Slide International Mkt-Handout

international MARKETING
Ho thi hai thuy

Foreign trade university,
ho chi minh city campus
introductions
Ho Thi Hai Thuy (MS.)
Foreign Trade University, Hochiminh city campus
Email: hothihaithuy.cs2@ftu.edu.vn
Tel: 0987 867 288
Teaching/Research:
Principles of Marketing
Marketing Management
International Marketing
Intellectual Property
Course outline
Course resources
Text book: Czinkota, Ronkainen, Sutton, and Beal
(2011), International Marketing: An Asia-Parcific
Edition (2ed.)
Analysis of case studies in lectures
Lecture slides
Individual/Group presentations
Gradings
Class attention: 10%

Midterm assignment: 30%
Final Exam: 60%
Bonus marks: individual/group activities
Midterm assignment:
international marketing commentary
Team of 6-7 students: Report + Presentation
Due: 1/9/2016
soft copy of written commentary sent to my email/ hard copy submitted on
presentation date
Presentations: held on 3/9/2016 to 10/9/2016
Main objective: critically assess the market potential in Vietnam for a foreign product
or service.
-
Students are to form groups (4-6 people), choose a foreign product or service that is
not available in Vietnam, do a market research analysis and recommend and
appropriate marketing strategy , using the theoretical and conceptual frameworks
learned.
Students are to present their analysis in groups as well as submit a group written
commentary.
Midterm assignment
international marketing commentary
Topics:
1. Drinks
2. A spa
3. A coffee shop
4. A restaurant
5. A fashion brand
6. Beauty/cosmetic brand
7. IT/technology
8. Convenient store/ supermarket
9. Food
10. Healthcare
11. Furniture
12. English center for children
Individual/pair bonus marks

For the session 10th and 11th, any individual or pair who want
to get bonus mark can register a topic related to a
Contemporary international marketing issues to present on
that day. Lecturer will choose some outstanding reports to be
presented for 10-15 minutes .
Due date for report submission: 25/8/2016 via email
10% of that mark will be added to the midterm mark.
Any contribution of individual/groups to the classs activities
can be considered to bonus marks.
class
day
content
Note/preparation
9/8
Course introduction
11/8
An introduction to international
marketing
Starbuck enters Vietnam

Zara to enter Vietnam
NYDC closure in Vietnam
13/8
The international marketing

environment
Language blunders
Case: Disney in Hongkong and
Home Depot in Chile
16/8
International market research
Case: A golden opportunity
18/8
International market entry
Case: The Wiggles
20/8
International marketing mix
International brand infringements

Case: Yellow Tail
23/8
25/8
27/8
Guest speaker
10
30/8
Contemporary international
marketing issues
11
1/9
Contemporary international
marketing issues
Case: Tasmanian Pure and nature
h
T
Ho
a
H
i
y
u
h
T
i
CHAPTER 1: AN INTRODUCTION TO
INTERNATIONAL MARKETING
Content
DEFINITIONS of MARKETING
Marketing
American
Marketing
Association
- AMA
Philip Kotler
American
American marketing
marketing association
association
1960
1985
2007
1960: The performance of business
activities that direct the flow of
goods and services from producers
to consumers.
1.1. DEFINITIONS of MARKETING

1985: 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.
2007
Marketing is the activity, set of
institutions, and processes for
creating, communicating,
delivering, and exchanging
offerings that have value for
customers, clients, partners, and
society at large.
Offerings is some combination

of products, services,
information, or experiences
offered to a market to satisfy
a need or want.
Philip Kotlers definition
http://www.youtube.com/watch?v=RKL6KFlJdaM&list=PLA62747E5A6151D34a
Philip Kotlers
Fear the dragon : H&M in Australia

H&M is ranked as the ninth largest fashion retailer in the world with
revenue of US$16 billion, from more than 2472 stores and over 64,000
employees.
H&M could potentially carve out up to a $500 million share of the
Australian fast fashion market based on overseas results in similar
countries.
Some current Australian players are ill-equipped to meet this challenge,
with little point of difference, variable quality of product, poor
presentation, lack of format innovation, and a lack of focus on service.
Gap arrives to Australia

Gap opened its first Australian store in Melbournes
Chadstoneshopping centre in August 2010, with a second central
business district flagship store now trading in Westfields Sydney
City development.
The launch of the brand in Australia is part of a corporate strategy to
expand in Asia and the Pacific, with a focus on China, with more
store openings to come in Thailand, Singapore, Malaysia and
Indonesia in 2011..
Gap Inc has signed the license for Gap with Brand Republic, a
subsidiary of Busby Holdings Australia, which represents Aldo,
Guess, Travelite, Diplomat and now Gap brands.
GAP IN VIETNAM
In Vietnam, the first Gap stores opened in October followed by the first
Banana Republic store in 2012
A franchise agreement with Imex Pan Pacific (IPP), one of the largest
conglomerates in Vietnam
The Gap stores will carry products from Gap, GapKids and babyGap,
while Banana Republic will bring its take on affordable luxury
apparel and accessories for women and men to the region.
Targeting upper-middle-class consumer base and young population
Zara enters Australia

Zara parent Inditex, has finally opened its first store in the Australian
market (Sydney).
2010, Inditex opened its first stores in Syria while in the early
months of 2010 it has entered Kazakhstan, Bulgaria and India,
taking to 77 the number of countries it has stores in.
The company is understood to have delayed an Australian foray in
favour of concentrating on market closer to home, and those
offering higher immediate growth potential in Asian countries.
It now has a strong presence in Singapore where it has opened Zara
and launched other brands, Pull and Bear and Bershka.
Zara enters vietnam?

Vietnam promises great opportunities for Zara as:
- The majority of its population are young to middle age
- The rapid urbanization and globalization in Vietnam has seen the
number of customers who care about international high street fashion
increase dramatically
- Many local brands are failing to offer modern clothing styles and what
they do offer can be quite expensive
Definition of international marketing

International marketing is the performance of business
activities designed to plan, price, promote, and direct
the flow of a companys goods and services to
consumers or users in more than one nation for a
profit.
(Philip R.Cateora, 2012)

International marketing is the process of planning
and conducting transactions across national
borders to create exchanges that satisfy the
objectives of individuals and the organizations.
(M.R. Czinkota, 2011)
- A tool to improve domestic and global position

- Subject to constantly changing macro-environment
factors
The international environment
Driving and Restraining Forces in International Marketing
Opportunities in International Marketing

Firms can reach more customers.
Lowers the risk of insolvency
Consumers have more variety of products and
services
Firms can learn from their competitors.
Global employee recruitment
Smaller firms are considered major players.
Starbucks to enter India

The first store will open in 2011, the chairman of Tata Coffee, RK Krishnakumar, told
the CNBC-TV18 news channel after announcing the alliance with the global caffeine
powerhouse.
Typically tea-drinking Indians are increasingly turning to coffee and upmarket cafes,
which are promoted as sophisticated marks of affluence and good taste in the classconscious nation.
Tata Coffee is a coffee bean supplier with operations spread over the different growing
districts of South India.
Starbucks enters vietnam?
Challenges in International Marketing

Firms need to be prepared to develop active responses to change.
Developing new strategies involves:
technological innovation
process improvements
creativity (innovation).
Adaptation to the new environment and markets requires an acute awareness of
global developments.
Social effects of globalization can, at times, be questioned (e.g. G8 protests).
Environmental impact of global transportation
NYDC closure in vietnam
NYDC closure in vietnam

HCMC - New York Dessert Cafe (NYDC) has shut down its last restaurant in
Vietnam after seven years of operation in the country. HCMC - New York
Dessert Cafe (NYDC) has shut down its last restaurant in Vietnam after seven
years of operation in the country.
The rise of local coffee chains such as The Coffee House, Phuc Long, Urban Station,
Trung Nguyen, Kafe and Highlands, which offer affordable prices and
comfortable space.
The arrival of more international coffee chains has intensified competition: Gloria
Jeans Coffees and The Coffee Bean & Tea Leaf, Starbucks
Core marketing concepts
Needs
A state of felt deprivation
Maslows Hierarchy of Needs

Self
Actualisation
Self-Esteem
Belongingness
Safety
Physiological
Figure 7.3, p.249 (Kotler, Brown, Adam, Armstrong, 2001)

Self
Actualisation
Self-Esteem
Belongingness
Safety
Physiological
Figure 7.3, p.249 (Kotler, Brown, Adam, Armstrong, 2001)

When needs were not satisfied, a person will do
one of 2 things:
- Look for an object that satisfied it
- Or try to reduce the need
WANTS
The form that a human need takes as shaped by
culture and individual personality.
Eg: a hugry person in US may want .
a huger in China may want..
a huger in VN.
As a society evolves, the wants of its members
expand. As people are exposed to more objects that
arouse their interest and desire, producers try to
provide more want-satisfying products and
services.
DEMANDS
Human wants that are backed by buying power.

