DIRECT MARKETING and e-COMMERCE

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THE INTERNATIONAL ENVIRONMENT FOR PROMOTION and I
MC
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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

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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

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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

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Overcoming Cultural Barriers in International
Promotion

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

The tendency to view and value things from the
perspective of ones own culture.
The unconscious reference to ones own cultural
values, experiences and knowledge as a basis for
decisions.
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How Might This American Ad Be Viewed as
Ethnocentric 7.6
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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

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Challenges in International Advertising

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

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International Markets Prefer Different
Creative Executions
7.9
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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

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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

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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

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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

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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

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Promotions in International Markets Must be
Researched for Regulation and Legality
7.15
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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

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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

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Standardized vs. Promotional Customized Campaigns

• standardized campaigns use same appeal creative
  execution across all international 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

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Certain Product Lend Themselves to Standardized
Campaigns 7.19
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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

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Challenges in Developing Managing A Global
Sales Force

• developing a global sales force can be achieved
  with
• expatriate personnel
• local nationals
• third country nationals

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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.