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Amity Business School
MBA 2011, 4th Semester
Global Marketing Management
Amanpreet Kang
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Module I: Management of
Global Market Mix. (GMM)
Shobhit Mathur
[email protected]+91 98101 00348
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Agenda
Module I: Management of Global Market
Mix. (GMM)
What is GMM, Business Customs inGlobal Marketing, Required Adaptation,Methods of doing Business, Global MarketMix. Strategy, Improved Products &
Program Effectiveness.
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What is GMM?
Global Marketing mix is the set of
marketing tools that the firm uses to
pursue its marketing objectives in the
Global market
Product
Price
Place (Distribution)
Promotion
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Business Customs in Global
Marketing
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Types of Customs
3 Types of Customs 1. Cultural Imperatives
Business customs and expectations that MUST be met inorder to conduct successful business transactions in other
countries/cultures 2. Cultural Electives
Business customs and expectations that are OPTIONAL, inwhich business executives may participate/conform in, but isnot required.
May help to establish rapport and respect when participationoccurs
Majority of customs fall into this category
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Types of Customs
3. Cultural Exclusives
Customs that are reserved exclusively for thelocals, where foreign participation is EXCLUDED
Example: Foreign business people criticizing localpoliticians, business practices where it is acceptable forthe local to do so
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Terpstra and Sarathy Cultural
Framework 8 categories Language - Low/high context Religion,
Values and Attitudes, - Europeans Family first,Americans more competitive, individualistic
Education,
Social Organizations, - caste/class systems, role ofwomen
Technology and Material Culture,
Law and Politics and - UK laws mkt based, precedence& legislation based, Iran - Islamic
Aesthetics. - Traficante" an Italian mineral water found agreat reception in Spain's underworld. In Spanish it
translates as "drug dealer
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ADAPTATION VS.
STANDARDIZATION
Elements of the marketing mix could be
Standardized across all markets
Adapted to appeal to particular market segments
Standardization
Essentially the same approach to the 4 Ps in
every target market
Adaptation Marketing mix is tailored to country or to market
segment within a country
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Global Product Hybrid I Mktg Strategy
ebaY.incustomised for Indian audience
Coca Cola Light
Ideal Global Mktg Strategy
DELLreplicated its direct selling
practices globally
Nike
National Product Ideal National Mktg Strategy
Haldirams - caters to Indians in India &
abroad
Nirma - caters to rural & low income
segments in India
Hybrid II Mktg Strategy
McDonalds - Retailing formula & mktg
activities are same around the World, &product is suited to local markets
Product Strategy
Segmentation Strategy
National Market Segment Global Market Segment
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FACTORS IN PRODUCT
ADAPTATION
Internal company considerations
Human and financial resource constraints
Costs of developing and producing distinctproducts
Customer considerations
Customer preferences (example: GMOs)
Economic situation of customers (example:farm machinery)
The total size of the market
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FACTORS IN PRODUCT
ADAPTATION (continued)
Competitive considerations
Degree of competition in target market
Exploiting gaps in competitors product lines
Legal and regulatory considerations Sanitary standards
Tariff and nontariff barriers (example: milkcomponents)
Bottom line: is adaptation profitable, and how longwill it take for it to become profitable?
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EXAMPLE OF PRODUCT
ADAPTATION
Kit-Kat roughly $1 billion in salesworldwide
In Russia, its slightly smaller and the chocolate
is coarser In Japan, its strawberry flavored
Each of these product variations is the result of
thorough market research on local tastes.There is no global consumer for the food-and-beverage business. This is a deep belief wehave, Brabeck says. (Peter Brabeck is the Chairmanand CEO of Nestle)
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PACKAGING AND LABELING
Protection of the product Climate control
Transportation and handling Packaging usually needs to be more durable for export
Shelf life
Size of the package Pillsbury uses packages with 6-to-8 servings in
developing countries, while 2-serving packages are
most popular in North America 2-liter bottles of Coke were too large for the
compartments in most refrigerators in Spain
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PACKAGING AND LABELING
(continued)
Legal Constraints
Packaging recycling requirements
Consumer information requirements (food labels)
Multilingual labeling requirements Canada (French and English)
Belgium (French and Flemish)
Finland (Finnish and Swedish)
Promotion of the product
Brand image
Distinguish product from the competition
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PRICE
Pricing situations
Export pricing
Foreign market pricing (production abroad)
Pricing strategies
Cost-based strategies
Demand-based strategies
Eclectic strategies based on short- and long-term company goals
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COST-BASED STRATEGIES:
EXPORTING
Standard worldwide pricing
Price is based on average fixed, variable,and export-related production costs
Dual pricing
Export price is based on marginal costsrather than average costs
Constitutes dumping (an example of costdumping)
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COST-BASED STRATEGIES:
PRODUCING ABROAD
Standard within-market pricing
Price in each market in based on averagefixed and variable production costs in that
market
With either exporting or producing abroad,cost-based strategies may be out of
alignment with market conditions
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DEMAND-BASED PRICING
STRATEGIES
Price discrimination Charge different prices in different markets
Can do with exporting or producing abroad
A type of dumping when applied to exports(price dumping)
How does it work? Lower prices in market segments with more price-elastic demands, higher prices in segments withless price-elastic demands
If price differences are too large, run into
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ECLECTIC STRATEGIES
BASED ON
Short- and long-term company goals
Profitability
Market share
Production costs
Demand-side considerations
Competitive considerations
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PLACE
Distribution choices are the least flexiblechoices in the marketing mix
International challenges
Lack of familiarity with distribution channels
Use of intermediaries means relinquishingcontrol
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PROMOTION
Promotion mix includes
Advertising
Personal selling
Publicity Sales promotions
Mix will depend on
Target audience
Company objectives
Product or service being marketed
Resources available
INTERNATIONA
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INTERNATIONAL
ADVERTISING
Media strategy
Which media reach your target market? May be muchdifferent from India
Media regulations vary by country Promotional message
Why would the target consumer buy the product?Emphasize those attributes
How is the product positioned? Ads should beconsistent with positioning
Rational versus emotional appeals
Be very sensitive to cultural considerations
INTERNATIONAL
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INTERNATIONAL
ADVERTISING (continued)
Ad literacy of target audience Is audience used to connecting ad images and ad
messages?
