Chapter 1: The Scope and Challenge of International Marketing

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Chapter 1 The Scope and Challenge of
International Marketing
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Global Perspective Recent Events
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Global Perspective Recent Events
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Global Business Trends
1. Growth of WTO and regional trade groups
2.. Global acceptance of free market system
3. Impact of the Internet on global communications
4. Threats of terrorism and armed conflict
5. Rise of new producers and consumers
6. Management of global environmental resources
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Internationalization of Business
Increasing globalization of markets
Firms face competition on all fronts
Many Canadian companies are foreign
controlled Tim Hortons (US), Labatt (Belgian)
Firms seeking foreign markets to increase profits
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Foreign Ownership of Canadian Companies
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Top 10 Global Companies
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The Globalization Debate

• Pro-Globalists
• Anti-Globalists
• Skeptics
• Transformationalists

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International Marketing A Definition
Marketing concepts, processes, and principles are
universally applicable all over the world.
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The International Marketing Task
Foreign Environment (Uncontrollables)
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1. Competition
7. Structure of Distribution
Domestic environment (Uncontrollables)
Environmental uncontrollables country market A
1. Competition
(Controllables)
2. Technology
Price
Product
Target Market
Environmental uncontrollables country market B
5. Political- Legal
6. Geography and Infrastructure
2 .Technology
Promotion
Place
4. Culture
Environmental uncontrollables country market C
3. Economy
3. Economy
5. Political- Legal
4. Culture
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Environmental Adaptation Needed?
Firms may adapt to uncontrollable environments of
international marketing by adjusting the
marketing mix.
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Major Cultural Obstacles

• Self-Reference Criterion (SRC)
• an unconscious reference to ones own cultural
  values, experiences, and knowledge as a basis for
  decisions
• Ethnocentrism
• the notion that ones own culture or company
  knows best how to do things

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Avoiding the Self Reference Criterion

• 1. Define the business problem in home-country
  cultural traits, habits, or norms.
• 2. Define the business problem in foreign-country
  cultural traits, habits, or norms. Make no value
  judgments.
• 3. Isolate the SRC Influence in the problem and
  examine it carefully to see how it complicates
  the problem.
• 4. Redefine the problem without the SRC influence
  and solve for the optimum business goal situation

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Developing a Global Awareness

• 1. Tolerant of Cultural Differences, and

• Knowledgeable of
• (a) Culture,
• (b) History,
• (c) World Market Potential,
• (d) Global Economic, Social and Political Trends

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Stages of International Marketing Involvement
In general, firms go through five different
phases in going international