International Marketing: Global Marketing Strategies.

5 Key Components to a successful, comprehensive market Research Strategy

Market Assessment

      Trend Analysis

      Industry monitoring

      Market Sizing & share

      Competitive Intelligence

      Partnership Evaluation

Customer Knowledge

      Segmentation, Targeting

Product Management

      Concept Testing

      Feature Preferences

      Price & Demand

      Opportunity Analysis

      Post Launch Assessment

Data Insights

      Forecasting

Brand & Marketing Strategy

      Loyalty

      Brand Positioning

      Brand Awareness

      Brand Attitude & Uses

      Performance drivers

& Positioning       Customer Acquisition	Predictive Analysis	•   Outline business expansion in a
	Data Visualization	new international market from
Customer Feedback       Win/Loss Analysis	Special Insights       Data Mining	secondary data analytics and select 1 country out of 2 in
		different continent
Business Research Report		•   Prepare a Questionnaire to find

Consider you as a International Business Development

In charge for New-Market

Assignment: Establishment of a SBU for retail market

for your garment factory, marketing aspects only

target customer and product

identification

•   Considering Data Insights, plan a

go to market, target expansion,

brand establishment

GLOBAL MARKETING STRATEGIES

■ GLOBAL MANAGEMENT: PLANNING & ORGANIZING ■ PRODUCT/SERVICE FOR CONSUMERS/ BUSINESS ■ INTERNATIONAL  MARKET DISTRIBUTION CHANNEL ■ PRICING STRATEGY ■ INTEGRATED MARKETING COMMUNICATION

& ADVERTISING STRATEGY ■ IMPLEMENTATION INCLUDING NEGOTIATING WITH

CUSTOMERS/ PARTNERS/ REGULATORS

Global Marketing Management

1970s      standardization Vs adaptation

1980s      globalization Vs localization

internet

unprecedented global reach

dynamism

CUSTOMIZED

1990s      global integration Vs local responsiveness

CocaCola was a great example of Global brand for marketing worldwide but it also

had to acquire Thumbs up in India; DietCoke to CokeLite in Japan.

Strategy:

•   Think & plan long term

Nestle Way: Evolution Not Revolution

Starting in 1866, as a maker of infant formula, today it sell 8,500 products produced in 489 factories in 193 countries – infant formula (lactozen, Cerelac), powder milk (nido, milo), instant coffee (Nascafe), chocolate (kitkat), soups (maggi), mineral water (purelife), Ice cream (word’s 2nd biggest), cereal (Kellogg).

•   Decentralize

•   Stick to what you know

•   Adapt to local taste

In middle east, it has only 2% of world sell –

so longer terms! Despite regional conflicts,

looking long setup network of factories in 5:

ice-cream in Dubai, soups & cereal in KSA,

yogurt  &  bouillon  in  Egypt,  chocolate  in

Turkey and Ketchup & noodle in Syria

IKEA open outlet in Russia with 40k customer  in  que  in  2000. Government  quarters  furniture supply was a massive entry!

iPhone negotiate with NTT do-co-mo entered world’s 2nd biggest economy Japan with a considerable stake

The Planning Process

Phase  I:  Preliminary  Analysis and   Screening   –   matching company & country need Phase    II:   Defining    Market

Segments       and       adapting

marketing mix accordingly

Phase    III:    Developing    the

Marketing Plan

Phase  IV:  Implementation  &

control Plan

STRATEGIC & TACTICAL PLANNING

Since upper managers generally have a better understanding of the organization as a whole than lower level managers do, upper management  generally  develops  the  strategic  plans  and  because lower level managers generally have better understanding of the day to day organizational operations, generally the lower level managers develop the tactical plans.

Because Strategic   Planning emphasizes analysing the future and tactical planning emphasizes analysing the everyday functioning of the organization, facts on which to base strategic plans are usually more difficult to gather than are facts on which to base tactical plans.