Annual per capita spending on advertising variestremendously by country and region:
United States: $153
Canada: $64
Europe: $43 Latin America: $5
Asia and Pacific: $4
Middle East: $2
Africa: 80
Statistics: ad spending per capitaby top 100 marketers in 2006
Sources:Advertising Age andPopulation Reference Bureau
ADDITIONAL PROMOTION
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ADDITIONAL PROMOTION
TOOLS
Personal sellingoften used
In early stages of international expansion
For high-cost products
For industrial goods
Publicity/Public Relations
To earn public understanding and acceptance
Anticipate or counter criticisms Portray as good citizens of host country
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SALES PROMOTIONS
Covers all promotions except for advertising, personalselling, and publicity
Includes:
Coupons Free samples
Consumer education
Product demonstrations
Point-of-purchase materials Discounts
Direct mail
Prizes and giveaways
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IN-CLASS EXERCISE
In groups of 3-5 people, come up with an Indianfood product that, as far as you know, isnt currently
sold in the UK
Outline a plan for how you would market thatproduct in the UK
Report your findings to the class
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Methods of Doing Business
Methods of doing business can vary not onlyacross culture, but within cultures.
Methods of doing business can vary in:
Levels of Authority Management Objectives
Communication Emphasis
Formality and Tempo
Negotiations
Gender Attitudes
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Levels of Authority
There are three general authority patternswhich describes who makes the decisionin an organization:
Top-level management
Decentralized
Committee or group
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Levels of Authority Question
What level of authority does the personyou are interacting with have in makingdecisions?
What is the best way to get to the decisionmaker?
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Management Objectives
Understanding the managers objectives can be
an important tool when doing internationalmarketing.
Management objectives can be broadlyclassified in the following areas:
Personal Goals
Security and Mobility
Personal Life
Social Acceptance
Power
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Management ObjectiveQuestions
What is the management objectives of theperson I am dealing with?
How do these objectives affect the decision
he could potentially make?
How can I tailor my product around themanagers objectives?
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Communication Emphasis
Communications should be kept formalboth in written and spoken form.
Communication may go far beyond words.
Depending on the society you are doingbusiness with, how you say something is asimportant as what you say.
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Low Versus High ContextLanguage
A low context language is one that isheavily dependent on explicit verbalexpression what is said is what is meant
Swiss, German, Scandinavian A high context language is one that relies
heavily on the context or nonverbalcommunications what is said may not bemeant Japanese, Arabian, Latin American
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Communication Questions
When doing business in a foreign country,how important is the context of thelanguage when conversing?
What constitutes a confirmation or denialin the language you are doing businessin?
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Formality Questions
What is the proper greetings for theperson you are doing business with?
When and where is it appropriate to talkbusiness?
What is appropriate side discussion?
What is the formal business dress?
Eg US East Coast vs the West
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Tempo and Time
Tempo is related to how you deal with timeand the use of it.
How cultures handle time can be viewed inthe following:
Polychronic Time (P-Time)
Monochronic Time (M-Time)
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Negotiation Questions toConsider
Does the culture you are dealing with liketo bargain?
Does the culture your dealing with getinsulted if you try to negotiate to much?
What aspect of fairness comes intonegotiations?
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Social Responsibility Questions
Is it legal?
Is it right?
How will the public and vestedstakeholders view your actions?
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Business Customs and theInternet
Language on a website is one of the mostimportant considerations.
Since your website can be anywhere in
the world, special consideration should betaken as to the colors and symbols youuse on the website.
Care should be taken when designing awebsite to make sure it is intuitive to theclient.
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Learnings from Switch 1000launch
All-around campaign integration
Revaluation of launch vehicles andmethods
Localised content available at the time ofor shortly after US launch
Keeping momentum going post launch
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ADAPTATION VS
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ADAPTATION VS.
STANDARDIZATION
Elements of the marketing mix could be
Standardized across all markets
Adapted to appeal to particular market segments
Standardization Essentially the same approach to the 4 Ps in
every target market
Adaptation Marketing mix is tailored to country or to market
segment within a country
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PRICE
Pricing situations
Export pricing
Foreign market pricing (production abroad)
Pricing strategies
Cost-based strategies
Demand-based strategies
Eclectic strategies based on short- and long-term company goals
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DEMAND-BASED PRICING
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DEMAND BASED PRICING
STRATEGIES
Price discrimination Charge different prices in different markets
Can do with exporting or producing abroad
A type of dumping when applied to exports(price dumping)
How does it work? Lower prices in market segments with more price-
elastic demands, higher prices in segments withless price-elastic demands
If price differences are too large, run intotransshipment (smuggling) problems
ECLECTIC STRATEGIES
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ECLECTIC STRATEGIES
BASED ON
Short- and long-term company goals
Profitability
Market share
Production costs
Demand-side considerations
Competitive considerations
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PROMOTION
Promotion mix includes
Advertising
Personal selling
Publicity Sales promotions
Mix will depend on
Target audience
Company objectives Product or service being marketed
Resources available
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ADDITIONAL PROMOTION
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TOOLS
Personal sellingoften used In early stages of international expansion
For high-cost products
For industrial goods Publicity/Public Relations
To earn public understanding and acceptance
Anticipate or counter criticisms Portray as good citizens of host country
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Product Piracy
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Product Piracy
Downside for the Manufacturer Any aspect of the product is vulnerable
Brand name, logo, design, packaging
Impact is twofold Monetary losses; eg China where $16B worth
counterfeit goods sold each year; P&Gestimates 15% sales are fake,leading to
annual loss of $ 150M Damage to the brand name poor quality,
service
Sometimes the fake products are also
Product piracy preventive
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Product piracy preventivesteps
Lobbying With the Govt to toughen legislation &
enforcement of existing laws in the foreign
country Legal action
Prosecuting counterfeiters China has setup
special courts to stamp out IPR piracy Customs
Seek their assistance in seizure of counterfeitgoods
Product piracy preventive
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Product piracy preventivesteps..contd
Product Policy options Putting holograms on products to distinguish
fakes
Distribution Microsoft got Chinas 4 largest PC makers to
bundle XP into their computers
CommunicationsAdvertising, PR campaigns to educate
customers, warn counterfeiters
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Country of origin(COO)
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Country of origin(COO)stereotypes contd
Demographics matter Elderly, less educated, politically conservative
Culture
Individualistic societies like US will be moreobjective, while Collective like Japan will bemore inclined towards a domestic product
Some consumers use COO as a cue whenunfamiliar with product brand name
Coping with COO
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Coping with COO
Product policy Select a brand name that disguises COO
2 of the most successful apparel retailers in Hongkong haveItalian sounding names - Giordano & Bossini
Pricing - Low pricing will attract customers
Distribution Use big local names eg Hungarian and Chilean wines are
successful in UK - they are sold by Tesco
Communication 2 fold strategy
Improve the Country image
Improve the brand image The above may also be used to overcome Made in India hurdle
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Module III: Product
Management (GMM)Shobhit Mathur
[email protected]+91 98101 00348
Agenda
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Agenda
Module III: Product Management(GMM)
Placement Management
Movement across frontiers,
Import oriented distribution,
Global Retail Distribution,
Foreign Market Channels of Distribution,
Use of Free Ports,Time Management & distribution,
Key India issues in import distribution.
