pp 01 introduction keegan
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Global Marketing Management
Warren J. Keegan
Chapter 1 Introduction to Global Marketing
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Overview
Marketing: A Universal Discipline The Three Principles of MarketingGlobal Marketing:What It Is & What It Is Not Importance of Global MarketingManagement Orientation & Global MarketingDriving and Restraining Forces Affecting Global
Integration & Global MarketingSummary
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Learning Objectives
Understand how the world economy developed over the past decades
Know the impact of globalization on the marketing discipline
Learn about the interdependencies between management orientation & marketing performance
Understand the factors supporting or inhibiting international marketing activities
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Marketing: A Universal Discipline
Marketing (1): the process of focusing the resources & objectives of an organization on environmental opportunities & needs
Marketing (2): a set of concepts, tools, theories, practices, procedures, & experiences
Although marketing is a universal discipline, marketing practice varies from country to country
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The Marketing Concept (1)
Concept has chanced dramatically1950’s: Focus on products1960’s:
Focus on customer orientation Development of marketing mix: product, price, place,
promotion (4P’s)
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The Marketing Concept (2)
1990’s: Focus on customer in the context of the broader external
environment Competition, government policy & regulation
Focus on stakeholder valueemployees, customers, shareholders, society
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The Marketing Concept (3)
Today: Two key tasks of marketing
Focus on customer & his/her environmentCreate value for consumers & 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
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The Three Principles of Marketing
CUSTOMER VALUE
DIFFERENTIATION FOCUS
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Key Elements of Marketing – 1. 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
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Elements of Marketing – Customer Value
V = Value
B = Perceived Benefits – Perceived Costs
P = Price
V = B / P
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Key Elements of Marketing – 2. Differentiation
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.
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Key Elements of Marketing – 3. Focus
Goal: a concentration of attention & resources Requirement to create customer value at a
competitive advantage A viable way for small & medium sized companies
to achieve dominant position in world market A clear focus on customer needs & wants
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Global Marketing Marketing discipline is universal but markets &
customers are quite different 3 domains of knowledge
Cross-Cultural Knowledge Country/ Regional Knowledge Cross-Border Transactions Knowledge
Need for “Global Localization”: Adjustment of global marketing strategies to local requirements
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Product Design
Canon/photocopier/McDonalds/Toyota/Ford
Brand Name Marlboro/Coke/Pepsi/Mercedes/Caterpillar
Product Positioning
Colgate toothpaste/Unilever fabric softener
Packaging Gillette razors
Advertising Strategy
Coca-cola/British Airways/Benetton
Sales Promotion
IBM
Distribution Benetton/United Distillers
Customer Service
American Express/Hertz
Examples of Global Marketing
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Importance of Global Marketing
International arena is of great importance to companies maximizing growth potential
75% of market potential is outside the US 94% of market potential for German companies is
outside of Germany A large number of industries will be dominated by a
handful of global companies
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Management Orientation and Global Marketing (1)
Different Management Orientations in the Global Arena – EPRG Framework
Regiocentric
Ethnocentric
Geocentric
Polycentric
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Management Orientation & Global Marketing (2)
Ethnocentric Orientation: Characteristic of domestic & 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
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Management Orientation & Global Marketing (3)
Regiocentric or Geocentric Orientation: Characteristic of global & transnational companies Marketing opportunities are pursued by both extension &
adaptation strategies in global markets
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Driving Forces Affecting Global Marketing Technology Regional Economic Agreements Market Needs & Wants Transportation & Communication Improvements Product Development Costs Quality World Economic Trends Leverage The Global/ Transnational Corporation
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Restraining Forces Affecting Global Marketing
Management Myopia & Organizational Culture
National Controls & Barriers
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Summary
Global marketing is the process of focusing resources on global marketing opportunities
Goal, to create customer value & competitive advantage by maintaining focus
Three classifications of management orientation: ethnocentric, polycentric, regiocentric, geocentric
Global marketing importance is shaped by a variety of driving & restraining forces