Because strategic plans are based primarily on a prediction of the future and tactical plans on known circumstances that exist within the organization, strategic plans are generally less detailed than tactical plans.

Because strategic planning focuses on the long term and tactical planning  on  the  short term,  strategic  plans  cover  a  relatively  long period of time whereas tactical plans cover a relatively short period of time.

Despite their differences, tactical and strategic planning are integrally related. Manager need both tactical and strategic planning program, and these program must be closely related to be successful.

Organizing/ Alternate market entry strategy

1.    Exporting: Visit/Correspondence/Internet (dot com), Exporter – Importer & Distributor, Direct

Sales (big tickets)

2.    Contractual agreement: Licensing & franchising

3.    Strategic Alliance: SA (One World – AA, CP, BA, JAL, Finn, Quantas vs Star Alliance – United, Continental, EK, SinAir, Thai – for mileage & last mile) /Joint venture (between separate entities, share management, equity by each) /Consortia (as JV but with large number participant, operates where none participated before eg Airbus/ATR vs Boeing/Dash)

4.    Direct Foreign Investment/ Ownership

G r e a t e r  c o n t r o l  &  g r e a t e r  r i s k

CHINA – Disney rolls the dice again

Open in 1955 at Anaheim, CA – notion of modern theme park – rides, attractions, characters. Tokyo proved to be a success through licencing as ¾ are repeat visitors

EuroDisney deal structured differently – kept majority of stake including hotel & restaurant, keeping higher risk. Before opening in 1992, assault on French culture proved to be a mistake of selecting right location like Mediterranean climate of alternate Barcelona over chilly winter or right language on adventure like Pirates of Caribbean. By summer 1994, managing costly multinational workforce etc, real consideration was given to closing the park. It required cash injection for twice, with French CEO, renaming Paris Disneyland it is still riding bumpy.

In 2006 HKG opened its service with 80% of $3b investment by government. With option of Cantonese/Mandarin/English performance option, it could draw 5.2M visitors in 2006 but fall sharply to 4M in next year – had to do financial remodelling. HKG still want expansion. In 2009, China approved new park in Shanghai with a price tag of $4M. In a theme park, beside entry pass of $100, visitors spent equivalent on souvenir, food, hats/t-shirt/glass/swim-gear etc

QUALITY

market perceived quality

performance quality

customer satisfaction or quality to customer is more than compliance.

eg. Airline business - European/Asian, with same craft but service

Maintaining Quality: Continuity of restaurant food, leaving right quality from factory does not assure maintenance in distribution channel (Mars vs RedOctober in Russia), CRM (Toyota never run away from problem or pretend not notice them)

Physical or mandatory requirements and adaption: Pepsi – Leher-Pepsi in India for better communicate, motor-cycle with one-side ladies leg-rest to accommodate sari, economy demand like shampoo sachet/ reduce typical quantity razor, cigarettes, chewing gum etc, taste change (less sugar Oreo in China)

Green Marketing Product: Ecology friendly, recycle/ reuse, green movement are CSR & thus promotion

Product/Service:

A product is more than a physical item (multi-dimentional) – it’s a bundle of satisfactions (utilities) that its buyer receive. The utility include: its form, taste (if edible), colour, order, texture, easy functionality, package, label, warranty, servicing, confidence on brand, reputation of manufacturer, country of origin, any other symbolic add on etc. In other words, a product is a sum of physical and psychological satisfaction provided to its user.

Product & Culture

•     Physical attribute of a product offer primary functions but need beyond with culture & custom – car carrying point A to point B what it has with colour, size, design, brand, price etc.

