4. Topic Entering foreign markets
Friday, September 11, 2009
5. products and services and its attractiveness as a market to foreign firms depend o
Direct nomic, political-legal, and cultural environments.
investment Suppose a company has assembled a list of potential markets to enter. How does
• Somebody explain this to me
among them? Many companies prefer to sell to neighboring countries because the
stand these countries better and can control their costs more effectively. It is not s
that the two largest U.S. export markets are Canada and Mexico, or that Swedish co
first sold to their Scandinavian neighbors. As growing numbers of U.S. companie
Joint
• Can we have some examples?
abroad, many are deciding the best place to start is next door.
Commitment, Risk, Control, and Profit Potential
ventures
At other times, psychic proximity determines choices. Many U.S. firms prefer
Canada, England, and Australia—rather than in larger markets such as Germany and
because they feel more comfortable with the language, laws, and culture. Companie
be careful, however, in choosing markets according to cultural distance. Besides the
potentially better markets may be overlooked, it also may result in a superficial an
Licensing
some very real differences among the countries. It may also lead to predictable m
actions that would be a disadvantage from a competitive standpoint.24
Regardless of how chosen, it often makes sense to operate in fewer countrie
deeper commitment and penetration in each. In general, a company prefers to en
Direct tries (1) that rank high on market attractiveness, (2) that are low in market risk, a
exporting which it possesses a competitive advantage. Here is how Bechtel Corporation, the c
tion giant, goes about evaluating overseas markets.
B E C H T E L C O R P O R AT I O N
Indirect Bechtel provides premier technical, management, and directly related services to develop, manage
exporting
build, and operate installations for customers in nearly 60 countries worldwide. Before Bechtel ventur
markets, the company starts with a detailed strategic market analysis. It looks at its markets and trie
mine where it should be in four or five years’ time. A management team does a cost-benefit analys
| FIG. 21.2 | tors in the position of competitors, infrastructure, regulatory and trade barriers, and the tax situation
porate and individual). Ideally, the new market should be a country with an untapped need for its p
Five Modes of Entry into Foreign services; a quality, skilled labor pool capable of manufacturing the product; and a welcoming environ
Markets ernmental and physical).
Friday, September 11, 2009 Are there countries that meet Bechtel’s requirements? Although Singapore has
9. 248 Part V Delivering Value
FIGURE 13.4 The Value-Adds Versus Costs of Different Channels
High
Sales force
Value-added
partners
Value-Add of Sale
Direct sales
Distributors channels
Retail stores
Telemarketing "Indirect" channels
Internet
Direct marketing
channels
Low
Low High
Cost per Transaction
Source: Oxford Associates, adapted from Dr. Rowland T. Moriarty, Cubex Corp.
CHANNEL-MANAGEMENT DECISIONS
Friday, September 11, 2009 After a firm has chosen a channel alternative, individual intermediaries must be
28. Chapter 15 Designing and Managing Integrated Marketing Communications 281
TABLE 15.1 Common Communication Platforms
Events/ Personal Direct
Advertising Sales Promotion Experiences Public Relations Selling Marketing
Print and broadcast ads Contests, games, Sports Press kits Sales Catalogs
sweepstakes, lotteries presentations
Packaging—outer Entertainment Speeches Sales meetings Mailings
Packaging—inserts Premiums and gifts Festivals Seminars Incentive Telemarketing
programs
Motion pictures Sampling Arts Annual reports Samples Electronic
shopping
Brochures and booklets Fairs and trade shows Causes Charitable Fairs and TV shopping
donations trade shows
Posters and leaflets Exhibits Factory tours Publications Fax mail
Directories Demonstrations Company Community relations E-mail
museums
Reprints of ads Coupons Street activities Lobbying Voice mail
Billboards Rebates Identity media
Display signs Low-interest Company magazine
financing
Point-of-purchase Entertainment
displays
Audiovisual material Trade-in allowances
Symbols and logos Continuity programs
Videotapes Tie-ins
media. Four represent major communication functions—encoding, decoding, response, and
feedback. The last element in the system is noise (random and competing messages that
Friday, September 11, 2009
29. What are channels?
direct mail
mobile
email
radio
web
TV
Friday, September 11, 2009
37. data
$1,050
$730
$502 $520
$194 $242
$121
web
store
catalog
catalog+internet
internet+retail
catalog+retail
catalog+retail + internet
Friday, September 11, 2009
39. Share of Ad Spending
Local TV
Internet
14.8%
5.9%
4.5% 2.5% Network TV
National Magazines
17.1% Cable TV
2.4% National Magazines
Local TV
7.2% Internet
Local Newspapers
Hispanic TV
Cable TV Syndicated TV
22.7% Network TV Other
22.8%
source: Nielsen Online, AdAcross, Marketingcharts.com
Friday, September 11, 2009
44. More Tips
• Look at online materials forum
• Slides support speakers
• Have hip-pocket slides
• Be prepared
• Use pictures, not clip art - www.compfight.com
• Have fun, create a story arc
Friday, September 11, 2009
