Ch 1 Flashcards
What are some of the trade preference programs that the U.S. government uses to assist countries?
(unsure)
Generalized Systems of Preference (GSP)
- renews/ decade
Caribbean Basin Economic Recovery Act
- updated version of GSP
-17 countries
-no expiration authorized until Sep 30,2030
Andean Trade Promotion + Drug Eradication Act
What is “Most-Favored Nation (MFN)” treatment in international trade?
Obtaining the lowest tariffs
What are some of the reactive reasons that drive companies to market their products internationally?
Reactive:
- Responding to unsolicited offers from abroad
- Loss of domestic competitiveness
- Defensive purposes (foreign competition)
What are the uncontrollable environments in international marketing? How do they differ from domestic marketing?
International mkt:
- Political/ legal forces
- Cultural forces
- Geography + infrastructure
- Structure of distribution
- Level of technology
- Competitive forces
- Economic forces
Domestic mkt: same except for
- Economic climate
- Competition
Differ:
In the environment (consider domestic AND environmental forces in each one of their foreign markets)
What is the self-reference criterion (SRC)?
An unconscious reference to one’s own cultural values, experiences, and knowledge as a basis for decisions.
What is Ethnocentrism?
The notion that one’s own culture or company knows best how to do things
What are the 5 stages of international marketing involvement and what do companies do at each stage?
- No direct foreign mkt
- Infrequent foreign mkt
3.Regular foreign mkt - Multidomestic
- Global
What are the 3 different strategic orientations in international marketing and the firm classifications they represent?
1.Domestic mkt extension–> ethnocentric
2. Multidomestic mkt–> polycentric
3. Global mkt–> regiocentric or geocentric
What is the Value Chain and how do global companies optimize it?
Series of operations that a company does to deliver value to its customers
- Optimize value of chain: global mkt
- Assign each element of value chain to the subsidiary that does it best
What are some of the proactive reasons that drive companies to market their products internationally?
- Expanded mkt potential + growth
- Geographic diversification to spread risk
- Economies of scale + optimal productivity
- Product at end of its life cycle
- Overseas markets as source of new products, ways of doing business
What is domestic mkt extension orientation?
More important
int. is an extension of this
USES EXPORTING
Firm classification: ethnocentric
What is ethnocentric classification?
Home country is superior, management sees SIMILARITIES in foreign countries to domestic mkt
What is multidomestic- International mkt orientation?
Each foreign country is DIFFERENT
requires separate mkt strategies
SETS UP FOREIGN SUBSIDARIES (BRANCHES)
firm classification: polycentric
What is polycentric classification?
Mkt strategy MUST be adapted to local country mkts
What is global mkt orientation?
ENTIRE world is a potential mkt
many similarities + differences
Firm classification: regiocentric or geocentric
What is regiocentric/ geocentric classification?
Managers look for global mkts with SIMILAR needs + try to standardize to a global basis
USES OPTIMIZATION of the VALUE CHAIN
What do you do during the 1st “no direct foreign mkt” stage of international mkt involvement?
Purely domestic company
Not interested in foreign mkt
Can engage in INDIRECT mkt
What do you do during the 2nd stage, “infrequent foreign mkt” of international mkt involvement?
take inquiries from foreign mkts
involvement: exporting
What do you do during the 3rd stage “regular foreign mkt” of international mkt involvement?
Set up foreign mkt department
regularly exporting overseas
What do you do during the 4th stage “mulidomestic- international mkt” of international mkt involvement?
foreign plants are self-reliant
