4.3 Global Marketing

Question 1

Definition of Global marketing

Answer 1

This involves the planning, production, placing and promoting of a business’s products in a worldwide market

Question 2

Definition of Global localisation

Answer 2

A firm adapting to local expectations in order to succeed in an international marke

Question 3

Definition of Domestic/Ethnocentric

Answer 3

Assumes that what works in the home markets will work in the international ones

Is effective if international consumers value authenticity

Question 4

Pros and cons to Domestic/Ethnocentric approach

Answer 4

Pros:
Economies of scale
Average cost can be lower - lead to lower prices - lead to more sales - lead to higher profits
Cons:
May not sell well as it hasn’t been adapted
Business will be taking a risk
Does not take into account cultural or national differences

Question 5

Definition of Mixed/Geocentric approach

Answer 5

Recognises differences in national markets

Main aim is to build truly global markets

Question 6

Pros and cons of a Mixed/Geocentric approach

Answer 6

Pros:
Products are tailored to meet local needs - result in higher sales
Cons:
High costs

Question 7

Definition of International/Polycentric approach

Answer 7

Recognises that every national market requires a different marketing mix

Products designed specifically to meet local needs

Question 8

Pros and cons of a International/Polycentric approach

Answer 8

Pros:
Products should sell well as they are tailored to meet specific needs in a market
May be more effective
Cons:
High costs
Have to compete with established local brands

Question 9

Definition of The Marketing Mix

Answer 9

A marketing strategy sets to achieve select aims
The marketing mix must be used in global markets and must be considered as part of a global marketing strategy

Question 10

What does the marketing mix consist of

Answer 10

Price - include factors such as income, taxes, rent and other costs
Place - Need to take into account how local consumer buy their products
Product - Need to identify whether or not they need to modify/adapt their product for global markets
Promotion - Needs to be conscious of cultural differences e.g. languages

Question 11

What does the Ansoff Matrix allow

Answer 11

For businesses to decide their product and market growth strategy

Question 12

What does the Ansoff Matrix consist of

Answer 12

Market penetration - Existing product , Existing market
Market development - Existing product , New market
Product development - New product , Existing market
Diversification - New product , New market

Question 13

Aims of market penetration

Answer 13

Maintain or increase the market share of current products
Secure dominance of growth markets
Restructure a mature market by driving out competitors
Increase usage by existing customers

Question 14

Definition of Niche Market

Answer 14

Small segments of the global market that are characterised by unique and specific needs and preferences

Question 15

Features of global niche markets

Answer 15

A clear understanding of needs and wants of the market segment
An emphasis on quality
Excellent customer service
Expertise in the product area
Prioritising profit rather than market share
Innovation

Question 16

Pros and cons of Global niche markets

Answer 16

Pros:
Lower competition than in mass markets
Greater customer loyalty
Prices are likely higher so higher profits
Risk may be reduced
Potential economies of scale
Specialist products reduce PED
Cons:
Economies of scale may not be achievable as each market may need individual attention
Co-ordination and communication may be difficult