Final Exam Definitions

Question 1

is a process of planning and conducting transactions across national borders to create exchanges that satisfy the objectives of individuals and organizations.

Answer 1

international marketing

Question 2

involves identifying needs and wants of customers, providing products and services to give the firm differential marketing advantage, communicating information about these products and services and distributing and exchanging them internationally through one or a combination of foreign market entry modes.

Answer 2

international marketing strategy

Question 3

total commitment to international marketing on a global scale

Answer 3

global marketing

Question 4

A powerful force drives the world towards a converging commonality, and that force is
technology. Companies must learn to operate as if the world were one large market – ignoring superficial regional and national differences.

Answer 4

globalization

Question 5

When accumulated volume in production results in lower cost price per unit

Answer 5

economies of scale

Question 6

the likelihood that a government or society will undergo political changes that negatively affect local business activity. It can threaten an exporter’s market, manufacturing facilities, and the ability to repatriate profits (Wild et al, 2006).

Answer 6

political risk

Question 7

The firm outsources the local marketing activities to an external partner (typically an agent, importer, or distributor).

Answer 7

export modes

Question 8

Somewhere in between using export modes (external partners) and hierarchical modes.

Answer 8

intermediate modes

Question 9

The firm owns and controls the foreign entry mode/organization.

Answer 9

hierarchical modes

Question 10

When the manufacturing firm does not take direct care of exporting activities, but rather another domestic company such as an export house or trading company.

Answer 10

indirect export

Question 11

When the producing firm takes care of exporting activities and is in direct contact with the first intermediary in the foreign target market.

Answer 11

direct export

Question 12

this involves collaborative agreements with other firms (export marketing groups) concerning the performance of exporting functions.

Answer 12

cooperative export

Question 13

independent company that stocks the manufacturer’s product. It will have to choose its own customers and price. It profit from the difference between its selling price and its buying price from the manufacturer.

Answer 13

distributor (importer)

Question 14

Independent company that sells on to customers on behalf of the manufacturer (exporter). Usually it will not see or stock the product, it profits from the commission paid by the manufacturer on the pre-agreed basis.

Answer 14

agent

Question 15

the licensor gives a right to the licensee against payment i.e. a right to manufacture a certain product based on a patent against some agreed royalty. The exchange of intangible property rights (patent,copyright,trademark,procedure) to another in exchange for payment.

Answer 15

licensing

Question 16

the franchisor gives a right to the franchisee against payment i.e. a right to use total business concept/system, including use of trade marks against some agreed royalty.

Answer 16

franchising

Question 17

An equity partnership typically between two partners. It involves two ‘parents’ creating the ‘child’ (the ‘joint venture’ acting in the market).

Answer 17

joint venture

Question 18

The standardization of international marketing strategy refers to using a common product, price, distribution and promotion program on a worldwide basis’

Answer 18

standardization

Question 19

is adjusting your marketing strategy to fit market requirements, market tailoring to fit the ‘unique dimensions’ of different international markets

Answer 19

adaptation

Question 20

refers to a firm standardizing several core elements of its marketing mix on a global scale such as, branding, AND localizing or adapting other elements of its marketing mix to local market requirements such as product modifications.

Answer 20

glocalization

Question 21

The summation of all cost factors in the distribution channel, including the firm’s net price, shipping costs, tariffs, and distributor mark-up is known as price escalation.

Answer 21

price escalation

Question 22

When resources can be reused from one business/country in additional business/countries, _____ occur.

Answer 22

economies of scope