Adobe Systems 21.09.2021 1 International Marketing - Introduction Ing. Dušan Mladenović Ph.D. dusan.mladenovic@econ.muni.cz Adobe Systems 2 Roadmap ̶Lecturers ̶Aim and Content of the Course ̶Tasks and Schedules ̶Literature ̶Exam and Grading System ̶Advices ̶Introduction to the Problematic: ̶Key terms ̶Motives for firms going international ̶Triggers of export initiation ̶Export barriers etc. Roadmap – 21.09.2021 Adobe Systems 3 Lecturers ̶Ing. Dušan Mladenović Ph.D. ̶dusan.mladenovic@econ.muni.cz ̶Room 545, 5th Floor ̶Individual office hours (online) is possible to arrange via e-mail Lecturer – 21.09.2021 Adobe Systems 4 Lectures’ Structure ̶Theory Summary – 50-60 minutes ̶Presentations - 40 minutes ̶If time available - Case Study or Specific Tasks Will be Solved ̶Attendance is mandatory Lectures’ Structure – 21.09.2021 Adobe Systems 5 Aims and Content of the Course ̶Students who complete this course successfully will be able to: ̶Understand reasons for adaptations of many marketing approaches in the international environment ̶Use special techniques or methods of international and global marketing ̶Analyze, select and evaluate various frameworks for firms approaching international markets having in mind the impact of cultural differences on marketing decisions ̶Be analytical and critical when it comes to analyzing and interpreting global marketing issues ̶Understand the culture and cultural differences in business etc. Aims and Content of the Course – 21.09.2021 Adobe Systems 6 Aims and Content of the Course ̶Following topics will be covered throughout the semesters: ̶The Nature of Global Marketing ̶Theories of International Trade and Marketing ̶The International Environment ̶Culture and International Marketing ̶International Market Selection and Segmentation ̶International Marketing Research ̶Market Entry Strategies and Modes ̶Product and Service Strategies ̶International Pricing ̶International Distribution ̶International Marketing Communication Aims and Content of the Course – 21.09.2021 Adobe Systems 7 Tasks and Schedules ̶Each student must choose one of the following: ̶Seminar work ̶Presentation of the country from the marketing standpoint ̶Weekly Case Study (optional) ̶Deadline for registration and enrollment: 03.10.2020 via IS. ̶Further details available in the Interactive Syllabus ̶ Tasks and Schedules – 21.09.2021 Adobe Systems 8 Literature ̶Mandatory ̶Hollensen, S. (2008). Essentials of global marketing. Pearson Education. ̶Hollensen, S. (2007). Global marketing: A decision-oriented approach. Pearson education. ̶Recommended ̶Usunier, J. C., Lee, J. A., & Lee, J. (2005). Marketing across cultures. Pearson Education. ̶Kotabe, M. M., & Helsen, K. (2020). Global marketing management. John Wiley & Sons. Literature – 21.09.2021 Adobe Systems 9 Exam and Grading System ̶Consists of 30 questions ̶Negative points (-0.25) for incorrect answer ̶Online via IS ̶Minimum: 60% ̶Dates will be communicated upfront – the latest 3rd week of November ̶Grade structure: ̶Exam = 30% ̶Presentation = 40% ̶Case Studies = 10% ̶Attendance = 15% ̶Extra points for participation in research = 5% Exam and Grading System – 21.09.2021 Adobe Systems 10 Exam and Grading System 1. •Originality and Creativity Creativity and originality of logic •Timeliness and uniqueness of ideas 15 2. •Organization (Logical presentation of ideas) Objectives/goals are clearly stated. •Methods are appropriate for achieving goals •Results are clearly presented •Thoughts and ideas flow in a logical manner 10 3. •Presentation (Not applicable in online mode) Exhibits good body posture •Maintains good eye contact with audience •Good diction; good articulation •Time management 5 4. •Knowledge of Material Exhibits knowledge of subject matter •Answers questions with confidence •Visual materials are easy to read. 10 5. Overall Presentation (Total) 40 Exam and Grading System – 21.09.2021 Adobe Systems 11 Advices ̶Be on-time ̶Be proactive ̶Consider Case Studies ̶Always prepare for lectures (home-reading) ̶Read Interactive Syllabus ̶Check tab: Bonus Materials Advices – 21.09.2021 Adobe Systems 12 Advices – 21.09.2021 13 Introduction •What is marketing? •What are export, international, multinational, and global marketing? •What are reasons for the differences? •Definition and „synonyms“ for international marketing? 14 Introduction – 21.09.2021 Introduction – 21.09.2021 15 Definitions and Synonyms •Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. •Unique feature of international marketing is its polycentric orientation with emphasis on product and promotional adaptation in foreign markets. •Polycentric orientation refers to a predisposition of a firm to the existence of significant local cultural differences across markets, necessitating the operation in each country being viewed independently. 16 Introduction – 21.09.2021 Definitions and Synonyms Core marketing concepts Needs •States of felt deprivation (physical – food, warmth, safety, social – belonging, affection and individual – knowledge, self-expression) Wants •The form taken by human needs as they are shaped by culture and individual personality or shaped by society and described in terms of objects that will satisfy needs Demands •Human wants that are backed with buying power •Demand = Want + willingness to buy + ability to buy •Demand may be brand specific (Adidas vs Nike vs Puma) 17 Introduction – 21.09.2021 Introduction – 21.09.2021 18 Definitions and Synonyms Export marketing begins with unsolicited orders from foreign customers. The internationalization process is a consequence of incremental adjustments to the changing conditions of the company and its environment, rather than a result of its deliberate strategy. Export marketers still tend to take an ethnocentric approach to foreign markets as being an extension of their domestic market and export products developed primarily for home country customers with limited adaptation to foreign customers’ needs. 