Market Psychology Mini 2 International Distribution & Sales Promotion PDF

Market Psychology Delivering Value – International Distribution and Sales Promotion Mini 2: International Distribution, and e-Commerce Prof. Dr. Christina Cramer  Agenda (Minis 1-3) 1. The Role of Marketing Channels 2. Channel Design and Channel Management 3. Cha...

Market Psychology Delivering Value – International Distribution and Sales Promotion Mini 2: International Distribution, and e-Commerce Prof. Dr. Christina Cramer  Agenda (Minis 1-3) 1. The Role of Marketing Channels 2. Channel Design and Channel Management 3. Channel Relations 4. International Distribution Issues 5. e-commerce 6. Sales promotions Prof. Dr. Christina Cramer 3  Exemplary Entry Strategies to Foreign Markets Strategy Channel Channel Comments Control Risk Internal expansion high low Requires profound understanding of the market; can take long Merger or Takeover high high Quick market access; high costs Franchising fair shared Low costs, access to local knowledge; success strongly depends on partner/partnership Joint Venture shared shared Access to resources, capabilities, often the only alternative for foreign investment Non-controlling low low “Passive entry strategy” to gain interest in local firm experience Source: Usunier/Lee 2013, p. 316ff. Prof. Dr. Christina Cramer 4  Criteria for Choosing Foreign Distribution Channels Legal frame (e.g., restricting regulations to foreign direct investment) Market/retail structure in the host country, competition Culture, consumers and their characteristics Strategic goals (e.g., ethnocentric versus geocentric perspective, speed of market entry, financial goals) Targeted balance of control and risk Knowledge of the host country, experience Own resources (e.g., capital, people) Existing relationships with potential partner Character of the brand Source: Usunier/Lee 2013, p. 316ff. Prof. Dr. Christina Cramer 5  Question Check how Starbucks entered the Australian market:  Usunier/Lee (2013), p. 320 Prof. Dr. Christina Cramer 6  Role of Distribution as a „Cultural Filter“ Shopping behavior: Who is the shopper? Who is the decision-taker? Is shopping time valued or experienced as wasted? How is return behavior perceived? What is the role of loyalty? What is the role of bargaining/price negotiations? How about compliance with rules (e.g., waiting lines) Products: Is the product acceptable in terms of religion, or legal prescriptions? Service: What is the role of service vs price? Source: Usunier/Lee 2013, p. 321ff. Prof. Dr. Christina Cramer 7  e-Commerce Marketing Practices E-business describes the use of electronic means and platforms to conduct a company’s business. E-commerce means that the company or site offers to transact or facilitate the selling of products online. E-marketing describes company efforts to inform buyers, communicate, promote, and sell its products and services over the internet. Online retailers can provide convenient, informative, and personalized experiences for vastly different types of customers while minimizing costs (e.g., retail floor, space, staff, inventory). Online retailers compete in three key aspects: 1. Customer interaction with the website 2. Delivery of the product 3. Ability to address problems when they occur Source: Kotler/Keller 2009, p. 474ff. Prof. Dr. Christina Cramer 8  Online selling and Shopping: Obstacles Main obstacles to online shopping: absence of pleasurable experience, social interaction, and personal consultation -> live online chat, blogs, online videos, avatars, etc. Problems of privacy and security (e.g., payment) -> new payment systems, need for international data security legislation Problem of fast growing user expectations -> responsive design, mobile first, etc. -> growing need for a sophisticated IT support (design, development, operation, maintenance, quality control, legal control and consulting, etc.) Source: Kotler/Keller 2009, p. 474ff. Prof. Dr. Christina Cramer 9  Direct Marketing Across Borders The development of international credit cards and the consequent facilitation of international payment have decreased the transaction costs for both consumers and cataloguers. Postage paid no-questions-asked returns and elaborate interactive sizing charts and modelling shots have dramatically increased the acceptance of fashion purchasing online. The integration of traditional stores and online shops has provoked international taxation issues. Customs, and speed and security of delivery are largely country- specific. Privacy, and the fraudulent use of mailing lists, are major concerns in a number of countries. Issues such as consumer protection, intellectual property rights, taxation cannot be left to self-regulation. Source: Usunier/Lee 2013, p. 323ff. Prof. Dr. Christina Cramer 10 Thank You For Your Attention Prof. Dr. Christina Cramer HSHL Hochschule Hamm-Lippstadt  Literature Kotler, P., Keller, K. L. (2009). Marketing Management. Pearson Education. Usunier, J. C., & Lee, J. A. (2013). Marketing across Cultures, 6th edition, Pearson. Prof. Dr. Christina Cramer 12