People have NARROW, BASIC NEEDS,
but almost UNLIMITED WANTS.
However
also have LIMITED RESOURCES.
Thus they want to choose products that provide the most
satisfaction for their money.
Satisfaction
The extent to which a products perceived performance
matches a buyers expectations.
Satisfaction
Satisfaction
Satisfaction
Satisfaction
Satisfied customers buy again and tell
others about their good experiences.
Dissatisfied customers often

switch to competitors and
disparage the products to others.
Satisfaction
Satisfied customers buy again and tell
others about their good experiences.
Dissatisfied customers often

switch to competitors and
disparage the products to others.
Products
Anything that can be offered to a market for
attention, acquisition, use or consumption
that might satisfy a want or need.
Products
Market
Market
Market
Marketers see the sellers as constituting an industry
and the buyers as constituting a market. The
relationship between industry and market is
shown as
Market
communication
Products/services
Industry (a
collection of
sellers)
money
information
Market (a
collection of
buyers
Market
Market is the set of all

actual and potential
buyers of a product or
service
Exchange
Is the act of obtaining a desired object from
someone by offering something in return
Exchange
Conditions making exchange possible
- At least 2 parties participate
- Each must have sth of value to offer the other
- Each must want to deal with the other
- Each must be free to accept or reject the others
offer
- Each must be able to communicate and deliver
Transaction
A trade between two parties that involves at least
two things of value, agreed-upon conditions, a
time of agreement and a place of agreement
Transaction is marketings unit of measurement
Evolution of Marketing Philosophies

1. Production
Concept
5. Societal Marketing
Concept
4. Marketing
Concept
2. Product
Concept
Key
Marketing
Concepts
3. Selling
Concept
The production concept
The philosophy that consumers will favor products

that are available and highly afforable
and
that management should therefore focus on
improving production and distribution efficiency.
consumers
available
product
Improving
distribution
efficiency
Highly
affordable
Improving
production
organization
1908 1927

It is useful in 2 types of situation:
1. The demand for a product > the supply
2. The demand for a product < the supply
But the products cost is too high
And improved productivity is needed to bring it down.
The product concept

The idea that consumers will favour products that
offer the most quality, performance and features
and that the organisation should therefore devote
its energy to making continuous product
improvements.
consumers
Most
quality
product
Product
improvement
organization
Performance
+
features
1864 - 1968
The Selling concept

The idea that consumers will not buy enough
of the organisations products unless the
organisation undertakes a large-scale selling
and promotion effort.
Most firm practise the selling concept when
they have overcapacity. Their aim is to sell
what they make rather than make what the
market wants.
The Selling concept

The idea that consumers will not buy enough of the organisations
products unless the organisation undertakes a large-scale selling
and promotion effort.
Most firm practise the selling concept when they have
overcapacity. Their aim is to sell what they make rather than
make what the market wants.
It focuses on creating sales transaction in the short term rather than
on building long term and profitable relationships with
customers.
The selling concept is also practised in the non-profit area
The Marketing concept

The marketing concept holds that achieving
organizational goals depends on determining
the needs and wants of target markets and
delivering the desired satisfactions more
effectively and efficiently than competitors
do.
The Marketing concept
Selling concept
Marketing concept
Starting point
factory
Market
Focus
Existing products
Customer needs
Means
Selling and promoting
Integrated marketing
Ends
Profits through sales

volume
Profits through
customer satisfaction
Perspective
Inside-out perspective
Outside-in
perspective
A LOT OF TIMES,
PEOPLE DONT
KNOW WHAT THEY
WANT UNTIL YOU
SHOW IT TO THEM
A LOT OF TIMES,
PEOPLE DONT KNOW
WHAT THEY WANT
UNTIL YOU SHOW IT TO
THEM
STEVE JOBS
ITS REALLY HARD TO DESIGN A

PRODUCT BY FOCUS GROUP. A
LOT OF TIMES, PEOPLE DONT
KNOW WHAT THEY WANT UNTIL
YOU SHOW IT TO THEM
STEVE JOBS
Find out what

customers want
without directly
asking them.
Find out what customers

want without directly
asking them.
How?
In future lectures
If that the company that satisfies

customers wants is always doing
what is best for customers and
society in long run?
Societal marketing concept
The idea that the organisation should

determine the needs, wants, and interests of
target markets and deliver the desired
satisfactions more effectively and efficiently
than competitors in a way that maintains or
improves the consumers and society wellbeing.
Societal marketing concept
Societal MKT concept
Marketing makes people buy

things they dont really need!
S
E
PL uy
I
C i Th
N
I i Ha
R
P o Th
H
OF
G
N
I
T
E
K
AR
CHAPTER 2:
THE INTERNATIONAL
MARKETING ENVIRONMENT
CONTENT
Definition
The marketing environments are the

actors and forces outside marketing
that affect marketing managements
ability to develop and maintain
successful transactions with its target
customers.
The companys microenvironment
The company
Suppliers
They provide the resources needed by the

company to produce its goods and services.
Suppliers are very important as supply
shortages, delays, labour strikes can
seriously affect marketing. Rising supply
cost may force price increases that can
harm the companys sales volume.
Marketing intermediaries
Are firms that help the company to

promote, sell and distribute its good
to final buyers.
Marketing intermediaries
Customers
Competitors
A company in the same industry or a similar

industry which offers a
similar product or service.
To be successful, a company must provide greater
customer value and satisfaction than its competitors
Publics
A public is any group that has an actual

or potential interest in or impact on an
organizations ability to achieve its
objectives.
Publics
The companys macro environment
International marketing environment
Differences between Countries

International distance (Ghemawat, 2001)
International Distance
CAGE Model (Ghemawat, 2001)
Economic Distance
The Economic Environment
Economic
Development
Key
Economic
Concerns for
Marketers
Changes
in Income
Changes
in Consumer
Spending Patterns
How do income levels of countries impact

marketing decisions?
How is country income measured?

GDP (Gross Domestic Product): value of all final goods and
services produced in a country in one year primary indicator of
purchasing power
GDP per capita (GDP / No. habitants)
GDP per/capita (PPP) purchasing power parity (equalizes
purchasing power)
PPP: Purchasing power parities shows how many units of one
currency are needed to buy a good or service in the currency of
another country
Changing consumer
spending patterns
- Product diffusion is the percentage
of households in a market that own
a particular product (rate of
adoption of a new product)
-
Early Majority
Innovators
Percentage of Adopters
Adoption of Innovations
Early
Adopters
34%
Late Majority
Laggards
34%
16%
13.5%
2.5%
Early
Time of Adoption
Late
Changing consumer spending patterns

- Product use differences
For example, appliances in European
households tend to be smaller than those in
Australian households.
Changing consumer spending patterns

- Engels Law: As family income increases, the
percentage spent on food declines, the percentage
spent on housing remains constant, and the
percentage spent on savings and other categories
(luxury goods) increases.
Eg. For example, a family that spends 25% of
their income on food at an income level of $50,000
will spend $12,500 on food. If their income increases
to $100,000, it is not likely that they will spend
$25,000 (25%) on food, but will spend a lesser
percentage while increasing spending in other
areas.

Food/beverages
Clothing/footware
Households goods/ser
Leisure&education
Australia
10.24%
3.90%
5.80%
14.35%
Thailand
27.23%
12.02&
9.22%
4.55%
India
43.44%
4.69%
2.91%
3.74%
A&F to cull US stores

Abercrombie & Fitch, the outfitter of casual wear for teenagers and young adults closed
71 stores in the US by 2014 as the economic slump affected the US market,
The company has 933 stores, about 81 percent of which are in the U.S
The companys closed 340 stores over the past six years and expects to shut another
60 this year.
Abercrombie is turning its focus to Europe and Asia, believing overseas markets may be
more responsive to the 'high-end yet casual all-American look'. After success in
Europe, the company believes it can replicate such brand penetration in Asia.
How do population levels of countries affect

How do population levels of countries affect

For basic and essential products, the more people there
are, the larger the size of the market.
Significance of population size decreases with the
sophistication of the product or service offered
Negative relationship between stage of economic
development and population growth rates
Distribution of age and location (rural v urban)
Social Development
Social development indicators

Urbanization, life expectancy, literacy rates, etc.
These tend to improve with economic development.
Cultural indicators
Book titles published, number of daily newspapers, number of public
libraries, etc.
Physical Quality of Life Index (PQLI) is a macromarketing tool used to measure the
level of welfare in a country.
life expectancy
infant mortality
adult literacy rates
Geographical distance
How does the Geographic Environment Affect

Marketing Decisions?
Infrastructure
Availability and quality of infrastructure
rail traffic networks for distribution capabilities
communication systems for marketing
energy (electrical and fuel) consumption
telecommunication
The diffusion of Internet technology
The number of Internet users surpassed one billion in 2005.
Do consumers purchase through the Internet?
Internet UsageS tatistics
Logistics Infrastructure of Countries in

