MSC 300-10 Marketing Research

MSC 300-10 Marketing Research - MSC 300 Principles of...

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05/13/09 Professor Blake Ashdown 1 MSC 300 Principles of Marketing III. GLOBAL MARKET-ENTRY STRATEGIES (1) Exporting (2) Licensing (3) Joint venture (4) Direct investment. The amount of financial commitment, risk, marketing control, and potential profit increases as the firm moves from exporting to direct investment.
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05/13/09 Professor Blake Ashdown 2 MSC 300 Principles of Marketing
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05/13/09 Professor Blake Ashdown 3 MSC 300 Principles of Marketing Exporting Two forms of exporting exist: 1. Indirect exporting is when a firm sells its domestically produced goods in a foreign country through an intermediary. This kind of exporting is ideal for the company that has no overseas contacts but wants to market abroad. The intermediary is often a distributor that has the marketing know-how and resources necessary for the effort to succeed.
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05/13/09 Professor Blake Ashdown 4 MSC 300 Principles of Marketing 1. Direct exporting is when a firm sells its domestically produced goods in a foreign country without intermediaries. Companies use direct exporting when they believe sales will be sufficiently large and easy to obtain so that they do not require intermediaries. Direct exporting involves more risk than indirect exporting for a firm but can provide increased profits. Exporting is commonly employed by large firms and is the prominent strategy among small- and medium-sized companies.
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05/13/09 Professor Blake Ashdown 5 MSC 300 Principles of Marketing Licensing Under licensing, a company offers the right to a trademark, patent, trade secret, or other similarly valued items of intellectual property in return for a royalty or a fee. Advantages of licensing: 1. Low risk, allowing the licensee to gain information that allows it to start with a competitive advantage. 1. Chance to enter a foreign market at virtually no cost. 3. Foreign country gains employment by having the product manufactured locally.
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05/13/09 Professor Blake Ashdown 6 MSC 300 Principles of Marketing Disadvantages of licensing: 1. Licensor gives up control of its product and reduces the potential profits gained from it. 2. The licensor may be creating its own competition because some licensees are able to modify the product and enter the market themselves with the product and marketing knowledge gained from the licensor. 3. If the licensee is a poor choice, the name or reputation of the company may be harmed.
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05/13/09 Professor Blake Ashdown 7 MSC 300 Principles of Marketing A variation of licensing is franchising . In franchising, a company contracts with an individual to set up an operation to provide products or services under the company’s established brand name. Franchising is one of the fastest-growing market-entry strategies.
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05/13/09 Professor Blake Ashdown 8 MSC 300 Principles of Marketing Joint Venture A joint venture occurs when a foreign company and a local firm invest together to create a local business. These two companies share ownership, control, and profits of the new company. Advantages of a joint venture:
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MSC 300-10 Marketing Research - MSC 300 Principles of...

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