MKTG 6377

School of Business Administration

University of Houston-Victoria

Chapter 1: Introduction to Global

Marketing
 Learning Objectives

• Summarize the evolution of marketing

• Identify the three basic principles of marketing
• Discuss global marketing practices and strategies
• Discuss the growth of global market opportunities
• Compare and contrast management orientations
• Describe the driving forces behind the increased
pace of global integration
• Identify three restraining forces that hinder global
marketing efforts
 Marketing: A Universal Discipline

• Marketing is the process of focusing the

resources & objectives of an organization on
environmental opportunities and needs

• Marketing is also a set of concepts, tools,

theories, practices, procedures and experiences

• Although marketing is a universal discipline,

marketing practice varies from country to country
 The Marketing Concept

• The concept has chanced dramatically over the

years
• The old concept: Focus on products
• The new concept (around 1960):
• Focus was a customer orientation
• Development of the marketing mix: product, price,
place, promotion (4P’s)
 The Marketing Concept

• The Strategic Concept (1990s):

• Focus on customer in the context of the broader
external environment
• Competition, government policy and regulation
• Economic, social and technological macro forces

• Focus on stakeholder value

• employees, customers, shareholders, society
 The Marketing Concept

• Today:
• Two key tasks of marketing
• Focus on customer and his/her environment
• Create value for consumers and stakeholder
• Shift towards
• Focus on managing strategic partnerships
• Positioning of firm in value chain to optimize value creation
• Profit as a measure of success, not an end in itself
The Three Principles of Marketing

CUSTOMER VALUE

COMPETITIVE ADVANTAGE FOCUS

 The Three Principles of Marketing:
Customer Value
• Goal: create customer value that is greater
than the value created by competitors
• Strategy:
• Expand or improve product and/or service benefits
• Reduce the price
• Combine these two elements
 The Three Principles of Marketing:
Customer Value

V=B/P

V = Value
B = Perceived Benefits
P = Price
 The Three Principles of Marketing:
Competitive Advantage
• Goal: Create competitive advantage through
differentiation
• Advantage can exist in any element of a
company’s offer
• One way to penetrate a new national market is
to offer a superior product at a lower price.
 The Three Principles of Marketing:
Focus
• Focus is the concentration of attention and
resources
• Requirement to create customer value at a
competitive advantage
• A clear focus on customer needs and wants
 Global Marketing

• Marketing discipline is universal, but markets

and customers are quite different
• Marketing practice must vary region-to-region
and country-to-country
• Need for “Global Localization:” Think globally
but act locally
Examples of Global Marketing Strategies

Product Design Apple/Google/McDonalds/Toyota

Brand Name Coca-Cola/Apple/BMW
Product Positioning Unilever/Harley Davidson/Apple/Samsung
Packaging Gillette/Apple
Sourcing Toyota/Honda/Nike/Wal-Mart/Apple
Innovation Apple/Google/Samsung/Tata/Foxconn
Distribution IKEA/Apple/H&M
Customer Service Caterpiller/Dell/Apple/Lexus
 Globalization and Global Marketing

• The U.S. represents approximately 25% of the

total world market for all products and
services
• China is now the world’s 2nd largest economy;
Japan is now number three
• In 2009, China became the world’s largest
market for cars
• None of the top 15 automobile and parts
companies are Chinese
 Management Orientation and
Global Marketing

• Different Management Orientations in the

Global Arena – EPRG Framework

Polycentric

Ethnocentric

Regiocentric Geocentric
 Management Orientation and
Global Marketing

• Ethnocentric Orientation:
• Characteristic of domestic and international
companies
• Opportunities outside the home market are pursued
by extending various elements of the marketing mix

• Polycentric Orientation
• Characteristic of multinational companies
• Marketing mix is adapted by autonomous country
managers
 Management Orientation and
Global Marketing

• Regiocentric or Geocentric Orientation:

• Characteristic of global and transnational
companies
• Marketing opportunities are pursued by both
extension and adaptation strategies in global
markets
 Driving Forces Affecting
Global Marketing
• Technology
• Culture
• Market Needs
• Cost
• Free Markets
• Peace
• Management Vision
• Strategic Intent
 Restraining Forces Affecting
Global Marketing

• Culture
• Market Differences
• Costs
• Nationalism
• War
• Management Myopia
 Summary

• Global marketing is the process of focusing

resources on global marketing opportunities
• Goal, to create customer value and
competitive advantage by maintaining focus
• Four classifications of management
orientation: ethnocentric, polycentric,
regiocentric, geocentric
• Global marketing importance is shaped by a
variety of driving and restraining forces