ASEAN
The World's Most Expensive Cities
Administrative
How Does the Administrative Environment affect

Marketing Decisions?
Major Regional Trade Agreements
The European Union (EU):

Austria,Belgium,Bulgaria,Cyprus,CzechRepublic, Denmark.,
Estonia,Finland,France,Germany,Greece,Hungary,Ireland,Italy,
Latvia,Lithuania,Luxembourg,Malta,Poland,Portugal,Romania, Slovak Republic,
Slovenia,Spain,Sweden,Netherlands,U.K.
The European Free Trade Association (EFTA):

Iceland, Liechtenstein, Norway, Switzerland
The North American Free Trade Agreement (NAFTA):

Canada, Mexico, United States.
The Southern Common Market (MERCOSUR):

Argentina, Brazil, Paraguay, Uruguay
ASEAN Free Trade Area (AFTA)

Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand,
Vietnam
Association of Asia Pacific Economic Cooperation (APEC)
Closer Economic Relations (CER)

trade partnership between Australia and New Zealand
Financial Environment
Currency exchange issues (risk!)
Financial crisis
Asia (1997), Mexico (1994), Russia (1998), etc.
Sources of funding (banks & governments)
Level of debt impacts on the attractiveness of a market:
Country ability to borrow money
Availability of foreign exchange
Likelihood of payment
Political Environment
Role of government (local, regional, state)
Government-to-government relationships,
particularly if they are hostile, affect
international marketing
Political instability (Risks!)
KFC opens in Iran

In 2012, US fast food chain restaurant Kentucky Fried Chicken opened a branch in Iran despite harsh US
sanctions against Iran over the country's nuclear programs.
Ami-Hossein Alizadeh, the license holder, said it took him five years to get the permission from relevant local
authorities to re-open KFC in Iran.
KFC was closed in Iran following the 1979 Islamic revolution, due to its affiliation with the US, the country's
political arch-enemy.
The Iranian administration has also prohibited any business activities which would symbolize Western
culture, especially those that give a high profile to American brands.
The Legal Environment
Legal complexities are greater for international trade (2 systems)
No real international law for business activities

WTO, United Nations Commission on International Trade Law (UNICITRAL)
Marketers need an awareness of

Differences between the written law and common practice/interpretation
Differing laws related to each element of the marketing mix
Product: Laws to protect consumers
Price: Price control mechanisms; dumping; tariffs, profit margins
Distribution: Regulations covering distribution channels
Promotion: prohibition of advertising; use of words/expressions

Impact of laws related to the environment, human resources, and Intellectual
property protection (patents, copyrights, trademarks)
Laws that affect International Marketing

Laws affecting the entry of goods
tariffs and quotas
Anti-dumping laws
A firm cannot export at a lower price than what it charges in its home market.
Food safety laws
Sanitary and phytosanitary (SPS) regulations govern the safety of exported
foodstuffs from Australia and New Zealand.
Governments are increasingly devising new rules that affect trade in
genetically modified products.
Laws prohibiting deceptive advertising
http://www.youtube.com/watch?v=rn0lwGk4u9o
Culture distance
What is Culture?
Culture is the total way of life in a society (Fletcher, 1979)
Culture is the collective programming of the mind (Hofstede, 1980)
Culture is the glue that binds groups together (anonymous)
Overall, culture is an integrated system of learned behaviour patterns
that are distinguishing characteristics of the members of any given
society
Primarily passed on by parents
Provides a code of conduct
Helps give an individual an identity
Culture
Culture is:
Prescriptive: prescribes form of acceptable behavior
Learned: people are not born with culture
Dynamic: interactive
Subjective: based on peoples shared beliefs
Three key elements of culture
Language and communications systems
Material culture and artefacts
Values and belief systems
Expressions of Culture
Culture Symbols:Words,
gestures, objects or
pictures that are
recognisable and have
specific meaning
Rituals:Collectiv
e activities that
are an essential
element of social
activities
Heroes: People
who possess the
qualities highly
prized in that
culture
Values:At the core of
culture are values:
tendencies to prefer
certain affairs over
others
Levels at which Culture Operates
Cultural Elements
Language
Local language capabilities play an important role in international marketing.
aids in information gathering and evaluation
provides access to local society
important for company communications
Verbal language
how words are spoken
gestures made and body position assumed
degree of eye contact
Non-verbal language:
time flexibility and sensibility
personal physical space and personal touching
non-verbal gestures and signaling
Main Languages in the World 2010
Language Blunders
Mitsubishi realized that Pajero was not the right name for a car in
Spanish speaking countries, so they changed it to Montero.
General Motors tried to sell the Chevrolet Nova in Latin America,
only to find that people found "no va" (doesn't go) a funny name
for a car.
Mazda has a van in Japan called the Laputa, but they made the
mistake of selling it under that name in Spanish-speaking
countries.
A car that would need a new name in Spain is the Nissan Moco
(they even have it in the right shade of green)!
Religion
People find in religion a reason for being, the belief in a higher power and the
belief that they are part of the bigger picture .
Religion has an impact on international marketing.
seen in a cultures values and attitudes towards entrepreneurship,
consumption and social organisation.
The dominant religions of the world (2007)
Islam1,600,000,000 1,800,000,000
Christianity1,300,000,000 1,500,000,000
Hinduism 828,000,000 1,000,000,000
Buddhism500,000,000 1.5 billion
Major holidays are often tied to religion.
Manners and Customs/Material Elements
Products are used differently according to manners and customers

(examples?)
Material culture is related to the way society organizes its economic

activity.
Economic infrastructure: transportation (e.g. roads), energy (e.g. electrical
power plants), Communications (e.g. landline, mobile and internet)
Social infrastructure: Housing, health, education
Financial and marketing infrastructures: Banks, research firms
Cultural convergence: Globally, consumers are showing a greater
acceptance of equipment for personal use (e.g. mobile phones, personal
computers and Internet use).
Manners and Customs/Material Elements

(cont.)
The ability of marketers to reach consumers is affected by ownership

of radios, personal computers or televisions.
Potential problem areas for marketers arise from an insufficient

understanding of:
different ways of thinking in the host country
the decision-making process and personal relations
the allocation of time for negotiations.
Example: The number eight in Chinese culture is of great significance.
Aesthetics
What is good taste?
What is and what is not acceptable?
For example, attitudes towards sex in advertising differ
across cultures.
Colours can have symbolic value (e.g. white is the
colour of mourning in India and Japan).
International firms must be mindful of local tastes and
concerns when designing their facilities.
Luxury still booms in China

Young Chinese continue to drive a boom in luxury goods in China, according to a survey of more
than 1000 luxury consumers conducted in June in China mainland who earned between
US$15,000-US$30,000 annually.
"Chinese consumers buy luxury products mainly to reward themselves or build confidence, as well as
to reflect their taste and personality, and will continue to do so this year," said Elan Shou, MD of
Ruder Finn China.
"We are seeing a change in spending patterns, not a drop in the desire for luxury items.
Respondents said they would increase spending on luxury cosmetics (43%), high-end shoes (43%),
and top-brand wines, spirits and cigars (40%).
One aspect of the luxury market that has not changed was the status of established luxury brands in
the Chinese mindset. According to the survey, Louis Vuitton was ranked first with a top of mind
(TOM) awareness of 39% and a spontaneous recall (Spon) of 65%.
The French fashion icon was followed by nine other European big name brands Chanel, Gucci,
Hermes, Christian Dior, Armani, Rolex, Cartier, Prada and Versace.
VANITY (Economist , 31/08/09)

Venezuelans are the worlds vainest people, followed
by Mexicans, Russians and Turks, according to
Roper Starch Worldwide.
- A poll of 1,000 people in each of 30 countries
found that of 65% Venezuelan women and 47%
of men say that they think about how they look
all the time.
- Venezuelans, who also hold the record for
deodorant-use, spend an average of 20% of
household income on personal care products.
VANITY (Economist , 31/08/09)

- Globally only 23% of women and 16% of men
think constantly about their appearance.
- Respondents to the survey also report that the best
way to stay attractive is to get a good nights sleep.
Dental care and drinking lots of water are next in
importance.
How does Culture Impact on International

Marketing?
Affects needs and wants of potential buyers
Impacts on expectations and preferences
Impacts on the way messages are received and
interpreted (communication and perceptions)
Pervades all elements of the marketing mix.
Can we measure Cultural Differences?

