Chapter 17 Global Marketing

Chapter 17 - Global Marketing Chapter 17 Global Marketing Multiple Choice Questions Which of the following refers to the increased flow of goods, services, people, technology, capital, information, and ideas around the world? A Globalization B Power distance C Strategic alliance D Trading bloc E Cultural imperialism According to the Government of Canada and the Business Development Bank of Canada, globalization refers to the increased flow of goods, services, people, technology, capital, information, and ideas around the world Its impacts are economic, political, social, cultural, and environmental 17-1 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-01 Assessing Global Markets Which of the following is NOT a component of a country market assessment? A Political B Economic C Sociocultural analysis D Technology E Location The four components of a country market assessment are political, economic, technology and infrastructure, and sociocultural analysis Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-01 Assessing Global Markets Which of the following refers to the practice of selling a good in a foreign market at a price that is lower than its domestic price or below its cost? A Quota B Exchange control C Dumping D Purchasing power parity E Glocalization Dumping refers to the practice of selling a good in a foreign market at a price that is lower than its domestic price or below its cost 17-2 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment Which of the following is a form of trade sanction? A Strategic alliance B Contract manufacturing C Dumping D Segmentation E Embargo Trade sanctions are penalties or restrictions imposed by one country over another country for importing and exporting goods, services, and investments An embargo is a form of trade sanction that prohibits trading with a certain country or trading in specific goods (e.g., oil embargo) by other signatory countries Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment The Republic of Rhodia recently tested a deadly nuclear missile despite international opposition Consequently, some of the nations in business alliance with Rhodia imposed a ban on all goods imported from Rhodia Which of the following exemplifies the above scenario? A Exchange control B Tariff C Quota D Trade sanction E Dumping Trade sanctions are penalties or restrictions imposed by one country over another country for importing and exporting goods, services, and investments An embargo is a form of trade sanction that prohibits trading with a certain country or trading in specific goods (e.g., oil embargo) by other signatory countries 17-3 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Moderate Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment Canada imposes 247% tariffs on dairy imports The main reason for that tariff is: A To increase revenue government revenue B To ban import of dairy products from certain countries C To increase health and safety of dairy products in Canada D To make imported dairy products less competitive compared to the domestic ones E To boycott dairy producers in other countries The intention for imposing tariffs is to make imported goods more expensive and thus less competitive with domestic products Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Difficult Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment Which of the following is a component of the human development index (HDI)? A Environmental sustainability B Gender equality C Life expectancy at birth D Universal adult suffrage E Religious freedom The human development index (HDI) is a composite measure of three indicators of the quality of life in different countries: life expectancy at birth, educational attainment, and whether the average incomes are sufficient to meet the basic needs of life in that country 17-4 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-03 Analyzing the Economic Environment Using Metrics In the context of country market assessment, which of the following factors include quota and tariff? A Geographic B Sociocultural C Economic D Political E Technology and infrastructure Four sets of factors are often used to assess a country's market: Political/Legal, Economic, Sociocultural, and Technology and infrastructure factors Quotas and tariffs are included under Political/Legal factors Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment The policies of a country aimed at restricting trade and global marketing are called: A trade liberalization policies B free trade policies C protectionist policies D pricing policies E fair trade policies Policies aimed at restricting trade and global marketing are called protectionist policies 17-5 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 10 The policies of a country aimed at encouraging global trade and marketing are referred to as: A protectionist policies B trade sanctions C trade liberalization policies D tariffs E import quotas Policies that encourage global trade and marketing are referred to as trade liberalization policies Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 11 The penalties or restrictions imposed by one country over another country for importing and exporting of goods, services, and investments are called: A trade liberalization policies B trade sanctions C free trade policies D pricing policies E fair trade policies Trade sanctions are penalties or restrictions imposed by one country over another country for importing and exporting goods, services, and investments In 2011, Canada imposed sweeping trade sanctions on Libya because of escalating human rights abuses by the Libyan government on its citizens 17-6 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 12 A form of trade sanction that prohibits trading with a certain country or trading in specific goods by the signatory countries is called a(n): A tariff B quota C embargo D trade agreement E duty An embargo is a form of trade sanction that prohibits trading with a certain country or trading in specific goods (e.g., oil embargo) by other signatory countries Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 13 Canada restricts its allies from trading with Libya This type of restriction imposed by the government is known