International Marketing Concepts

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Questions and Answers

What are the three primary company orientations when it comes to international marketing?

The three company orientations are ethnocentric, polycentric, and geocentric.

Explain the main mistake ethnocentric companies often make when entering foreign markets.

Ethnocentric companies often fail to recognize cultural differences, understand local preferences, and adapt to local market contexts.

What is the primary function of export planning?

Export planning provides companies with tools to analyze foreign markets, offering agile planning processes, control over operations, and data-driven decision making.

List two key benefits of export planning for companies.

Export planning reduces economic uncertainty for companies, particularly SMEs, and supports their development by encouraging internationalization best practices. Signup and view all the answers

What is the main objective of country portfolio analysis in international marketing?

Country portfolio analysis helps companies identify attractive markets and manage a portfolio of countries strategically to achieve their goals. Signup and view all the answers

During the first phase when a company internationalizes, what are the three key activities involved?

The key activities in phase 1 of company internationalization include market selection and evaluation, development of a comprehensive marketing program, and gaining international experience. Signup and view all the answers

What is the definition of international marketing research?

International marketing research involves systematically gathering, recording, and analyzing data related to marketing goods and services in international markets. Signup and view all the answers

What are two potential benefits of using open data in export planning?

Open data can provide access to market information, data on countries and product categories, specific product data, and historical sales data. Signup and view all the answers

What are the two key aspects of the 'glocal' approach to international marketing?

The 'glocal' approach balances standardization of products and services with adaptation to individual countries, ensuring a balance between global consistency and local relevance. Signup and view all the answers

What is the purpose of a market audit in the context of international marketing?

Market audits are a circular process designed to monitor and control market performance, reinforcing objectives and goals through the use of market metrics. Signup and view all the answers

What are the five stages of the international marketing model?

The international marketing model consists of: market choice, marketing objectives, entry mode selection, marketing program definition (4Ps), and control and adaptation. Signup and view all the answers

Explain the meaning of the 'outcome-oriented' feature of the international marketing model.

The international marketing model is outcome-oriented as it aims to produce a prioritized list of countries based on their attractiveness for market entry. Signup and view all the answers

What are the three key steps in conducting in-depth market analysis before entering a new market?

The steps are gathering information about the specific country, comparing information across multiple countries, and ultimately choosing the most attractive country. Signup and view all the answers

Explain the difference between 'macro-environmental factors' and 'micro-environmental factors' in market analysis.

Macro-environmental factors encompass broad external influences like political, demographic, technological, cultural, economic, and natural environment, while micro-environmental factors focus on industry-specific aspects like competitors, clients, and distribution networks. Signup and view all the answers

What information does social and cultural analysis provide in the context of international marketing?

Social and cultural analysis delivers insights into consumer characteristics and behaviors, local specifics, lifestyles, cultural aspects, and consumer behaviors. Signup and view all the answers

Give two examples of potential barriers to entry for a company seeking to enter a new foreign market.

Two examples of barriers to entry include language differences and country/market boundaries (limiti). Signup and view all the answers

What are the three primary areas for investment when using the Key-Country Matrix? What are the characteristics of each area?

The three primary areas for investment are: Light Green (high market attractiveness and strong competitive position), Green (moderate market attractiveness and moderate competitive position), and Grey (low market attractiveness and weak competitive position). Signup and view all the answers

Explain how the Key-Country Matrix helps companies make strategic decisions regarding their international portfolio.

The Key-Country Matrix helps companies evaluate their international portfolio by classifying countries based on their market attractiveness and competitive position. This allows them to prioritize investments in countries with the highest potential for success (Light Green) and potentially divest from countries with low attractiveness and poor competitive positioning (Grey). Signup and view all the answers

What is the "Equilibrated Portfolio" concept in the context of the Key-Country Matrix, and what is its significance?