Definition of Global logistics
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Definition of Global logistics
It is defined as the design andmanagement of a system that directs andcontrols the flow of materials into, through,
and out of the firm across nationalboundaries to achieve its corporateobjectives at a minimum total cost.
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Movement across frontiers factors
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Movement across frontiers factorsthat determine the optimal mode of
transportation Value-to-volume ratio
Perishability of the product
Quality deterioration over time or product lifecycle
Cost of transportation
To be viewed along with both above factors
A it B i S h l
Movement across frontiers different
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Movement across frontiers differentmodes of transport and their optimal
use Ocean Shipping for transport of heavy, bulky, ornonperishable products eg crude oil, automobiles, andsteel
Liner Service scheduled passage on establishedroutes
Bulk shipping contractual service for pre-specifiedperiods of time
Irregular runs
Container ships help cut cost due to standardised
containers that help loading/unloading, and intermodalxport
Some cartels do exist so to cut its costs Honda uses itsown ships to ferry cars to North America & brings back
us Soya
A it B i S h l
Movement across frontiers different
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Movement across frontiers differentmodes of transport and their optimal
use Air Freight seen rapid growth over last40 yrs
Volume of goods still < 2%, value >20%
High value goods esp with high V to V ratio egsemiconductor chips, LCD screens ,diamondsetc
Flowers & perishable agricultural produce Super sized export planes hv facilitated
courier groth service eg Fedex, DHL, UPS
Amit B siness School
Movement across frontiers different
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Movement across frontiers differentmodes of transport and their optimal
use Intermodal transportation Combination of more than 1 means of
xportation
Eg upto the domestic port by road / air then ocean Cost, time to mkt (esp retail) drive the
decision
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Global Retail Distribution
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Global Retail Distribution
The face of distribution that consumersinteract with is the Retail Store
Retailers have grown into the largest cos
ie Walmart buys as much as JP mkt fmP&G
Retailing involves very locallyentrenchedactivities local holidays (sabse sastadin), festivals, seasonal promotion egwinter wear, as well as meeting localcompetition on a daily basis
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Retailing differences across the
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Retailing differences across theworld
Density - Developed Countries have less outletsthan emerging mkts smaller & more frequentpurchases due to low incomes
Japan difference tight regulations, fresh foodingredients, perishable items (fish), local duetraffic congestion
Germany limited hours
China low price matters most, one-stopshopping, many visits
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Foreign markets channel of
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Foreign markets channel ofdistribution
Licensing Co (licensor), offers some proprietory assets
to a foreign company (licensee) in exchange
for royalty Fee eg Tokyo Disneyland ownedand operated by Oriental Land companyunder license fm Disney
Pros profitable, not demanding on resources,
Cons recovering fees fm Licensee, lessprofitable than export, patent protection
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Foreign markets channel of
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Foreign markets channel ofdistribution
Joint Ventures The Co agrees to share equity and other resources
with other partners to establish a new entity in atarget country three types Majority >50%, 50-50,
Minority
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Session V: Brand
Management (GMM)Shobhit Mathur
+91 98101 00348
Amity Business School
Agenda
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Agenda
Brand Management Branding for the world,
Global or Local Brands,
National Brands,
Private Brands,
Brand Name change over strategies,
Umbrella Branding,
Protecting Brand Names,
Global Brands in India
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A Brand can convey upto 6
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a d ca co ey up o 6levels of meanings
Attributes : Amul youthful image, wholesome Benefits : healthy, hygienic
Values : most successful Indian co-operative,
benefits many, well run, diversified food portfolio Culture :The taste of India original Indian
product, made in India
Personality : witty youngster
User : Indian homes, local food joints / Dhabas
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Deep & shallow brands
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p
Deep brand when the audience canvisulaise all six dimensions eg Mercedes
Shallow brand Audi is less deep esp on
attributes of Benefits, Personality & Userprofile
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Branding for the
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gWorldstrategy consideration
What aspect of brand policy is global, whathas local flexibility
In India Coca-Colas large brand is Thums Up
as they didnt want to lose thesweet cola mkt What brands will become Global mega,
which should be kept Local
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Global branding issues
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Branding_URLetc.ppt
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4 types of Branding
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yp g
Solo Branding Each brand stands on it ownwith a brand manager running it Eg Unilever Lux, Knorr, Surf , P&G Ariel, Pantene
Hallmark branding co tags one main brand
no sub brands eg HSBC, banking sector Umbrella (Family) branding us corporate
brand a an authority symbol eg Sony Playsation,Apple iPhone
Extension branding start with one productand extend to other categories, as far aspossible eg Ralph Lauren's Polo brandsuccessfully extended from clothing to home
furnishin s such as beddin and towels
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Factors shaping global brand
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p g gstructure / brand portfolio
drivers Firm based drivers Centralised firms more likely to have a global brand Organic or in-organic growth strategy
Product diversity Nokia can be fully global as fewer
products than Unilever Product Market drivers
How homogeneous are the segments, are they local,regional, global?
Products with strong local preference Thums Up Market dynamics what distribution channels
are available in a country
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Local branding
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g
Often justified by Cultural barriers Brand names like Healthy Choice, Weight
Watchers etc. may not be relevant in non-Englishspeaking countries
Patriotism and Buy local attitudes Heineken people identify with their local brewery;
unlike soaps, and electronics
Danone of France grew in China by acquiring localfood companies & continue selling under local names,80% of Danones sales came from these local brand
names
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Private brands/Private label
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branding/Store branding Started by Shoppers Stop with their
STOP brand
Initially the private label was only targeted
towards the non branded product rangewhich included wheat flour, masalas andpapads.
