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Global Market Entry Strategies

Global Market Entry Strategies. Differences in the International Market Environment Culture Political Stability Trade Regulations Economic Development/Conditions Marketing/Business Infrastructure Product/service fit Market – size, potential Competition.

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Global Market Entry Strategies

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  1. Global Market Entry Strategies Differences in the International Market Environment • Culture • Political Stability • Trade Regulations • Economic Development/Conditions • Marketing/Business Infrastructure • Product/service fit • Market – size, potential • Competition.

  2. The Global Market Opportunity Analysis • Consumer Analysis • Product/Service/Brand (offering) Analysis • Price Analysis • Distribution/Supply Chain Analysis • Promotion/Marketing Communications Analysis • Employees/Staff Analysis • Infrastructure/Building/Vicinity Analysis • Work ethic/Workforce attitude to work Analysis • Environmental Analysis - - PESTLE

  3. Global Market Opportunity Analysis contd. The Preceding analyses lead to Firm’s: • Marketing Planning Analysis • SWOT Analysis • Gap – Niche Analysis • Financial Analysis • Competition Analysis • Operational Analysis • Human Resources/Manpower Analysis

  4. What is Marketing Planning? • Defined as the planned application of marketing resources to achieve marketing objectives. • In other words, it is the logical and systematic sequence of the various activities effected in the setting up of corporate objectives and the formulation of plans for achieving them (McDonald, 1992, pp.13).

  5. Marketing Planning contd. Where are we now? How are Where do we doing? We want to be? How shall we get there?

  6. Key issues about Marketing Planning Analysis • 1. Analysis of the market (i.e., where are we now?) • 2. Setting of objectives and Aims (i.e., where do we want to be?) • 3. Methods and Determination of strategy(ies) and tactics (i.e., How will we get there?) • 4. Formulation of evaluation procedures (i.e., Are we getting there?). Evaluation may be geared toward products, markets, profits/results. • Procedures may include (a) assessment of sales reports, (b) profit analysis, (c) manpower productivity, (d) consumer satisfaction or complaints assessments, (e) consumer perceptions about offering/firm, (f) financial, working capital, liquidity assessment, (g) capital/equipment assessment.

  7. Five Major Factors Involved in the Decision to “go international” • Proactive Factors: (1) Niche products, (2) Economies of scale/scope. • Reactive Factors: (3) Threats in the external environment (competitive, regulatory), (4) Insufficient domestic market growth (static, not enough to meet firm’s growth targets), (5) Adjustment to changing customer needs (automobile components, manufacturers).

  8. Factors Influencing Marketing in the Global Market • Industry Globalization Drivers: • Globally standardized customer needs (Levitt, 1983). • Global or regional customer/channels. • Customer reaction to foreign marketing. • Effect of exposure outside home country. • Overall market globalization drivers. 2. Firm position and strategy: • Global coverage. • Global market share. 3.Organizational factors: • Global marketing workforce/CEO/VP • Globally concentrated value chain. • Parent firm characteristics: • Parent firm size • Nationality of parent firm

  9. The Categorization of Countries (a selection)

  10. The Methods of Entry to the Targeted Market (Country) • Exporting (e.g. through local agents or subsidiaries). • Licensing (e.g. through local agents). • Franchising (e.g. through local companies etc.). • Joint Ventures (with local entrepreneurs/affiliates/governments). • Full Ownership (largely total ownership; 90 - 100%).

  11. Methods of entry contd. • Standardization. • Adaptation. • Pluralistic. • Concentration. • Diversification.

  12. Decisions on International Offerings • “…There is only one significant respect in which a company’s activities around the world is important, and that is in what it produces and how it sells. Everything else derives from and is subsidiary to, these activities…” Levitt (1983).

  13. Further discussion • Japanese management vs. American management • “world class manufacturing”? • Country of origin effects? • Awareness of different cultural preferences? • Is there global consumer culture? – from Timbuktu to Sydney through New York, Paris and Shanghai. • Is there a powerful force driving the world toward a commonality, i.e., technology – ICT? • Protectionism? • “No nation is an Island”?

  14. Final questions • What is global brand/product/service? • What does the following acronyms stand for? • EU • EFTA • ECSC • NAFTA • TRIAD • ECOWAS • EEC. • Capital towns of the following countries:……………

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