1. Chapter 1 Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
1
IntroductionIntroduction
 Products have been traded across bordersProducts have been traded across borders
throughout recorded civilization, extending backthroughout recorded civilization, extending back
beyond thebeyond the Silk RoadSilk Road that once connected Eastthat once connected East
with West from Xian (China) to Rome (Italy).with West from Xian (China) to Rome (Italy).
 Total world trade volume in goods and servicesTotal world trade volume in goods and services
grew from $6.5 trillion in 1998 to $7.6 trillion ingrew from $6.5 trillion in 1998 to $7.6 trillion in
2000.2000.

2. Chapter 1 Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
2
Introduction (contd.)Introduction (contd.)
 Big Emerging Markets (BEMs):Big Emerging Markets (BEMs): In the next ten toIn the next ten to
twenty years, BEMs such as the Chinesetwenty years, BEMs such as the Chinese
Economic Area (CEA: including China, HongEconomic Area (CEA: including China, Hong
Kong Region, and Taiwan), India, South Korea,Kong Region, and Taiwan), India, South Korea,
Mexico, Brazil, Argentina, South Africa, Poland,Mexico, Brazil, Argentina, South Africa, Poland,
Turkey, and the Association of Southeast AsianTurkey, and the Association of Southeast Asian
Nations (ASEAN: including Indonesia, Brunei,Nations (ASEAN: including Indonesia, Brunei,
Malaysia, Thailand, the Philippines, and Vietnam)Malaysia, Thailand, the Philippines, and Vietnam)

3. Chapter 1 Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
3
Introduction (contd.)Introduction (contd.)
will provide many opportunities in globalwill provide many opportunities in global
business.business.

4. 1-4
Global MarketingGlobal Marketing
 Create value for customers by improvingCreate value for customers by improving
benefits or reducing pricebenefits or reducing price
– Improve the productImprove the product
– Find new distribution channelsFind new distribution channels
– Create better communicationsCreate better communications
– Cut monetary and non-monetary costs andCut monetary and non-monetary costs and
pricesprices
Value = Benefits/Price

5. Chapter 1 Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
5
1. Why Global Marketing is Imperative1. Why Global Marketing is Imperative
 Saturation of domestic marketsSaturation of domestic markets: Domestic-market: Domestic-market
saturation in the industrialized parts of the worldsaturation in the industrialized parts of the world
and marketing opportunities overseas are evidentand marketing opportunities overseas are evident
in global marketing.in global marketing.
 Global competitionGlobal competition: Competition around the world: Competition around the world
and proliferation of the Internet are on the rise.and proliferation of the Internet are on the rise.
 Need for global cooperationNeed for global cooperation: Global competition: Global competition
brings global cooperation.brings global cooperation.

6. Chapter 1 Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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1. Why Global Marketing is Imperative1. Why Global Marketing is Imperative
(contd.)(contd.)
 Internet revolutionInternet revolution: The Internet and electronic: The Internet and electronic
commerce (e-commerce) are bringing majorcommerce (e-commerce) are bringing major
structural changes to the way companies operatestructural changes to the way companies operate
worldwide.worldwide.
 The term “The term “globalglobal” epitomizes both the competitive” epitomizes both the competitive
pressure and expanding market opportunities.pressure and expanding market opportunities.
 Whether a company operates domestically orWhether a company operates domestically or
across national boundaries, it can no longer avoidacross national boundaries, it can no longer avoid
competitive pressures from around the world.competitive pressures from around the world.

8. Chapter 1 Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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3. Evolution of Global Marketing3. Evolution of Global Marketing
 What is marketing?What is marketing? Marketing involves theMarketing involves the
planning and execution of the conception, pricing,planning and execution of the conception, pricing,
promotion, and distribution of ideas, products, andpromotion, and distribution of ideas, products, and
services.services.
 Marketing involves customer satisfaction and theirMarketing involves customer satisfaction and their
current and future needs.current and future needs.
 Marketing is much more than selling and involvesMarketing is much more than selling and involves
the entire company.the entire company.
 Within marketing strategies, companies are alwaysWithin marketing strategies, companies are always
under competitive pressure to move forward bothunder competitive pressure to move forward both
reactivelyreactively andand proactivelyproactively..

9. Chapter 1 Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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3. Evolution of Global Marketing3. Evolution of Global Marketing
(contd.)(contd.)
 Global MarketingGlobal Marketing: Global marketing refers to: Global marketing refers to
marketing activities that emphasize themarketing activities that emphasize the
following:following:
1.1. Standardization efforts.Standardization efforts.
2.2. Coordination across markets.Coordination across markets.
3.3. Global integration.Global integration.

10. Chapter 1 Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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3. Evolution of Global Marketing3. Evolution of Global Marketing
(contd.)(contd.)
 Five stages in the evolution of global marketingFive stages in the evolution of global marketing
(see Exhibit 1-2):(see Exhibit 1-2):
1.1. Domestic MarketingDomestic Marketing (domestic focus; home(domestic focus; home
country customers; ethnocentric orientation).country customers; ethnocentric orientation).
2.2. Export MarketingExport Marketing (indirect vs. direct exporting;(indirect vs. direct exporting;
country choice, exports; ethnocentric orientation;country choice, exports; ethnocentric orientation;
home country customers).home country customers).
3.3. International MarketingInternational Marketing (markets in many(markets in many
countries; polycentric orientation; use ofcountries; polycentric orientation; use of
multidomestic marketing when customer needs aremultidomestic marketing when customer needs are
different across national markets).different across national markets).

11. Chapter 1 Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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3. Evolution of Global Marketing3. Evolution of Global Marketing
(contd.)(contd.)
4.4. Multinational MarketingMultinational Marketing (many markets;(many markets;
consolidation on regional basis; regiocentricconsolidation on regional basis; regiocentric
orientation; standardization within regions).orientation; standardization within regions).
5.5. Global MarketingGlobal Marketing (international, multinational(international, multinational
& geocentric orientation; company’s willingness& geocentric orientation; company’s willingness
to adopt a global perspective; global products withto adopt a global perspective; global products with
local variations).local variations).

12. Chapter 1 Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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3. Evolution of Global Marketing3. Evolution of Global Marketing
(contd.)(contd.)
 Global marketing does not necessarily mean thatGlobal marketing does not necessarily mean that
products can be developed anywhere on a globalproducts can be developed anywhere on a global
scale.scale.
 The economic geography, climate, and cultureThe economic geography, climate, and culture
affect how companies develop certain products.affect how companies develop certain products.
 The Internet adds a new dimension to globalThe Internet adds a new dimension to global
marketing.marketing.
 E-commerce retailers gain substantial savings byE-commerce retailers gain substantial savings by
selling online.selling online.

13. 1-13
Global Marketing: What It Is andGlobal Marketing: What It Is and
What It Isn’tWhat It Isn’t
Single CountrySingle Country
Marketing StrategyMarketing Strategy
 Target market strategyTarget market strategy
 Marketing mixMarketing mix
– ProductProduct
– PricePrice
– PromotionPromotion
– PlacePlace
Global MarketingGlobal Marketing
StrategyStrategy
 Global market participationGlobal market participation
 Marketing mix developmentMarketing mix development
– 4 P’s: adapt or standardize?4 P’s: adapt or standardize?
 Concentration of marketingConcentration of marketing
activitiesactivities
 Coordination of marketingCoordination of marketing
activitiesactivities
 Integration of competitiveIntegration of competitive
movesmoves