3-1

Global StrategiesGlobal Strategies

3-2

Reasons for International TradeReasons for International Trade

Access to products

Comparative Advantage

3-3

Factors Affecting International TradeFactors Affecting International Trade

TechnologyConsumer Preferences

Trade Barriers

Subsidized Industries

Tax Structure

Marketing Capability

3-4

Why International MarketingWhy International Marketing

PotentialDemand

MarketSaturation

CustomerExpectations

3-5

Strategic Planning for Strategic Planning for International MarketingInternational Marketing

RegionalStrategy

LocalStrategy

Global Strategy

3-6

Market DemandMarket Demand

Number of

people

Buying behavior

Ability to buy

3-7

Social and Cultural EnvironmentSocial and Cultural Environment

Family

Customs and Behavior

Education

Language Differences

3-8

Economic EnvironmentEconomic Environment

Infrastructure

Competition

Level of Economic Development

3-9

Political and Legal ForcesPolitical and Legal Forces

Trade Barriers

• Tariff• Import quota• Local-content law• Local operating laws

• Standards and certification

• Boycott

3-10

Political and Legal ForcesPolitical and Legal Forces

Trade AgreementsTrade AgreementsTrade AgreementsTrade Agreements

World Trade Organization

European Union

North American Free Trade Agreement

Asia-Pacific Economic Cooperation forum

Association of Southeast Asian Nations

Common Market of the South

WTO

EU

NAFTA

APEC

ASEAN

MERCOSUR

3-11

Structures for OperatingStructures for Operating in Foreign Markets in Foreign Markets

Exporting Directly, or

through Import-Export

Middlemen

Company Sales

Branches

Licensing Foreign

Producers

Contract Manufactur

ing by Foreign

producers

Joint Ventures &

Strategic Alliances

Wholly Owned

Subsidiaries

MNC’s

Low Involvement

Abroad

High Involvement

Abroad

3-12

DesigningDesigning the Marketing Mixthe Marketing Mix

Advertising

Pricing

Distribution Systems

ProductPlanning

Market Research

3-13

International Product & International Product & Communication StrategiesCommunication Strategies

Do Not Change Product

Adapt product Develop New product

Do Not Change Communications

Straight extensions

Product Adaptation

Product Invention

Adapt Communications

Communication Adaptation

Dual Adaptation

Product

Communications

3-14

International Pricing StrategiesInternational Pricing Strategies

• Uniform price everywhere• Market based price in each country• Cost-based price in each country

Some Issues:• Transfer Price• Dumping• Gray Market