as a(n): A tariff B quota C duty D embargo E exchange control An embargo is a form of trade sanction that prohibits trading with a certain country or trading in specific goods (e.g., oil embargo) by other signatory countries 17-7 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 14 A tax levied by the government on a good imported into a country is called a(n): A quota B trade agreement C embargo D exchange rate E tariff A tariff (or duty) is a tax levied on a good imported into a country In most cases, tariffs are intended to make imported goods more expensive and thus less competitive with domestic products, which in turn protects domestic industries from foreign competition Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 15 The tax levied by a government on imported goods to make them more expensive and less competitive with domestic products is known as a(n): A quota B tariff C embargo D trade agreement E boycott A tariff (or duty) is a tax levied on a good imported into a country In most cases, tariffs are intended to make imported goods more expensive and thus less competitive with domestic products, which in turn protects domestic industries from foreign competition 17-8 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 16 Which of the following designates the maximum quantity of a product that may be brought into a country during a specified time period? A Tariff B Embargo C Duty D Exchange rate E Quota A quota designates the maximum quantity of a product that may be brought into a country during a specified time period Many Canadian quotas on foreign-made textiles were eliminated in 2005, which reduced the cost of imported apparel products sold in Canada Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 17 Which of the following can benefit domestically made products by reducing the availability of imported merchandise? A Dumping B Franchising C Quotas D Glocalization E Direct investment Tariffs artificially raise prices and therefore lower demand, and quotas reduce the availability of imported merchandise Conversely, tariffs and quotas benefit domestically made products because they reduce foreign competition 17-9 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 18 Which of the following, when levied on imported goods, artificially raises their price, thereby lowering their demand in the local markets? A Tariffs B Boycotts C Quotas D Embargo E Exchange control Tariffs artificially raise prices and therefore lower demand, and quotas reduce the availability of imported merchandise Conversely, tariffs and quotas benefit domestically made products because they reduce foreign competition Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 19 Local retailers refusing to buy goods from a foreign textile firm in response to the firm's violation of labour laws is an example of a(n): A exchange control B boycott C tariff D duty E countertrade A boycott pertains to a group's refusal to deal commercially with some organization to protest against its policies Boycotts might be called by governments or nongovernmental organizations, such as trade unions, human rights, or environmental groups 17-10 Chapter 17 - Global Marketing True / False Questions 98 Globalization has created economics of scale for global companies TRUE Globalization has created economics of scale because of global scale in research, production, and marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 99 An embargo is a form of trade sanction that prohibits trading with a certain country or trading in specific goods by other signatory countries TRUE An embargo is a form of trade sanction that prohibits trading with a certain country or trading in specific goods (e.g., oil embargo) by other signatory countries Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 100 Dumping refers to a group's refusal to deal commercially with some organization to protest against its policies FALSE A boycott pertains to a group's refusal to deal commercially with some organization to protest against its policies 17-51 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Moderate Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 101 The policies aimed at encouraging global trade and marketing are referred to as protectionist policies FALSE Policies aimed at restricting trade and global marketing are called protectionist policies, and those that encourage global trade and marketing are referred to as trade liberalization policies Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 102 Trade sanctions are penalties or restrictions imposed by one country over another country for importing and exporting goods, services, and investments TRUE Trade sanctions are penalties or restrictions imposed by one country over another country for importing and exporting goods, services, and investments Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 103 A trade agreement is a protectionist policy as it is designed to protect a country's domestic industry from foreign competition FALSE A trade agreement is an intergovernmental agreement designed to manage and promote trade activities for a specific region 17-52 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Moderate Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 104 A trade deficit means that a country imports more goods than it exports TRUE A trade deficit means that a country imports more goods than it exports Firms would prefer to manufacture in a country, such as Canada, that has a trade surplus, or a higher level of exports than imports, because it signals a greater opportunity to export products to more markets Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-03 Analyzing the Economic Environment Using Metrics 105 The purchasing power parity (PPP) theory states that if the exchange rates of two countries are in equilibrium, a product purchased in one will cost more in the other, expressed in the same currency FALSE The purchasing power parity (PPP) theory states that if the exchange rates of two countries are in equilibrium, a product purchased in one will cost the same in the other, expressed in the same currency Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-03 Analyzing the Economic Environment Using Metrics 106 A trade surplus