Description
This is ppt is about International Marketing Environment
International Marketing Environment
The International Marketing Environment
Foreign Environment (Uncontrollables)
7. Structure of Distribution 1. Competition Domestic environment (Uncontrollables)
(Controllables) 1. Competition 2. Technology Price Product Target 5. Political7 Market 6. Geography and Legal Promotion Place or 2 .Technology Infrastructure Distribution 4. Culture 3. Economy 5. PoliticalLegal 4. Culture 3. ECONOMY
Introduction
Proliferation of trade and emergence of the global economy
Intensification of global competition
More emerging markets
Developments in technology allow communications with global consumers and movement of goods
World Trade and U.S. Multinationals
•
•
• •
•
Resurgence of competition from all over the world challenged the supremacy of American industry Newly industrialized countries (NICs) such as Brazil, Mexico, South Korea, Taiwan, Singapore, and Hong Kong experienced rapid industrialization Economic power evenly distributed with growth of MNCs from other countries Establishment of the WTO Creation of NAFTA, ASEAN, and APEC
21st Century: The First Decade and Beyond
Faster growth rates expected in developing countries such as Brazil, China, India, Indonesia, and Russia.
More trade expected in emerging markets, regional trade areas, and the established markets in Europe, Japan, and U.S. Companies need to be more efficient, improve productivity, expand global reach, and respond quickly. Greater growth in international sales expected by smaller firms.
Balance of Payments
The BP is the difference between receipts and payments
BP Receipts BP Payments •merchandise export sales. •money spent by foreign tourists. •transportation. •payments of dividends and interest from FDI abroad. •new foreign investments in the Country •costs of goods imported. •spending by nationals overseas. •new overseas investments. •cost of foreign military and economic aid.
Balance of Payments
The BP includes three accounts:
(1) current account—a record of all merchandise exports, imports, and services plus unilateral transfers of funds; (2) the capital account—a record of direct investment, portfolio investment, and short-term capital movements to and from countries;
(3) the official reserves account—a record of exports and imports of gold, increases or decreases in foreign exchange, and increases or decreases in liabilities to foreign central banks;
Protectionism: Logic and Illogic
Countries use protectionist measures to shield a country’s markets from intrusion by foreign competition and imports.
Arguments for Protectionism include: 1. 2. 3. 4. 5. 6. 7. 8. maintain employment and reduce unemployment. increase of business size, and protection of the home market. need to keep money at home. maintenance of the standard of living and real wages. conservation of natural resources. protection of an infant industry industrialization of a low-wage nation
Protectionism: Logic and Illogic
Arguments above are considered valid for protectionism
In general, protectionism contributes to industrial inefficiency and makes a nation uncompetitive
Protectionism is implemented through the imposition of trade barriers, which include tariff barriers and non-tariff barriers
Types of Non-Tariff Barriers
Specific Limitations on Trade: 1. Quotas 2. Voluntary Export Restrictions 3. Proportion restrictions of foreign to domestic goods 4. Minimum import price limits 5. Boycotts and Embargoes
General Agreement on Tariffs and Trade (GATT)
1. 2.
GATT created as an agency to serve as watchdog over world trade and provide a process to reduce tariffs GATT also provided a mechanism to resolve trade disputes bilaterally
GATT covers three basic areas: 1. trade shall be conducted on a nondiscriminatory basis; 2. protection shall be afforded domestic industries through customs tariffs, not through such commercial measures as import quotas; and 3. consultation shall be the primary method used to solve global trade problems.
3.
GATT now replaced by the World Trade Organization
World Trade Organization (WTO)
Unlike GATT,
is an institution, not an agreement
1.
It sets many rules governing trade between its 132 members WTO provides a panel of experts to hear and rule on trade disputes between members, and, unlike GATT, issues binding decisions
2.
The International Monetary Fund (IMF)
1. 2. 3. 4.
IMF was created to assist nations in becoming and remaining economically viable It assists countries that seek capital for economic development and restructuring IMF loans come with stipulations that borrowing countries slash spending and impose controls to curb inflation It helps maintain stability in the world financial markets
Objectives of the IMF include: 1. stabilization of foreign exchange rates 2. establish convertible currencies to facilitate international trade 3. lend money to members in financial trouble
World Bank Group (WBG)
The goal of WBG is to reduce poverty and the improvement of living standards by promoting sustainable growth and investment in people.
