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Book Reviews

It is well known today that global marketing management is a


GLOBAL MARKETING: complex task. Managers are challenged to design marketing
A MARKET-RESPONSIVE programs and strategies that will work well across many
APPROACH countries with different economic, political, social, and cul-
tural characteristics. Svend Hollensen, associate professor of
Svend Hollensen international marketing at Southern Denmark Business
Prentice Hall Europe, School, The Netherlands, provides an analytical framework
Hemel Hempstead, U.K., for the development and implementation of global marketing
1998, 604 pp. programs in his book Global Marketing: A Market Responsive
Approach. His academic background and practical experi-
ences are well reflected in his work.

The book is logically organized into five parts that correspond


to decision-making steps. Part I is “The Decision Whether to
Internationalize.” It is followed by Part II, “Deciding Which
Markets to Enter,” and Part III, “Market Entry Strategies.” Part
IV is titled “Designing the Global Marketing Programme.” Part
V is “Implementing and Coordinating the Global Marketing
Programme.” The book ends with an appendix titled “Global
Marketing Research/Decision Support Systems.”

At the end of each part, several illustrative cases are pre-


sented. The questions at the end of these cases provide the
opportunity to apply chapter knowledge. Moreover, the cases
themselves are inherently interesting, particularly because
they cover a wide range of industries in a variety of coun-
tries. Each chapter starts with learning objectives that lay out
what to expect in the coming pages. The comprehensibility
of chapters is greatly enhanced through excellent use of vi-
sual tools such as tables, charts, diagrams, graphs, exhibits,
and maps. The examples of global marketing practices by
companies are particularly useful in helping readers digest
the text material.

The first four chapters of the book constitute Part I. Chapter 1


(“Global Marketing in the Firm”) starts with Solberg’s (1997)
contingency framework, which describes the strategic choices
involved in the internationalization decision. The characteri-
zation and comparison of the management styles of small and
medium-sized enterprises (SMEs) and large-scale enterprises
(LSEs) are given in the next section. Subsequently, the role of
global marketing in the firm is described from a holistic point
of view by means of Peters and Waterman’s (1982) 7-S (struc-
ture, systems, style, staff, skills, strategy, and shared values)
model. Finally, the concept of the value chain (Porter 1986)
and its usefulness as a framework for identifying international
competitive advantage are explained.

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Chapter 2 (“Initiation of Internationalization”) analyzes the
reasons for going international (initiating exporting) and dis-
tinguishes between proactive and reactive motives. Next, the
external and internal triggers of export initiation are ex-
plained. A description of different factors that hinder export
initiation is followed by a discussion of critical barriers in
the process of exporting.

Chapter 3 (“Export Behavior Theories”) concentrates on


three central theories that explain companies’ international-
ization process. These are the Uppsala internationalization
model, transaction cost theory, and the network model. In
addition, four cases of internationalization (early starter,
lonely international, late starter, and international) are iden-
tified on the basis of the degree of the firm’s and the market’s
internationalization (Johanson and Mattson 1988).

Chapter 4 (“Development of the Firm’s International Compet-


itiveness”), the last chapter of Part I, focuses on how the firm
creates and develops competitive advantage in the interna-
tional market. Porter’s (1990) diamond framework is used to
analyze the competitiveness issue from a macro perspective.
Next, competitiveness at the industry level is explained in
terms of Porter’s (1980) five forces model (competitors, sup-
plies, buyers, substitutes, and new entrants). Subsequently,
another framework (the five sources model; Burton 1995),
which focuses on the assessment of collaborative (Kanter
1994) rather than competitive advantage, is presented. Value
chain analysis is discussed. At the end of the chapter, a model
for the development of core competencies is presented.

Part II consists of Chapters 5 and 6. Chapter 5 (“The Interna-


tional Market Selection Process”) compares SMEs and LSEs
with respect to their international market selection processes.
A model for international market selection is presented that
incorporates firm and environment characteristics. Subse-
quently, market expansion strategies are analyzed from incre-
mental entry versus simultaneous entry and concentration
versus diversification perspectives. A discussion of building
the global product-market portfolio concludes this chapter.

Chapter 6 (“The International Environment”) focuses on how


political/legal, economic, and sociocultural factors affect the
attractiveness of a potential market. A model showing the
macro environmental influence on market factors and buyer
behavior is suggested.

Selection of market entry strategies is the common theme of


the next five chapters, which make up Part III. In Chapter 7
(“Some Approaches to the Choice of Entry Mode”), a com-
prehensive model incorporates internal factors (firm size,
international experience, and product), external factors

Book Reviews 121


(sociocultural distance, country risk/demand uncertainty,
market size and growth, trade barriers, intensity of competi-
tion, and distribution system), desired mode characteristics
(risk averseness, control, and flexibility), and transaction-
specific factors.

Chapter 8 (“Export Modes”) focuses on indirect, direct, and


cooperative export modes. Five indirect entry modes are dis-
cussed: export buying agent, broker, export management
company, trading company, and piggyback. Direct exporting
modes include export through foreign-based agents and dis-
tributors. Cooperative export modes are discussed in the con-
text of SMEs, which are usually in a position to form export
marketing groups. Finally, the advantages and disadvantages
of these three core export modes are laid out.

In Chapter 9 (“Intermediate Entry Modes”), various arrange-


ments (such as contract manufacturing, licensing, franchising,
and joint ventures/strategic alliances) are described. The moti-
vations for engaging in these different intermediate entry modes
and advantages and disadvantages of each are discussed.

