4.3.1 Global marketing approaches Flashcards
global marketing strategy
adaptation of marketing strategy to target all markets on a worldwide scale
- traditional marketing mix/4Ps used with aim of sending an identical message to all countries (IKEA)
- adapted e.g. language/religion but changes are minimum
e.g. Disney selling in countries with existing firm distribution/media infrastructure
pros of global marketing approaches
- marketing EOS (production/distribution) = lower av market cost
- exposure/brand awareness = market power
- diversifying/spread risk
- consistent message/brand identity
- uniformity of marketing practice
cons of global marketing approaches
- doesnt work in every market (eastern/LEDS) culture,fashion,food,music
- hard to translate
- diff legal env (conflict with market)
- diff consumer need/wants/usage/consumer response to marketing
- diff brand/product development and competitive env
glocalisation
adaption of global marketing strategy
meet requirements of local geographic market (mix of globalisation & localisation)
practice of conducting business according to local and global consideration e.g. change menu to fit pallets
Starbucks in China (glocalisation e.g.)
stores: comfort, spacious, music
position: leveraging, western status
promotion: upmarket, dont lower price, loyal to domestic producers
training baristas (quality LT inv)
product range: grazing platter//drink
3 regional partners (localised to provinces) (joint venture)
globalisation
world increasingly interconnected due to increased trade and cultural exchange
localisation
organisations adapting to meet needs of local customer
rather than assume what works in 1 works in another
EOS
cost adv a business can exploit by expanding scale/production
pros of glocalisation
- tailoring = reduce risk
- build/establish new complex market
- secure distribution
- reputation (help local economy)
- local production = lower costs
- local retailers comfy with local supply
- optimise market share
cons of glocalisation
- expensive/time consuming (adapt new product) = long time to reach ARR
- not always effective
- informative expertise
- strong domestic comp
- MR and R&D costs
EPG model
global approach to marketing
framework used to consider marketing approach used by global firms
home nation
where business originated
host nation
where target market/subsidiary of business is based
EPG sections
Ethnocentric = Home (e.g. apple) Geocentric = Global/mix (e.g. McDonalds) Polycentric = Local (e.g. self foam soap)
Ethnocentricity (domestic)
ethnocentric
promotion of product is undertaken based on beliefs of home nation of business e.g. amazon
decision making centralised/ key personal from HQ
oversea marketing in other countries
restrict promotional prospects (consistent/marketing EOS)
ignore local customs/culture
Geocentric (mixed)
promotion of product undertaken based on a global/worldly point of view, not based on perspective of either home or host nation e.g. Air Bnb
marketing focus on business, benefit global bases (doesnt matter where HQ/subsidiary is) see diff in global mkt = aim to build global brand products marketed in foreign based on what is needed to succeed marketing approach (mix elements/ethnocentric and polycentric)
Polycentric (international)
promotion of product undertaken based on belief of nation in which business is operation
decision making is decentralised & key personnel need to be recruited from nation being targeted
recruitment = difficulty = loss of control of marketing operation
local knowledge used in marketing
factors influencing choice of approach/success of approach of EPG model
- nature/type of product
- target location
- brand objs
- product positioning (income elasticity)
- finance available
- size/status
- mass mkt product
- laws/regualtions
- connections with local market
Ansoffs matrix
marketing planning model that helps a business determine its product and market growth strategy
components of Ansoffs matrix
products (existing) (new)
market (existing) (new)
Market penetration existing & existing
Product development new & existing
Market development existing & new
Diversification new & new
(INCREASING RISK)
suggest series of possible growth strategies assessed against risk
suggest bus and their attempt to grow depends on market/product (new/existing)
Market penetration
sell existing products - existing markets (less investment)
main objs:
1. maintain/increase MS (price, adv,sales promo, personal sale)
2. securing dominance
3. restructuring mature markets (drive out competitors)
4. increasing usage/loyalty
-consolidation, withdrawal, do nothing
benefits: give comp adv, increase MS, least risky
limitations: difficult to grow, least lucrative
consolidation
focus on comp adv, may require efficiency gains
withdrawal
could require disposals if over extended
do nothing
especially in static market
product development
intro new products in existing market
suitable where differentiation aids competitiveness
modify/revamp/ completely new emphasise on R&D and innovation
customer insight/trends/ 1st to market (FMA)
benefits: new customer base, competitive/FMA, price skimming, differentiate
limitations: may not be a market, R&D costs risk of not recouping costs
market development
sell existing products in new market
ways of approaching MD:
-new geographical markets, new product aspect/ packaging/ distribution channels
-differnet pricing strategies/policies = attract new market
benefits: established bus/product -FMA, higher sales vol
limitations: high costs from market research
diversification
business markets new products in new markets
riskiest = little/no experience (related/unrelated)
new clear idea of gains/accurate assessment of risk
potential high returns achieved through integration/growth
benefits: highly lucrative if works, spread risk
limitations: most risky, time to recoup costs from research & R&D