The functions of the WBG include:
1. 2.
lending money to countries to finance development projects in education, health, and infrastructure; providing assistance for projects to the poorest developing countries;
3.
4.
lending directly to the private sector in developing countries with longterm loans, equity investments, and other financial assistance;
provide investors with investment guarantees against “noncommercial risk,” so developing countries will attract FDI; and
5.
provide conciliation and arbitration of disputes between governments and foreign investors
Protests Against Global Institutions
In 1999 “anti-capitalist protestors” complained against the WTO, and IMF, over the unintended consequences of globalization that include:
1. 2. 3. 4. 5.
environmental concerns worker exploitation and domestic job losses cultural extinction higher oil prices, and diminished sovereignty of nations
CULTURAL ENVIRONMENT
LANGUAGE ? In addition to national boundaries and geographic obstacles, language affects cultural stability ? Same language countries have more cultural similarity and culture spreads more easily RELIGION ? A strong molder of values ? May affect business – sale of beaf, ham products, timing of prayers, holidays, days of work (El Al does not fly on saturdays), interest, insurance
ECONOMIC ENVIRONMENT ? POLITICAL ENVIRONMENT
?
The Economic Freedom Index
? approximates the extent to which a government intervenes in the areas of free choice, free enterprise, and market-driven prices for reasons that go beyond basic national needs ? classifies countries as: -free -mostly free -mostly unfree -repressed
Countries Ranked According to Economic Freedom
Mostly Free
Mostly Unfree
Free
Repressed
4-19
Diffusion of Innovation
? The Adoption Process ? Characteristics of Innovations ? Categories of Adopters
The Adoption Process
? The mental stages through which an individual passes from the time of his or her first knowledge of an innovation to the time of product adoption or purchase
? ? ? ? ? Awareness Interest Evaluation Trial Adoption
Characteristics of Innovations
? Innovation is something new, five factors that affect the rate at which innovations are adopted include
? ? ? ? ? Relative advantage Compatibility Complexity Divisibility Communicability
Categories of Adopters
? Classifications of individuals within a market on the basis of their innovativeness. ? Five categories
? ? ? ? ?
Innovators Early Adopters Early majority Late majority Laggards
Categories of Adopters
Thank you!
doc_565694515.ppt
This is ppt is about International Marketing Environment
International Marketing Environment
The International Marketing Environment
Foreign Environment (Uncontrollables)
7. Structure of Distribution 1. Competition Domestic environment (Uncontrollables)
(Controllables) 1. Competition 2. Technology Price Product Target 5. Political7 Market 6. Geography and Legal Promotion Place or 2 .Technology Infrastructure Distribution 4. Culture 3. Economy 5. PoliticalLegal 4. Culture 3. ECONOMY
Introduction
Proliferation of trade and emergence of the global economy
Intensification of global competition
More emerging markets
Developments in technology allow communications with global consumers and movement of goods
World Trade and U.S. Multinationals
•
•
• •
•
Resurgence of competition from all over the world challenged the supremacy of American industry Newly industrialized countries (NICs) such as Brazil, Mexico, South Korea, Taiwan, Singapore, and Hong Kong experienced rapid industrialization Economic power evenly distributed with growth of MNCs from other countries Establishment of the WTO Creation of NAFTA, ASEAN, and APEC
21st Century: The First Decade and Beyond
Faster growth rates expected in developing countries such as Brazil, China, India, Indonesia, and Russia.
More trade expected in emerging markets, regional trade areas, and the established markets in Europe, Japan, and U.S. Companies need to be more efficient, improve productivity, expand global reach, and respond quickly. Greater growth in international sales expected by smaller firms.
Balance of Payments
The BP is the difference between receipts and payments
BP Receipts BP Payments •merchandise export sales. •money spent by foreign tourists. •transportation. •payments of dividends and interest from FDI abroad. •new foreign investments in the Country •costs of goods imported. •spending by nationals overseas. •new overseas investments. •cost of foreign military and economic aid.
Balance of Payments
The BP includes three accounts:
(1) current account—a record of all merchandise exports, imports, and services plus unilateral transfers of funds; (2) the capital account—a record of direct investment, portfolio investment, and short-term capital movements to and from countries;
(3) the official reserves account—a record of exports and imports of gold, increases or decreases in foreign exchange, and increases or decreases in liabilities to foreign central banks;
Protectionism: Logic and Illogic
Countries use protectionist measures to shield a country’s markets from intrusion by foreign competition and imports.