Now the private label brands have grown
out of proportion by entering into hightechnology electronic gadgets like mobilesby Univercell,
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Brand name change over
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strategies Local to Global
brand Fade-in/fade-out Global brand name is tied with the existing
brand, after a period local name is dropped
Paris EuroDisney -> Euro Disneyland ->Disneyland
Co-branding to combine brands
When Whirpool acquired Philips whitegoodsdiv, kept the name Whirlpool & Philips,afterwards Philips dropped
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Brand name change over
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strategies Local to Global
brand Transparent forewarningAlerts the Customer to the brand name
change eg Hongkong Bank of Canada /
Australia -> HSBC Summary axing
Simply drop the brand name overnight andreplace with a Global one
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Protecting Brand names
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Legal registration most common way Paris Convention for the protection of
Intellectual Property is supported by 100
Countries European Union SMA (Single Market Act)
Differences exist
Developed Countries view IP as right for
Innovativeness
Developing Countries regard IP as a public good
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Agenda
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Brand Management Branding for the world,
Global or Local Brands,
National Brands,
Private Brands, Brand Name change over strategies,
Umbrella Branding,
Protecting Brand Names,
Global Brands in India
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Other Cultural barriers in Advertising
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Religion In Saudi Arabia only veiled womencan be shown, except from the back
Political sensitivitiesCadburys Kashmir gaffe
too good to share Work with local translators / ad agencies
Ad campaigns should be in tune with theCultural value systems of target audience -
Individualism, Collectivism, Feminism,Masculinism
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Setting the Global Advertising Budget
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Percentage of Sales method Pros simple; Cons the objective of advertising is to impact
sales a case of Dog wagging the tail
Competitive Parity
Use competitors advertising budget as benchmark
Cons new entrants need to spend more Objective and Task method
Most popular, used by almost two thirds of the cos
Necessitates a solid understanding of relationship betweenadvertising spending and stated goalmkt share, brand recall
Field experiments are used to achieve this Resource Allocation method Bottom Up each country
Microsoft, FedEx Top Down Bausch & Lomb, AT&T
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Creative strategy
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Pros of standardisation Consistent Image
Matters esp to the globe trotting Consumers
Global Consumer Segments
the young and the rich have very similar tastes globally Ray-Ban has a pan Asia campaign
Creative talent Creative talent in ad agencies is in short supply
Cross-fertilisation Marketers encourage their affiliates to adopt or atleast
consider adopting ideas that are successful in other markets When P&G introduced Pantene in Latin America it used and ad
that was produced for Taiwan
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Creative strategy
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Barriers to standardisation Cultural Differences
Advertising Regulations
While Ray-Ban had a pan Asia ad, in Malaysia adsfeaturing Caucasians are not allowed, shot withlocals
Market maturity
Products relatively new to the market neededucation
Not-Invented-Here (NIH) Syndrome
ThumsUp vs Coke in early days ?
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Approaches to create
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multinational Ads Laissez Faire each Country follows its own course,no centralised decision making
Pepsi ads with Indian cricketers, Coke with actors
Export Advertising the same positioning theme usedWW
BMW, ultimate driving machine
Prototype standardisation
Guidelines given to subsidiaries for execution ofstrategy Mercedes Tag Heuer, Wrigleys
Regional Approach Nokia strategic decisions madeby a central forum; execution local
Pattern Standardisation HQ spells guidelines forpositioning theme and brand identity all its global
advertising showed distorted object clear thru Smirnoff
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Media Planning / Media
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decisions Media Infrastructure
Abundant In Western Countries new mediachannels emerge continuously; not so inothers, Regulations Germany TV
advertising allowed only during limitedtimeframes of the day
Japan scarce supply of ad space earlyplanning
Media Limitations Creative options Intel used bike reflectors
in Shanghai and Beijing Intel inside, Radio
Taxis etc
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Media landscape major trends
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Growing commercialisation and deregulation of massmedia
Shift from radio and print to TV and Internet
television Shopping Network Teleshop
Rise of global and regional media MTV and ESPN, regional websites eg Yahoo India
Growing spread of interactive Marketing
Xbox with an interactive ad
Growing popularity of text messaging Most popular in Asia - mobile phone penetration ishighest
Improved monitoring of broadcast spots
Improved TV viewership measurements by using people
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Advertising Regulations
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Culture - Malaysia banned a Toyota adwith Brad Pitt humiliation against Asianswhy do we need to use Western faces inour Ads?, Are our own people nothandsome?
Advertising of Vice Products andPharmaceuticals rules on advertising of
liquor and tobacco getting more severe Comparative advertisingChina doesnt
allow product comparisons, Use of best;US is OK
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Advertising Regulations
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Content of Advertising messages Regulated by local regulators
Ads may be taken off air if they are offensive,indecent
Advertising targeting children highlyregulated
Banned in parts of Canada
In Finland, children cannot speak the productname
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Coping with AdvertisingR l ti
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Regulations Keep track of regulations & pending
legislations
Screen the campaign early on
Lobbying activities Challenge regulations in court
Adapt marketing mix strategies eg
Kingfisher Water, Soda
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Advertising agency - selection
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Market coverage in the entire Geography Quality of coverage Japan an agency with media
buying skills is preferred over one with better creativeskills
Expertise with developing central international campaign Creative reputation
Scope & quality of support services eg Mkt Research
Desirable image (global Vs local)
Size of the agency imp for media buying
Conflicting accounts does it work for competitorsneed for confidentiality agreements
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Session VI: Cross Cultural
BusinessBehaviour
(GMM)Shobhit Mathur
+91 98101 00348
Amity Business School
Culture and its implication inGl b l M k ti
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Global Marketing Culture& Mktg Feb 02.ppt
Amity Business SchoolCross Cultural Negotiations
http://localhost/var/www/apps/conversion/tmp/scratch_8/Culture&%20Mktg%20Feb%2002.ppthttp://localhost/var/www/apps/conversion/tmp/scratch_8/Culture&%20Mktg%20Feb%2002.ppt7/29/2019 Gmm the Final Slide
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4 Stages of Negotiation Process non-task soundings
task-related information exchange
persuasion concessions and agreements
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Non-task soundings
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Includes all aspects that are used toestablish rapport among parties involved
Weather talk, commute for the meeting, any
recent sporting event, arrival into the Country Japanese spend much more time building rapport
than Amercicans
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Task-related info exchange
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Proposal, timelines, etc. Japanese prefer to spend much more time on
first 2 stages so that little effort is needed forthe persuasion stage
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Persuasion
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Give and take the deal For Americans, this is the most important
stage
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Concessions and agreement
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To achieve consensus / handshake Eg agreeing to a price discount for better
payment terms to achieve closure
Americans prefer to make concessions during thecourse of the negotiation while as Japanese preferto defer this to the end
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4. Adapting to Cultures
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Global marketers need to becomesensitive to cultural biases that influencetheir thinking, behavior, and decisionmaking.
Self-reference criterion (SRC): Refers tothe peoples unconscious tendency toresort to their own cultural experience and
value systems to interpret a givenbusiness situation.
Ethnocentrism refers to the feeling ofones own cultural superiority.
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4 step SRC correctionmechanism
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mechanism Define the business problem or goal in
terms ofyour own cultural traits
Define the business problem or goal in
terms ofhost cultures cultural traits Isolate the SRC influence
Redefine the business problem or goal,
this time w/o the SRC influence
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Ethnocentrism
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More risky than SRC Mattel introduced Barbie in Japan called
Moba Barbie Looked akin to what they thought Japanese
desired Never got more than 5-6 percent mkt share!
