International Marketing

15th edition

Philip R. Cateora, Mary C. Gilly, and John L. Graham

Introduction
Issues of standardization versus adaptation
Less relevance to marketing industrial goods than
consumer goods

Factors accounting for greater market similarities

in customers of industrial goods versus consumer
goods
The inherent nature of the product (industrial
products and services are used in the process of
creating other goods and services)
The motive or intent for the user differs (industrial
consumers are seeking profit, whereas the ultimate
consumer is seeking satisfaction)
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Major Categories
U.S. Exports
Exhibit 14.1

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Demand in Global
Business-to-Business Markets
Three factors affect the demand in industrial
markets differently than in consumer markets.
They are:
Volatility of industrial demand (demand in
industrial markets is by nature more volatile)
Stages of economic development (stages of
industrial and economic development affect
demand for industrial products)
Technology and market demand (the level of
technology of products and services make their
sales more appropriate for some countries than
others)
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The Volatility
of Industrial Demand
Cyclical swings in demand
Professional buyers tend to act in concert
Derived demand accelerates changes in markets

Derived demand can be defined as demand dependent

on another source
Minor changes in consumer demand mean major
changes in related industrial demand
Boeing
Worldwide demand for travel services related to
demand for new airplanes
Commercial aircraft industry one of the most volatile
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Quality and
Global Standards
Perception of quality rests solely with the
customer
Level of technology reflected in the product
Compliance with standards that reflect customer
needs
Support services and follow-through
Price relative to competitive products

Quality standards vary with level of countrys

industrialization

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ISO 9000 Certification

An International Standard of Quality
(1 of 2)
Positively affects the performance and stock
prices of firms
Certification of the existence of a quality control
system a company has in place to ensure it can
meet published quality standards
Describes three quality system models
Defines quality concepts
Gives guidelines for using international standards
in quality systems

Generally voluntary
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ISO 9000 Certification

An International Standard of Quality
(2 of 2)
EU Product Liability Directive
Now a competitive marketing tool in Europe and
around the world
The ACSI approach

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Business Services
For many industrial products the revenues from
associates services exceed the revenues from the
products
Cellular phones
Printers

Leasing capital equipment

Services not associated with products
Boeing at-sea-satellite-launch services
Ukrainian cargo company space rental on giant jets
Professional services (advertising, banking,
healthcare, etc.)
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After-Sale Services
Installation
Training
Spare and replacement parts
Delivery time
Cost of parts

Service personnel
Almost always more profitable than the actual
sale of the machinery or product
Crucial in building strong customer loyalty
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Other Business Services

Client followers
Mode of entry
Licensing
Franchising
Direct investment

Protectionism
Restrictions on cross-border data flows

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Trade Shows: A Crucial Part of Businessto-Business Marketing

(1 of 4)
Secondary methods for marketing:

Advertising in print media

Catalogs
Web sites
Direct mail

Trade shows have become the primary and most

important vehicle for doing business in many
foreign countries

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Trade Shows: A Crucial Part of Businessto-Business Marketing

(2 of 4)
Total annual media budget spent on trade
events:
Europeans 22 percent
Americans 5 percent

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Trade Shows: A Crucial Part of Businessto-Business Marketing

(3 of 4)
Trade shows
Provide the facilities for a manufacturer to exhibit and
demonstrate products to potential users
Allow manufacturers to view competitors products
Are an opportunity to create sales and establish
relationships with agents, distributors, franchisees, and
suppliers

Online trade shows

Become useful in difficult economic and/or political
circumstances
Are obviously a less than adequate substitute for live
trade shows
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Trade Shows: A Crucial Part of Businessto-Business Marketing

(4 of 4)
Not a matter of selling the right product the
first time instead selling a continuously changed
the product to keep it right over time
The objective of relationship marketing

To make the relationship an important attribute of

the transaction
Differentiating oneself from competitors

Using the Internet to facilitate relationship

building and maintenance
Cisco Systems
Solar Turbines Inc.
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