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Marketing
Process of planning and executing
the conception, pricing, promotion,
and distribution of ideas, goods,
and services to create exchanges that satisfy
individuals and organizational objectives
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©2004 Prentice Hall
Marketing Mix
 How to develop the firm’s products
 How to price those products
 How to sell those products
 How to distribute those products to the
firm’s customers
 Who is the Target Market?
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©2004 Prentice Hall
The Elements of the Marketing Mix for
International Firms
Marketing Mix
Product
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Pricing
Promotion
Place
©2004 Prentice Hall
Key Decision-Making Factors
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Standardization versus customization
Legal forces
Economic factors
Changing exchange rates
Target customers
Cultural influences
Competition
©2004 Prentice Hall
Standardization versus Customization
 Should the firm adopt an ethnocentric
approach?
 Should it adopt a polycentric
approach?
 Should it adopt a geocentric approach?
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Standardized International Marketing
Advantages
 Reduces marketing costs
 Facilitates centralized
control of marketing
 Promotes efficiency in
R&D
 Results in economies of
scale in production
 Reflects the trend toward
a single global
marketplace
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Disadvantages
 Ignores different
conditions of product use
 Ignores local legal
differences
 Ignores differences in
buyer behavior patterns
 Inhibits local marketing
initiatives
 Ignores other differences
in individual markets
©2004 Prentice Hall
Customized International Marketing
Advantages
 Reflects different
conditions of product use
 Acknowledges local
legal differences
 Accounts for differences
in buyer behavior
patterns
 Promotes local marketing
initiatives
 Accounts for other
differences in individual
markets
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Disadvantages
 Increases marketing costs
 Inhibits centralized control
of marketing
 Creates inefficiency in
R&D
 Reduces economies of
scale in production
 Ignores the trend toward a
single global marketplace
©2004 Prentice Hall
Product Life Cycle
Intro
Growth
Maturity
Decline
Sales
Profit
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©2004 Prentice Hall
Break Even Analysis
$
Total Revenue
Curve = Selling
Price X Units
Cost Curve =
Fixed Costs +
Variable Costs
BE = Total Fixed Costs/Price – Variable Costs
Units
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Pricing Policies
 Standard price policy
 Two-tiered pricing
 Market pricing
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Conditions for Market Pricing
 Firm must face different demand
and/or cost conditions in the countries
in which it sells its products
 Firm must be able to prevent arbitrage
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©2004 Prentice Hall
Risks to Market Pricing
 Complaints about dumping
 Damage to its brand name
 Development of a gray market for its
products
 Consumer resentment against
discriminatory prices
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©2004 Prentice Hall
Promotion Mix
 Advertising
 Personal Selling
 Sales Promotion
 Public Relations
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©2004 Prentice Hall
Factors affecting Advertising Strategy
 The message it wants to convey
 The media available for conveying the
message
 The extent to which the firm wants to
globalize its advertising effort
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©2004 Prentice Hall
Advantages of Personal Selling for
International Firms
 Local sales representatives understand
local culture, norms, and customs
 Personal selling promotes close,
personal contact with customers
 Personal selling makes it easier for
firm to adopt valuable market
information
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©2004 Prentice Hall
Distribution Issues
 Physically transporting its goods and
services from where they are created to
the various markets in which they are
to be sold
 Selecting the means by which to
merchandise its good in the markets it
wants to serve
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©2004 Prentice Hall
Basic Parts of a Distribution Channel
 The manufacturer
 A wholesaler
 The retailer
 The actual customer
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Distribution Channel Options
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©2004 Prentice Hall
Using E-Commerce
http://www.prettygarlic.com
and disintermediation.
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©2004 Prentice Hall