After 8 years re-introduced with more westernlooks, also displayed Japanese girls playing with
Barbie in TV ads
Mattel mistakenly tried to cater to Japanesedesires
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5. Culture and the Marketing Mix
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Culture is a key pillar of the marketplace. Product Policy: Certain products are more culture-
bound than other products. Food, beverages, andclothing products tend to be very culture-bound.
GM introduced Buick in China with better rear seats;Americans put children in rear, Chinese bosses
Pricing: Pricing policies are driven by four Cs:
Customers
Company (costs, objectives, strategy)
Competition Collaborators (e.g., distributors)
Magic Prices ending with 9 (Rs 19.99) to show goodvalue in emerging markets
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5. Culture and the Marketing Mix(contd.)
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(contd.)
Distribution: Cultural variables may also dictatedistribution strategies.
Avon in China had to change its direct-selling model to smallcounters in departmental stores, kiosks high context culture
Promotion: Promotion is the most visible marketingmix. Culture will typically have a major influence on afirms communication strategy. Local cultural taboos
and norms also influence advertising styles. High context cultures (Japan, Italy, Spain) subtle messaging
Low context cultures (Germany, Scandinavia) more use offactual data, reasoning, etc.
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Organizational Culture: Most companies arecharacterized by their organizational (corporate)culture.
A model of organizational culture types includes
the following four cultures Clan culture
Adhocracy culture
Hierarchy culture
Market culture
Most firms have elements of several types ofCultures
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Clan Culture
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Cohesiveness, teamwork, sense of family Leadership style father figure, mentor
Bonding Loyalty
Strategic emphasis development ofhuman resources
Japanese cos
Tata Group
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Adhocracy culture
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Entrepreneurship, creativity Leadership style Entrepreneur,
innovator, risk taker
Bonding Entrepreneurship, flexibility, risk Strategic emphasis innovation
Germany, US
Bharti Group Telecom as well as foraysinto Retail, Food Products, Insurance
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Hierarchy culture
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Order, rules & regulations Leadership style coordinator,
administrator
Bonding rules, policies,and procedures Strategic emphasis stability,
predictability, operational excellence
France, Japan Most Indian PSUs SBI, LIC, ONGC
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Market Culture
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Competitiveness, goal achievement Leadership style decisive, goal-oriented
Bonding Goal orientation, production,
competition Strategic emphasis - competitive
advantage, market superiority
UK, US, Japan
RIL, Future Group
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7. Global Account Management (GAM)
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The coordination of the management ofcustomer accounts across national boundariesare referred to as global account management(GAM).
Global Accounts Requirements: May require a single point of contact
May demand coordination of resources forserving customers
May push for uniform prices and terms oftrade
May have standardized products andservice
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7. Global Account Management (GAM)(contd.)
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( )
May require a high degree of consistency inservice quality and performance
May support in countries where thecompany has no presence
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7. Global Account Management (GAM)
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Managing Global Account Relationships: Clarify the role of the global account
management team.
Make incentive structure realistic.
Pick the right global account managers.
Create a strong support network.
Make sure that the customer relationshipoperates at more than one level.
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Management (CRM)
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g ( )
The process of managing interaction betweenthe company and its customers is calledcustomer relationship management (CRM):
Helps in customer retention
Helps in richer communication and interactivemarketing
Helps in tailored services
Helps to maintain a closer contact with thecustomers
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Enterprise Systems
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ManufacturerWholesaler
Retailer
Distribute Sell
Supply
Demand
Consumer
ConsumeProduce
$ $$
Purchase
Enterprise Resources Planning
Supply Chain Management
Customer RelationshipManagement
Customer RelationshipManagement
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Single view of the customer?
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ERP Back Office
Internet
Support
Customer
Management
Sales
Marketing
CardCard
ReportReport
Report
Spreadsheet
Spreadsheet
Document
Document
Document
Document
Document
Document
Spreadsheet
Spreadsheet
Spreadsheet
Spreadsheet
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CRM applicationsSales Service
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DataKnowledge
BaseWarehouse
CRM SystemMarketing(analysis,promotions
actuals)
(synchronised,field information)
(orders,complaints)
Management
(decision support,performance)
Partner(promotions,
funds, portals)
Consumer(web, clubs)
Other systems, email, telephone
Web
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8. Global Customer RelationshipManagement (CRM) (contd.)
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g ( ) ( )
Benefits of CRM: A better understanding of customers
expectations and behavior
Ability to measure the customers value to the
company
Lower customer acquisition and retentioncosts
Ability to interact and communicate withcustomers in countries where access totraditional channels is limited
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8. Global Customer RelationshipManagement (CRM) (contd.)
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g ( ) ( )
Guidelines for Successful CRM Implementation: Make the program business-driven rather
than IT-driven
Monitor and keep track of data protection andprivacy laws in those countries where CRMsystems are being used or are in the planningstage
A good data is the main pre-requisite. Rewards being sent out to customers are
relevant, targeted, and personal.
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Session X : Pricing
(GMM)
Shobhit Mathur
+91 98101 00348
Amity Business School
Chapter Overview
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1. Drivers of Foreign Market Pricing
2. Managing Price Escalation3. Pricing in Inflationary Environments
4. Global Pricing and Currency Movements
5. Transfer Pricing
6. Global Pricing and AntidumpingRegulation
7. Price Coordination
8 Countertrade
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Introduction
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Global pricing is one of the most critical andcomplex issues in international marketing.
Price is the only marketing mix instrument thatcreates revenues. All other elements entail
costs.
A companys global pricing policy may make or
break its overseas expansion efforts.
Multinationals also face the challenges of how tocoordinate their pricing across differentcountries.
