INTERNATIONAL P R E P A R E D B Y : M I S S N O O R S Y A L I N A N O R D I N BUSINESS BUS 3233 TOPIC 6 : INTERNATIONAL MARKETING AND INTERNATIONAL OPERATIONS MANAGEMENT
TOPIC OUTLINE: After studying this topic, student should be able to : Understand international marketing management Explain marketing mix issues and decision: Product, Pricing, Promotion and Distribution Discuss the nature of international operations management Discuss production management and international service operations Explain on how to manage productivity, quality and information in international business
6.1 International marketing management Marketing is “the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives.” International marketing is the extension of these activities across national boundaries.
International Marketing as an Integrated Functional Area 4 Human Resource Management Finance Accounting Operations Management Marketing
6.1 International marketing management (cont..) Marketing Mix How to develop the firm’s product(s) How to price those products How to sell those products How to distribute those products to the firm’s customers
The Marketing Mix 6 Product Promotion Place Pricing
6.1 International marketing management (cont..) Key Decision-Making Factors Standardization versus customization Legal forces Economic factors Changing exchange rates Target customers Cultural influences Competition
Standardization versus Customization 8 Ethnocentric Polycentric Geocentric
Standardized International Marketing 9 Advantages Disadvantages •Lower Marketing Costs •Centralized Control •Efficient R&D •Economies of Scale •Global Marketplace •Different Product Uses •Local Legal Differences •Local Buyer Behavior •Local Marketing •Market Differences
Customized International Marketing 10 Advantages Disadvantages •Different Product Uses •Local Legal Differences •Local Buyer Behavior •Local Marketing •Market Differences •Higher Marketing Costs •Less Central Control •Inefficient R&D •Less Economies of Scale •Ignores Global Market
Standardized Products or Customized Products? 11 Target Customers Legal Forces Cultural Influences Economic Factors Brand Names International Product Policies
Target Customers 12 Industrial Products Consumer Products
Legal Forces 13 Labeling Requirements Health Standards Technical Standards Product Design
Cultural Influences 14 Language Ingredients Packaging Presentation
Economic Factors 15 Economic Development Local Infrastructure
Brand Names 16 Packaging Design Advertising
Market Pricing Risks Damage to Brand Names Gray Market Development Consumer Resentment
The Promotion Mix •Advertising •Personal Selling •Sales Promotion •Public Relations International Promotion Issues and Decisions
Advertising Strategy Three Decision Factors Global vs. Local Message Medium
What Is Personal Selling? •Industrial Products •Consumer Products
Advantages of Personal Selling Knowledge of Local Markets Close Contact with Customers Access to Valuable Market Information
Disadvantages of Personal Selling Compensating Sales Representatives Making Contacts After the Sale Expenses of Regional Sales Offices
Sales Promotion •Retailers •Wholesalers •Consumers
Public Relations The General Public Government Regulators Enhanced Reputation
Mode Advantages Disadvantages Train Reliable, Low Cost Rail Routes Only, Slow Airpla ne Safe, Reliable Costly, Limited Access Truck Versatile, Low Cost Size Limitations Ship Low Cost, Large Items Slow, Indirect Online Fast Delivery Product Limitations International Distribution Issues and Decisions
Transportation Mode Inventory and Service
Channels of Distribution Manufacturer Manufacturer Manufacturer Import Agent Import Agent Import Agent Customer Retailer Customer Wholesaler Retailer Customer
Channel Length Distribution Channel Stages Direct Sales to Customers Use of Retailers Use of Wholesalers
Distribution Strategy Home-Country Methods Foreign Distributors Joint Ventures Local-Market Systems
International Operations Management 30 Strategic Context Standardized vs. Customized Production Logistics and Materials Mgmt. Location Decisions Acquisition of Resources The Nature of International Operations Management
Strategic Context 31 •Superior Value •Business Strategy •Production Processes •Production Technologies
Complexities of Operations Management 32 •Resources •Location •Logistics
Make-or-Buy Decision Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 17 - 33 Type of Decision Internal Production Buy “Off-the-Shelf” Special Ventures or Contracts Competitive Advantage Strategic Vulnerability High High Low Low Intermediate Moderate
Additional Factors 34 •Control •Risk Levels •Flexibility
Location Decisions 35 Country-Related Issues Product-Related Issues Government Policies Organizational Issues
Country-Related Issues 36 Resources Infrastructure Brand Image
Product-Related Issues 37 Value-toWeight Ratio Production Technology
Government Policies 38 Political Processes National Trade Policies Foreign Trade Zones Development Incentives
Organizational Issues 39 •Business Strategy •Organizational Structure •Inventory Management
International Logistics 40 Parts Other Resources Materials Supplies From Suppliers to the Firm Between Units of the Firm From the Firm to Customers
Domestic vs. International Materials Management 41 •Shipping •Transporting •Regulating
International Issues 42 Logistics and Materials Management Information Technology Factory Location Packaging
International Services 43 •Resources •Output •Utility International Service Operations
The Nature of Services 44 Intangible Non-Storable Customer Participation Associated Products
The Role of Government in International Services Trade 45 Protecting Local Professionals Traditional Functions Restricting Entry of Firms Upholding Domestic Standards
Service Operations 46 Capacity Location Facilities Schedules
The Importance of Productivity 47 Overall Success Living Standards Long-Term Survival Business Revenues The Company The Country Managing Productivity in International Business
Maintaining and Boosting Productivity 48 Increase Research and Development Improve Operations and Productivity Increase Employee Involvement
International Organization for Standardization (ISO) 49 •Product Testing •Employee Training •Record Keeping •Supplier Relations •Repair Policies Managing Quality in International Business
Importance of Quality 50 •Competition •Productivity •Customer Loyalty