Planning for Global Markets
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Questions and Answers

Which of the following describes indirect exporting?

  • Establishing an office in a foreign country
  • Selling directly to customers in another country
  • Directly shipping goods to consumers
  • Selling to an importer or distributor in another country (correct)

    • Ex-works means the seller delivers goods to the buyer at the seller's premises.

    True

    What is a licensing agreement?

    An agreement where one company makes an asset available to another company in exchange for royalties or compensation.

    CFR stands for __________, which indicates that the seller arranges for the carriage of goods by sea.

    <p>cost and freight</p> Signup and view all the answers

    Match the Incoterms to their descriptions:

    <p>FAS = Seller places goods alongside the vessel and pays charges up to that point FOB = Seller's responsibility ends once goods are placed aboard the ship CFR = Seller arranges for carriage of goods by sea to a port of destination DDP = Seller delivers goods to the buyer at an agreed place with all costs paid</p> Signup and view all the answers

    What is the primary purpose of a licensing agreement?

    <p>To allow the licensee to use an asset in exchange for compensation</p> Signup and view all the answers

    In franchising, the franchisee has the complete freedom to set their own policies without adhering to the franchisor's guidelines.

    <p>False</p> Signup and view all the answers

    What is the main difference between franchising and licensing?

    <p>Franchising involves a contract between a parent company and a franchisee, while licensing allows a licensee to use an asset in exchange for compensation.</p> Signup and view all the answers

    A business alliance where partners share ownership of a new entity is known as a __________.

    <p>joint venture</p> Signup and view all the answers

    Which of the following is an example of a licensing agreement?

    <p>A toy manufacturer produces action figures based on movie characters</p> Signup and view all the answers

    Match the following terms with their descriptions:

    <p>Licensing = Legal authority to use an asset Franchising = Operating a business developed by another Joint Venture = Shared ownership of a new business Contract Manufacturing = Outsourcing production to a subcontractor</p> Signup and view all the answers

    Contract manufacturing allows a company to focus on product design while leaving manufacturing to contractors.

    <p>True</p> Signup and view all the answers

    What is a key advantage of forming joint ventures?

    <p>Provides opportunity to learn in a new environment</p> Signup and view all the answers

    Joint ventures do not require sharing rewards among partners.

    <p>False</p> Signup and view all the answers

    Name one reason firms enter strategic international alliances.

    <p>Opportunities for rapid expansion into new markets</p> Signup and view all the answers

    One disadvantage of joint ventures is the potential for __________ among partners.

    <p>conflict</p> Signup and view all the answers

    Match the following terms with their definitions:

    <p>Collaborative Agreements = Formal partnerships for mutual benefit Global Strategic Partnerships = Strategic alliances for international collaboration Market Strategies = Plans to target specific consumer segments Geographic Segmentation = Dividing markets based on location</p> Signup and view all the answers

    What does 'conventional wisdom' regarding global segmentation assume?

    <p>Heterogeneity between countries</p> Signup and view all the answers

    Unconventional wisdom emphasizes micro-level differences in segmentation.

    <p>True</p> Signup and view all the answers

    What is one disadvantage of joint ventures related to investment?

    <p>Requires more investment than a licensing agreement</p> Signup and view all the answers

    What is the first phase of planning for global markets?

    <p>Preliminary Analysis and Screening</p> Signup and view all the answers

    Adapting the marketing mix is unnecessary for successful market entry.

    <p>False</p> Signup and view all the answers

    What is one of the four broad modes of foreign market entry?

    <p>Exporting</p> Signup and view all the answers

    The _____ phase involves narrowing down target market options and developing a marketing plan.

    <p>Developing the Marketing Plan</p> Signup and view all the answers

    Which strategy requires a commitment of resources to a country market?

    <p>Planning</p> Signup and view all the answers

    Match the following phases with their descriptions:

    <p>Phase 1 = Evaluate potential of foreign markets Phase 2 = Identify and analyze target markets Phase 3 = Develop marketing plan and action program Phase 4 = Implementation and evaluation control</p> Signup and view all the answers

    The implementation phase is the final step in the planning process.

