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globalization and introduction to international marketing

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globalization and introduction to international marketing

  1. 1. Globalization & Introduction to International Marketing By Anubhav Singh Lovely Professional University
  2. 2. Integration of Economies • The increasing reliance of economies on each other • The opportunities to be able to buy and sell in any country in the world • The opportunities for labour and capital to locate anywhere in the world • The growth of global markets in finance Stock Markets are now accessible from anywhere in the world! Copyright: edrod, stock.xchng
  3. 3. Impact of globalization
  4. 4. • Globalization is the increasing interdependence, integration & interaction among people and corporation in various locations around the world. • Interdependence is a dynamics of being mutually responsible to and sharing common ET of principles with others. •Globalization refers to rapid increase in the share of economic activity taking place across national borders. •It goes beyond the international trade includes the way in which goods/ services are produced /created, delivered &sold & movement of capital. • Globalization refers to rapid increase in the share of economic activity taking place across national borders. • It goes beyond the international trade includes the way in which goods/ services are produced /created, delivered &sold & movement of capital
  5. 5. Threat or opportunity...  Globalization can be a force for good. It has the potential to generate wealth and improve living standards. But it isn't doing that well at the moment.  The benefits from increased trade, investment, and technological innovation are not fairly distributed.  The experience of the international trade union movement suggests that the reality for the majority of the world's population is that things are getting worse.  Globalization as we know it is increasing the gap between rich and poor. This is because the policies that drive the globalization process are largely focused on the needs of business.
  6. 6. KEY PLAYERS  They are  Multinational firms which carry out business across the national borders.  The World Trade Organization (WTO) THROUGH WHICH INTERNATIONAL TRAD E AGREEMENTS ARE NEGOTIATED & ENFORCED  The World Bank & International Monetary Fund (IMF) are means to assist Govt .in achieving development aims through the provision of loans, technical assistance.
  7. 7. STAGES IN GLOBALISATION • Domestic company links with dealer & distributor. • Company does the activities on its own. Company begins to carryout its own manufacturing , marketing & sales in the foreign markets. • Company starts full fledged operations including business systems and R&D. At this stage the managers are expected to perform the tasks which they were doing in domestic markets to replicate them in foreign markets.
  8. 8. Conditions for globalization • Business Freedom-No unnecessary Government restrictions like restriction, restrictions on sourcing of funds and other factors from abroad. Hence the liberalization is the 1st step towards facilitating globalization. • Facilitators-Infrastructure facilitation available at home country an help entrepreneurs go globally. • Government support –Government support available in the form of policy & procedure reform encourage globalization • Resources-Resources is an important factor which decides the ability of affirm to globalize. They include finance ,technology, brand image, company’s image, managerial expertise etc. • Competitors- This is an important factor which company’s success in global market bank on. The factors like low costs& price, product quality, product differentiation, technological superiority. After sales service, market strengths etc are few to name.
  9. 9. Firm operate internationally for a number of reasons: • They may be seeking to secure better sources of raw materials & energy. • They may want to obtain access to low cost factors of production such as labour. • They may be attracted to certain countries because of subsidies those countries provide. • They may be seeking new markets for their products. • Domestic markets may no longer be able to absorb production at minimum efficient scale.
  10. 10. Entering global markets: • There are a number of steps that need to be taken before you decide to enter international markets. • Analyze the international marketing environment. A PEST/STEP analysis needs to be conducted on the market you enter, to assess whether it is worthwhile or not. Reasons For Globalization
  11. 11. Various options to go overseas Direct export The organization produces their product in their home market and then sells them to customers overseas Indirect export The organizations sell their product to a third party who then sells it on within the foreign market. Licensing Less risky market entry method is licensing. Here the Licensor will grant an organization in the foreign market a license to produce the product, use the brand name etc in return that they will receive a royalty payment Eg. Software company etc. Franchising Franchising is another form of licensing. Here the organization puts together a package of the ‘successful’ ingredients that made them a success in their home market. The Franchise holder may help out by providing training and marketing the services or product. Eg Macd, Ccd etc.
  12. 12. Various options to go overseas cont.. Contracting The manufacturer of the product will contract out the production of the product to another organization to produce the product on their behalf. FDI The ultimate decision to sell abroad is the decision to establish a manufacturing plant in the host country. The government of the host country may give the organization some form of tax advantage because they wish to attract inward investment to help create employment for their economy. Joint Venture To share the risk of market entry into a foreign market, two organizations may come together to form a company to operate in the host country. The two companies may share knowledge and expertise to assist them in the development of company; of course profits will have to be shared. Eg. Sony-Ericsson, Nokia- Siemens Merger & Acquisitions Corporate finances, management and strategy dealing with purchasing and/or joining with other companies. In a merger, two organizations join forces to become a new business, usually with a new name. Eg-, TCS- CMC one business buys a second and generally smaller company which may be absorbed into the parent organization or run as a subsidiary.Eg-Flipkart-Myntra, Microsoft- Linkidin
  13. 13. • In simple words International Marketing is the application of marketing principles to across national boundaries. • However, there is a crossover between what is commonly expressed as international marketing and global marketing, which is a similar term. International Marketing

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