results when a country imports more goods than it exports FALSE A trade surplus results when a country exports more goods than it imports 17-53 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-03 Analyzing the Economic Environment Using Metrics 107 Smaller local firms can often exhibit greater flexibility in their pricing to hold on to market share TRUE Local marketers are becoming increasingly price competitive in selling their products Local marketers already have strong familiarity with their markets, existing distribution channels, and good name recognition and can often exhibit greater flexibility in their pricing Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-03 Analyzing the Economic Environment Using Metrics 108 Understanding consumer behaviour is about understanding consumers' culture TRUE Culture affects every aspect of consumer behaviour: why people buy, who is in charge of buying decision, how, when and where people shop Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 17-03 Describe the various global market entry strategies Topic: 17-04 Analyzing Sociocultural Factors 109 Indirect exporting offers greater profits to the exporting firm, as it carries the least risk FALSE Indirect exporting approach carries the least risk but probably returns the least profit for the exporting company 17-54 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-03 Describe the various global market entry strategies Topic: 17-08 Exporting 110 Firms engaging in franchising have limited control over the market operations in the foreign country TRUE When a firm engages in franchising, the firm has limited control over the market operations in the foreign country and its potential profit is reduced Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-03 Describe the various global market entry strategies Topic: 17-09 Franchising 111 Strategic alliances refer to collaborative relationships between independent firms who invest in one another FALSE Strategic alliances refer to collaborative relationships between independent firms, though the partnering firms not create an equity partnership; that is, they not invest in one another Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-03 Describe the various global market entry strategies Topic: 17-10 Strategic Alliance 112 Contract manufacturing is a variant of a joint venture in which a domestic firm provides management consulting and advice to a foreign firm FALSE Contract manufacturing is when a foreign firm contracts with a local firm in the host market to manufacture the product 17-55 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-03 Describe the various global market entry strategies Topic: 17-11 Joint Venture 113 Advertising campaigns have the same effectiveness in countries with the same languages FALSE Even among English speakers, there can be significant differences in the effectiveness of advertising campaigns Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 17-04 List the similarities and differences between a domestic marketing strategy and a global marketing strategy Topic: 17-15 The Global Marketing Mix 114 Firms must adjust their products and services to meet the needs of national target market(s), but must not alter their marketing mix to serve the needs of global markets FALSE Just as firms adjust their products and services to meet the needs of national target market(s), they must alter their marketing mix to serve the needs of global markets Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Moderate Learning Objective: 17-04 List the similarities and differences between a domestic marketing strategy and a global marketing strategy Topic: 17-15 The Global Marketing Mix 115 The major challenge in developing a global communication strategy is identifying the elements that need to be adapted to be effective in the global marketplace TRUE The major challenge in developing a global communication strategy is identifying the elements that need to be adapted to be effective in the global marketplace For instance, literacy levels vary dramatically across the globe 17-56 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-04 List the similarities and differences between a domestic marketing strategy and a global marketing strategy Topic: 17-15 The Global Marketing Mix 116 Some criticize that when U.S firms enter foreign markets, the U.S products and services overwhelm the local culture This is an example of cultural imperialism TRUE Cultural imperialism refers to the belief that one's own culture is superior to that of other nations Critics of U.S firms entering foreign markets claim that U.S products and services overwhelm the local culture, often replacing its foods, music, movies, and traditions with those of the West Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 17-05 Explain how ethical issues affect global marketing practices Topic: 17-19 Impact on Host Country Culture Short Answer Questions 117 What is glocalization? Explain your answer with one example When firms offer standardized products globally and change promotional campaigns geared to local markets, it is referred to as glocalization 17-57 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Moderate Learning Objective: 17-04 List the similarities and differences between a domestic marketing strategy and a global marketing strategy Topic: 17-15 The Global Marketing Mix 118 What are trade sanctions? Provide one example Trade sanctions are penalties or restrictions imposed by one country over another country for importing and exporting goods, services, and investments In 2011, Canada imposed sweeping trade sanctions on Libya because of escalating human rights abuses by the Libyan government on its citizens Some of the measures announced include a ban on all goods exported from Canada to Libya and a ban on all goods imported from Libya into Canada An embargo is a form of trade sanction that prohibits trading with a certain country or trading in specific goods (e.g., oil embargo) by other signatory countries Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Moderate Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 119 Why should marketers assess the viability of a different country's market and what four factors they