    <p>False</p> Signup and view all the answers

    What should the marketing plan establish?

    <p>What is to be done, by whom, how, and when.</p> Signup and view all the answers

    Study Notes

    Planning for Global Markets

    • Planning is a systemized way of relating to the future, managing the impact of external factors on the company's strengths, weaknesses, and objectives.
    • Planning involves formulating goals and methods to achieve them, committing resources to specific markets, and allowing for the rapid growth of international ventures.

    Phase 1: Preliminary Analysis and Screening

    • Evaluates the potential of foreign markets.
    • Analyzes the business environment in which the company will operate.
    • Matches the company and country needs.

    Phase 2: Defining Target Markets and Adapting Marketing Mix

    • Identifies and analyzes potential target markets in more depth.
    • Evaluates the marketing mix in each target market.
    • Determines which cultural and environmental adaptations are necessary for successful product acceptance and assesses if adaptation costs allow for profitable market entry.

    Phase 3: Developing the Marketing Plan

    • Developed for specific markets once target market options are narrowed.
    • Begins with a situational analysis and culminates in selecting an entry mode and defining a specific action program.
    • Establishes what needs to be done, by whom, how, and when.
    • Includes budgets and expectations for sales and profits.
    • May reveal that objectives and goals can’t be met and the company might decide to not enter the market.

    Phase 4: Implementation and Control

    • The planning process continues even after implementation.
    • Uses an evaluation and control system that requires performance-objective actions.
    • Encourages the consideration of all variables that impact success and provides a basis for viewing all country markets and their interrelationships.

    Alternative Market-Entry Strategies

    • Exporting:
      • Direct exporting involves selling to customers in another country directly, e.g., through the internet.
      • Indirect exporting involves selling to an importer or distributor in another country.
      • Direct sales may necessitate establishing an office in a foreign country, especially for high-tech and industrial products.
    • Contractual Agreements:
      • An agreement where one company makes an asset available to another company in exchange for royalties or compensation.
      • Licensing involves making an asset (patent, trade secret, brand name, product formulations) available to a licensee in exchange for royalties, license fees, or compensation.
      • Contract manufacturing involves providing technical specifications to a subcontractor or local manufacturer, allowing the company to specialize in product design while the contractor manufactures.
      • Franchising involves a contract between a parent company (franchisor) and a franchisee, allowing the franchisee to operate a business developed by the franchisor in return for a fee and adherence to franchising policies.
    • Joint Ventures:
      • An entry strategy for a single target country where partners share ownership of a newly-created business entity.
      • Advantages include risk sharing, opportunity for learning, achieving synergy, and access to markets with barriers to entry.
      • Disadvantages include the need for more investment than licensing, sharing rewards and risks, potential conflicts among partners, and a partner potentially becoming a competitor.
    • Strategic International Alliances:
      • A relationship established by two or more companies cooperating out of mutual need and sharing risk to achieve a shared goal.
      • Reasons for entering strategic alliances include opportunities for rapid expansion, access to new technology, more efficient production and innovation, reduced marketing costs, strategic competitive moves, and access to additional sources of products and capital.

    Global Strategic Partnerships

    • Collaborative agreements and global strategic partnerships are possible terms.

    Market Strategies

    • Contrasting Views of Global Segmentation:
      • Conventional Wisdom: Assumes heterogeneity between countries and homogeneity within a country. Focuses on macro-level cultural differences, relies on clustering national markets, and places less emphasis on within-country segments.
      • Unconventional Wisdom: Assumes the emergence of segments that transcend national boundaries. Recognizes within-country differences, emphasizes micro-level differences, and segments micro-markets within and between countries.

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    Global Marketing Management: Planning and Market Strategies PDF

    Description

    This quiz explores the essential strategies and phases in planning for global markets. It covers preliminary analysis, identifying target markets, and developing a tailored marketing plan. Test your understanding of how to navigate international business environments effectively.

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