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MKT1002 > Lecture 20 The Global Marketplace > Flashcards

Lecture 20 The Global Marketplace Flashcards

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1
Q

What is an advantage of being a global firm?

A

Can gain marketing, production, R&D and financial advantages not available to purely domestic competitors

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2
Q

How do global firms see the world?

A

As one market

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3
Q

What are tariffs?

A

Taxes on certain imported products designed to raise revenue or to protect domestic firms

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4
Q

What are quotas?

A

Limits on the amount of foreign imports a country will accept in certain product categories to conserve on foreign exchange and to protect domestic industry and employment

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5
Q

What are exchange controls?

A

A limit on the amount of foreign exchange and the exchange rate against other countries

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6
Q

What are nontariff trade barriers?

A

Biases against bids or restrictive product standards that go against American product features

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7
Q

What does GATT stand for?

A

General Agreement on Tariffs and Trade

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8
Q

How old is GATT?

A

61 years

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9
Q

What is the aim of GATT?

A

To promote world trade

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10
Q

How does GATT work?

A

It reduces tariffs and other international trade barriers

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11
Q

What does WTO stand for?

A

World Trade Organisation

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12
Q

What does WTO do?

A

Enforces GATT rules
Mediates disputes
Imposes trade sanctions

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13
Q

What are regional free-trade zones?

A

These are economic communities formed by certain countries

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14
Q

Give 4 examples of regional free-trade zones

A

EU
NATFA
CAFTA
UNASUR

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15
Q

What does CAFTA stand for?

A

Central American Free Trade Agreement

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16
Q

What does UNASUR stand for?

A

Union of South American Nations

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17
Q

What two economic affect a country’s attractiveness as a market?

A

Industrial structure

Income distribution

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18
Q

What are the different types of industrial structure?

A

Subsistence economies
Raw material exporting economies
Emerging economies
Industrial economies

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19
Q

What are the different types of income distribution?

A

Low-income households
Middle-income households
High-income households

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20
Q

What does the political-legal environment look at?

A

The country’s attitude toward international buying
Government bureaucracy
Political stability
Monetary regulationss

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21
Q

What are the impacts associated with the cultural environment?

A

Impact of culture on marketing strategy

Impact of marketing strategy on cultures

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22
Q

How should which countries to enter be decided?

A

Define international marketing objectives and policies
Foreign sales volume
How many countries to enter
Types of countries to enter

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23
Q

What can the type of country to enter be based on?

A

Geography
Income and population
Political climate

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24
Q

What are the demographic characteristics?

A

Education
Population size and growth
Population age composition

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25
What are the geographic characteristics?
``` Climate Country size Population density Urban or rural Transportation structure and market accessibility ```
26
What are the 5 economic factors?
``` GDP size and growth Income distribution Industrial infrastructure National resources Financial and human resources ```
27
What are the sociocultural factors?
Consumer lifestyles, beliefs, and values Business norms and approaches Cultural and social norms Languages
28
What are the political and legal factors?
``` National priorities Political stability Government attitudes toward global trade Government bureaucracy Monetary and trade regulations ```
29
What are the three ways of entering a global market?
Exporting Joint venturing Direct investment
30
What are the two ways of exporting?
This can be indirect or direct
31
How does joint venturing work?
By licensing, contract manufacturing, management contracting or joint ownership
32
How does direct investment work?
Assembly facilities | Manufacturing facilities
33
What is exporting?
This is when the company produces its goods in its home country and then sells them in a foreign market. It is the simplest means involving the least change in the company's product lines, organisation, investment, or mission
34
What is joint venturing?
This is when a firm joins with foreign companies to produce or market products or services
35
How does joint venturing differ from exporting?
The company joins with a host country partner to sell or market abroad
36
What is licensing?
When a firm enters into an agreement with a license in a foreign market. For a fee or royalty, the licencee buys the right to use the company's process, trademark, patent, trade secret or other item of value
37
What is contract manufacturing?
This is when a firm contracts with manufacturers to produce its product or provide its service. Benefits include faster start-up, less risk and the opportunity to form a partnership or to buy out the local manufacturer
38
What is management contracting?
When the domestic firm supplies management skills to a foreign company that supplies capital. The domestic firm is exporting management services rather than products
39
What is joint ownership?
When one company joins forces with foreign investors to create a local business in which they share joint ownership and control. Joint ownership is sometimes required for economic or political reasons
40
What is direct investment?
The development of foreign-based assembly or manufacturing facilities
41
What are the advantages of direct investment?
``` Labour Logistics Control Government incentives Lower costs Raw materials ```
42
What are the 3 approaches to global marketing strategy?
Entrepreneurial marketing Formulated marketing Intrapreneurial marketing
43
What is entrepreneurial marketing?
This involves visualising an opportunity and constructing and implementing flexible strategies
44
What is formulated marketing?
This involves developing formal marketing strategies and following them closely
45
What is intrapreneurial marketing?
This involves attempting to re-establish an internal entrepreneurial spirit and refresh marketing strategies and approaches
46
What does that standardised marketing mix involve?
Selling the same products and using the same marketing approaches worldwide
47
What does the adapted marketing mix involve?
Adjusting the marketing mix elements in each target market, bearing more costs but hoping for a larger market share and ROI
48
What is a straight extension?
Product and communications do not change
49
What is a communication adaptation?
Product does not change but communications do
50
What is a product adaptation?
The product changes but communications do not
51
What is a dual adaptation?
Both the product and communications change
52
What is a product invention?
Development of a new product
53
What does straight product extension mean?
Marketing a product in a foreign market without any change
54
What does product adaptation mean?
This involves changing the product to meet local conditions or wants
55
What does product invention consist of?
This consists of creating something new for a specific country or market
56
What are the two ways in which product invention can be done?
Maintain or reintroduce earlier products | Create new products
57
What might be changed in standardised communications campaigns?
Adjustments may be required for language or cultural differences
58
What is uniform pricing?
This charges the same price in all markets but does not consider income or wealth where the price may be too high in some or not high enough in other markets
59
What is standard mark-up pricing?
This is a price based on a percentage of cost but can cause problems in countries with high costs
60
What are the three types of distribution channel?
Seller's headquarters organisation Channels between nations Channels within nations
61
How does the seller's headquarters organisation work?
This supervises the channel and is also part of the channel
62
How do channels between nations work?
They move the products to the borders of the foreign nations
63
How do channels within nations work?
They move the products from their foreign point of entry to the final customers
64
What three typical international marketing activities are done?
Establishing an exporting department with a sales manager and staff Creating an international division organised by geography, products or operating units Becoming a complete global organisation

MKT1002 (17 decks)

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