Overview of Marketing o Marketing = The process of planning and executing the conception, pricing, promotion, and distribution (PPPP)

) of products (ideas, goods, and services) to create exchanges that satisfy individual and organization goals = satisfy customer wants/needs/demands with products and services that offer competitive value. = one of the functional areas of a business (e.g. marketing, finance, operations, etc.) = one of the activities that comprise a firm's value chain. Value Chain = Marketing + R&D + Product design + Manufacturing + Transportation logistics + other activities = value for customers Emphasis must be on the effective coordination of Marketing with the other functional areas of the business Boundaryless Marketing = Ensuring a marketing orientation permeates all value-creating activities in a company = Eliminate communication barriers between marketing and other functional areas. Marketing Mix = PPPP = Product + Price + Promotion (= Communication) + Placement (= Distribution) Marketing orientation = Marketing orientation = Marketing concept = Consumer focus = A marketing oriented firm is one that allows the wants and needs of customers and potential customers to drive all the firm's strategic decisions. The firm's corporate culture is systematically committed to creating customer value.
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Value = perceived value for the customers = Benefits / Price = (Product + Promotion + Distribution) / (money + time + effort + etc.) To increase the customer's perceived value: Improve the bundle of benefits (product, channels of distribution, communication strategies) Lower prices (cut costs to lower prices - cheap raw materials, low-wage labour, process efficiencies in manufacturing) Lower nonmonetary costs for customers (time and effort to learn about or seek out the product) Strategic Focus = the concentration of resources on a core business or core competence Refocusing = change corporate culture, alliances, mergers, acquisitions, divestitures, combining (folding into other) businesses, etc. Competitive Advantage = the result of a match between a firm's distinctive competencies and the factors critical for creating superior customer value in an industry measured relative to rivals in a given industry

Definition of Global Marketing o Globalization = the transformation of formerly local or national industries into global ones Segmentation Targeting local national international multinational transnational = global o Global Industry = an industry in which competitive advantage can be achieved by integrating and leveraging operations on a worldwide scale. How global is that industry? = interdependence of a company's industry position in one country with its industry position in other countries = ratio of cross-border trade to worldwide production = ratio of cross-border investment to total capital investment = proportion of industry revenue generated by companies that compete in all key world regions "the same global bazaar that allows consumers to buy the best that the world can offer also allows producers to find the best partners" (p. 5) o Global Marketing = attention to (Customer Value, Competitive Advantage, Focus) on a worldwide basis and the use of SWOT - with a global focus o Paradox - global marketplace / local markets o Survival = A company that fails to understand the importance of global marketing risks losing its domestic business to competitors with lower costs, more experience, and better products. Choosing not to participate in global markets is no longer an option. o Customer Value = configure the value chain on a global basis o Global Opportunities - Companies that fail to pursue global opportunities risk being pushed aside by stronger global competitors Strategy of Global Marketing = GMS = Global Marketing Strategy = see page 8 Strategy depends on industry conditions and the company's sources of competitive advantage. 1. Participation in global markets = Target globally 2. Marketing Mix Development = adapt or standardize for each element in PPPP standardization = extension - (for each element in PPPP) = executed in the same way = homogeneous products = "one size fits all" everywhere localization = adaptation - (for each element in PPPP) = executed in different ways = customization global localization = "think globally and act locally" = keeping both perspectives in mind simultaneously
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Concentration = one/few/many countries Coordination of cross-border marketing activities

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Integration of competitive moves = the extent to which a firm's competitive marketing tactics in different parts of the world are interdependent.

Importance of Global Marketing o USA = 25% of world market for all products and services o global expansion is the key to growth for many companies Management Orientations = EPRG framework o Ethnocentric orientation = "my home country is superior" = national arrogance = assume that products and practices that succeed in the home country will be successful anywhere = ignore opportunities outside the home country National = domestic companies International = standardization = extension = no adaption = extend the elements of the marketing mix o Polycentric orientation Multinational = opposite of ethnocentric = assumption that each country is unique = no central control in its marketing management PPPP is adapted and localized by country managers operating autonomously = localization = adaptation o Global and Transnational companies are either Regiocentric, Geocentric, or Both Management uses a combination of standardized (extension) and localized (adaption) elements in the marketing program. Decisions are made on the basis of ongoing research into market needs and wants. Global operations are fully integrated and coordinated. Regiocentric orientation = having a world view on a regional scale integrated strategy for a particular geographic area - e.g. NAFTA, ECU Geocentric orientation company seeks global markets = the world = stateless world view = the entire world is a potential market so the company develops integrated world market strategies a synthesis of ethnocentrism and polycentrism = create a global strategy that is fully responsive to local needs and wants Forces affecting Global Integration and Global Marketing o Driving Forces Regional Economic Agreements NAFTA, ECU GATT, WTO Converging Market Needs and Wants create global markets serve global markets Information Revolution Internet = the democratization of information

Transportation and Communication Improvements Telephone, Satellite, TV, Internet, e-mail, fax, video teleconferencing, wi-fi Airlines, tourism, containers Product Development Costs No single market is large enough to support investments of this size, so global marketing is unavoidable e.g. pharmaceuticals, recorded music, movies Quality R&D = Research & Development Uniformity can drive down research, engineering, design, and production costs across business functions No single market is large enough to support investments of this size, so global marketing is unavoidable e.g. automobiles World Economic Trends economic growth in developing countries - i.e. less resistance to the entry of foreign firms slow growth in industrialized countries - i.e. need to look abroad for growth worldwide movement toward free markets, deregulation, and privatization Leverage = an advantage = experience that allows the company to conserve resources (expend less time, less effort, less money) Experience Transfers = draw upon management practices, strategies, products, advertising appeals, or sales or promotional ideas that have been market tested in one country or region and apply them in other comparable markets Scale Economies = greater manufacturing volume Economies of staffing = eliminating duplicate positions or by centralizing functional activities Resource Utilization = find human resources, financial resources, raw resources anywhere in the world Global Strategy Scan the world business environment to identify opportunities, trends, threats, and resources. Leverage its skills and focus its resources to create superior perceived value for customers and achieve competitive advantage The reward is not just success, it's survival. Restraining Forces Management Myopia and Organizational Culture management ignores global opportunities - nearsighted, ethnocentric need to integrate global vision and perspective with local market initiative and input National Controls = protection of local commercial interests

Tariff barriers monopolies (electricity, communications and data, agriculture products, etc.) Non-tariff barriers = NTBs "buy local" campaigns food safety rules laws and regulations and other bureaucratic obstacles Opposition to Globalization globaphobia = an attitude of hostility toward trade agreements, global brands, or company policies that appear to result in hardship for some individuals or countries while benefiting others.