Global Marketing Management, 8e

Warren J. Keegan

Chapter 1: Introduction to Global Marketing

2013 Pearson Education, Inc. publishing as Prentice Hall

Learning Objectives
Summarize the evolution of marketing Identify the three basic principles of marketing Discuss global marketing practices and strategies Discuss the growth of global market opportunities Compare and contrast management orientations Describe the driving forces behind the increased pace of global integration Identify three restraining forces that hinder global marketing efforts
2013 Pearson Education, Inc. publishing as Prentice Hall

Marketing: A Universal Discipline

Marketing is the process of focusing the resources & objectives of an organization on environmental opportunities and needs Marketing is also a set of concepts, tools, theories, practices, procedures and experiences
Although marketing is a universal discipline, marketing practice varies from country to country

2013 Pearson Education, Inc. publishing as Prentice Hall

The Marketing Concept

The concept has chanced dramatically over the years The old concept: Focus on products The new concept (around 1960):
Focus was a customer orientation Development of the marketing mix: product, price, place, promotion (4Ps)

2013 Pearson Education, Inc. publishing as Prentice Hall

The Marketing Concept

The Strategic Concept (1990s):
Focus on customer in the context of the broader external environment
Competition, government policy and regulation Economic, social and technological macro forces

Focus on stakeholder value

employees, customers, shareholders, society

2013 Pearson Education, Inc. publishing as Prentice Hall

The Marketing Concept

Today: Two key tasks of marketing
Focus on customer and his/her environment Create value for consumers and stakeholder

Shift towards
Focus on managing strategic partnerships Positioning of firm in value chain to optimize value creation

Profit as a measure of success, not an end in itself

2013 Pearson Education, Inc. publishing as Prentice Hall

The Three Principles of Marketing

CUSTOMER VALUE

COMPETITIVE ADVANTAGE

FOCUS

2013 Pearson Education, Inc. publishing as Prentice Hall

The Three Principles of Marketing:

Customer Value

Goal: create customer value that is greater than the value created by competitors Strategy:
Expand or improve product and/or service benefits Reduce the price Combine these two elements

2013 Pearson Education, Inc. publishing as Prentice Hall

The Three Principles of Marketing:

Customer Value
V=B/P
V = Value B = Perceived Benefits P = Price

2013 Pearson Education, Inc. publishing as Prentice Hall

The Three Principles of Marketing:

Competitive Advantage

Goal: Create competitive advantage through differentiation Advantage can exist in any element of a companys offer One way to penetrate a new national market is to offer a superior product at a lower price.

2013 Pearson Education, Inc. publishing as Prentice Hall

The Three Principles of Marketing:

Focus

Focus is the concentration of attention and resources Requirement to create customer value at a competitive advantage A clear focus on customer needs and wants

2013 Pearson Education, Inc. publishing as Prentice Hall

Global Marketing
Marketing discipline is universal, but markets and customers are quite different Marketing practice must vary region-to-region and country-to-country Need for Global Localization: Think globally but act locally

2013 Pearson Education, Inc. publishing as Prentice Hall

Examples of Global Marketing Strategies

Product Design Brand Name Apple/Google/McDonalds/Toyota Coca-Cola/Apple/BMW

Product Positioning
Packaging Sourcing Innovation Distribution Customer Service

Unilever/Harley Davidson/Apple/Samsung
Gillette/Apple Toyota/Honda/Nike/Wal-Mart/Apple Apple/Google/Samsung/Tata/Foxconn IKEA/Apple/H&M Caterpiller/Dell/Apple/Lexus

2013 Pearson Education, Inc. publishing as Prentice Hall

Globalization and Global Marketing

The U.S. represents approximately 25% of the total world market for all products and services China is now the worlds 2nd largest economy; Japan is now number three In 2009, China became the worlds largest market for cars None of the top 15 automobile and parts companies are Chinese
2013 Pearson Education, Inc. publishing as Prentice Hall

Management Orientation and Global Marketing

Different Management Orientations in the Global Arena EPRG Framework
Polycentric Ethnocentric Regiocentric Geocentric

2013 Pearson Education, Inc. publishing as Prentice Hall

Management Orientation and Global Marketing

Ethnocentric Orientation:
Characteristic of domestic and international companies Opportunities outside the home market are pursued by extending various elements of the marketing mix

Polycentric Orientation
Characteristic of multinational companies Marketing mix is adapted by autonomous country managers
2013 Pearson Education, Inc. publishing as Prentice Hall

Management Orientation and Global Marketing

Regiocentric or Geocentric Orientation:
Characteristic of global and transnational companies Marketing opportunities are pursued by both extension and adaptation strategies in global markets

2013 Pearson Education, Inc. publishing as Prentice Hall

Driving Forces Affecting Global Marketing

Technology Culture Market Needs Cost Free Markets Peace Management Vision Strategic Intent

2013 Pearson Education, Inc. publishing as Prentice Hall

Restraining Forces Affecting Global Marketing

Culture Market Differences Costs Nationalism War Management Myopia

2013 Pearson Education, Inc. publishing as Prentice Hall

Summary

Global marketing is the process of focusing resources on global marketing opportunities Goal, to create customer value and competitive advantage by maintaining focus Four classifications of management orientation: ethnocentric, polycentric, regiocentric, geocentric Global marketing importance is shaped by a variety of driving and restraining forces
2013 Pearson Education, Inc. publishing as Prentice Hall