Lnternational marketing. Global market strategy. (Chapter 6)

1.

lnternational Marketing
Chapter 6
Global market strategy

2.

• Global marketing strategy – overview
• Global market segmentation
• Global targeting
• Global product positioning
• Entry and expanison strategies

3.

A. Global marketing strategy
A strategy is a plan of action
designed to achieve a particular goal.
A marketing strategy is a process that can allow an
organization to concentrate its limited resources on
the greatest opportunities to increase sales and
achieve a sustainable competitive advantage.
It should be centered around the key concept that
customer satisfaction is the main goal.

4.

Corporate’ strategic planning
It is an organization's process of defining its strategy,
or direction, and making decisions on allocating its
resources to pursue this strategy, including its capital
and people.
Set mission statement
Situational analysis (SWOT)
Set objectives
Targeting

5.

1. Mission Statements
A company's mission statement is a constant
reminder to its employees of why the company
exists and what the founders envisioned when
they put their fame and fortune at risk to breathe
life into their dreams.

6.

To Bring inspiration and innovation
to every athlete in the world.
Serving the sports and athletic industry, NIKE Inc is
known for manufacturing shoes, gear and apparel,
particularly for athletes in a whole range of sports
such as baseball, golf, tennis, football, etc.

7.

To make people happy

8.

• No cynicism
• Nurturing and promulgation of "wholesome
American values"
• Creativity, dreams and imagination
• Fanatical attention to consistency and detail
• Preservation and control of the Disney "magic"

9.

"To give ordinary folk the chance to buy
the same thing as rich people."

10.

"To experience the joy of advancing and
applying technology for the benefit of the public."

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2. SWOT Analysis
Strengths
Weaknesses
Opportunity
Threats

12.

• Strengths: attributes of the organization that are
helpful to achieving the objective.
• Weaknesses: attributes of the organization that are
harmful to achieving the objective.
• Opportunities: external conditions that are helpful to
achieving the objective.
• Threats: external conditions which could do damage
to the business's performance.

13.

CASE

14.

3. Set objective
Specific
Measurable
Achievable
Relevant
Time defined

15.

4. Targeting
STP
Segmentation
Targeting
Positioning

16.

B. Global market segmentation
The process of subdividing a market into
distint subsets of customers that behave
in the same way or have similar needs.

17.

18.

1.Geographic segmentation
Dividing the world into geographic subsets
country
weather
Population
Labor
Transtion

19.

2. Demographic segmentation
Age
Gender
Income
Education
Occupation
Social class
Region

20.

21.

• Poundland is a British-based variety store chain
which sells every item in its stores for £1
• Poundland, unlike many of its rivals, have been one
of the few to report strong sales in a time of economic
crisis, with 2012-2013 revenue expected to reach
£400m

22.

• Poundland boast a loyal customer base, with
roughly 2 million predominantly female shoppers
every week . Poundland also attract students and the
elderly who typically watch their budgets and look
for bargains.
• The retailer has been keen in recent years to move
away from their reputation of only appealing to lowincome households, as they continue to expand into
mainstream shopping centres and districts, with an
increasing number of higher earning consumers in the
market for a bargain.

23.

10-
10-29
30-50
50+

24.

C. Psychographic segmentation
Attitudes
Values
Lifestyle
Purchase occasion

25.

D. Behavior segmentation
Wether people buy and use a product
When to but the product
Usage rate (Heavy,medium,light,nonuser)
User status (Potential user,nonusers,exusers,regulars,first-timers)
• brand loyalty

26.

CASE

27.

VS

28.

CCTV
CCTV1
CCTV2
CCTV3,11
CCTV4,9
CCTV5
CCTV6,8
CCTV7
CCTV10
CCTV12
CCTV13
CCTV14

29.

BBC
0 6: CBeebies
6 12: CBBC
16 34
1.BBC1
2.BBC2
3.BBC3
4.BBC4
5.BBCNews

30.

31.

C. Global targeting
Targeting is the second stage of
the STP process. After the
market has been separated into
its segments, the marketer will
select a segment or series of
segments and 'target' it/them

32.

1.Undifferentiated marketing
A market-coverage strategy in which a firm decides to
ignore market segment differences and go after the
whole market with one offer .

33.

2. Differentiated marketing strategy
The firm decides to target several segments and
develops distinct products/services with separate
marketing mix strategies aimed at the varying groups.

34.

CASE 1

35.

CASE 2
Airline companies offering first, business
(segment 1) or economy class tickets (segment 2) ,
with separate marketing programmes to attract the
different groups.

36.

3. Concentrated Marketing
The organisation concentrates its marketing effort on
one particular segment.

37.

D.Global product positioning
After the organisation has selected its target market,
the next stage is to decide how it wants to position
itself within that chosen segment. Positioning refers
to ‘how organisations want their consumers to see
their product’.

38.

CASE 1

39.

• Super-luxury marque,sells barely 800 cars a year .
The company's target customers are people with
liquid assets worth at least $30m, a group
Capgemini estimates numbers about 85,000
worldwide.
• The marque's main point of contact with existing
and potential customers is through its 74
independently owned dealerships worldwide. It
chooses dealers who “live in the same world,
drive the same cars, have the same yachts and
aircraft” as its customers .

40.

• Last year, Mr Robertson personally signed letters
to all of its 2,700 customers of the past three years,
and sent out a coffee-table album to the cars'
former owners. The book features individual
testimonials from buyers such as Japanese fashion
designer Nigo, now on his third Phantom.

41.

CASE 2

42.

CASE 3

43.

CASE 4

44.

CASE 5
"man always remember love because of
romantic only"

45.

46.