•    Potential customer belief/norm innovated Islami banking for MNC banks or introduction of McArabia Sandwich, Arab Cola, Cola Turka etc;

•    Buyers habit/practice - no designated place in kitchen in Japanese household for dishwasher restrained foreign companies till Mitsubishi &

Toto came up with compact design; Another popular example of US bake co’s introduction of ‘sponge cake mix’ over market research on

500 Briton house-wives, could not work as they were habituated with basic ingredient!

•    Buyers’ way of taking - despite Japanese version, Harry Potter sold 20% in English, as for them it was not entertainment only but education. Innovative Products and Adaption: Foreign market goal should be: Gaining the largest number of consumers in the market in the shortest span of time and Assessing probable rate of acceptance

Diffusion of Innovation: Crucial elements in the diffusion of new ideas are: □An Innovation □ communicate

through certain channels □ Overtime □ Among members of Social system

Production of Innovation: After 100% adoption ie reaching saturation point, we can look back at the characteristics of Innovation: Relative advantage, Compatibility, Complexity, Trial-ability, Observability. Inventiveness of companies and countries, R&D can lead to production, where new ideas come from acquisitions & collaborations.

Product Components for ADAPTATION:

  Core Components

Product platform

Design Features

Functional features

  Packaging Components

Price

Quality

Packaging

Styling

Trademark

Brand name

  Support Service Components

Deliveries

Warranty

Spare parts

Repair & maintenance

Installation

Instructions

Other related service

      Localization   of   core:   Nestle   reformulated cereals with seaweed, carrots & zucchini and coconut & papaya, to adopt Japanese breakfast habit with rice & fish

      Localization of Pack: language of instruction, country of origin, pack size customization. Labelling law (eg smoking injury, expiry date etc). Whereas price need to be on labels in Venezuela but illegal in Chile.

Service Opportunities in global market

•   Tourism & Transportation

•   Tele-communication

•   Financial services

•   Education

•   Healthcare

•   Entertainment

•   Professional Services like legal, accounts, IT,

archi/engineering, advertise, insurance etc

US exports equally in 3 categories: durable goods (cars/computers etc), non durable (food/drug/toys), services (tourism/telecom). Lion share of BD exports are Garments, Jute/jute-products, leather/leather-products, sea-food and direct labour. Having such a demographic dividend service export should institutionalize a long term sector.

Brand: A brand is the use of a name, term, sign, symbol, design or combination, intended to identify goods or services of a seller and differentiate from competitors. This is a very valuable resource of the company and the importance is unquestionable. Global Brand is the worldwide image of the same. Internet & other technologies accelerate the pace of globalization of brand.

Country of Origin effect is the influence of the country that manufacture, assembly or design and has consumers’ positive or negative perception of a product. Eg. English tea, French perfume, Thai silk, Italian leather, Japanese electronics, German engineering etc are   Ethnocentrism.   Countries   are   stereotyped   –   industrialized,   in   process   of industrializing, developing. More knowledgeable consumer are more sensitive to the

Measuring Brand Value

•    Intangible asset

•    Goodwill of co. vs

brand value of

product/ service

•    Customers’ Loyalty

•    Key personnel/ Skill

set/ scientist etc

Assess brand values on

Forbes

TefhfeectW.

orld's Most Valuable Brands 2016 ranking by

a variety of issues such as strategic brand management, marketing budget allocation, marketing ROI, portfolio management, brand extensions, Merger & Acquisition, balance sheet recognition, licensing, transfer pricing and investor relations

International market of product & service for BUSINESS:

Technology exports are represented smallest (semi-conductors) to largest (aircrafts) industrial goods or services but has same inherent

Nature: Intermediary, used in process of creating finished product

Motive: Industrial consumer seek profit whereas ultimate consumer seek satisfaction

Some parameters of B2B:

QUALITY: Defined by Buyer

STANDARDIZE: Global Standard – ISO 9000

FACTOR: After Sales Support

PROMOTION: Trade Show, a crucial part of

B2B Marketing + Relationship Marketing

Demand in Global B2B Markets

Shanghai’s30km $1.2b bullet train

=> Sino-German JV mass transit –

longest    (1339mile)    &    fastest

(267mph)

with $58b German subsidy

Andy Grove, founder of Intel, Fortune’s cover story as

‘Amazing Profit Machine’, Time’s ‘Man of the Year’ also

seen Bust, also covered up and returned to lead. CAUSE:

   Volatility of Industrial demand in global B2B market

   Stages of Economic Development

   Technology & market demand

International Marketing Channels

Channel of Distribution Structures:

Distribution   structures   in   some   markets   are multi-layered, complex, inefficient, even strange, and often difficult for new marketers and others with middlemen and yet others with mixture.

