Concepts and Principles of International Management

Yasser Iqbal

What is Marketing?
Activity: In groups of 2/3 discuss what do you think marketing means?
Think of some examples of marketing from your own experiences

Is This Marketing?
A retail bank offering new customers a bonus interest rate for an introductory period if they open an account.
A grocery chain rewarding customers with points and money off vouchers for repeat purchasing over a period of 3 months. A limited edition product.

Is this Marketing?
A landscape gardener receiving year-on-year repeat business from an established customer base which grows only through word-of-mouth from satisfied customers. A charity producing a newsletter for its volunteers. A law firm sending one of its staff to work in a museum for one day every week.

What is your worst ever experience of marketing?

What was the product? How was it promoted? How was it distributed? Where did you receive it? How easy was it to access/obtain? Did you complain? If so, what was their response? Did you/would you repeat purchase? How many people have you told about this?

A Definition of Marketing
Marketing is a culture, an organizational function and a set of processes for creating, communicating, and delivering value with customers and for interacting in networks of relationships in ways that benefit the organization, its customers and other stakeholders
(Gummesson, 2008:14)

Chartered Institute of Marketing

Management process Giving customers what they want Identifies and anticipates customer requirements Fulfils customers requirements profitably

Marketing rules of thumb

Life time value how much we spend over a period of time.

Economically, it is less costly to retain a customer than to find a new one. Pareto 80/20 Rule 1 unhappy customer tells 8 to 10 others of their negative experience For every one complaint we receive there are ten others we do not receive Mass mail and media advertising is economically inefficient (high costs, low response rates typically 2%)
(Gray and Byun, 2003)

The Marketing Concept

To anticipate customers needs and solve their problems profitably
Blythe (2009, p.193)

The Brand
An important concept in marketing
A bundle of values associated with a product or service A successful brand is an identifiable product, service, person or place, augmented in such a way that the buyer or user perceives relevant, unique added values which match their needs most closely. Furthermore, its success results from being able to sustain those added values. (DeChernatony and McDonald, 1998)

Branding
The process of developing a specific set of identifying marks, symbols and perceptions to distinguish one product from competing products in the same market.
Communicating the essence of your business. (Blythe, 2009, p.163)

The Marketing Mix

The Marketing mix is the group of activities undertaken by marketers to create and encourage exchanges with customers and consumers. Jim Blythe (2009). The basis of the concept is that marketers have various tools at their disposal for encouraging exchanges: these tools can be combined to create an overall mix that targets consumers efficiently and effectively.

The 7 Ps
1. 2. 3. 4. 5. 6. 7. Product Price Place Promotion People Process Physical Evidence

The 7 Ps
Product - The product or service offered. Price - The cost to the customer adopting the product. Place - The physical location where exchange takes place and the related distribution network of getting the product or service to the location. Promotion - The marketing communication package used to generate awareness of the product or service. People - Human resources participating in marketing activities. Full-time and Part-time. Process - The activities involved in getting the product from supplier to the customer. In service the activities such as ordering, receiving and returns. Physical Evidence - Related to the collection of evidence captured as a result of the transaction taken place. Servicescape the environment where the service is assembled.

1. The Product (or service)

The bundle of benefits that the seller offers and the customer receives. The particular set of benefits on offer will appeal to a specific group of customers
(Blythe,2009 pg 130)

Products, products everywhere.

AUGMENTED PRODUCT
INSTALLATION

Product levels
PACKAGING FEATURES

BRAND NAME

DELIVERY
& CREDIT QUALITY

CORE BENEFIT OR SERVICE

AFTERSALE SERVICE

STYLING

WARRANTY

ACTUAL PRODUCT

CORE PRODUCT

Tangible (Actual) Product

Style MINI brand Alloys Aircon Bonnet stripes Colour Upholstery

Core Product
Personal transportation Fashionable / iconic

Augmented product
MINI TLC MINI finance MINI insurance

After-sales care
Warranty MINI passport

The Business Product lifecycle

Illustrates the changes that may take place during the time that a product is on the market.
(Jobber and Fahy)

Research & Development Introduction Growth Maturity Decline Termination

The Business Product lifecycle

The Business Product lifecycle

Research & Development: exploring customers needs, market niches, innovative ideas. Introduction: new product, new market. Creating awareness and product trials. Growth: Increasing market share, developing brand preference. Maturity: Sales will eventually peak and stabilise, similar/improved competitor products. Retain market position through marketing communication, refreshing product. Decline: Product demand falls new technology, change in consumer trends. Little or no investment. Termination: Production being terminated.