19 Introduction – 21.09.2021 Definitions and Synonyms International marketing is the process by organizations: •Identify needs and wants of customers in different markets •Provide products, services and ideas competitively to satisfy needs and wants of different customer groups concerning issues different from domestic market •Communicate information about the products and services with the proper adaptation to different customer perception rising from other country effect •Deliver the products and services internationally 20 Introduction – 21.09.2021 Definitions and Synonyms •Multinational marketing is when the company markets its products in many countries around the world. •Management of the company comes to realize the benefit of economies of scale in product development, manufacturing, and marketing by consolidating some of its activities on a regional basis. •This regiocentric approach suggests that product planning may be standardized within a region (e.g., a group of contiguous and similar countries), such as Western Europe, but not across regions. 21 Introduction – 21.09.2021 Definitions and Synonyms •Product development, manufacturing, and marketing are all executed by each subsidiary for its own local market. •Different product lines, product positioning, and pricing may be observed across those subsidiaries. Few economies of scale benefits can be obtained. •Multi-domestic marketing is useful when customer needs are so different across different national markets that no common product or promotional strategy can be developed. 22 Introduction – 21.09.2021 Definitions and Synonyms Global marketing is defined as the firm’s commitment to coordinate its marketing activities across national boundaries in order to find and satisfy global customer needs better than the competition. This implies that the firm is able to: •develop a global marketing strategy, based on similarities and differences between markets •exploit the knowledge of the headquarters (home organization) through worldwide diffusion (learning) and adaptations •transfer knowledge and ‘best practices’ from any of its markets and use them in other international markets 23 Introduction – 21.09.2021 Definitions and Synonyms Global marketing refers to marketing activities by companies that emphasize the following: •Standardization —standardizing marketing programs across different countries particularly with respect to product offering, promotional mix, price, and channel structure •Coordination —reducing cost inefficiencies and duplication of efforts among their national and regional subsidiaries •Global Integration—participating in many major world markets to gain competitive leverage and effective integration of the firm’s competitive campaigns across these markets by being able to subsidize operations in some markets with resources generated in others and responding to competitive attacks in one market by counterattacking in others 24 Introduction – 21.09.2021 25 Introduction – 21.09.2021 Internationalization Philosophies •Ethnocentric (domestic/export marketing) •Polycentric (international marketing) •Regiocentric (multinational marketing •Geocentric (global marketing) 26 Introduction – 21.09.2021 Internationalization Philosophies Ethnocentric orientation •Home country is superior to others •International markets are secondary, regarded as outlets for surplus production •Sees only similarities in other countries •Assumes products and practices that succeed at home will be successful everywhere •Leads to a standardized or extension approach Negatives •Loss of demand •No local responsiveness •No anticipation of local needs 27 Introduction – 21.09.2021 Internationalization Philosophies Polycentric •Each country is unique •Guided by the multi-domestic marketing concept •Each subsidiary develops its own marketing strategies •Fully decentralized, minimal coordination with headquarters •Leads to a localized or adaptation approach that assumes products must be adapted to local market conditions Negatives •No economies of scale •Duplicated functions •Higher final costs 28 Introduction – 21.09.2021 Internationalization Philosophies Regiocentric orientation •A region is the relevant geographic unit •Regional offices coordinate marketing activities •Question: Is everything in one region same? Geocentric orientation •Entire world is a market •Strives for integrated strategies •Strategies aimed at market segments, rather than geographic locations •Maximizes efficiencies worldwide and provides standardized product or service •Retains an association with the headquarters country •Pursues serving world markets from a single country 29 Introduction – 21.09.2021 Internationalization Philosophies Introduction – 21.09.2021 30 Standardization vs. Adaptation Globalization (standardization) •Developing standardized products marketed worldwide with a standardized marketing mix •Essence of mass marketing Global localization (adaptation) •Mixing standardization and customization in a way that minimizes costs •Essence of segmentation •“Think globally, act locally” 31 Introduction – 21.09.2021 Internationalization Motives 32 Introduction – 21.09.2021 Export Initiation 33 Introduction – 21.09.2021 Internationalization Barriers Internal •finances •insufficient knowledge •lack of foreign market connections •lack of export commitment •lack of capital to finance expansion into foreign markets •lack of productive capacity to dedicate to foreign markets •lack of foreign channels of distribution •management emphasis on developing domestic markets •cost escalation due to high export manufacturing, distribution and financing expenditures External •Market risk •Commercial risk •Political risk 34 Introduction – 21.09.2021 Value Chain in International Marketing Introduction – 21.09.2021 35 Home-readings for Next Week Reading for next lecture (state holiday): •Theories Explaining Firms’ Internationalization Process •Hollensen – Essentials of Global Marketing. Chapter 3 • Case Study •Entertainment Rights: Internationalization of ‘Postman Pat’ (p. 67) More details available in Interactive Syllabus. 36 Home-readings for Next Week– 21.09.2021 Pilot Study •Please fill out the following survey: https://forms.gle/5jzLQKNfuSKvVBdq9 •This is a pilot study for us to understand if the survey questions are clear enough and ready for full scale research •Approximate time: 5-7 minutes •Thank you very much 21.09.2021 37 Thank you for you attention End of presentation 38