Hofstede (1980) & Hofstede & Bond (1988):
116.000 surveys of employees at IBM on 40 countries
(1971-1973). He later expanded 10 countries.
Five underlying dimensions to measure cultural differences
across countries.
The Cultural Environment

Looking at Theory: Hofstede
Studied thousands of IBM Employees in more than 60 countries.
Five underlying dimensions to measure cultural differences:
Individualism vs Collectivism
Power Distance
Uncertainty Orientation
Masculinity vs Femininity
Long-term vs short-term orientation

Individualism vs Collectivism
Individualistic societies: The extent to which people in a culture
look after their own interests and those of their immediate
family, and achievements valued
People in a culture look after their own interest
I mentality
Focus on the self, immediate family
Eg: Australia, USA, The Netherlands
Collectivist societies:: groups, ties are tight, people born into
collectives
We mentality
Focus on strong cohesive groups in society and extended family
Eg: South Korea, Taiwan, Guatemala

Power Distance
Measures the tolerance of social inequality within a
social system ( inequality of power and wealth is
accepted)
High
Hierarchical, inheritance as power (people distrust those in
power)
Eg: Malaysia, Arabic countries, Mexico
Low
Equality, knowledge, respect as power (people believe those
who hold power are entitled to privileges)
Eg: Austria, Germany, Great Britain

Uncertainty Avoidance
Measures the tolerance of ambiguity and uncertainty
among members of a society (people feel
threatened by uncertain/unknown situations)
High: place premium on job security, career patterns,
rule, trust
Eg: Greece, Japan, Guatemala
Low: willing to take risks
Eg: Indonesia, Singapore, Canada

Femininity vs Masculinity
Measures the extent to which dominant values in a
society are masculine (relationship between gender
& work roles)
Masculine: strong minded, individualistic, Assertive
Eg: Japan, Mexico
Feminine: Equality of the sexes, fluid sex roles,
interdependency, relational
Eg: Sweden, New Zealand, Norway,
Long-term vs Short-term:
Long-term: thrift, perseverance, trust
Short-term: chase immediate returns,
competitive, opportunism, price
focus
Cultural Analysis
Addressing Cultural Differences for

International Marketing
Embrace local culture.
Be the best possible corporate citizen.
Build relationships.
Local ties are invaluable in expansion and countering political risk.
Employ locals and gain cultural knowledge.
The best way to understand a market is to grow with it.
Help employees understand you.
Local employees need corporatization to be effective.
Adapt products and processes to local markets.
Constant and consistent product redevelopment efforts are needed.
Coordinate by region.
The transfer of best practice is critical.
e
l
p
iy
c
ir nhai thu
P o t hi
H
m
f
o
e
k
r
g
n
ti
Chapter 3: INTERNATIONAL
MARKETING RESEARCH
DEFINITION
The systematic design, collection,

analysis, and report of data
relevant to a specific marketing
situation facing an organization.
Some large companies have their own research department, some
hire outside research specialists, some purchase data collected by
outside firms
It can
- Gives MKT insights into customer motivations,
purchase behavior, and satisfaction
- Help them to assess market potential and market
share or measure the effectiveness of pricing,
product, distribution, and promotion activities
- Provide relevant, up-to-date information on market
- Indicate trends
- Take the guess work out of decision-making
It can not
- Provide a miracle cure
- Make your decisions for you
Breadth and scope of international marketing

research
The basic difference between domestic and foreign
market research is the broader scope needed for
foreign research, necessitated by higher levels of
uncertainty.
Breadth and scope of international marketing research

(Information needs)
Information needs
1. Economic and demographic:
economic growth, key economic indicators for the original country and major foreign
countries
inflation,
business cycle trends,
profitability analysis for the divisions products;
specific industry economic studies;
Population trends: migration, immigration, and aging.
2. Cultural, sociological, and political climate.:A general noneconomic review of
conditions affecting the divisions business.
Information needs
3. Overview of market conditions: A detailed analysis of market conditions that the
division faces, by market segment, including international.
4. Summary of the technological environment: A summary of the state-of-the-art
technology as it relates to the divisions business, carefully broken down by product
segments.
5. Competitive situation: A review of competitors sales revenues, methods of
market
segmentation, products, and apparent strategies on an international scope.
MARKETING RESEARCH PROCESS
Step 1: Define the research problem and establish

research objectives

research objectives
The marketing decision problem: The reason for the research
- Helps researcher understand what is to be done?
- But defined from management perspective
Eg. Should we change our ad campaign in the Hochiminh
market?
- Critical phase of the marketing research process.
- Inadequate problem definition is a leading cause of failure
of marketing research projects.

research objectives
Symptoms (of the problem)
Declining sales
Decline in profits
Losing market share
Inability to meet sales forecasts
Low traffic
Dissatisfied customers
Management

research objectives
Possible causes
rival
or service
channel
company or brands
company
force
Researcher
Superior promo by
Low-quality product
Incorrect pricing
Inappropriate distribution
Low awareness of
Poor image of the
Unmotivated sales
Step 1: Define the research problem and

establish research objectives
The Market Research Problem
(MRP)
- The MRP is a broad and comprehensive
description of the information required
to make the management decision
Eg. To understand the decision making
process of potential university students in
their choice of university .
Step 1: Define the research problem and

establish research objectives
The Market Research Problem (MRP)
- The MRP it should:
Guide the researcher towards all information
needed to address the management decision
problem
Assist the researcher in formulating the
specific research objectives
Suggest possible ways the data could be
collected (the research design)
The distinction between the MDP and the MRP

research objectives
research objectives
Step 2: Determine the sources of information to fulfill the research

objectives
Step 2: Determine the sources of information to fulfill the

research objectives
Information
Secondary data that already exists
somewhere, having been
collected for another purpose.
Eg. Companys internal database, commercial
data services, government sources. Eg. The
Nielsen company; Cnn, Factiva, Lexisnexis,
internet

research objectives
Secondary Data
Step 2: Determine the sources of information

to fulfill the research objectives
Secondary Data
http://www.vietrade.gov.vn
http://www.austrade.gov.au/ http://www.austrade.gov.au/Country/default.aspx
http://www.pwc.com/
http://www.planetretail.net/
http://www.nielsen.com/
http://www.hsbc.com/

research objectives
Primary Data
Primary Data
Observation Involves gathering

primary data by observing
relevant people, actions, and
situations.
Researchers often observe consumer behavior to
glean customer insights that they cant simply
obtain by asking questions.
In research labs, using high tech cameras and
other equipment, or in in natural environment.
http://www.youtube.com/watch?v=QX_oy9614HQ
observation
Survey research
Gathering primary data by

asking people questions
about their knowledge,
attitudes, preferences, and
buying behavior.
Survey/Questionnaire Types
Person administered Self administered
Telephone
Home
Shopping Mall
Direct mail outs

On-line
Shopping Mall
Advantages
High response rates
Rapport established between researcher
and interviewee
Advantages
Lower cost
More respondent control
Less interviewer bias
Ability to gather data on many respondents in a
small time frame
Ability to ask socially sensitive questions
Disadvantages
Time consuming
Expensive to administer
May lead to biased responses
Disadvantages
Very time consuming
Lower response rates than person administered
surveys
Primary data collection

contact methods
Mail
Telephone
Personal
Online
Flexibility
Poor
Good
Excellent
Good
Quantity of data
collected
Good
Fair
Excellent
Good
Control of
interviewer effects
Excellent
Fair
Poor
Fair
Control of sample
Fair
Excellent
Good
Excellent
Speed of data
collection
Poor
Excellent
Good
Excellent
Response rate
Poor
Poor
Good
Good
Cost
Good
Fair
Poor
Excellent

contact methods
Experimental research
Gathering primary data by selecting matched
groups of subjects, giving them different
treatments, controlling related factors, and
checking for differences in group responses.
Experimental research tries to explain cause-andeffect relationships
Eg. McDonalds, before adding new sandwich to its
menu, might use experiments to test the effects
on sales of 2 different prices it might change.

contact methods
Online marketing research:
Collecting primary data online through
internet surveys, online focus groups,
web-based experiments, or tracking
consumers online behavior.
Advantages: cost, speed, more
interactive, engaging, easier to
complete, less intrusive than traditional
contact methods.
Research instruments
Questionnaire
A good questionnaire appears
Simple
Focused
Easy to compose
Problems of Gathering Primary Data

Ability to Communicate Opinions
Willingness to Respond
Sampling in Field Surveys
Language and Comprehension
Step 4: Gather the relevant data from secondary

or primary sources, or both.
Data collection can be carried out by the
companys marketing research staff or by
outside firms.
The data collection phase ofthe marketing
research process is generally the most
expensive and the most subject to error.
Researchers should watch closely to make sure
that the plan is implemented correctly.
Step 5: Analyze, Interpret and summarize the

Results
The researcher must possess a high degree of cultural

understanding of the market in which research is being
conducted.
At some level, it will be absolutely necessary to have a native of

the target country involved in the interpretation of the results of
any research conducted in a foreign market.
A creative talent for adapting research methods is necessary.
A skeptical attitude in handling both primary and secondary data
is helpful.
Step 5: Analyze, Interpret and summarize the

Results
The researcher must possess a high degree of cultural

understanding of the market in which research is being
conducted.
At some level, it will be absolutely necessary to have a native of

the target country involved in the interpretation of the results of
any research conducted in a foreign market.
A creative talent for adapting research methods is necessary.
A skeptical attitude in handling both primary and secondary data
is helpful.
issues
The research design must ensure that the study is relevant and that it employs
effective procedures.
Three critical issues construct, measurement and sample equivalence
-
Construct equivalence: the meaning of a concept may vary across countries

