PESTLE & SWOT & Uppsala

Question 1

What are the two marketing environments?

Answer 1

1- Micro environment
2- Macro environment

Question 2

What is in the micro environment?

Answer 2

Actors close to the company that affect its ability to serve its customers

Question 3

Examples of actors in the micro environment?

Answer 3

Intermediaries
Suppliers
Publics
Competitors
Consumers

Question 4

What is the macro environment?

Answer 4

Larger societal forces that affect the microenvironment

Question 5

Examples of the macro environment?

Answer 5

Natural, economic, technological, political, demographic, and cultural factors

Question 6

What does PESTLE stand for?

Answer 6

Political
Economic
Social
Technological
Legal
Environmental

Question 7

Political environment?

Answer 7

• Trade tariffs (tax on the import or export of goods between countries. Tariffs are a form of foreign trade regulation )
• Fiscal policies
• Corruption
• Political stability
• Conflicts

Question 8

Economic ?

Answer 8

• Change in consumer spending
• Inflation
• Interest rates
• Big mac index
• Labour costs

Question 9

Social ? (2 sides to evaluate)

Answer 9

1. Demography
2. Culture
   - generational groups and needs
   - cultural barriers (core and secondary beliefs)
   - population growth

Question 10

Technological?

Answer 10

• Emerging technologies
• Product and distribution
• Impact on production
• New communication and sales channels
• Research and investment

Question 11

Legal ?

Answer 11

• regulation
• employment laws
• Regulatory bodies

Question 12

Environmental ?

Answer 12

• Climate
• Corporate Social Responsibility (CSR)
• Environmental policies

Question 13

What is SWOT?

Answer 13

• Created by Albert Humphrey in the 60’s
• An objective analysis / summary of the current internal and external environment of the firm

Question 14

What are the 2 internal analysis of the SWOT?

Answer 14

• Strengths
• Weaknesses

Question 15

2 external?

Answer 15

• Opportunities
• Threats

Question 16

Strengths?

Answer 16

Internal capabilities that may help a company reach its objectives

Question 17

Weaknesses?

Answer 17

Internal limitations that may interfere with a company’s ability to achieve its objectives

Question 18

Opportunities?

Answer 18

External factors that the company may be able to exploit to its advantage

Question 19

Threats?

Answer 19

Current and emerging external factors that may challenge the company’s performance

Question 20

What is the Internationalisation theory?

Answer 20

The Uppsala Model

Question 21

What is POS?

Answer 21

Point Of Sales

Question 22

FDI?

Answer 22

Foreign Direct Investment

Question 23

Internationalisation?

Answer 23

A firm’s internationalisation is the product of a series of incremental decisions–> gradually increase their international involvement (sequential process)

Question 24

According to Uppsala model

Answer 24

All firms start at low investment and fewer resources. And not only do the company extend to other markets but they also diversify their modes of operations by increasing their market commitment.

Question 25

What is the concept of "Learning"

Answer 25

Process of accumulating knowledge

Question 26

Why is the concept of "Learning" important?

Answer 26

It is a dynamic process where firms seek experimental knowledge about their clients and markets as well as the institutional elements of the foreign market.

Question 27

What is the opposite of Learning?

Answer 27

Psychic distance

Question 28

What is psychic distance?

Answer 28

Distance between the home market and a foreign market resulting from the perception and understanding of cultural and business differences.

Question 29

What does Psychic distance do?

Answer 29

It causes disturbance in the flow of information between the home market and a foreign market.

Question 30

Weaknesses of the Uppsala model

Answer 30

- Internationalisation is not always as a linear and incremental process (uppsala says there is no going back, but companies may have to leave a country) - Companies can combine different entry modes depending on the country - Born- global companies: early adopters of internationalisation- that is, companies that expand into foreign markets and exhibit international business prowess and superior performance, from or near their founding (ex: Spotify, Apple)

Question 31

Liability of Foreigness

Answer 31

Additional costs that a firm operating in market overseas incurs compared to a local firm--> Higher transportation, travel coordination costs --> A foreign firm’s lower familiarity with the market --> Lack of information networks or political influence in the host-country

Question 32

Liability of outsidership (new name for "liability of foreignness)

Answer 32

A firm’s problems and opportunities in international business are becoming less a matter of country-specificity and more one of relationship-specificity and network-specificity --> New knowledge is developed in relationships