Read the summary and the most important questions on Introduction competing on a global basis

• 1 introduction, competing on a global basis

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• What major decisions in international marketing can be identified?

  - Deciding whether to go abroad

  - Deciding which markets to enter

  - Deciding how to enter the market

  - Deciding on the marketing program

  - Deciding on the marketing organization

• 2 Deciding whether to go abroad

• What are the reasons for going international?

  - Profitability increase

     Increasing potential market, hence business volume, or simply maintain it (when domestic customers went international).

  
  

  - Risk decrease

    Counteract against global cycles

    Reduce dependence on one market

  
  

  - Sustainability along time

    Learning from more developed markets

    Taking advantage of accumulated knowledge

  
  

  - Opportunistic; jump to the opportunity

  
  

  - In some industries global perspective is simply obligatory

• What are the risks of going abroad?

  - Company might not understand foreign preferences and could fail to offer a    competitively attractive product.

  - The company might not understand the foreign country's business culture

  - The company might underestimate foreign regulations and incur unexpected costs.

  - The company might lack managers with international experience

  - The foreign country might change its commercial laws, devaluate its currency or undergo a political revolution and expropriate foreign property.

• What are the most common mistakes in an internationalization process?

  - Starting exports without an intl. marketing plan or expert advice

  - Lack of commitment by senior management

  - Bad choice of distributors

  - Failure to adapt product to foreign markets

  - Failure to adapt advertising to foreign markets

  - Putting exports on ice when domestic sales pick up

  - Discriminating between domestic and foreign distributors

• What are the five key factors for success in getting a company international?

  - Market research; information is power. 

  - Product adaptability: ability to adapt

     Business orientations evolution is a cumulative process, not a substitution         one. 

     As is the product dimensions

  - Well-designed international Marketing plan

  - Sales promotion

  - Organization

• What are the factors affecting the form of international presence?

  - Company size

  - Track record and orientation; organization culture, strategic axis profile.

  - Industry structure and competitive dynamic

  - Type of product and stage in its life cycle

  - Financial capacity; own funds, capacity to take debt, skill in identifying and    
     obtaining public funds.

  - Entry barriers

• What are the key elements in an international marketing plan?

  - Two-fold time perspective; tactical and strategic

  - Segmentation; not only geographically based

  - Testing on consistency with marketing mix

  - Quantified objectives

  - Allocation of human and financial resources

  - Properly budgeted plans

  - Scenario-based cash flow simulations

  - Contingency plans

  - Forecast profits and loss account

• What are the differences between Global vs Local marketing strategies?

  - Market boundaries 

     - local; defined within borders. Customers and competitors of local origin.

     - global; transcend borders. Customer & /or competitors cross frontiers to         buy and sell

  - Differences on customers from different countries:

     - local: insignificant, segments defined locally

     - global; significant segments go across geographic frontiers

  - Competition arena

     - local: among primarilly local firms, on a country-by-country basis

     - global: diverse competitors, regional or global

  - Market interdependence; impact of competitive actions in one market:

     - local: no impact elsewhere

     - global: do impact other markets

  - Strategies scope & advantages of coordinating activities among markets

    - local: little

    - global (or regional) : great

• What four stages does the internationalization process consist of?

  1) no regular export activities

  2) export via independent representatives (agents) (creation export department)

  3) establishment of one or more sales subsidiaries (creation export department)

  4) Establishment of production facilities abroad (creation export department).

  
  

  After every step the investment and risk increases but also the earning potential.

• 3 Deciding which markets to enter

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• What three decisions need to be taken when deciding which markets to enter?

  - How many markets to enter

  - Developed vs developing markets

  - Evaluating potential markets