Marketing Chapter 7
Marketing Chapter 7 MAR 250
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This 5 page Class Notes was uploaded by Melanie Guerrero on Sunday February 28, 2016. The Class Notes belongs to MAR 250 at Pace University taught by Harvey Markowitz in Winter 2016. Since its upload, it has received 33 views. For similar materials see Principles of Marketing (20335) in Marketing at Pace University.
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Date Created: 02/28/16
Chapter 7 – Marketing Vocabulary: Back transaction – where a translated word or phrase is retranslated into the original language by a different interpreter to catch errors Balance of trade – the difference between the monetary value of a nation’s exports and imports Bottom of the pyramid – the largest, but poorest, socioeconomic group of people in the world Consumer ethnocentrism – the tendency to believe that it is inappropriate, indeed immortal, to purchase foreign-made products Countertrade – the practice of using barter rather than money for making global sales Cross-cultural analysis – involves a study of similarities and differences among consumers in two or more nations or societies Cultural symbols – things that represent ideas and concepts Currency exchange rate – the price of one country’s currency expressed in terms of another country’s currency Customs – what is considered normal and expected about the way people do things in specific country Direct investment – entails a domestic firm actually investing in and owning a foreign subsidiary or division Dumping – when a firm sells a product in a foreign country below its domestic price or below its actual cost Economic Espionage Act (1996) – the theft of trade secrets by foreign entities a federal crime in the United States Exporting – producing products in one country and selling them in another country Foreign corrupt practices act – makes it a crime for the US corporations to bribe an official of a foreign government or political party to obtain or retain business in a foreign country Global brand – a brand marketed under the same name in multiple countries with similar and centrally coordinated marketing programs Global competition – exists when firms originate, produce, and market their products and services worldwide Global consumers – consist of consumer groups living in many countries or regions of the world who have similar needs or seek similar features or benefits from products or services Global marketing strategy – the practice of standardizing marketing activities when there are cultural similarities and adapting them when cultures differ Gray market – a situation where products are sold through unauthorized channels of distribution Gross domestic product (GDP) – the monetary value of all products and services produced in a country during one year Joint venture – when a foreign company and a local firm invest together to create a local business Microfinance – the practice of offering small, collateral-free loans to individuals who otherwise would not have access to capital necessary to begin small businesses or other income-generating activities Multidomestic marketing strategy – have as many different product variations, brand names, and advertising programs as countries in which they do business Protectionism – the practice of shielding one or more industries within a country’s economy from foreign competition through the use of tariffs or quotas Quota – a restriction placed on the amount of a product allowed to enter or leave a country Semiotics – the role of symbols that of a field of study Strategic alliances – agreements among two or more independent firms to cooperate for the purpose of achieving common goals such as a competitive advantage or customer value creation Tariffs – a government tax on products or services entering a country, primarily serve to raise prices on imports Values – represent personally or socially preferable modes of conduct or states of existence that tend to persist over time World trade organization (WTO) – a organization created to address an array of world trade issues I. Dynamics of world trade A. World trade flows 1. Global perspective on world trade a. Countertrade – vocab** b. A country’s imports affect its exports and exports affects imports 2. US perspective on world trade a. Gross domestic product – vocab** b. Balance of trade – vocab** B. Competitive advantage of nations 1. Factor conditions 2. Demands conditions 3. Related and supporting industries 4. Company strategy, structure, and rivalry C. That dark side of global competitive advantage 1. Economic espionage act – vocab** 2. Economic espionage – collection of trade secrets or proprietary information about competitors II. Marketing in a borderless economic World A. Decline of economic protectionism 1. Protectionism – vocab** 2. Tariffs – vocab** 3. Quota – vocab** 4. World trade organizations – vocab** B. Rise of economic integration 1. European union 2. North American free trade agreement 3. Asian Free trade agreements C. A new reality: global competition among global companies for global consumers 1. Global competition a. Vocab** b. Strategic alliances – vocab** 2. Global companies a. 3 Types of companies populate and compete in the global marketplace i. International firms ii. Multinational firms iii. Transnational firms b. Multidomestic marketing strategy – vocab** c. Global marketing strategy – vocab** d. Global brand – vocab** 3. Global consumers a. vocab** D. emergence of a networked global marketspace 1. A networked global marketspace enables the exchange of products, services, and information from sellers anywhere to buyers anywhere at any time and at a lower cost III. Global environmental scan A. Cultural diversity 1. Values a. Vocab** b. Cross-cultural analysis – vocab** 2. Customs a. Vocab** b. Foreign corrupt practices act – vocab** 3. Cultural symbols a. Vocab** b. Semiotics – vocab** 4. Language a. Back translation – vocab** 5. Cultural ethnocentricity a. Consumer ethnocentrism – vocab** B. Economic considerations 1. Stage of economic development a. Bottom of the pyramid – vocab** 2. Economic infrastructure 3. Consumer Income and purchasing power a. Microfinance – vocab** 4. Currency exchange rates a. Vocab** C. Political-regulatory climate 1. Political stability 2. Trade regulations IV. Comparing global market-entry strategies A. Exporting 1. Vocab** 2. Indirect exporting – when a firm sells its domestically produced products in a foreign country through an intermediary 3. Direct exporting – when a firm sells its domestically produced products in a foreign country without intermediaries B. Licensing 1. Contract Manufacturing 2. Contract Assembly C. Joint Venture 1. Vocab** D. Direct Investment 1. Vocab** V. Crafting a worldwide marketing program A. Product and promotion strategies *Products may be sold globally in one of 3 ways: (1) in the same form as in its home market (2) with some adaptions (3) as a totally new product 1. Product extension 2. Product adaptation 3. Product invention 4. Communication adaptation strategy 5. Dual adaptation strategy B. Distribution strategy C. Pricing strategy 1. Dumping – vocab** 2. Gray market – vocab**
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