Chapter 16

Question 1

What is a global firm?

Answer 1

A firm that, by operating in more than one country, gains R&D, production, marketing, and financial advantages in its costs and reputation that are not available to purely domestic competitors.

Question 2

What are major international marketing decisions?

Answer 2

1) Looking at the global marketing environment
2) Deciding whether to go global
3) Deciding which markets to enter
4) Deciding how to enter the market
5) Deciding on the global marketing program
6) Deciding on the global marketing organization

Question 3

What is the economic community?

Answer 3

A group of nations organized to work toward the common goal in the regulation of international trade.

Question 4

Which types of industrial structures are there?

Answer 4

1) Subsistence economies: Majority of people engage in simple agriculture
2) Raw material exporting economies: Rich in one or more natural resource and most of the revenue comes from exporting it.
3) Emerging economies: Fast growth in manufacturing results in rapid economic growth
5) Industrial economies: Major exporters of manufactured goods, services, and investment funds.

Question 5

Which market entry strategies are there?

Answer 5

Exporting (Direct/ Indirect)
Joint venturing (Licensing, contract manufacturing, management contracting, joint ownership)
Direct investment (Assembly facilities, Manufacturing facilities)

Question 6

What is exporting?

Answer 6

Entering foreign market by selling goods produced in the company’s home country, often with little notification.

Question 7

What is joint venturing?

Answer 7

Entering foreign market by joining with foreign companies to produce or market a product or service.

Question 8

What is licensing?

Answer 8

Entering foreign markets through developing an agreement with a licensee in the foreign market.

Question 9

What is contract manufacturing?

Answer 9

A joint venture in which a company contracts with manufacturers in a foreign market to produce its product or provide its service.

Question 10

What is management contracting?

Answer 10

A joint venture in which the domestic firm supplies the management know-how to a foreign company that supplies the capital; the domestic firm exports management services rather than products.

Question 11

What is joint ownership?

Answer 11

A cooperative venture in which a company creates a local business with investors in a foreign market, who share ownership and control.

Question 12

What is the direct investment?

Answer 12

Entering a foreign market by developing foreign-based assembly or manufacturing facilities.

Question 13

What is standardized global marketing?

Answer 13

An international marketing strategy that basically uses the same marketing strategy and mix in all of the company’s international markets.

Question 14

What is adapted global marketing?

Answer 14

An international marketing approach that adjusts the marketing strategy and mix elements to each international target market, which creates more costs but hopefully produces a larger market share and return.

Question 15

What is straight product extension?

Answer 15

Marketing a product in a foreign market without making any changes to the product.

Question 16

What is product adaptation?

Answer 16

Adapting a product to meet local conditions or wants in foreign markets.

Question 17

What is product invention?

Answer 17

Creating new product or services for foreign markets.

Question 18

What is a communication adaption?

Answer 18

A global communication strategy of fully adapting advertising messages to local markets.

Question 19

What is whole-channel view?

Answer 19

Designing international channels that take into account the entire global supply chain and marketing channel, forging an effective global value delivery network.