Chapter 16

Question 1

Globalization

Answer 1

Increased (economic) activity among different parts of the world.

Question 2

Political and Legal factors

Answer 2

Tariffs (or duty) = Tax on imports by the host country.
Quotas
Trade sanctions = Penalties or restrictions for importing and exporting goods, services, and investments.
Boycott
Trade agreements = Inter-govt. agreements to promote and manage trade.

Question 3

Economic Factors

Answer 3

• General economic environment
• Trade Deficit or Trade Surplus
• GDP
• Purchasing Power Parity
• Human Development Index
• Market size and population growth
  Evaluating real income

Question 4

Socio-Cultural (HOFSETDE’s cultural factors)

Answer 4

• Power distance belief
• Uncertainty avoidance
• Individualism vs. Collectivism
• Masculinity-femininity
• Time orientation
• Indulgence

Question 5

Four key elements of a country’s infrastructure:

Answer 5

• transportation,
• distribution channels,
• communications
• commerce

Question 6

The appeal of BRIC countries

Answer 6

BRAZIL: Regional powerhouse + 8th largest economy + increasing literate and consuming population
RUSSIA: Growing internet savvy population + 6th largest economy + promising consumer market
INDIA: large consumer base (1.3 billion) + tech fueled + median age = 28.1 years + unorganized retail sector but intensive distribution
CHINA: manufacturing led growth + improving living standards + slowed population growth

Question 7

Choosing a global strategy

Answer 7

In order of least risk and control to most risk and control:
* direct investment
* joint venture
* strategic alliance
* franchising
* exporting

Question 8

Global Marketing Mix: Product

Answer 8

• Sell the same product or service in both the home country market and host country
• Sell a product or service similar to that sold in home country but include minor adaptations
• Sell totally new products or service

Question 9

Global Marketing Mix: Price

Answer 9

• Tariffs
• Quotas
• Anti-dumping
• Policies
• Currency Exchange Policies

Question 10

Global Marketing Mix: Communication / Promotion

Answer 10

• literacy levels
• language & need for adaptation
• cultural and religious differences also matter

Question 11

Ethical issues in global marketing

Answer 11

Environmental
Labor: child-labor, labor working in hazardous condition
Cultural impact: Lack of cultural understanding and how the marketing mix affects the local cultures and practices can wreak havoc