(concepts are bound, e.g. beauty, wealth, trust)
Measurement equivalence: a method of measurement that works well in one
cultural environment may not work well in another
- Units of measurement may vary in countries (phone/email survey)
- Translation of verbal and non-verbal language may differ
- The meanings respondents attached to each point in the scale
- Sampling equivalence: the ability to identify an equivalent population sample to test
in two countries.
Managing the Cultural Barrier in International

Marketing Research
Ho
h
hi
h
it
uy
Chapter 4: INTERNATIONAL
MARKET ENTRY
International Market Selection
Screening for Market Selection (Stage

Screening Approach)
Screening for Market Selection (Stage

Screening Approach)
Analyse Elements of the Foreign Market (opportunities & threats)

Administrative, economic, geographic, & cultural conditions CAGE
Competitive conditions (Competition)
Consumer behaviour and preferences (demand)
Analyse Elements of the Firm (strengths and weaknesses)
Competitive Advantage
Management and marketing competencies
Technology and production competencies
Financial Resources
Progressively eliminate markets to 3-5 final options.
Analyse final selection of markets with SWOT/Porter model.
Modes of Entering Foreign Markets

How can a firm enter a foreign market?
What criteria does a firm use to decide on the mode of
entry?
Each mode of entrys attractiveness to a particular firm
on a particular market depends on:
The firms objectives
A balance of benefits, costs, and risks

Exporting:
Firm does business overseas without investing in owned
assets and own human resources in target market.
Sell produced products into foreign markets through
local independent agents or directly to customers
Indirect export
Direct exporting
Establish sales office in foreign market

Exporting:
Indirect export
Home agent
Cooperative exporting
Direct exporting
Foreign agent
End-user (internet)
Greater resources/control than indirect export
Establish sales office in foreign market

Contractual agreement: licensing and franchising
Licensing
Licensor grants rights to licensee for use of intangible property over a specified period
in return for a fee
Intangible property: patents, inventions, formulas, processes, designs, copyrights,
trademarks
Licensing agreement likely allows licensor quality assurance rights over actual use of
intangible asset
Franchising
Franchisor, grants franchisee use of intangibles under the condition that franchisee
follow strict rules of operating the business
Mode of operation is part of the brand image

Licensing
Licensor grants rights to licensee for use of intangible property over a
specified period in return for a fee
Intangible property: patents, inventions, formulas, processes, designs,
copyrights, trademarks
Licensing agreement likely allows licensor quality assurance rights
over actual use of intangible asset

Franchising
Franchisor, grants franchisee use of intangibles under the condition
that franchisee follow strict rules of operating the business
Mode of operation is part of the brand image

Relationship-based mode of entry:
Contract manufacturing
Goods produced by the partner company.
Strategic alliances: form of joint venture where
two or more companies enter a formal or
informal collaborative networking partnership
to achieve a given project or objective.

International joint ventures
Firms that are owned jointly by two or more independent
firms; most IJVs are between two firms.
One (or more) parent firms are non-resident in the host
market
Ownership % may vary from majority foreign owned, to
50%-50% owned, to minority owned by the foreign firm

Manufacturing-based entry
Wholly owned subsidiaries
Firms owned 100% by a company in a foreign country
Acquisition or greenfield operation
Factors Affecting Mode of Entry
Evaluation of entry mode strategy
mode
Conditions favoring
this mode
advantages
disadvantages
MARKETING STRATEGIES
MARKET SEGMENTATION
Segment
A segment is a group of customers who share
one or more similar characteristics, and
therefore have similar product/service needs.
Market Segmentation
Dividing a market into smaller segments with
distinct needs, characteristics, or behavior
that might require separate marketing
strategies or mixes.
216
Why Segment Markets?

Provides Focus
Identify and Compare best marketing opportunities.
Concentrate company resources on most profitable segments.
Increase profit
greater efficiency, less waste, improved marketing performance.
Reduces vulnerability by matching resources to segment needs
217
MARKET SEGMENTATION
Segmenting consumers markets

Geographic
Demographic
Psychographic
Behavioral
220
Psychographic Segmentation
Lifestyle:
Eight Male Lifestyle groups
Older Conservatives (21%)

Active Organizers (8%)
Money-Oriented Males (8%)
Alienated Young Bargain-Seekers (14%)
Average Successful (On Way Up) Males
(18%)
Experience-Seekers (7%)
Young Single Actives (13%)
Intellectual Activists (11%)
222
Psychographic Segmentation
Lifestyle:
Nine female lifestyle groups
young miss libbers (11%)

Community active females (12%)
Money-Oriented Females (9%)
Bargain-Conscious Housewives (11%)
Uninvolved Dolly Birds (15%)
Sophisticated Women (13%)
Liberated-equals women (9 %)
Older mundane-life housewives (16%)
Conscientious housewives (4%)
223
September 29, 2016
SEGMENTING INDUSTRY
MARKETS
Less scope to segment

than in consumer
markets, because:
fewer segmentation
variables
markets concentration &

dominance
Segmentation
variables harder to
Geographical: location
Demographical: industry,
company size
Benefits sought
User status
Usage rate
Loyalty status
Customer operating
characteristics
Purchasing approaches
Situational factors
Personal characteristics
discern
224
SEGMENTING INDUSTRY MARKETS

Industry / Economic Activity
Standard Industry Codes (SIC)
Agriculture, Forests and Fisheries
Mining
Construction
Manufacturing
Transportation
Communications
Wholesale trade
Retail trade
225
September 29, 2016
Segmenting international markets

Geographic location: Western Europe, the
Pacific Rim, the Middle East, Africa
Economic factors
Political and legal factor
Cultural factors: languages, religions,
customs, values
Intermarket / cross-market segmentation
Requirements for Effective Market Segmentation

To be useful, market segments must be:
Selecting target Market Segments

Market Targeting: the process of
evaluating each market segments
attractiveness and selecting one or
more segments to enter
A target market consists of a set of
buyers sharing common needs or
characteristics that the company
decides to serve.
Selecting target market segments
229
Market Coverage Strategies

Company
Company
Marketing
Marketing
Mix
Mix
Market
Market
A. Undifferentiated Marketing
Company
CompanyMix
Mix11
Segment
Segment11
Company
CompanyMix
Mix22
Segment
Segment22
Company
CompanyMix
Mix33
Segment
Segment33
B. Differentiated Marketing
Company
Company
Marketing
Marketing
Mix
Mix
m
te
p
Se
r2
e
b
6
01
2
,
Segment
Segment11
Segment
Segment22
Segment
Segment33
C. Concentrated Marketing
230
Choosing a differentiation and positioning strategy

Identify possible value differences and
competitive advantages:
An advantage over competitors gained by
offering greater customer value, either
by having lower prices or providing
more benefits that justify higher prices.
A company can differentiate along the
lines of product, services, channels,
people, or image.

Choosing the right competitive advantages:
.is a posture that allows a firm to gain an
edge over its rivals in attracting customers and defending
against competitive forces.
BMW
- Technological superiority
Rolex
- Brand Image
Amazon.com
- Distribution, product range
Body Shop
- Environmentally friendly philosophy

Selecting an overall positioning strategy:
Developing a positioning statement
To (target segment and

need) our (brand) is
(concept) that (point of
difference).
To busy, mobile professionals who need to always be in the
loop, the BlackBerry is a wireless connectivity solution that
gives you an easier, more reliable way to stay connected to
data, people, and resources while on the go.
Positioning
Product position is the way the product

is defined by consumers on important
attributesthe place the product
occupies in consumers minds relative to
competing products
Identifying a Positional Direction

by perceptual mapping
vincom
Crescent
mall
parkson
SG
square
Identifying a Repositioning Direction
vincom
Crescent
mall
parkson
SG
square
Many theories relating to Strategy
BCG Matrix
Product/market expansion
grid
7ps
SWOT Analysis
SWOT analysis
An overall evaluation of the companys strengths, weaknesses,
opportunities, and threats
Internal:
- strengths: internal capabilities, resources, positive situational
factors
- weaknesses: internal limitations, negative situational factors
External:
-
opportunities: favorable factors or trends in the external

environment that the company may be able to exploit to its
advantage
Threats: unfavorable external factors or trends -> challenges
BCG Matrix
BCG Matrix
Evaluates a companys SBUs in term of its market growth rate
and relative market share
SBUs: strategic business units key businesses that make up
the company a company division, a product line, a single
product or brand
BCG Matrix
Stars
are high-growth,
high-share businesses or products
requiring heavy investment to finance
rapid growth
They will eventually turn into cash cows.
Cash cows
are low-growth,
high-share businesses or products
requiring less investment to maintain market share
Produce a lot of cash, support other SBUs
Question marks
are low-share business units
high-growth markets
requiring a lot of cash to hold their share
Dogs
are low-growth,
low-share businesses and products
may generate enough cash to maintain
themselves but do not promise to be large
sources of cash
BGC Matrix
Stars
are high-growth, high-share businesses or products requiring heavy investment to
finance rapid growth. They will eventually turn into cash cows.
Cash cows
are low-growth, high-share businesses or products that are established and
successful SBUs requiring less investment to maintain market share
Question marks
are low-share business units in high-growth markets requiring a lot of cash to hold
their share
Dogs
are low-growth, low-share businesses and products that may generate enough cash
to maintain themselves but do not promise to be large sources of cash
2-13
Problems with Matrix Approaches like the BCG
Difficulty in defining SBUs and

measuring market share and growth
Time consuming
Expensive
Focus on current businesses, not
future planning
2-15
Product Market Expansion Product/Market Expansion