An Equilibrated Portfolio is a balanced matrix representation of countries spread across all three areas (Light Green, Green, and Grey). This strategy aims to ensure a diversified portfolio with various levels of market attractiveness and competitive position, mitigating risks and optimizing overall return. Signup and view all the answers

Describe the typical investment strategy when using the Key-Country Matrix, starting with prioritized areas.

The typical investment strategy prioritizes Light Green countries first, followed by Green countries. Grey countries are considered for investment only after solid operations and strong positions are established in better-performing locations. Signup and view all the answers

What are the three critical factors considered when making investment decisions using the Key-Country Matrix?

The three critical factors considered are market attractiveness (size, growth, and segmentation), competitive position (company strength and market share), and portfolio control (balancing countries across all three areas to ensure diversification). Signup and view all the answers

What are the key similarities and differences between a marketing plan and an entry plan?

Both marketing plans and entry plans involve analyzing markets and identifying strategies for success. However, an entry plan specifically focuses on entering a foreign market and considers elements like current trends and the most suitable entry mode for that particular market. Signup and view all the answers

What are some examples of key factors that might be used to determine a country's 'market attractiveness' when using the Key-Country Matrix?

Some key factors include market size (total demand), market growth rate (potential for expansion), and market segmentation (identifying specific customer groups). Signup and view all the answers

Why is it essential to consider the potential impact of macroeconomic factors on countries when applying the Key-Country Matrix?

Macroeconomic factors, such as economic growth, inflation, and political stability, can significantly influence a country's attractiveness and competitiveness. Ignoring these factors could lead to inaccurate assessments and potentially poor investment decisions. Signup and view all the answers

Explain the key function of a trading company in international business.

Trading companies act as intermediaries in international commerce, connecting buyers and sellers in different countries. They facilitate global trade by sourcing, distributing, and marketing products across international borders, often operating in various sectors and markets. This allows them to leverage economies of scale and provide a streamlined service for both buyers and sellers. Signup and view all the answers

What is a Sogo Shosha and what are some of its key strategies?

Sogo Shosha are large Japanese trading companies known for their global reach. They are characterized by their extensive network of suppliers and customers, their participation in various industries, and their focus on global market presence. Key strategies include leveraging economies of scale, utilizing information systems for market opportunities, and engaging in barter trade for goods and services. Signup and view all the answers

What are the main benefits of direct exporting for a manufacturer?

Direct exporting offers greater control over pricing, marketing, and distribution, allowing manufacturers to build direct relationships with foreign customers. It often leads to higher sales volumes as the manufacturer can tailor their approach to specific markets without intermediaries. Signup and view all the answers

Outline two key disadvantages associated with direct exporting.

Direct exporting can be more costly and time-consuming than indirect methods. Setting up a direct selling operation in a new market requires significant resources, expertise, and time commitment, and manufacturers may struggle to reach a wide range of customers effectively. Signup and view all the answers

Describe the key considerations a manufacturer should address when implementing a direct exporting strategy.

Direct exporting requires a strong understanding of market trends, customer needs, and distribution channels. Manufacturers must price their products competitively, effectively manage logistics, and develop a strong marketing strategy to establish their brand and promote their products in the foreign market. Signup and view all the answers

Under what circumstances might direct exporting be considered the second-best option?

Direct exporting can be suitable when the company’s commitment to the international market is limited due to resource or time constraints. Additionally, if the country of origin effect offers a distinct competitive advantage, direct exporting can maximize this benefit. Furthermore, if the company lacks sufficient expertise for direct exporting, it may be a temporary option while they build the necessary skills and resources. Signup and view all the answers

How can companies leverage effective management tools to enhance their export performance?

Companies can utilize management tools such as market research, sales forecasting, and CRM systems to gain insights into market trends, customer behaviors, and sales performance. These tools can help optimize pricing strategies, streamline logistics, and allocate resources effectively to maximize export success. Signup and view all the answers

Explain the role of ‘gap analysis’ in the context of export planning.

