Marketing Study Guide

Marketing Study Guide - International Marketing Exam 2...

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International Marketing Exam 2 Study Guide Chapter 7 4 steps of market selection Selection of relevant segmentation criteria Development of appropriate segments Screening of segments Micro-segmentation: Develop segments in countries Steps 1 and 2 Defining Criteria Measurability : Degree to which size and purchasing power of resulting segments can be measured Accessibility Substantiality/Profitability : Degree to which segments are large and profitable Actionability General Characteristics: High measurability, low relevance Specific Characteristics: Low measurability, high relevance Preliminary (Macro) Screening : Country A compared to basket of countries Micro-Screening : Match markets to firm strengths Market/Country Attractiveness Market Size/Market Growth Buying power of customers Market seasons and fluctuations Average Industry Margin Competitive conditions Market prohibitive conditions Government regulations Infrastructure Economic and Political Stability Psychic Distance Bases for segmentation Demographic Psychographic Benefit Seeking Usage and User Geographic Market Strategy – Simultaneous Entry Seize emerging opportunity or forestall competition Provides economies of scale in production and marketing Requires more $$$ resources, and risk Market Strategy – Single (Incremental Entry) Allows firm to build up experience in international operations Makes sense if firm enters late and faces entrenched local competition Waterfall Approach: Countries are gradually entered sequentially, starting with the advanced countries, and continuing to the less developed countries Shower Approach: Many countries are entered simultaneously in a limited time period
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Herfindahl Index: C = (Sum of Market share)^ 2 Chapter 8 Pitfall of exporting Ignorance and Intimidation Poor Distribution Program Failure to customize product offering Poor understanding of competitive conditions Poor market analysis Problems securing finance Poorly executed promotional campaign Improving export performance Information from government sources Export Management Companies Utilizing export strategies Export Management Companies Export specialists that act as the expert management department or international department for client firms Assignment One: Start operations for a firm Assignment Two: Start-up services Exporting Strategy Helps to hire an EMC or someone with experience Focus on one or a few markets Enter markets on a small scale until you learn the ropes. Add new lines after success Need to recognize the time and managerial commitment Build strong and lasting relationships Hire locals to help firm establish itself Keep the option of local production in mind Letter of Credit : Bank guarantees on behalf of importer to exporter assuring payments when exporter presents specified documents Drafts (Bill of Exchange):
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