketing and e-Commerce (cont)

• LEVEL OF ECONOMIC DEVELOPMENT (cont)
• Newly Industrialized Markets Better Environment
  for Promotional Tools Must be Managed Carefully
• Consumer Income Rises More Consumer Goods are
  Introduced and Succeed
• As Media Proliferate, Sales Promotions and Direct
  Marketing can be Introduced Based on
  Market-by-Market Assessment
• 7.12

13
Challenges in International Sales Promotion,
Direct Marketing and e-Commerce (cont)

• STRUCTURE OF TRADE CHANNELS
• Highly Developed Distribution Retailing Systems
  Trade Channel Members Demand Support or Carry
  Marketers Brand
• Trade Allowances, Incentives, Point-of-Purchase
  Displays Sampling
• Must Have the Means to Handle Coupon Redemption
  or Premium Distributions
• Less Developed Trade Channels May Not be Able
  to Use Traditional Promotional Techniques
• Fragmentation of Trade Channels
• Retailers - No Way of Handling Coupons
• Some Countries So Small May Not be able to Handle
  Point-of-Purchase
• Trade Show
• 7.13

14
Challenges in International Sales Promotion,
Direct Marketing and e-Commerce (cont)

• REGULATIONS
• Regulation of Promotion, Direct Marketing, and
• e-Commerce Varies Widely Market-to-Market
• Most Sales Promotion Tools are Legal Across
  Europe
• Sweepstakes are Either Heavily Banned or
  Regulated in All European Markets
• In Japan Value of Premium Offered with a
  Product is Limited to 10 of the Value of the
  Original Price
• 7.14

15
Promotions in International Markets Must be
Researched for Regulation and Legality
7.15
16
Challenges in International Public Relations

• COMPANIES HAVE LESS CONTROL OVER GLOBAL PUBLICITY
  RELATIVE TO DOMESTIC SITUATIONS, AND NO
  CORPORATIONS ARE POWERFUL ENOUGH TO CONTROL A
  HOST COUNTRYS MEDIA

7.16
17
Promotion Agencies Around the World

• GLOBAL AGENCY
• Will Know Marketers Products Current Promotion
  Program
• Agency may then Either Adapt Domestic Campaigns
  or Launch New Ones
• Disadvantage is their Distance from Local
  Culture. Exporting Meaning is Never Easy
• INTERNATIONAL AFFILIATE
• Set Up as a joint Venture w/Local Agencies
• Join Networks or Take Minority Ownership
• Benefits in this Arrangement
• LOCAL AGENCY
• Knowledgeable about Culture/Local Market
• Have Well-Established Contacts
• One Problem-Less Standardization of Creative
  Effort
• 7.17

18
Standardized vs. Promotional Customized Campaigns

• STANDARDIZED CAMPAIGNS USE SAME APPEAL CREATIVE
  EXECUTION ACROSS ALLINTERNATIONAL MARKETS
• CUSTOMIZED CAMPAIGNS INVOLVE PREPARING CREATIVE
  EXECUTIONS FOR EACH MARKET A FIRM HAS CREATED
• A BRAND IS WELL SUITED FOR A STANDARDIZED
  CAMPAIGN WHEN
• Communication Primarily Uses Visual Appeal
• Communication is Culture-less
• Brands that are Standardized
• Products have Global Reputation
• 7.18

19
Certain Product Lend Themselves to Standardized
Campaigns 7.19
20
Standardized vs. Promotional Customized Campaigns
(cont)

• ENVIRONMENT FOR STANDARDIZED PROMOTION IS MORE
  FAVORABLE DUE TO
• Expansion of Global Communications Media
• Emergence of Global Teenager
• Trend Towards Universal Demographic Lifestyle
  Trends
• Americanization of Consumption Values
• 7.20

21
Challenges in Developing Managing A Global
Sales Force

• DEVELOPING A GLOBAL SALES FORCE CAN BE ACHIEVED
  WITH
• Expatriate Personnel
• Local Nationals
• Third Country Nationals
• 7.22

22
Challenges in Developing Managing A Global
Sales Force

• MANAGING THE GLOBAL SALES FORCE
• Training
• Expatriate
• Foreign National Personnel
• Training for Foreign Personnel
• Motivation Compensation
• Companies Must Consider Culture
• Guidelines Include Examining the Way Firms are
  Compensating People
• High Tax-Rate Countries Sales Personnel Push
  for Packages instead of Direct Taxable Income
• E.g., Cost of Living Allowances, Private School
  Tuition, etc.
• 
  
  7.23