Amity Business School1. Drivers ofForeign Market
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Foreign Market
Pricing
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1. Drivers of Foreign MarketPricing
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Pricing
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Driversthe 4 Cs
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Company costs, goals Customers price sensitivity, segments
Competition nature, intensity
Channels distribution channels
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Main drivers affecting global pricing: Company Goals
Satisfactory ROI
Market Share Specified Product Goal
New Balance shoes, sold in France aspremium, twice the US price
Altruistic goals Merck sells its AIDS drug at85% discount in Asia
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Company Costs
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Fixed & Variable costs variable costs thatchange with volume, fixed costs overheadsthat do not change with volume
Cost-Plus Pricing
Adds international cost plus markup todomestic mfg cost
Dynamic Incremental Pricing Price arrived at after removing fixed costs
FC has to be borne anyhow export or not- Mfg costshv to be managed
HLL spends a large sum on R&D to lower mfg costs
McDonalds only imports potatoes, has setup a largeR&D to improve Indian potatoes
Could lead to dumping / grey mkt
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Company costs
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Kelloggs on the other hand entered Indiawith costly packaging and expensiveadvertising result Champion cornflakes
piggybacked on their Mktg efforts andconquered the cereal mkt with one fifth thecost of mfg
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2. Drivers of Foreign Market Pricing
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Customer Demand It is a function of buying power, habits and substitutes
Customers; willingness to pay sets a ceilingwhile
Starbucks is viewed as premium in US, it faces formidablerivals in Europe and Asia who charge much lower
Buying power is a key consideration Eg Shampoo sachets in rural India80% of sales
Niche player Haagen Dazs charges a premium priceworldwide
Country specific products Have a portfolio of products that caters to every income tier
HLL
Sell Older versions Mercedes sells older models in India
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Competition
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Cross-Border Price Differentials Caused by differences in competitive situations acrosscountries
Fewer competitors in a country
Global vs local players
Private vs govt players (enjoying subsidies, cheaper loans)
Counterfeits / piracy also forces firms to cut prices
China has a huge smuggled car polulation from Japan andKorea
Bottomiline Companies will be price leaders in some
countries and price takers in othersHeinzs policy is to cutprices in markets where its not the market leader
Nonprice Competition Competition in advertising, channel coverageCoke vs Pepsi
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Distribution Channels
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Variations in Trade Margins and Length of Channels Eg France & UK have huge retailers who buy in bulk henceare able to nego large discounts
Rest of Europe, smalll retailers have formed cross-border co-ops to negotiate better with manugacturers
Issues of Every Day Low Prices (EDLP) Mfr offers consistently lower prices to retailers / consumers Distributors have a problem with this
In UK PCs are 50% more expensive than US andGermany where there is an option of channel choicesdirect marketers, supermarkets, large speciality chains like
BestBuy in US Parallel Imports (Gray Market)
Moevement of goods from low price countries to high pricecountries
To curtail, firms consider lowering cross-border price disparities
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Government Policies
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Even after launch of the Euro, car prices vary by50% across European countriesreason.. Sales tax, value added taxes, tariffs, price controls
Taxes have a direct impact on prices
Indirect impact huge government deficits mayraise the cost of capital, hence high interestrates, Volatility, high inflation, etc.
Government interference
Chinese government sets minimum prices in 21industriesviolators slapped with hefty fines
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Several options exist to lower the export price: 1. Rearrange the distribution channel To byepass the notorious Japanese distribution infra, many
US companies resorted to direct Mktgcatalog sales,telesales
2. Eliminate costly features (or make themoptional)
make the products no-frills
3. Downsize the product
Ariel reduced the package size fm 200 to 150 g inEgypt
4. Assemble or manufacture the product inforeign markets
Japanese cars in the US
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Managing Price Escalation..contd
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Premium positioning strategy Lego has positioned its toys as educational
in Indiaeg Lego Learning toys, Construction
toys
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Pricing in Inflationary Environments
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In January 1990 a Big Mac meal in Russiacosted 6 rubles, 3 years later the samemeal costed 1100 rubles!!!
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Alternative ways to safeguard against inflationmay include:
1. Modify components, ingredients, parts and/orpackaging materials.
2. Source materials from low-cost suppliers.
3. Shorten credit terms.
4. Include escalator clauses in long-term contracts.5. Quote prices in a stable currency. US$ or Euro
6. Pursue rapid inventory turnovers.
7. Draw lessons from other countries Otis andMacDonald used their Managers in Latin America to
Amity Business School3. Pricing in Inflationary Environments
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Companies faced with price controls can considerseveral alternatives:
1. Adapt the product line
2. Shift target segments or markets.
3. Launch new products or variants of existingproducts - In Zimbabwe bakers added
raisins to dough to call it raisin bread toescape price control on bread
4. Negotiate with the government.
5. Predict incidence of price controls.
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5. Transfer Pricing
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Sales transactions between related entities of the samecompanies are called transfer prices.
Determinants of Transfer Prices:1. Market conditions in the foreign country2. Competition in the foreign country
3. Reasonable profit for foreign affiliate
4. U.S. federal income taxes
5. Economic conditions in the foreign country
6. Import restrictions
7. Customs duties
8. Price controls
9. Taxation in the foreign country
10 Exchange controls
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5. Transfer Pricing
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Criteria for making transfer pricing decisions:
Tax regimes Cos would like to boost their profits in low tax countries
Could lead to audit issues in high tax countries
Local market conditions
To gain mkt share, Cos may initially underprice intercompanyshipments
Market imperfections High import duties may prompt Cos to lower transfer prices
Joint venture partner Need to protect interest of local JV partners
Morale of local country managers Esp when employee performance is linked to sales, esp an
issue in high tax countries
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Market-based transfer pricing:
Arms length pricesAs if the transfer had occurred between unrelated Cos
Yardstickmarket price
Nonmarket-based pricing:
Cost-based pricing Simple mark-up to the cost of goods
Issue : consensus on fair profit splits and allocation ofcorporate overhead
Many instances when tax authorities do not accept it
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Transfer pricing
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Negotiated pricing Country affiliates negotiate a transfer price
A recent study shows that compliance with
financial reporting norms, fiscal and customrules, and anti-dumping regulations promptcompanies to use market-basedtransferpricing.
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Government-imposed market constraints(e.g., import restrictions, price controls,
exchange controls) favor nonmarket-basedtransfer pricing.
Most firms use a mixture of market-based
and non-market pricing procedures. Minimizing the Risk of Transfer Pricing Tax
Audits:
Basic Arms Length Standard (BALS)
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5. Transfer Pricing
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To minimize the risk of tax audits, decisions shouldcenter around the following five questions (seeExhibit 13-6):
1. Do comparable/uncontrollable transactionsexist?2. Where is the most value added? Parent?Subsidiary?3. Are combined profits of parent and subsidiary
shared in proportion to contributions?4. Does the transfer price meet the benchmark setby the tax authorities?5. Does the tax MNC have the information to
justify the transfer prices used?
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Regulation
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Dumping occurs when imports are sold atan unfair price.
Govts may impose counterveiling duties orfines to protect local mfrs
Voluntary Export Restraint (VER)
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To minimize risk exposure to antidumpingactions, exporters might pursue any of the
following marketing strategies:
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following marketing strategies:
Tradiing-up Move from low value to high value products, Japanese carmfrs
Service enhancement
add support services to core products to differentiate
Distribution and communication Strategic alliances with local Distributors
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7. Price Coordination
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The following considerations will be necessarywhen developing a global pricing strategy:
1. Nature of customers
2. Amount of product differentiation
3. Nature of channels4. Nature of competition
5. Market integration
6. Internal organization7. Government regulation
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7. Price Coordination
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Global-Pricing ContractsGPCs (see Exhibit 13-7):
Purchasers often demand GPCs from theirsuppliers.