use to assess the viability of markets? Since different countries, at their various stages of globalization, offer marketers a variety of opportunities, firms must assess the viability of a variety of international markets The analysis of a country's market offers marketers a more complete picture of a country's potential as a market for products and services Four sets of factors are often used to assess a country's market: Political/Legal, Economic, Socio-Cultural, and Technology and Infrastructure factors In fact, marketers often have to make trade-offs between these factors when entering or doing business in a foreign market 17-58 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-01 Assessing Global Markets 120 What is a trade agreement and what does a trading bloc have to with a trade agreement? Provide an example A trade agreement is an intergovernmental agreement designed to manage and promote trade activities for a specific region, and a trading bloc consists of those countries that have signed the particular trade agreement Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-02 Analyzing the Political Environment 121 What is purchasing power parity? Provide one example Purchasing power parity is a theory that states that if the exchange rates of two countries are in equilibrium, a product purchased in one will cost the same in the other, expressed in the same currency A novel measure that employs PPP to assess the relative economic buying power among nations is The Economist's Big Mac Index, which suggests that exchange rates should adjust to equalize the cost of a basket of goods and services, wherever it is bought around the world Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Moderate Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-03 Analyzing the Economic Environment Using Metrics 122 Define the term "infrastructure" and explain why it is an important consideration for global companies Provide some examples Infrastructure is defined as the basic facilities, services, and installations needed for a community or society to function, such as transportation and communications systems, water and power lines, and public institutions such as schools, post offices, and prisons 17-59 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-05 Analyzing Technology and Infrastructure Capabilities 123 Why is global STP more complicated than domestic STP? Global STP is more complicated than domestic STP for the following reasons:  Firms considering a global expansion have much more difficulty understanding the cultural nuances of other countries  Subcultures within each country also must be considered  Consumers often view products and their role as consumers differently in different countries Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 17-04 List the similarities and differences between a domestic marketing strategy and a global marketing strategy Topic: 17-14 Target Market: Segmentation, Targeting, and Positioning 124 What are the three potential global product strategies?  Sell the same product or service in both the home country market and the host country  Sell a product or service similar to that sold in the home country but include minor adaptations  Sell totally new products or services Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Moderate Learning Objective: 17-04 List the similarities and differences between a domestic marketing strategy and a global marketing strategy Topic: 17-15 The Global Marketing Mix 125 What are the environmental concerns associated with global marketing? Environmental concerns include, but are not limited to, the excessive use of natural resources and energy, refuse from manufacturing processes, excess trash created by consumer goods packages, and hard-to-dispose-of products such as tires, cellphones, and computer monitors 17-60 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17-05 Explain how ethical issues affect global marketing practices Topic: 17-17 Environmental Concerns 126 What is cultural imperialism? Cultural imperialism refers to the belief that one's own culture is superior to that of other nations It can take the form of an active, formal policy or a more subtle general attitude Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Moderate Learning Objective: 17-05 Explain how ethical issues affect global marketing practices Topic: 17-19 Impact on Host Country Culture 127 Describe Geert Hofstede's cultural dimensions concept One important cultural classification scheme that firms can use is Geert Hofstede's cultural dimensions concept Hofstede believes cultures differ on five dimensions: Power distance: Willingness to accept social inequality as natural Uncertainty avoidance: The extent to which the society relies on orderliness, consistency, structure, and formalized procedures to address situations that arise in daily life Individualism: Perceived obligation to and dependence on groups Masculinity: The extent to which dominant values are male oriented A lower masculinity ranking indicates that men and women are treated equally in all aspects of society; a higher masculinity ranking suggests that men dominate in positions of power Time orientation: Short- versus long-term orientation A country that tends to have a longterm orientation values long-term commitments and is willing to accept a longer time horizon for, say, the success of a new product introduction 17-61 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Moderate Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-04 Analyzing Sociocultural Factors 128 A U.S.