Gap analysis helps companies identify the differences between their current export capabilities and the needs of their target international market. By examining strengths, weaknesses, opportunities, and threats, companies can develop strategies to bridge existing gaps, better understand market demands, and improve their competitiveness in the export arena. Signup and view all the answers

What are the two core aspects of product policy in international marketing?

Developing a strategy to determine which products to offer in international markets and adapting existing products to meet specific market needs. Signup and view all the answers

What is the fundamental task facing international marketers when it comes to the product offer?

To analyze the product and its features, evaluate the service expectations of the target market, and assess the product's value and perceived attributes by consumers. Signup and view all the answers

Describe the key difference between the actual product and the augmented product in international marketing.

The actual product refers to the physical attributes of the product, such as brand name, quality, features, and packaging. The augmented product comprises additional value-added services like after-sales support, installation, delivery, warranties, or financing. Signup and view all the answers

Explain two key advantages of licensing as a strategy for international market entry.

Licensing offers a low-cost entry option and reduces the risk of direct investment. It allows companies to access new markets quickly and potentially achieve high profits through royalty payments. Signup and view all the answers

What are the two major distinguishing characteristics of franchising compared to other international market entry strategies?

Franchising provides a proven system for operations, reducing risk for franchisees, and offers comprehensive training and marketing support from the franchisor. Signup and view all the answers

What is the fundamental principle driving the formation of a joint venture in international marketing?

Companies combine financial, technical, or marketing resources, allowing them to share expertise, reduce costs, and access new markets more effectively. Signup and view all the answers

Identify two potential benefits of using a joint venture as a mode of entry into foreign markets.

Joint ventures allow for the sharing of resources and expertise, which can be advantageous for companies with limited capabilities in a foreign market. They also provide access to local market knowledge and relationships. Signup and view all the answers

Describe the main challenge for companies that choose to implement a global branding strategy?

The primary challenge is ensuring that the brand message resonates with diverse cultures and consumer preferences in different countries, while maintaining brand consistency and brand equity. Signup and view all the answers

What are the key considerations when deciding whether exporting is the right choice for a company?

Key factors include: aligning export strategy with overall company goals, analyzing market characteristics, determining product suitability, and ensuring sufficient financial resources. Signup and view all the answers

Explain the difference between indirect and direct exporting, and discuss the pros and cons of each.

Indirect exporting uses intermediaries, simplifying entry but reducing control and slowing down market expansion. Direct exporting offers more control but increases costs. Signup and view all the answers

Describe how globalization affects the competitive landscape for companies.

Globalization intensifies competition as companies face global rivals, requiring differentiation and adaptation to diverse markets. Signup and view all the answers

What is the value chain, and how can companies redefine value chain activities through exporting?

The value chain encompasses all activities involved in creating and delivering a product. Exporting can reshape the value chain by relocating production or adding new activities in the export market. Signup and view all the answers

Explain the concept of franchising and how it functions as an alternative entry mode.

Franchising involves a licensing agreement where a franchisee operates a business based on a proven concept, benefiting from brand recognition and established procedures. Signup and view all the answers

Describe the difference between joint ventures and strategic alliances as entry modes, and provide an example of each.

Joint ventures involve creating a new business by combining resources with another company, while strategic alliances involve collaboration for specific goals without forming a new entity. A joint venture example is two carmakers combining to create a new car brand. A strategic alliance example is two airlines collaborating on frequent flyer programs. Signup and view all the answers

How does Foreign Direct Investment (FDI) differ from other entry modes, and provide an example of FDI?

FDI involves creating a foreign subsidiary or establishing a manufacturing facility, providing a higher level of control and potential for long-term involvement in the foreign market. An example is a U.S. company building a factory in China to manufacture goods for export. Signup and view all the answers

Explain the importance of aligning export strategies with a company's overall market goals.

Aligning export strategies ensures that export activities support the company's broader strategic objectives, promoting long-term sustainability and achieving desired outcomes in the international market. Signup and view all the answers

Flashcards

Local Products

Products and services tailored to meet the needs of specific countries.

Glocal

Balancing between standardization and local adaptation in marketing.