GPCs can also benefit suppliers.
A GPC can offer the opening toward nurturinga lasting customer relationship.
Small suppliers can use GPCs as adifferentiation tool to get access to newaccounts.
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7. Price Coordination
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7. Price Coordination
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Aligning Pan-Regional Prices A Pricing Corridor (to find the middle ground by
upping prices in low-price countries and cuttingthem in high-price countries) works as follows:
Step 1. Determine optimal price for eachcountry.
Step 2. Find out whether parallel imports
(gray markets) are likely to occur at theseprices.
Step 3. Set a pricing corridor.
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7. Price Coordination
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Implementing Price Coordination: Globalmarketers can choose from four alternatives topromote price coordination within theirorganizations:
1. Economic measures2. Centralization
3. Formalization
4. Informal coordination
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Countertrade
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Unconventional trade-financingtransactions that involve some form ofnon-cash compensation
Accounts for 10-15 % of worlds trade
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8. Countertrade
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Motives behind Countertrade: Gain access to new or difficult markets
Overcome exchange rate controls or lack ofhard currency
Overcome low country credit worthiness
Increase sales volume
Generate long-term customer goodwill
Amity Business School8. Countertrade
F f C t t d
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Forms of Countertrade:
Simple barter China & Morocco traded $260 M worth of pesticides vs
phosphates
Clearing agreement
2 Govts enter into agmt to import a specified value of goodsfrom one another
Indoenesia and Iran paper, rubber for Iranian oil
Switch trading Clearing house with a third party which uses the surplus
credits to buy goods from the deficit country Buyback (compensation)
Seller provides the equipment and is ready to receive partpayment thru sales of goods produced from the equipment
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Countertrade
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Counterpurchase Similar to buyback
Offset
Seller agrees to offset the purchase price by
sourcing from the importers country MIG Corporations deal with HAL
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8. Countertrade
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Shortcomings of Countertrade:
No in-house use for goods offered by
customers
Timely and costly negotiations
Uncertainty and lack of information on future
prices Transaction costs
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8. Countertrade
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Words of advice regarding countertrade:
1. Always evaluate the pros and cons of countertrade
against other options.2. Minimize the ratio of compensation goods to cash.
3. Strive for goods that can be used in-house.
4. Assess the relative merits of relying on middlemen
versus an in-house staff.5. Check whether the goods are subject to any
restrictions.
6. Assess the quality of goods.
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Session XI : Global Market
Research
Shobhit Mathur
+91 98101 00348
Amity Business School
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Global Marketing Research
Amity Business SchoolOverview
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1. Research Problem Formulation2. Secondary Global Marketing Research
3. Primary Global Marketing Research
4. Market Size Assessment5. New Market Information Technologies
6. Managing Global Marketing Research
Amity Business SchoolIntroduction
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Given the complexity of the global marketplace,solid marketing research is critical for a host ofglobal marketing decisions
Walmarts Jewellery counters in Argentina stocked
precious stones, while Argentine women prefer gold &silver!
Hardware dept had tools at 110 Volts, standard is 220Volts!!
Most of the cultural blunders in global marketingstem from inadequate marketing research.
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Six steps in conducting globalmarket research:
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1. Define the research problem(s)
2. Develop a research design
3. Determine information needs4. Collect the Data (secondary and
primary)
5. Analyze the data and interpret theresults
6. Report and present the findings of the
Amity Business SchoolMajor challenges faced by globalmarketing researchers:
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1. Complexity of research design due toenvironmental differences
2. Lack and inaccuracy of secondary data
3. Time and cost requirements to collectprimary data
4. Coordination of multicountry research efforts
5. Difficulty in establishing comparability acrossmulti-country studies
Amity Business School1. Research Problem Formulation
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Any research starts off with a precise definitionof the research problem(s). What does the motorist in a country demand of his
car?
In an international context, the marketingresearch problem formulation is hindered by theself-reference criterion (SRC). Local subsidiaries should be consulted to minimise
this
A major difficulty in formulating the researchproblem is unfamiliarity with the foreignenvironment.
Omnibus surveys are regularly conducted by
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1. Research Problem Formulation(contd.)
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Once the research issues have been stated,management needs to determine the informationneeds.
Amity Business School2. Secondary Global MarketingResearch
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Secondary Data: Data/information which isalready available.
Primary Data: When the information is notuseful, or simply does not exist.
Selected Secondary Data Sources: Lexis/Nexis,FINDEX, National Trade Data Bank, U.S.Department of Commerce, Japan External TradeOrganization (JETRO), OECD, IMF, TheEconomist Intelligence Unit (E.I.U.), ACNielsenCo, Taylor Nelsen Sofres, etc.
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2. Secondary Global MarketingResearch (contd.)
Problems with Secondary Data Research:
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Problems with Secondary Data Research:
Accuracy of Data
Age of data
Reliability over Time
Comparability of Data
Triangulate
Functional or Conceptual Equivalence In US bicycles are used for sport; while in China &
Netherlands used for transport
Lumping of Data Arising from the tendency of official data sources to often group
statistics on certain variables in very broad categories
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3. Primary Global Marketing Research
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Focus Groups Hiring well trained moderators is critical to
international MR
Survey Methods for Cross-Cultural MarketingResearch:
Questionnaire Design
Conceptual and Functional EquivalenceAcross cultures
Translation and Scalar Equivalence Careless translations can lead to
embarrassment
Amity Business SchoolSampling: A sampling planconsists of:
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Sampling unit
Who should be surveyed
Sample size Sampling procedure
Heterogeneous cultures like India demandlarger sample sizes than Korea
Inapproachability of women in Muslimcountries
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Contact Method
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Mail Telephone
Person-to-person interviews (shopping mallintercepts)
Online Survey Methods
E-mail surveys
Random Web site surveys
Panel Web site surveys
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Some methods prevail in somecultures; some in others
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Germans more resistant to telephoneinterviewing than other Europeans
Daytime telephone calls dont work in Saudi
Arabia as women cannot talk to strangers
Brazil has issues with lost mail
Some countries do not have adequatetelephones
Chinese managers reluctant to discuss issuesover phone, face to face ok
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Online survey research
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3 types E-mail surveys
Self-administered questionnaire sent out
Website surveys
Visitors to a site are asked to fill out questionnaire
Panel website surveys
Rely on a panel of respondents
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Pros and cons of Internet as atool for Global MR
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Pros Large samples possible in short time
Global access
Lower costs, scale independentAnonymity
Easier data analysis : can be directly loadedinto statistical tools and databases
Overall short response time
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Pros and cons of Internet as atool for Global MR
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Cons Poor IT infrastructure in many countries
Sample representative ness
Speed of access Low response rates
Multiple responses (from same respondent)
Amity Business School3. Primary Global Marketing Research(contd.)