Grid
(Used to Develop Strategies for Growth and Downsizing)
Product/Market Expansion Grid

Market penetration is a growth strategy increasing
sales of current products to current market
segments without changing the product
Market development is a growth strategy that identifies
and develops new market segments for current
products
2-18
Product/Market Expansion Grid
Product development is a growth strategy that offers

new or modified products to existing market
segments
Diversification is a growth strategy through starting up
or acquiring businesses outside the companys
current products and markets
2-19
Identifying Possible Competitive

Advantage
Consumers typically choose products and services
that give them the greatest value

The key to winning and keeping customers is to
understand their needs and buying processes better
than competitors and to deliver more value
If a company can position itself as providing

superior value to selected target marketseither
by offering lower prices than competitors or by
providing more benefits to justify higher prices
it gains competitive advantage
Identifying Possible Competitive

Advantage
Product
Product
Service
Service
Areas
Areas for
for Competitive
Competitive
Differentiation
Differentiation
Personnel
Personnel
Image
Image
Marketing Strategies for Competitive Advantage
Market
Leader
Market
Challenger
STRATEGY A COMPANY ADOPTS

DEPENDS ON ITS
INDUSTRY POSITION
Market
Nicher
Market
Follower
Market leader:
The firm in an industry with the largest
market share
Leads the other firms in prices changes,
new product introductions, distribution
coverage, promotion spending
- expand total demand
- protect market share
- expanding market share
Market challenger
A runner-up firm that is fighting hard to
increase its market share in an industry
- attack the market leader
- wrest more market share
Market follower
A runner-up firm that wants to hold its share
in an industry without rocking the boat
Learn form market leaders experience
Copy and improve market leaders products,
programs, with less investment
Try to bring distinctive advantages: location,
services, financing
Low cost, prices, high quality
Market nicher
A firm that serves small segments that
the other firms in an industry overlook
or ignore
Ho
i
Th
uy
h
T
ai
Chapter 5: international
marketing mix
PRODUCTS, SERVICES, & BRANDS
What is a product?
Anything that can be offered to a market for attention,
acquisition, use, or consumption that might satisfy a want
or need.
Tangible objects
Services
Events
Persons
Places
Organizations
Ideas
ny
pa
m
Co
go
Lo
www.the
megaller
y.com
Products
Services are a form of product that consists

of activities, benefits or satisfaction that is
essentially intangible and does not result
in the ownership of anything.
ny
pa
m
Co
go
Lo
www.the
megaller
y.com
Levels of product and services
ny
pa
m
Co
go
Lo
www.the
megaller
y.com
Levels of product and services

QANTAS
Augmented Product
Qantas Club
Tours
Holliday
Packages
Seat
allocation
Inflight
Services
Meals
Time
Time
Critical
Critical
Transportation
Transportation
Booking
System
Fly-drive
packages
Safety
Record
Schedules
Hertz
Car
Rental
Booking
Frequent Flyer Scheme

Actual Product
Core Product
Standardization versus adaptation

A firm has 4 basic alternatives in approaching
international markets:
- Selling the product as it is in the international marketplace
- Modifying products for different countries and/or regions
- Designing new products for foreign markets
- Incorporating all the differences into one product design
and introducing a global product

Product standardization strategy refers to a uniform
representation of all aspects of the product such as the
quality, the materials been used, product name, and
packaging for all markets, regardless of location around
the world.
one size fits all approach

Product adaptation is when changes and special
modifications are made in order to adjust to each
market
There are many factors affecting to use adaptation
strategies. Some of them are product, target
market, package & design, ingredients,
language, culture, religion etc.
North american red bull vs chinese redbull

Red=action + courage
Silver=maturity
Blue=youth spirituality +
peace
Red = good luck

Gold = wealth + happiness
kekou kele
delicious fun
International product lifecycle
national Product life cycle
9 - 277
Early Majority
Innovators
Percentage of Adopters
Adoption of Innovations
Early
Adopters
34%
Late Majority
Laggards
34%
16%
13.5%
2.5%
Early
Time of Adoption
Late
International service marketing
Reasons for Growth in International

Services
the nature and characterisitcs of a

service
ny
pa
m
Co
go
Lo
www.the
megaller
y.com
ny
pa
m
Co
go
Lo
www.the
megaller
y.com
Services Marketing Mix
Process
Place
Product
Price
Promo
Personnel
Physical
facilities
Product
Place
Promotion
Price
Drivers of Service Internationalisation
Challenges for International Services

How do service firms export their services?
How do the characteristics of services affect the
export of services?
What are the most important barriers that
service exporters face?
What are the drivers of international
performance for service exporters?
Ways of Exporting Services
Cross border
The service is delivered to an overseas customer without the supplier being
present
Inward export
Overseas customer comes to the suppliers country to receive the service (eg tourism)
Commercial presence
Supplier establishes an office, appoints a representative (franchise) or develops a

partnership overseas
Movement of natural persons
Employees of the supplier travel to the overseas country to deliver the service
Branding or trademark?
A brand is a name, term, sign, symbol, or design,
or a combination of these, that identifies the
products or services of one seller or group of
sellers and differentiates them from competitors.
ny
pa
m
Co
go
Lo
www.the
megaller
y.com
Product Vs Brand
A Product is what the firm makes
A Brand is what the customer buys
A Product can be copied
A Product can be quickly outdated
A Brand is Unique
A Brand is what makes the firms product unique
A Brand can go on and on, forever.
ny
pa
m
Co
go
Lo
www.the
megaller
y.com
International Brand infringements
Ho
i
Th
uy
h
T
ai
marketing mix
international pricing
What Is a Price?
Price is the amount of money charged for a product or service.
It is the sum of all the values that consumers give up in order
to gain the benefits of having or using a product or
service.
Price produces revenue;
all other elements in the marketing mix represent costs
Considerations affecting price decision
Value based Pricing

Price set in accordance
with customer
perceptions about the
value of the
product/service.
Examples include status
products/exclusive
products
Cost based pricing

Cost plus pricing (markup pricing): add a
standard markup to the cost of the
product.
Break-even analysis and target profit pricing
The breakeven point is the point at

which costs of producing the
product equal revenue from
selling the product.
Setting price to break even on the costs of making and
marketing a product or setting price to make a target return
Determining the Breakeven Point

Dollars
Total Revenue
Breakeven
Point
Profits
Total
Costs
Fixed Costs
Units of Production
299
Fixed cost = $300,000

Variable cost = $10
Price = $20
Major Pricing Strategies
Break-Even Analysis and Target Profit Pricing
Breakeven Point
Fixed Costs
Breakeven Point = _______________________________
Per Unit Contribution to Fixed Costs
=
Fixed Costs
___________________
Price - Variable Costs
$300,000 : ($20 - $10)
302
Total revenue = P.Q

P = $20
Q = 42,000
Total revenue = $840,000
Profit = total revenue total costs = 840,000 (300,000 + 10 x
42,000) = $ 120,000
Competition based pricing

Setting prices based on competitors strategies, costs, prices,
and market offerings.
Consumers will base their judgments of a products value on
the prices that competitors charge for similar products.
Price demand relationship
Demand Curve
Price
Price/Quantity Relationship
P1
D1
Q1
Quantity
306
Demand Curve
Price
Price / Quality Relationship-- Prestige Products
P3
P2
P1
Q1 Q2
Quantity
307
Price elasticity of demand illustrates

the response of demand to a change in price
Inelastic demand occurs when demand
hardly changes when there is a small
change in price
Elastic demand occurs when demand
changes greatly for a small change in price
Elasticity of Demand
Price
Inelastic Demand
eg: Electricity
P2
P1
Q2 Q1
Quantity
309
Price
Elastic Demand
P2
Vehicles
P1
Q2
Quantity
Q2
310
Price
Reviewed
Inelastic (Electricity)
Elastic
( Vehicles)
Quantity
311
New product pricing strategies
MARKET SKIMMING STRATEGY