Distribution  process  depends  on:  Physical handling & distribution of goods; The passage of ownership; Marketing strategy.

The structure of passing from producer to user is also country specific, with variety of middlemen with customary functions/services, competition, market characteristics, tradition, economy.

Starbucks Introducing comfortable Sofa was a break

IKEA in China with huge space store targeted browsers turn eventually   into   buyers,   overcoming   the   challenge   of replicas, visiting customers with carpenters!

Walmart & Carrefour entered China in 90s with many flocked to new huge stores just to look & touch. And now millions shop everyday

In a Chinese Kitchen market shop it sell duck to dogs, from scorpion to dried lizard on sticks

Retailers like JCPenney, Walmart, Office Depot are going global accommodating cultural & business differences with competitively superior assortment of product and by developing superior value chain

Import Oriented Distribution Structure: Different functionalities: Importer - wholesaler – marketer (research, advertise) – warehouse/storage – local transportation – financing. Applicable at unstructured market. Countries with economic growth gets structured include defined intermediaries.

Japanese Distribution Structure: Known as most effective non tariff barrier. Has 4 distinguishing features: i) dominated by many small middlemen dealing with small retailers; ii) channel control by manufacturer; iii) business philosophy shaped by unique culture; iv) laws protect the small retailers.

Trends: Traditional to Modern Channel Structure in new forms, new alliances, new processes come from within or without. Direct marketing, door-to-door selling, hypermarkets, discount houses, shopping malls, catalogue selling, internet sell/dot com, etc are being introduced for efficient channel.

International Marketing Channels

Channel

Indirect Channel                              Direct Channel

Domestic Agent

Distribution Patterns:

Retail Pattern:

Size pattern

•  Export Broker •  Sales Rep	Domestic Merchant •  Export Merchant		•  Foreign Distributor •  Foreign Retailer	Direct Marketing Resistance to Change
•  EMC	•  Export Drop		•  State Control
•  Coop Exporter •  Buying Agent	Shipper •  Export Distributor		trading company •  End User	Alternate Middleman: Home Country middleman:
•  Resident buyer	•  Trading Company			Manufacturers’ retail store

Choice of Channel:

1.    Identify target market

2.    Specify market goal: volume, market share, margin etc

3.    Specify financial & personnel commitments

4.    Identify control, length of channel, terms of sale and channel

ownership

Channel cost

Capital requirement

Maintenance Cost depending on Control, Coverage, Character, Continuity

Channel Management

Locating   Middleman   -   Selecting   Middleman   –   Motivating

Middleman – Terminating Middleman – Controlling Middleman

Global retailer

Export management co

Trading Co

Manufacturer’s export agent

Foreign Country Middleman

E Vendor: success depends on

  Culture

  Adaptation

  Local Control

  Payment

  Delivery

  Promotion

and

  LOGISTICS

International Marketing Communication & Int’l Advertising

Integrated Marketing Communication (IMC):

Composed of advertising, trade show, personal selling, direct selling and public relations

Sales Promotion

marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation

Public Relations & Publicity

Promoting product over news

Advertising Strategy and Goals

•    Product Attribute and benefit segmentation

•    Message: Creative Challenges

•    Legal Constrains

•    Linguistic limitations & Cultural Diversity

•    Media Limitation

•    Newspaper/ Magazine

Barbei dolls customized for markets but LEGO various types but of same type globally --- both could go far with right communication to the target