The Business Product lifecycle

Try and think of examples of Products that are in: Growth Maturing Declining Terminated
Coca cola exercise.

Globalisation
Globalization: Trend toward greater economic, cultural, political and technological interdependence among national institutions and economies. The trend is a result of national boundaries becoming less relevant (denationalization) and different entities cooperating more actively across national boundaries (internationalization).
http://globalmarketingtoday.wordpress.com/about/what-is-global-marketing/

International Marketing International Marketing: When external marketing

becomes increasingly more important and successful for the business, they will begin seeking new sources of growth and profit. New countries serve as new markets, thus international marketing begins. International Marketing is approached by concentrating product and promotional strategy to a given foreign market.
http://globalmarketingtoday.wordpress.com/about/what-is-global-marketing/

International Marketing
The export, franchising, joint venture or full direct entry of a marketing organization into another country. Exporting a company's product into another location, entry through a joint venture with another firm in the target country.

Global Marketing
Global Marketing involves marketing activities by firms that do each of the following: Standardize their marketing programs: Allow marketing efforts to seamlessly operate across country borders. Standardization ensures products, promotions, price and channel structure cooperate together to increase opportunity and effectively meet the needs of global customers. Coordinate across markets: Businesses eliminate cost inefficiencies and reduce duplicate business efforts of their national/regional divisions. Practice Global Integration: This involves playing a role in many different world markets that are relevant to the business. Integrating firm operations means some markets use the resources of others to achieve success and vice-versa. It also involves balancing responses to competitive attacks in all areas.

http://globalmarketingtoday.wordpress.com/about/what-is-global-marketing/

Why should I, or my business care?

Marketing is the balance between customers and competitors. In todays age, that balance exists on a MUCH bigger scale, hence the increasing popularity of global marketing. Think about the number of businesses, brands that have entered the developing economies in the last 5-10 years

The Marketing Mix in a Global Context

PRODUCT Specifications Size/Packaging Product Launch POSITIONING Target Segments Value Proposition BRAND Name Image Advertising PRICE DISTRIBUTION Global Brands/Local Brands Communication messages Single/multiple agencies Global Pricing/multiple High End/Low end Same across the world/Country segment specific Standardization/Adaptation Waterfall/Sprinkle

Target Segments Value Proposition SERVICES

Call Centres After Sales

High End/Low end Same across the world/Country segment specific

Centralized/Decentralized

Product
Positioning Brand name Core Product Ingredients

Advertising TV
Concept Execution

Advertising Print
Concept Execution

Pricing Packaging Sales Promotion Public Relations Distribution

= Global standardization

Product Launch
Waterfall
Launch In Country of Origin Launch in Countries , Region A Launch in Countries, Region B Launch in Countries , Region C Time Launch In Country of Launch in Countries , Origin Region A Launch in Launch in Countries , Countries , Region B Region C

Sprinkle

What Determines the Choice?

Supply
Costs (Economies of Scale)

Demand
Market Segmentation Across Countries Existence of a Significant Global segment across Countries Market Segmentation Within Countries

Competition Companies Capabilities Companies Identity and brand integrity

Existence Significant Differentiated within countries

Cokes 232 Brands

Japan

Argentina

Brazil Chile Ecuador

India

China

El Salvador

Taiwan Philippines Germany South Africa

Mexico

Japan

Global Brands

Advantages
Concentration of Resources
Targetted Impact Cross border Learning Motivation for Recruitment Quality Management

Disadvantages
Over Standardization Ignorance of level of market development Skimming the surface Rigid implementation