Country Manager

1
Country Manager

• International Marketing Simulation

2
Why a Simulation?

• I hear and I forget
• I see and I remember
• I do and I understand

3
The Environment

• The Toothpaste Category Manager for an
  international corporation is expanding into Latin
  America
• Six countries offer viable market potential
• Each market has unique environmental, buyer,
  competitive, and distribution characteristics
• The ultimate goal is to develop a REGIONAL
  presence in Latin America, doing so through a
  sequential market entry approach

4
The Environment - Countries
Country Population (Millions US) GDP (Billions US) Toothpaste Retail Sales (Millions US)
Argentina 37 374 90.4
Brazil 172 1,035 830.4
Chile 15 185 93
Mexico 100 815 211.4
Peru 27 112 50.4
Venezuela 23 195 31.1
5
The Environment - Competition

• Starting Situation Multiple firms competing in
  different countries
• 4 International Competitors
• BB Healthcare
• Caremore
• Driscol
• Evers
• Also regional and local competitors
• NOTE All individuals/teams play against the
  computer

6
The Environment - Consumer

• Consumers differ cross-nationally and by segment
  in terms of
• Toothpaste size, delivery system, and vehicle
  preferences
• Needs they are trying to satisfy with regard to
  formulation (prevention of cavities, whiter
  teeth, good taste)
• Competitive offerings/choices
• Price sensitivity
• Customers are more likely to purchase a brand
  that they know and can find in their preferred
  store.

7
The Product - Toothpaste

• Packaging and Formulation Variations
• Sizes Travel, Personal, and Family
• Delivery Tube, Pump
• Vehicle Paste, Gel
• Formulations Basic, Whitener, Healthy, Kids
• Your firm has a number of different combinations
  of these available to introduce as unique SKUs.

8
Decisions Market Entry(Consolidated Menu)

• Issues to consider for Market Entry/Exit
• Market potential and growth
• Synergies with other/existing markets
• Regional Customization vs. Standardization
• Competitive intensity
• Distribution
• Cost structures production/distribution
• Shipping and tariffs
• General economic/political outlook

9
Decisions Production Location Capacity
(Consolidated Menu)

• Issues to consider for Productive Capacity
• Production will take place in USA unless a single
  Latin American plant is opened.
• Any production necessary to meet demand beyond
  what is planned takes place in USA.
• Local production goes to local markets first.
• One year to build capacity.

10
Decisions Market Management (Individual Country
Menus)

• SKUs to offer (based on target positioning)
• Price in local currency and promo allowance
• Advertising campaign and budget including
  localization issues
• Distribution channels to support
• Sales Force / Use of Wholesalers
• Promotional Support
• Production U.S. plant versus Latin American
  plant
• Forecasts
• Dont Bother With the Pro-Forma Unless Using it
• to Project on Hypothetical Situations

11
Performance Measures

• Index numbers especially brand equity measures
• Performance in countries entered
• Overall performance in Latin America
• Market share and net contribution
• How have you left the company positioned for the
  future?

12
Country Manager Logistics

• Print out decisions before advancing
• After advancing, print out administrators and
  turn it in
• You are allowed one replay per period but no
  restarts
• Important Back-up your decisions!

13
Final Considerations

• Marketing and Business Strategy drives your
  decisions make sure you have one!
• Focus on how to best serve your target customers
  through a total offering product, marketing,
  service, and price
• Importance of team organization
• Decide on responsibilities
• But dont overspecialize - limits what you learn

14
Final Considerations

• Manage your margins understand financial
  implications of decisions
• Understand fixed and variable costs
• Long term vs. short term
• Make wise investments
• Try new approaches apply concepts experiment
  have fun!