Collecting the Information
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Collecting the Information
Issues of nonresponse Due to reluctance to talk with strangers
Courtesy bias Esp in Asia and Mid east, respondent feels obliged to
give answers that please the interviewer Social desirability bias
Subject attempts to reflect a certain social status inresponse
Redundancy (asking the same question in different
ways) Issues of ethnographic research
Field Researchers embed themselves in target society
Intel does this in India, China & Chile
Amity Business School4. Market Size Assessment
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Method of Analogy Longitudinal method of analogy
Trade Audit
Chain Ratio Method
Cross-Sectional Regression Analysis
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Analysis by Inference
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Market assessment by inference usesavailable facts about related products or
other foreign markets as a basis for inferring
the necessary information for the market
under study Related products
Related markets size
Related environmental factors Analysis of demand patterns
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Method of Analogy
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The assumption is that there is an analogy between therelationship of a factor and demand for a particular productor commodity in two countries
Let XA = demand for product X in country A
YA = factor that correlates with demand for product X incountry A, data from country A
XB = demand for product X in country B
YB
= factor that correlates with demand for product X in countryA, data from country B
If we assume that :
XA/YA = XB/YB
and if XA, YA, and YB are known, we can solve for XB asfollows:
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Longitudinal Method of Analogy
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Displacing time is a useful method of market analysis when data
are available for two markets at different levels of development
The assumption is that an analogy between markets exists in
different time periods
Let
XA1 = demand for product X in country A during time period 1
YA1 = factor associated with demand for product X in country
A during time period 1
XB2 = demand for product X in country B during time period 2
YB2 = factor or factors correlating with demand for product X in
country A and data from country B for time period 2
If we assume that :
XA1/YA1 = XB2/YB2
and if XA, YA, and YB are known, we can solve for XB as follows:
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4. Market Size Assessment (contd.)
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When using market size estimates, keep thefollowing rules in mind:
Use several different methods.
Dont be misled by numbers.
Dont be misled by fancy methods.
Do a sensitivity analysis by asking what-ifquestions.
Look for interval estimates with a lower andupper limit rather than for point estimates.
Amity Business School5. New Market InformationTechnologies
Major developments/innovations:
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Major developments/innovations:
Point of sale (POS) store scanner data
Consumer panel data
Single source data
Shift from mass to micro marketing Continuous monitoring of brand sales/market
share movements
Scanning data are used by manufacturers tosupport marketing decisions.
Amity Business School5. New Market InformationTechnologies (contd.)
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Scanning data are used to providemerchandising support to retailers.
Amity Business School6. Managing Global MarketingResearch
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Selecting a Research Agency: Thefollowing considerations should be takeninto account while choosing agency:
Level of expertise
Qualifications Track record
Credibility and experience
Client record
Amity Business School
Coordination of Multi-Country Research:Emic versus Etic dilemma
The emic school focuses on the peculiarities
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pof each country.
The etic approach emphasizes universalbehavioral and attitudinal traits.
In cross-cultural market research, the need forcomparability favors the etic paradigm with anemphasis on the cross-border similarities andparallels.
Several approaches may be used to balancethese conflicting demands.
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Thank You
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International Marketing Research
Managing Marketing Information to gain
Customer Insights
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Introduction
Importance of customer information ???
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Not just customers but also competitors and stakeholders. Why and how is information gathered?
Some cases Case of Pizza Hut
CAT - Cab comfort in India
CAT reliability vs. efficiency of the machines
Lays and baseball matches (analytics)
Apples iPod
Touring the store with the customer (Major retail chains inthe world grocery as well as departmental stores)
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Introduction
Customer needs and buying motives not obvious difficult for
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customers to articulate Givaudan
Customer insights Understanding of customers and the marketplacederived from marketing information that become the basis for creating
customer value and relationships. Harley Davidson
Customer Insights teams at IMRB
Marketing information systemassess information needs, develop the
needed information and help in decision making (generate andvalidate actionable customer and market insights) Caterpillar, Infosys (Knowledge Management Portals on intranet of
organisations)
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International Marketing Research
American Marketing Association defines marketing research as systematic
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gathering, recording and analyzing of data about problems relating to themarketing of goods and services.
Some issues related to International Marketing Research:
Culture
Information to be communicated across cultural boundaries Case of Human Rights and perceptions of people Case of equal rights of employees irrespective of gender, Japan, France,
Germany, India
Environment in which research tools are applied are different
Varies from country to country Use of Kiosk in case of CAT Use of internet to gather data Use of technology in market research
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International Marketing Research
Lack of knowledge
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First time exporters Closed country environments
Socialist countries earlier; Arab World more recently
Unfamiliarity with foreign markets
Small exporters, only 27% use research and tools Country reports by reputed institutions are helpful (Occasional papers
and industry reports by ECGC, Exim Bank, EPCs in India)
Complex
Across cultures, context may be different Use of 5 point scale (Poor, Fair, Good, Very Good and Excellent)
cultural context
Models often used, not adapted as per country
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International Marketing Research
Unpredictable consumer demands
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Givaduan (fragrances) Colors (apparels, garments)
Changing beliefs, values
Indian breakfast
South East Asia and Food Habits
China Tea vs. Coffee Family Size
Attention to children DINKS
DISKS
Little princes and princesses of China
Socio-technographic profile of people (Psychographics)
In terms of expenditures countries that spend a lot on research are -US, UK, Japan, Germany
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Breadth and scope of International Marketing Research
International Marketing Research
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Three types:
General information about country, area and market
Information for future marketing requirements by anticipatingsocial, economic, consumer and industry trends
Specific market information to make product, promotion,distribution and price decisions
Economic
Cultural, sociological and political climate
Overview of market conditions
Technological environment
Competitive situation
PEST, PESTLE, PESTEL
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Process
International Marketing Research
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Marketing problem vs. Research problem Research objectives Cost and benefits of the research effort Data sources
Secondary data Availability of data Reliability of data Comparability of data Validating secondary data
Who collected the data?
For what purpose was the data collected? How was the data collected? Is data internally consistent and logical w.r.t. known sources
of data or market factors?
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International Marketing Research
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Process Data sources
Secondary data Different data collection methods
Classification differences Unit of measurement
Definitional differences
Case of normative databases
Understanding of scales by the consumers Sensitivity
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Primary data
International Marketing Research
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Gathering data Personal, Mail surveys, Telephonic, E-Mail, Survey Panels Agencies that are engaged in collecting data
Internal sources Case of Pizza Hut (Yum Brands) Tesco
Caf Coffee Day External agencies
Cross tab Online survey panels (Speak Asia Online) Experience sur
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