Chapter 10 (“Hierarchical Modes”) focuses on the entry


modes characterized by ownership and control. The hierar-
chical entry modes include domestic-based sales representa-
tives, resident sales representatives/sales subsidiary/sales
branch, sales and production subsidiary, and region centers.
These usually involve capital investments that range from ac-
quisitions to greenfield operations. Another issue discussed
is foreign divestment. Factors that can lead to withdrawal
from a foreign market are laid out.

Chapter 11 (“International Sourcing Decisions and the Role


of the Subsuppliers”) concludes Part III of the book. Out-
sourcing decisions are critical for the firm, and the relation-
ship between the buyer (main contractor) and the seller
(subsupplier or subcontractor) is examined within the frame-
work suggested by Turnbull and Valla (1986). Next, four dif-
ferent routes for the internationalization of subcontractors
are presented. The chapter ends with a section about project
exporting (turnkey contracts), which significantly differs
from subcontracting in bureaucratic and financial aspects.

The design of the global marketing mix is the focus of Part IV,
which consists of four chapters all framed within the contro-
versial standardization versus adaptation model. In Chapter
12 (“Product Decisions”), conceptual approaches such as
product life cycle concept and branding strategies at the pro-
duction level are discussed. Total quality management and
ISO 9000 are also addressed. Finally, green marketing strate-
gies that incorporate environmental concerns into decision
making are presented with their value chain implications.

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Chapter 13 (“Pricing Decisions and Terms of Doing Business”)
covers issues related to international pricing strategies. After
the internal and external factors that influence international
pricing decisions are examined, strategies such as skimming,
market pricing, price changes, experience curve pricing,
product line pricing, price standardization/adaptation, trans-
fer pricing, and currency management are discussed. A sec-
tion about export financing concludes the chapter.

Chapter 14 (“Distribution Decisions”) focuses on the manage-


ment of international distribution channels and logistics.
Channel decisions are related to the structure of the channel
(e.g., channel length) as well as management and control
(e.g., distributor agreements). Logistic decisions, in contrast,
aim for effective coordination of materials management and
physical distribution of finished products. Two special is-
sues are addressed in this chapter: international retailing and
gray marketing (parallel importing).

Part IV ends with Chapter 15, “Communication Decisions


(Promotion Strategies),” which concentrates on the commu-
nication process targeted at customers. Advertising, public
relations, sales promotion, direct marketing (with emphasis
on the use of the Internet), personal selling, trade fairs, and
exhibitions are discussed.

Chapters 16 and 17 make up Part V. In Chapter 16 (“Interna-


tional Sales Negotiations”), the main focus is cross-cultural
negotiations issues. National culture, business/industry cul-
ture, company culture, and individual behavior (which are all
nested into one another) make up the cultural factor. Interna-
tional business ethics is another important topic addressed in
the chapter. The section about sales negotiations in China
provides a particularly useful example that shows the neces-
sity of knowing about different cultures in global marketing.

Chapter 17 (“Organization and Control of the Global Pro-


gramme”) is the last chapter in the book. As the firm passes
through different stages of internationalization, its organiza-
tional structure and its systems of coordination and control
mechanisms must change. Various organizational structures
(functional, international divisional, product, geographic, and
matrix) are explained. Next, the design of control systems that
employ financial (output control) as well as nonfinancial (be-
havioral control) measures is discussed. Feedforward control
is suggested as a proactive system that uncovers problems.

The appendix (“Global Marketing Research/Decision Sup-


port System”) concludes the book. Two detailed sections are
presented on primary and secondary data collection. The list
of the Internet addresses of various institutions is useful to
students, researchers, and practitioners.

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Overall, Global Marketing: A Market-Responsive Approach is
a well-organized and comprehensive book that would appeal
to undergraduate and graduate students as well as to practi-
tioners. The book has several special features, such as the fo-
cus on SMEs as global subcontractors, the wide variety of
cases and examples, and extensive Internet sources. In sum-
mary, this book is highly recommended for everyone inter-
ested in global marketing.
—Elif Sonmez
Michigan State University

Burton, John (1995), “Composite Strategy: The Combination of Col-


REFERENCES laboration and Competition,” Journal of General Management,
21 (Autumn), 1–23.
Johanson, Jan and Lars Gunnar Mattson (1988), “Internalization in
Industrial Systems,” in Strategies in Global Competition, Neil
Hood and Jan-Erik Vahlne, eds. Beckenham, UK: Croom Helm,
287–314.
Kanter, Rosabeth Moss (1994), “Collaborative Advantage: The Art
of Alliances,” Harvard Business Review, 72 (July/August),
96–108.
Peters, Thomas J. and Robert H. Waterman (1982), In Search of Ex-
cellence: Lessons from America’s Best-Run Companies. New
York: Harper and Row.
Porter, Michael E. (1980), Competitive Strategy. New York: The
Free Press.
——— (1986), “Competition in Global Industries: A Conceptual
Framework,” in Competition in Global Industries, Michael E.
Porter, ed. Boston: Harvard Business School Press.
——— (1990), The Competitive Advantage of Nations. New York:
The Free Press.
Solberg, Carl A. (1997), “A Framework for Analysis of Strategy De-
velopment in Globalizing Markets,” Journal of International
Marketing, 5 (1), 9–30.
Turnbull, Peter W. and Jean-Paul Valla (1986), Strategies for Inter-
national Industrial Marketing: The Management of Customer Re-
lationships in European Industrial Markets. London: Croom
Helm.

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