Procter & Gamble in Egypt made Ariel Road Show with ad

Kraft’s Oreo cookies univ survey with licking ad

Toyota CEO Akio Toyoda’s profuse apologies and calling back faulty and praise by media promoted the vehicle

International Advertising

In 2008 in US advertisement include P&G $9.7b, Unilever $5.7b . . . . 20co each $1.5b+

Aggregate        category:       Automobile

$25.6b,   Personal   Care   $25.4,   Food

$11.9b, Drug $10.3b

•    Radio/ TV/ Sat TV

•    Direct Mail

Media Planning & Analysis

•    Tactical Consideration

•    Cost

P&G  in  Russia  $127.7  &  in  China

$1.07b also top the list of advertiser

•    Internet/ Social media

•    Availability

•    Coverage

•    Mobile phone application

International Marketing Personal Selling and Sales Management

Glamorous  International  Assignment/  the  role  of interpersonal selling:

Sales person is the final link between buyer & the product/

service

The effective task of designing, building, training, motivating and compensating sales force can lead to sale. It complete with right CRM (customer relationship management).

Examples  of  personal  selling:  Retail  selling,  Field  selling,

Telemarketing, Inside selling

Forming Sales force:

Posting compatriot of company or recruiting local national (host country restriction) or relocate 3rd country national. Selection criterion of a sales and marketing personnel may

include – maturity, emotional stability, breadth of knowledge,

positive outlook, flexibility, energetic, enjoy travelling . . .

Training – be a Roman in Rome

Motivating: Job security, Promotion, Merit increase in pay, Feeling  of  worthwhile  accomplishment,  Social  recognition and personal growth & development are few.

Compensation: Repatriation

Stages of Personal Sales

Pricing for International Marketing

  Full cost vs Variable cost

  Skimming vs Penetration pricing

Parallel Imports:

•    Grey market vs exclusive distribution

•    Taxes, Tariffs and Administrative costs

•    Inflation/ Deflation

•    Exchange Rate fluctuation

•    Middleman and Transportation cost

•    Dumping/ Counter trade

Cost effectiveness/ tactics

•    Efficiency innovation

•    Free Zone

•    Utilization of FDI advantages

•    Counter trade (barter between neighbours

Pepsi vs Vodka between Russia & Romania)

•    Government influenced pricing

•    Leasing Vs Sales

Price  War:  P&G  and  Kimberley-Clerk  brought  Pampers

and Huggies – none can gain over price war.

Price cutting is like violence: no one wins

Citycell > GP > BL > AirTel

Negotiating with International Customer, Partners and Regulators

International business Vs Interpersonal business

Face to face negotiations are an omnipresent activity in international commerce

International negotiation is a comprehensive affair – not a stereotype like US cowboys, who thinks that everyone buy them or nor Japanese Samurai, who study for long before actually start the action! Nego  Preliminary:  Assessment  of  counterpart,  Agenda,  Best  alternate  to  negotiated  agreement,

Concession strategies, Nego Team assignments

Nego manipulations: Location, Physical arrangements, Number of parties, participations, Audience, Communication channel, Time limited

Pervasive Impact of culture on negotiation behaviour in

•    Language and Non-verbal behaviours,

•    Values:   Objectivity,   Competitiveness, Equality, Punctuality/ time

•    Thinking & decision making processes

(one issue at a time/ multiple)

At negotiation table

•    Non-task sounding

•    Task related exchange of information

•    Persuasion

•    Concession & agreement

Verbal Negotiation tactics

•    Promise

•    Threat

•    Recommendation

•    Warning

•    Reward & Punishment

•    Normative appeal

•    Commitment

•    Self disclosure

•    Questions

•    Command

Non Verbal behaviours

•    Use of words like No, You

•    Silent periods

•    Conversational overlaps

•    Interruption to counterpart

•    Facial gazing

•    Touching