Global marketing decisions Flashcards
Marketing deals with ?
Standadization or adaptation of branding, products and price
Explain the AAA-framework by Ghemawat?
Bases upon a semi-global world:
Adaptation: seeks to boost revenues
and market shares by maximizing a
firm’s local responsiveness (downstream)
Aggregation: To achive scale and scope economies through standadization. Coordination of operations by region. (downstream)
Arbitrage: is the exploitation of differences between national or regional
markets, often by locating separate parts of the supply chain in different places (upstream)
Mention the three levels of the products
We are interested in which of these should be standadized/adapted.
Support services (delivery, after-sale services)
Product attributed
(brand name, design, price)
Core product
(percerived value, technologye etc)
Authors to know on global marketing:
Ghemawat: AAA-framework and semi-globalization
Theodosiou M,
Explain Theodosiou M conclusion on firm performance by standaardization or adaptation
The underlying question concerning which strategic option,
standardization or adaptation, is the most suitable for the
international firm remains an essentially unresolved and
inconclusive issue
Why are pricing decision important regarded to adaptation/standardization?
Adapted products should have adapted market prices. Standadized products shouls also have adapted prices (refers to the consumers, but also taking into account tariffs, transportations etc).
Refers to custumer segments, brand-value, competition, it is all about marketshare you can charge premium prices,
Law of demand: The lower the price, the higher the marketshare. If you are first-mover you put the product on the market for a low price to gain high market share, then you raise price over time.
How is entry mode related to pricing decision?
Non-equity mode: potentially lower sales margin due to agent cost -> final sales price is higher.
If export mode:
Importer (agent), wholesaler, retailer, consumer. (all have a mark up %).
If equity mode: Less channels to go through.
Decision whether the end price is fixed or variates over market. It it is fixed for the consumer, the firm has different profit margin per product. The difference comes from GDP per capita in a certain country, tariffs, registration fees,. The supplier can also decide if it wants a certain price per item to avoid getting different sales margins in different countries
Which factors determine pricing decisions?
Firm-level factors:
Firm positioning
Product factors:
Quality, service
Environmental facotrs:
Tax, inflation, government influence
Market factors: Custumers perspecteion (needs, tastes), Custumers abiilty to pay, competition