The products quality & image
must support its higher price,
& enough buyers must want
the product at that price
Setting a high price for a new

product to skim maximum revenues
layer by layer from the segments
willing to pay the high price;
the company makes fewer but
more profitable sales
The cost of producing a smaller

volume cannot be so high that
they cancel (annul) the
advantage of charging more
Competitors should not be

able to enter the market
easily & undercut the
high price
MARKET PENETRATION STRATEGY

The market must be highly
price sensitive so that a low
price produces more
market growth
Setting a low price for a new

product in order to attract a large
number of buyers and a
large market share
Production & distribution costs

must fall as sales volume
increases
The low price must help

keep out the competition, and
the penetration pricer must
maintain its low-price position
vnd7.000/500ml
VND3.500/330ml
Price adjustment strategies
Discount and allowance pricing

reduces prices to reward customer responses such as
paying early or promoting the product
cash discount for paying promptly;
quantity discount for large volume;
functional (trade) discount for selling, storing, distribution, and
record keeping.
trade-in allowance
promotional allowance to reward dealers for participating in
advertising or sales support programs.
Segmented pricing
Promotional pricing
when prices are temporarily
priced below list price or cost
to increase demand
Loss leaders
Special event pricing
Cash rebates
Low-interest financing
Longer warrantees
Free maintenance
Promotional pricing
Risks of promotional pricing:
Used too frequently, and copies by competitors can
create deal-prone customers who will wait for
promotions and avoid buying at regular price
Creates price wars
Psychological Pricing
Form of value pricing (consumer based)
Used to play on consumer perceptions, e.g.
$1,990
High value goods priced according to what
consumers THINK should be the price
May be slightly below certain perceived price
points, e.g. <$2,000 computer
Complexities of International Pricing
Common Pricing Objectives
Factors Influencing International Pricing

Strategy
International Pricing Strategy:

Considerations
International price has to be consistent with positioning and competitive

for target segment.
What segments is our firm concerned with?
Who are our major international and domestic competitors?
What are the competitive strengths of the international and domestic
competitors?
What is the positioning that we want to achieve?
Why and how do the international consumers buy?
What do they value about our augmented product (e.g., delivery)?
International Pricing Strategy: Options
International Pricing Strategy: Terms of

Sale
(Incoterms)
EXW: Ex-works -price at factory
FAS: Free alongside ship -priced to delivery to port
FOB: Free on board -priced to delivery and loaded
C&F: Cost and freight -goods priced landed; no insurance or customs clearance etc.
CIF: Cost, insurance and freight -goods priced landed and insured
DDP: Delivery duty paid -goods priced door to door
Incoterms
internationally accepted since 1936
31 languages
Balance risk for exporters and importers
Problems in International Price Setting
Constraints on International Price Settings

Restrictive Trade Practices
e.g., price fixing in the distribution chain
Administered pricing by governments
Subsidises or dictates prices
Competitors
Collude -fix prices
Dumping
Selling products at a price lower than the current domestic value in the country of
origin (government incentive, surplus production)
Devaluation and Revaluation of currencies
Inflation
Requires constant price adjustments
Ho
i
Th
uy
h
T
ai
marketing mix
international distribution
What is distribution
Supply chain:
Managing upstream and
downstream value-added flows of
materials, final goods, and related
information among suppliers, the
company, resellers, and final
consumers.
Supply chain: Managing upstream and downstream
value-added flows of materials, final goods, and
related information among suppliers, the
company, resellers, and final consumers.
Upstream partners are firms that supply the
raw material, components, parts, information,
finances, and expertise to create a product or
service
Downstream partners include the marketing channels
or distribution channels that look toward the
customer, form a vital connection between the
firm and its customers.
Includes company activities that make

the product available to target
customers.
Involves:
channel management
transportation
warehousing
inventory management
wholesale
retail
Distribution channels
Marketing channels (or distribution channels): a
set of interdependent organizations that help
make a product or service available for use
or consumption by the consumer or business
user.
Manufactures, agents, wholesalers, retailers,
customers partner with each other to
improve the performance of the entire
system
Function and importance of Channel Intermediaries
Intermediaries offer producers greater

efficiency in making goods available to target
markets.
Through their contacts, experience,
specialization, and scale of operations,
intermediaries usually offer the firm more
than it can achieve on its own.
Smooth flow of goods and

services
Large quantity of limited
variety -> Limited quantity of
a wide variety
Function and importance of Channel

Intermediaries
Distribution Channels
Information: The collection and dissemination of marketing
research information about potential and current customers,
competitors, and other actors and forces in the marketing
environment.
Promotion: The development and dissemination of persuasive
communications designed to attract customers to the offer.
Negotiation: The attempt to reach final agreement on price and
other terms so that transfer of ownership or possession can be
effected.
Ordering: Marketing-channel members' communication of
intentions to buy to the manufacturer.
Financing: The acquisition and allocation of funds required to
finance inventories at different levels of the marketing channel.
Risk taking: The assumption of risks connected with carrying out
the channel work.
Physical possession: The successive storage and movement of
physical products from raw materials to the final customers.
Payment: Buyers' payment of their bills to the sellers through
banks and other financial institutions.
Title: The actual transfer of ownership from one organization or
person to another.
Number of channel levels

Direct marketing channel: a marketing
channel that has no intermediary level
Many businesses, especially small ones
and those just starting up, sell directly
to customers.
Advantage is a certain degree of
control over prices and selling
activities
Disadvantage: lack retailing expertise.

Indirect marketing channel
Channel containing one or more intermediaries
levels (wholesalers, retailers)
Advantages:
Middlemen are sales professionals
Useful when location of home base is too far from
consumers
Greater sales volume potential
Frees producer to focus on production
Disadvantages:
More expensive than direct distribution
Less control over product
Intermediaries in distribution channels:

Wholesaler
Wholesaling: all the activities involved in

selling goods and services to those
buying for resale or business use.
Wholesaler: a firm engaged primarily in
wholesaling activities.
Wholesalers buy mostly from producers
and sell mostly to resellers, industrial
consumers, and other wholesalers.
WHOLESALER
FUNCTIONS OF WHOLESALER
Selling and
Promotion
Buying and
assortment building
Bulk breaking
Warehousing
Transportation
Financing
Risk bearing
Market
information
Management
services
WHOLESALERs
Types of Wholesalers
RETAILERS
Retailing includes all the
activities in selling
products or services
directly to final
consumers for their
personal, non-business
use
Retailers are businesses
whose sales come
primarily from retailing
RETAILERS
Distribution strategies
Intensive
Selective
Channel
Distribution
Strategies
Exclusive
Intensive distribution: a strategy in
which the company uses as many
outlets as possible
Exclusive distribution: the producer
gives only a limited number of
dealers the exclusive right to
distribute its products in their
territories.
Selective distribution: the use of
more than one but fewer than all
the intermediaries who are willing
to carry the companys products.
Manufacturers are constantly
tempted to move from .
..or ..
distribution to more
distribution to
increase the coverage and the
sales.
Factors that Affect International

Distribution Strategies
Managing International Agents and

Distributors
More than 50% of world trade is handled through agents or distributors (face of the
firm).
Selection (screening)
What is the most appropriate distribution structure (length/width)?
How do we choose the best distributor/agent?
Similar or complementary products, competing lines, experience, trust, similar
objectives.
How do we build relationships?
Communicate promptly, provide information and support, should be visited regularly,
invite to domestic market, provide training, motivation schemes and rewards.
The Worlds Top 10 Grocery Retailers (US$

billions)
Grey Market
Involves unauthorized distributors that circumvent authorized
channel arrangements by buying the firms products in low
price countries and selling them in high price countries at lower
prices
Takes three forms
Parallel importation (import from a 3rd. Party, not manufacturer)
Re-importation (importing product back to home market)
Lateral importation (moving product from one overseas market
to another)
Similac Abbott to enter Australian market

That is the analysis of Similac product in US and Australian Market.
Please:
-
Search more on the product and brand
Add more information to the SWOT analysis
Market entry Mode?
Marketing Mix suggestions? Explanations.
Ho
i
Th
uy
h
T
ai
marketing mix
international integrated marketing
Integrated Marketing
Communications
The New Marketing
Communications Model
Consumers are better

informed
More communication
Less mass marketing
Changing communications
technology
Integrated Marketing
Communications
The Need for Integrated Marketing Communications
Integrated marketing communications is

the integration by the company of its
communication channels to deliver a clear,
consistent, and compelling message about
the organization and its brands
International Integrated Communication

Strategy
Communication in international markets plays the same role as in the

domestic market: to communicate with audiences to achieve a
desired outcome.
An organisations integrated marketing communication program
consists of a specific marketing communication mix that will most
effectively meet objectives such as to inform, persuade, or remind
consumers as well as to reinforce their attitudes and perceptions.
Relative importance of each element of the integrated communication
mix varies across market according to differences in international
environments
Haagen Dazs loves Honey Bees

http://www.youtube.com/watch?v=Swfg17Sf0yQ
Marketing
Marketing
Marketing
Marketing
Marketing
Communication process
Steps in Developing Effective Marketing