Arguments for Protectionism include: 1. 2. 3. 4. 5. 6. 7. 8. maintain employment and reduce unemployment. increase of business size, and protection of the home market. need to keep money at home. maintenance of the standard of living and real wages. conservation of natural resources. protection of an infant industry industrialization of a low-wage nation
Protectionism: Logic and Illogic
Arguments above are considered valid for protectionism
In general, protectionism contributes to industrial inefficiency and makes a nation uncompetitive
Protectionism is implemented through the imposition of trade barriers, which include tariff barriers and non-tariff barriers
Types of Non-Tariff Barriers
Specific Limitations on Trade: 1. Quotas 2. Voluntary Export Restrictions 3. Proportion restrictions of foreign to domestic goods 4. Minimum import price limits 5. Boycotts and Embargoes
General Agreement on Tariffs and Trade (GATT)
1. 2.
GATT created as an agency to serve as watchdog over world trade and provide a process to reduce tariffs GATT also provided a mechanism to resolve trade disputes bilaterally
GATT covers three basic areas: 1. trade shall be conducted on a nondiscriminatory basis; 2. protection shall be afforded domestic industries through customs tariffs, not through such commercial measures as import quotas; and 3. consultation shall be the primary method used to solve global trade problems.
3.
GATT now replaced by the World Trade Organization
World Trade Organization (WTO)
Unlike GATT,
is an institution, not an agreement
1.
It sets many rules governing trade between its 132 members WTO provides a panel of experts to hear and rule on trade disputes between members, and, unlike GATT, issues binding decisions
2.
The International Monetary Fund (IMF)
1. 2. 3. 4.
IMF was created to assist nations in becoming and remaining economically viable It assists countries that seek capital for economic development and restructuring IMF loans come with stipulations that borrowing countries slash spending and impose controls to curb inflation It helps maintain stability in the world financial markets
Objectives of the IMF include: 1. stabilization of foreign exchange rates 2. establish convertible currencies to facilitate international trade 3. lend money to members in financial trouble
World Bank Group (WBG)
The goal of WBG is to reduce poverty and the improvement of living standards by promoting sustainable growth and investment in people.
The functions of the WBG include:
1. 2.
lending money to countries to finance development projects in education, health, and infrastructure; providing assistance for projects to the poorest developing countries;
3.
4.
lending directly to the private sector in developing countries with longterm loans, equity investments, and other financial assistance;
provide investors with investment guarantees against “noncommercial risk,” so developing countries will attract FDI; and
5.
provide conciliation and arbitration of disputes between governments and foreign investors
Protests Against Global Institutions
In 1999 “anti-capitalist protestors” complained against the WTO, and IMF, over the unintended consequences of globalization that include:
1. 2. 3. 4. 5.
environmental concerns worker exploitation and domestic job losses cultural extinction higher oil prices, and diminished sovereignty of nations
CULTURAL ENVIRONMENT
LANGUAGE ? In addition to national boundaries and geographic obstacles, language affects cultural stability ? Same language countries have more cultural similarity and culture spreads more easily RELIGION ? A strong molder of values ? May affect business – sale of beaf, ham products, timing of prayers, holidays, days of work (El Al does not fly on saturdays), interest, insurance
ECONOMIC ENVIRONMENT ? POLITICAL ENVIRONMENT
?
The Economic Freedom Index
? approximates the extent to which a government intervenes in the areas of free choice, free enterprise, and market-driven prices for reasons that go beyond basic national needs ? classifies countries as: -free -mostly free -mostly unfree -repressed
Countries Ranked According to Economic Freedom
Mostly Free
Mostly Unfree
Free
Repressed
4-19
Diffusion of Innovation
? The Adoption Process ? Characteristics of Innovations ? Categories of Adopters
The Adoption Process
? The mental stages through which an individual passes from the time of his or her first knowledge of an innovation to the time of product adoption or purchase
? ? ? ? ? Awareness Interest Evaluation Trial Adoption
Characteristics of Innovations
? Innovation is something new, five factors that affect the rate at which innovations are adopted include
? ? ? ? ? Relative advantage Compatibility Complexity Divisibility Communicability
Categories of Adopters
? Classifications of individuals within a market on the basis of their innovativeness. ? Five categories
? ? ? ? ?
Innovators Early Adopters Early majority Late majority Laggards
Categories of Adopters
Thank you!
doc_565694515.ppt