International
Business,
8th Edition
Griffin & Pustay
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-1
Learning Objectives
Characterize the nature of marketing
management in international business
Discuss the basic kinds of product policies and
decisions made in international business
Identify pricing issues and evaluate pricing
decisions in international business
Identify promotion issues and evaluate
promotion decisions in international business
Discuss the basic kinds of distribution issues
and decisions in international business
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-2
International Marketing Management
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-3
International Marketing and Business
Strategies
Differentiation
Business Overall Cost
Strategy Leadership
Focus
Strategy
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-4
The Marketing Mix
Marketing Mix
How to develop the firm’s product(s)
How to price those products
How to sell those products
How to distribute those products to the
firm’s customers
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-5
The Marketing Mix (Cont.)
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-6
Standardization versus Customization
Ethnocentric Approach
Polycentric Approach
Geocentric Approach
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-7
Standardization versus Customization
(Cont.)
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-8
Standardization versus Customization
(Cont.)
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-9
Product Policy
Tangible
Product Features
(“P”) Intangible
Features
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-10
Standardized Products or Customized
Products?
Customized
Standardized
within
Across
Individual
Markets
Markets
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-11
Legal Forces
Labeling Requirements
Health Standards
Product Design
Technical Standards
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-12
Cultural Influences
Language
Packaging
Food Ingredients
Quality Consciousness
Environmental Consciousness
Local Morals and Sensibilities
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-13
Economic Factors
Level of
Quality of
Economic
Infrastructure
Development
Product
Desired
Attributes
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-14
Brand Names
Packaging Costs
Design Costs
Standardize
Brand Name
Advertising Production Costs
Ads Spillovers
Customize Example: Spider-Man; Disney;
Brand Name Sesame Street
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-15
Pricing Issues
Transportation Distribution
and Tariffs Practices
Varying Costs
Exchange-Rate
of Doing
Fluctuations
Business
Pricing
Policies
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-16
Pricing Policies
Standard Price Policy
Two-tiered Pricing
Market Pricing
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-17
Market Pricing
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-18
Market Pricing (Cont.)
Conditions
Demand and/or Cost Conditions
Arbitrage
Advantages
Setting prices
Allocating firm’s resources
Disadvantages
Damage to Brand Names
Gray Market Development
Consumer Resentment
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-19
Promotion Issues and Decisions
Advertising
Personal Selling
Promotion
Mix
Sales Promotion
Public Relations
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-20
Advertising
Decision Factors
Message
Medium
Global vs. Local Advertising
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-21
Personal Selling
Industrial Products
Consumer Products
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-22
Personal Selling (Cont.)
Advantages
Knowledge of Local Markets
Close Contact with Customers
Access to Valuable Market Information
Disadvantages
Compensating Sales Representatives
Making Contacts After the Sale
Expenses of Regional Sales Offices
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-23
Sales Promotion
Retailers
Wholesalers
Consumers
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-24
Public Relations
Model “Corporate Citizen”
Political Allies
Positive Image and Reputation
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-25
Distribution Issues and Decisions
Physical transportation
Selection of means to merchandise goods
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-26
International Distribution
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-27
International Distribution (Cont.)
Inventory and Service
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-28
Channels of Distribution
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-29
Review Questions
What are the basic factors involved in deciding
whether to use standardization or customization?
How do legal, cultural, and economic factors
influence product policy?
Why are brand names an important marketing
tool for international business?
What are the three basic pricing policies?
What are the problems that a firm using market
pricing might encounter?
What are some of the fundamental issues that
must be addressed in international advertising?
What is a distribution channel? What options does
an international firm have in developing its
channels?
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-30
COPYRIGHT © 2015 PEARSON EDUCATION, INC. Chapter 16-31