Communication
6. Collect Feedback

Communication
1. Identifying the Target audience
The audience may be

potential buyers or current
users, those who make the
buying decision or those
who influence it. The
audience may be
individuals, groups, special
publics or the general
public.
7372
Steps in Developing Effective

Marketing Communication
2. Determining the Communication Objectives
Marketers seek a purchase response that

results from a consumer decision-making
process that includes the stages of buyer
readiness

Communication
AIDA
Model
Get Attention
Hold Interest
Arouse Desire
Obtain Action
AIDA
Marketing
Promotion and the Hierarchy of Effects

Hierarchy of Effects
Behavioral Objective
of Promotion
Awareness
Promotional Mix
Relevant to Each Step
Provide
Information
Informative Advertising, Public

Relations, Point-of-Purchase,
Window Displays
Change
Attitudes
and Feelings
Competitive Advertising,
Personal Selling, Sales
Promotions
Stimulate
Desires
Reminder
Advertising, Personal Selling,
Frequent-Shopper Programs
Knowledge
Liking
Preference
Conviction
Purchase

Communication
3. Designing a Message
Message content is an appeal or theme that will produce the desired
response
Rational appeal - relates to the audiences self-interest
Emotional appeal - attempt to stir positive or negative emotions to
motivate purchase
Moral appeal is directed at the audiences sense of right.

3. Designing a Message
Message Structure
The communicator must put the messages together in a logical
way. Three message-structure issues need to be considered.
1.
Whether to draw a conclusion or leave it to the audience.
2.
Whether to present a one-sided or two-sided argument.
3.
Whether to present the strongest arguments first or last.
Message Format
The communicator needs a strong format for the message,
which is based on different communication tools. For
example, the communicator must consider words, sounds
and voices when the message is to be carried over the radio.

Communication
4. Choosing Media
Personal
Personal channels
channels
Personal
selling
Word of
mouth
Print
media
Broadcast
media
3
4-
82
Non-personal
Non-personal
channels
channels

Communication
4. Choosing Media
Personal communication involves two or more

people communicating directly with each other.
It is effective because it allows personal
addressing and feedback
Face to face
Phone
Mail
E-mail
Internet chat

4. Choosing Media
Personal Communication
Opinion leaders person[s] within a reference

group who exerts social influence on others,
because of their special skills, knowledge,
personality, or other characteristics,
Buzz marketing - cultivating opinion leaders
and getting them to spread information
about a product or service to others in their
communities

4. Choose Media
Non-Personal Communication Channels
Non-personal communication
is media that carry messages
that affect the buyer directly
without personal contact or
feedback, including
major media,
atmospheres, and
events

Non-Personal Communication Channels
Major media - print, broadcast, display, and

online media
Atmospheres are designed environments that
create or reinforce the buyers leanings
toward buying a product
Events - that communicate messages to target
audiences
Press conferences
Grand openings
Exhibits
Public tours
Its a Big Ad
http://www.youtube.com/watch?v=GY6uJlI-t14
7-387

5. Selecting the Message Source
The messages impact is affected

by audience view of the
communicator
Celebrities Role Model / Aspire /
Like
Athletes
Entertainers
Professionals Credibility
Health care providers

6. COLLECTING FEEDBACK
Get feedback from target audience.
see / aware of / ad / TVC etc.
How many bought?
Talked about it?
Other behavior resulting from it?
Review / make changes.
Biere Larue has a long history in Vietnam. However, its

stronghold has been around the central Vietnam (most
specifically Quang Nam and Da Nang) where it Larue has
the majority share of the beer market.
Larue is the first brand in the market that offer you a
unique and surprising combination of larger beer, with
lemon, at 2.7% alcohol to provide you with a new
refreshing taste experience.
The brand has own brand page @ facebook/bialarue to
communicate with young drinker about the brand and
products information.
The brand intends to carry out a marketing plan with:

1. Objectives
- To build awareness to young audience through digital
- To drive beer trial though online or offline activities
- To maximize the social network engagement or through Key Opinion Leaders (KOLs)
2. Communication message
Lets enjoy the innovation product of Larue brand, Larue lemon with TRUE DOUBLE REFRESHING taste.
3. Target Audience
Young adult 18-45, entry beer drinkers, beer rejected & Carbonate soft drink consumer, BC class, Male/ females
and living in urban cities.
Duration: in 3 months (before the end of 2016)
Digital should play the role:
- Hit the KPIs (key performance indicators) with high reach, like page, engagement, comments and share.
- To identify the Larue lemon packaging with refreshing taste
- To generate refreshing/aspirational/contemporary/young value, beer for fun and enjoyment
- To maximize link Larue lemon to the social activities of young people
Constrains for International Marketing

Communication Mix
Integrated International Communication

Strategies
Shaping the Overall Promotion Mix

Promotion Mix Strategies
Advertising
Advertising is any paid form of nonpersonal presentation and
promotion of ideas, goods, or
services by an identified sponsor
Powerful, effective, expensive, non-personal
Advertising
g
tin
e
k
ar
M
g
tin
e
k
ar
M
Pull Strategies: Publicity and Public

Relations
Communication between the company and its public to
achieve specific objectives.
Public is broader than the market it serves: includes all of
those affected by the firms operation: Customers,
general public, shareholders, government, media,
suppliers, employees, activists, financial community,
distributors.
Pull Strategies: Publicity and Public

Relations
Publicity is the deliberate attempt to manage the publics

perception:
Contests, Art exhibitions, Event sponsorship, Speech or talk, issue a

report, arrange for a testimonial, announce an appointment, invent
then present an award, organize a tour of your business.
The advantages of publicity are low cost, and credibility.
Public Relations (PR) is the practice of managing the flow of

information between a company and its public:
Sponsorships, speaking at conferences, winning industry awards,

working with the press, and employee communication.
Push Strategies: Sales Promotion &

Personal Selling
Sales promotion is the short-term

incentive to encourage the purchase or
sale of a product or service
Contests, coupons, sampling, deals, Trade shows/fairs
etc.
Added importance in the international market (new
products)
Push Strategies: Sales Promotion &

Personal Selling
Personal selling is the personal presentation by

the firms sales force for the purpose of making
sales and building customer relationships
Sales force activities:
Manage relationships and negotiation in different cultures.
Trade missions
Inward/outward
Brochures
Culturally sensitive
Direct marketing
Catalogue Marketing
Technological media (SMS)
Agencies
A company which produces baby formula, and fresh

milk in Vietnam was reported importing bad
ingredients from Australia to make their products.
On some websites posted: Ministry of Health requires
the investigation of the case that company A
importing importing bad ingredients from Australia
to make their products
Consumers were very angry and retailers refused to
distribute products of the company.
As a crisis manager for the company, what do you do
in this situation?

Slide International Mkt-Handout

Caricato da

Informazioni sul documento

Titolo originale

Copyright

Formati disponibili

Condividi questo documento

Condividi o incorpora il documento

Opzioni di condivisione

Hai trovato utile questo documento?

Questo contenuto è inappropriato?

Copyright:

Formati disponibili

Slide International Mkt-Handout

Caricato da

Copyright:

Formati disponibili

international MARKETING

Ho thi hai thuy

Class attention: 10%

Individual/pair bonus marks

Starbuck enters Vietnam

The international marketing

International market research

Case: A golden opportunity

International market entry

Case: The Wiggles

International marketing mix

International brand infringements

International marketing mix

International marketing mix

Case: Tasmanian Pure and nature

1.1. DEFINITIONS of MARKETING

Offerings is some combination

Philip Kotlers definition

Fear the dragon : H&M in Australia

Gap arrives to Australia

Zara enters Australia

Zara enters vietnam?

Definition of international marketing

Definition of international marketing

Definition of international marketing

- A tool to improve domestic and global position

Definition of international marketing

The international environment

Driving and Restraining Forces in International Marketing

Opportunities in International Marketing

Starbucks to enter India

Starbucks enters vietnam?

Challenges in International Marketing

NYDC closure in vietnam

NYDC closure in vietnam

Core marketing concepts

A state of felt deprivation

Maslows Hierarchy of Needs

Figure 7.3, p.249 (Kotler, Brown, Adam, Armstrong, 2001)

Maslows Hierarchy of Needs

Figure 7.3, p.249 (Kotler, Brown, Adam, Armstrong, 2001)

Maslows Hierarchy of Needs

Human wants that are backed by buying power.

Dissatisfied customers often

Dissatisfied customers often

Market is the set of all

Evolution of Marketing Philosophies

The production concept

The philosophy that consumers will favor products

The production concept

The production concept

The product concept

The production concept

The Selling concept

The Selling concept

The Marketing concept

The Marketing concept

Selling and promoting

Profits through sales

ITS REALLY HARD TO DESIGN A

Find out what

Find out what customers

If that the company that satisfies