Download GLOBAL COMPETITIVE ANALYSIS Chapter Eight

Global Marketing Management, 4e
Chapter 8
Global Marketing
Strategies
Chapter 8
Copyright (c) 2007 John Wiley & Sons, Inc.
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Chapter Overview
1. Information Technology and Global
Competition
2. Global Strategy
3. Global Marketing Strategy
4. Regionalization of Global Marketing
Strategy
5. Competitive Analysis
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Copyright (c) 2007 John Wiley & Sons, Inc.
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Introduction
 On a political map, country borders are clear as
ever. But on a competitive map, financial, trading,
and industrial activities across national boundaries
have rendered those political borders increasingly
irrelevant.
 Not only firms that compete internationally but also
those whose primary market is considered
domestic will be affected by competition from
around the world.
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1. Information Technology and
Global Competition
 Today, we are observing the emergence of a gross
information product, and it dwarfs the gross
domestic product.
 Electronic Commerce (E-Commerce)
 Real-Time Management
 Online Communications
 E-Company
 Faster Product Diffusion
 Global Citizenship
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2. Global Strategy
 Global Industry:
– Those industries where a firm’s competitive
position in one country is affected by its
position in other countries.
– The first question that faces managers is
the extent of globalization of their industry.
– Every industry has global or potentially
global aspects.
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2. Global Strategy
 Industry Globalization Drivers (see Exhibit 8-1):
– Market Drivers
1. Common customer needs
2. Global customers and channels
3. Transferable marketing
4. Lead countries
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2. Global Strategy
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2. Global Strategy
– Cost Drivers
1. Global economies of scale and scope
2. Steep experience curve
3. Global sourcing efficiencies
4. Favorable logistics
5. Difference in country costs
6. High product development costs
7. Fast-changing technology
8. Shorter product life cycles
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2. Global Strategy
–
–
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Government Drivers
1. Favorable trade policies
2. Compatible technical standards
3. World Trading Regulations
4. High growth/low labor cost developing countries
5. Deregulation/privatization of industries
Competitive Drivers
1.High exports and imports
2.Competitors from different continents and
countries
3.Interdependent countries
4.Globalized competitors
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2. Global Strategy
 Competitive Structure
– Cost leadership
– Product differentiation
– Niche strategy
– Nature of Competitive Industry Structure (see Exhibit 8-2):
»Industry competitors
»Potential entrants
»Bargaining power of suppliers
»Bargaining power of buyers
»Threats of substitute products or services
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2. Global Strategy
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2. Global Strategy

Gaining Competitive Advantage
– Creative destruction
– First-Mover Advantage vs. F-M
Disadvantage
– Competitor-focused Approach
– Customer-focused Approach
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2. Global Strategy
 Interdependency:
– Interdependency of modern companies
– Example: Global computer industry
– Governments also play a larger role,
affecting parts of the firm’s strategy.
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3. Global Marketing Strategy
 Benefits of Global Marketing:
– Cost Reduction
– Improved Products and Program
Effectiveness
– Enhanced Customer Preference
– Increased Competitive Advantage
 Limits to Global Marketing:
– Standardization vs. adaptation issues
– Globalization vs. localization
– Global integration vs. local responsiveness
– Scale vs. sensitivity
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3. Global Marketing Strategy
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3. Global Marketing Strategy
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4. Regionalization of Global
Marketing Strategy
 Regional strategies are the cross-subsidization of
market share battles in pursuit of regional
production, branding, and distribution advantages.
– Issues in regionalization of global marketing
strategy:
 Cross-Subsidization of Markets
 Identification of Weak Market Segments
 Use of “Lead Market” Concept
 Marketing Strategies for Emerging Markets
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5. Competitive Analysis
 SWOT (Strengths, Weaknesses, Opportunities,
and Threats) Analysis (see Exhibit 8-5)
– A SWOT analysis divides the information into
two main categories: internal and external
factors.
– Based on SWOT analysis, marketing executives
can construct alternative strategies.
– The aim of any SWOT analysis should be to
isolate the key issues that will be important to
the future of the firm and that will be addressed
by subsequent marketing strategy.
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5. Competitive Analysis
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