E.Entry and expansion strategies
When an organisation has made a decision to enter an
overseas market, there are a variety of options open to
it. These options vary with cost, risk and the degree
of control which can be exercised over them.

47.

1. Exporting
Exporting is the most traditional and well established
form of operating in foreign markets.
It can be defined as the marketing of goods produced in
one country into another. Whilst no direct
manufacturing is required in an overseas
country,significant investments in marketing are
required.

48.

• Exporting requires a partnership between exporter,
importer, government and transport. Without these
four coordinating activities the risk of failure is
increased. Contracts between buyer and seller are a
must.

49.

CASE

50.

Advantages:
Manufacturing is home based thus, it is less risky
than overseas based
Gives an opportunity to "learn" overseas markets
before investing in bricks and mortar
Reduces the potential risks of operating overseas.
• Disadvantage:
overseas agents , lack of control

51.

2. Licensing
Licensing is defined as "the method of foreign
operation whereby a firm in one country agrees to
permit a company in another country to use the
manufacturing, processing, trademark, know-how or
some other skill provided by the licensor".

52.

Advantages
• Good way to start in foreign operations and open
the door to low risk manufacturing relationships
• Capital not tied up in foreign operation
Disadvantages:
• Licensees become competitors

53.

54.

3. Franchise
A franchise business is a method a company uses to
distribute its products or services through retail
outlets owned by independent, third party operators.
The independent operator does business using the
marketing methods, trademarked goods and services
and the "goodwill" and name recognition developed
by the company. In exchange, the independent
operator pays an initial fee and royalties to the owner
of the franchise.

55.

• An individual who purchases and runs a franchise
is called a “ franchisee”. The franchisee purchases a
franchise from the “franchisor.”
• The franchisee must follow certain rules and
guidelines already established by the franchisor, and
the franchisee must pay an ongoing franchise royalty
fee, as well as an up-front, one-time franchise fee to
the franchisor.

56.

57.

Businesses with a good track record of profitability.
Businesses with broad geographic appeal.
Businesses which are relatively easy to operate.
Businesses which are relatively inexpensive to
operate.
• Businesses which are easily duplicated

58.

59.

• Shanghai GM is a joint venture between GM and
SAIC Motor that manufactures and sells Chevrolet,
Buick, Cadillac, and Opel brand automobiles in
mainland China.
• It was founded on June 12, 1997 with 50%
investment each from each partner. In February
2010, SAIC acquired an additional 1% stake in the
joint venture for US$85 million and assistance in
securing a US$400 million line of credit to boost
SAIC's total share of Shanghai General Motors to
51% .

60.

4. Joint ventures
• Joint ventures can be defined as “an enterprise in
which two or more investors share ownership and
control over property rights and operation”.
• Joint ventures are a more extensive form of
participation than either exporting or licensing.

61.

CASE

62.

• Xi’an Jiaotong – Liverpool University (XJTLU)
is a new international university jointly founded
by Xi’an Jiaotong University China and the
University of Liverpool UK as a joint venture.
• The University offers undergraduate degree
programmes and awards both its own Chinese
degree and a degree from the University of
Liverpool.

63.

• As part of its goal to offer a unique international
educational experience, XJTLU students can
transfer to complete part of their studies in
Liverpool via a range of options.
• Programmes are commonly referred to (n+m)
where n years of study will be in XJTLU and m at
the University of Liverpool. 2+2 or 4+1.

64.

Advantages
• Sharing of risk and ability to combine the local indepth knowledge with a foreign partner with knowhow in technology or process
• Joint financial strength
• May be the source of supply for a third country.

65.

Disadvantages:
• Partners do not have full control of management
• May be impossible to recover capital if need be
• Partners may have different views on expected
benefits.

66.

5. Ownership
The most extensive form of participation is 100%
ownership and this involves the greatest commitment
in capital and managerial effort.
The ability to communicate and control 100% may
outweigh any of the disadvantages of joint ventures
and licensing. However, as mentioned earlier,
repatriation of earnings and capital has to be carefully
monitored. The more unstable the environment the
less likely is the ownership pathway an option.

67.

6. Merger & acquisition
Mergers and acquisitions (M&A) are both an
aspect of corporate strategy, corporate finance and
management dealing with the buying, selling,
dividing and combining of different companies
and similar entities that can help an enterprise
grow rapidly in its sector or location of origin, or
a new field or new location, without creating a
subsidiary, other child entity or using a joint
venture.

68.

• A merger is a legal consolidation of two
companies into one entity.
• An acquisition is the purchase of one business or
company by another company or other business
entity. Such purchase may be of 100%, or nearly
100%, of the assets or ownership equity of the
acquired entity (in which case the target company
still exists as an independent legal entity
controlled by the acquirer).

69.

CASE 1

70.

• The marriage between Geely and Volvo, largely a
result of the global economic recession, is definitely
a milestone in the development of not only the two
companies but the Chinese auto industry.
• It marks the largest acquisition of an overseas
carmaker by a Chinese company, and is China's
biggest foray into the ownership of a big luxury brand.
Geely's move is seen as emblematic of the shift in the
global car industry's center of gravity from the US
and western Europe to China.

71.

CASE 2

72.

Summary
• Global market segmentation: Geographic
segmentation; Demographic segmentation;
Psychographic segmentation;Behavior segmentation
• Global targeting
• Global product positioning
• Entry and expanison strategies: Exporting; Licensing;
Franchise;Joint ventures;Ownership

73.

Reference
• 海尔的营销策略 孙健 企业管理出版社
• 经营战略 哈佛商学院MBA课程 阿尔弗雷德.
钱德勒 中国国际广播出版社
• http://www.infofranchise.cn/ (特许经营信息
• http://www.ftchinese.com/(海外并购新闻案例