-based textile firm is considering marketing its products in a foreign country What are the various measures that the firm can use to evaluate the general economic environment in that country? Students' answers will vary A firm can measure the relative health of a particular country's economy in several ways:  Relative level of imports and exports: Firms would prefer to manufacture in a country that has a trade surplus, or a higher level of exports than imports, because it signals a greater opportunity to export products to more markets  Standardized measures of output: The most widely used method is the gross domestic product (GDP) GDP growth means that production and consumption in the country is expanding; therefore, there are greater marketing opportunities for most goods and services When GDP growth is slowing, it means that the economy is contracting, or that production and consumption are falling, and marketing opportunities for certain goods and services will decline  Purchasing power parity (PPP): This theory states that if the exchange rates of two countries are in equilibrium, a product purchased in one will cost the same in the other, expressed in the same currency It can also be used as a measure of an overall economy because it helps to assess a country's relative economic buying power  Human development index (HDI): The United Nations has developed a corollary measure for the GDP and PPP known as the human development index (HDI), a composite measure of three indicators of the quality of life in different countries: life expectancy at birth, educational attainment, and whether the average incomes, according to PPP estimates, are sufficient to meet the basic needs of life in that country For marketers, these measures determine the lifestyle elements that ultimately drive consumption 17-62 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Moderate Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-03 Analyzing the Economic Environment Using Metrics 129 What are the four components of infrastructure that are essential for the development of an efficient marketing strategy? How does the analysis of these factors help in marketing?  Transportation: There must be a system to transport goods throughout the various markets and to consumers in geographically dispersed marketplaces  Distribution channels: Distribution channels must exist to deliver products in a timely manner and at a reasonable cost  Communications: The communications system must be sufficiently developed to allow consumers to access information about the products and services available in the marketplace  Commerce: The commercial infrastructure consists of the legal, banking, and regulatory systems that allow markets to function The assessment of these four components helps marketing managers make informed decisions about whether a particular country possesses the necessary characteristics to be considered a potential market for the firm's products and services Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Moderate Learning Objective: 17-01 Explain the components of global market assessments Topic: 17-05 Analyzing Technology and Infrastructure Capabilities 130 Why is it difficult for firms to develop global pricing strategies? Firms find it difficult to develop global pricing strategies for several reasons:  Many countries have rules governing the competitive marketplace, including those that affect pricing  Issues, such as tariffs, quotas, antidumping laws, and currency exchange policies can affect pricing decisions  Competitive factors influence global pricing Hence, market prices must be adjusted to reflect the local pricing structure  Currency fluctuations affect global pricing strategies 17-63 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 17-04 List the similarities and differences between a domestic marketing strategy and a global marketing strategy Topic: 17-15 The Global Marketing Mix 131 Edward is a marketing manager at a technology firm that makes mobile phones What are the various factors that Edward needs to consider while developing global communication strategies for the firm's products? Students' answers will vary The major challenge in developing a global communication strategy is identifying the elements that need to be adapted to be effective in the global marketplace  Media: Media availability varies widely across countries Some countries offer only statecontrolled media Advertising regulations differ too  Cultural differences: Edward needs to consider the differences in language, customs, and culture as they complicate marketers' ability to communicate with customers in various countries Also, within many countries, there are multiple variants on a language  Regulatory actions: Regulatory actions in the host countries also need to be considered as they affect the communication strategies 17-64 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Moderate Learning Objective: 17-04 List the similarities and differences between a domestic marketing strategy and a global marketing strategy Topic: 17-15 The Global Marketing Mix 132 Assume you are the marketing manager of a small company that designs and manufactures wireless-enabled lighting, plumping fixture, and climate control products for homes Your company is considering marketing its high tech, state of art products globally Explain five global market-entry strategies in the order of high risk/control to low risk/control for your company Which method would you choose? Explain your answer Student answers vary The five strategies from high risk/control/return to low risk/control/return are: Direct investment, joint venture, strategic alliance, franchising, and exporting The company is small, so direct investment is probably not a good option The more feasible options would be exporting, strategic alliance or joint venture; franchising could also be selected Students should justify the strategy they select based on the risk they are willing to take, the control they want to have and return they are expecting For example, exporting is the safest bet and has the least return and control Conservative students are likely to go with this option Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Difficult Learning Objective: 17-03 Describe the various global market entry strategies Topic: 17-07 Choosing a Global Market Entry Strategy 17-65 ... Objective: 17- 01 Explain the components of global market assessments Topic: 17- 03 Analyzing the Economic Environment Using Metrics 17- 50 Chapter 17 - Global Marketing True / False Questions 98 Globalization... 17- 3 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Moderate Learning Objective: 17- 01 Explain the components of global market assessments Topic: 17- 02... trade and global marketing are called protectionist policies 17- 5 Chapter 17 - Global Marketing Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 17- 01 Explain