Contents
Preface xviii
Part I
The decision whether to internationalize 1
1 Global marketing in the firm 3
Learning objectives 3
1.1
Introduction to globalization 4
1.2
The process of developing the global marketing plan 4
1.3
Comparison of the global marketing and management style of SMEs and LSEs 7
Exhibit 1.1 LEGO＊s strategic drift 10
Exhibit 1.2 Economies of scale with Nintendo Game Boy 12
1.4
Should the company internationalize at all? 14
1.5
Development of the ＆global marketing＊ concept 15
Exhibit 1.3 Helly Hansen uses ＆localization＊ through geo-targeting technology 18
Exhibit 1.4 Persil Black and Persil Abaya =
glocalization (same product,
but different packaging and market communication) 18
1.6
Forces for global integration and market responsiveness 19
Exhibit 1.5
McDonald＊s is moving towards a higher degree
of market responsiveness 21
1.7
The value chain as a framework for identifying international
competitive advantage 22
1.8
Value shop and the ＆service value chain＊ 28
1.9
Global experiential marketing 32
Exhibit 1.6 Case Construction Equipment is using experiential marketing 35
Exhibit 1.7 IKEA＊s use of AR 36
1.10
Information business, ＆Big Data＊ and the virtual value chain 37
1.11
Artificial Intelligence (AI) and its influence on global marketing 38
1.12
Summary 40
Case studies
1.1
Green Toys, Inc.: a manufacturer of eco-friendly toys goes international 41
1.2
Hunter Boot Ltd: the iconic British brand is moving into exclusive fashion 45
1.3
Nivea 48
1.4 Uber 48
Questions for discussion 49
References 49
2 Initiation of internationalization 51
Learning objectives 51
2.1
Introduction 52
viii
Contents
2.2
Internationalization motives 52
Exhibit 2.1 J.germeister: the famous herbal liqueur is going global as a result
of ＆managerial urge＊ in the family-owned company 54
Exhibit 2.2 Global marketing and economies of scale in Japanese firms 57
Exhibit 2.3 Internationalization of Haier 每 proactive and reactive motives 60
2.3
Triggers of export initiation (change agents) 61
2.4
Internationalization barriers/risks 65
Exhibit 2.4 De-internationalization at British Telecommunications (BT) 68
2.5
Summary 70
Case studies
2.1
LifeStraw: Vestergaard-Frandsen transforms dirty water into clean
drinking water 71
2.2
Elvis Presley Enterprises Inc. (EPE): internationalization of a cult icon 73
2.3 TOMS Shoes 74
Questions for discussion 75
References 75
3 Internationalization theories 76
Learning objectives 76
3.1
Introduction 77
3.2
The Uppsala internationalization model 79
3.3
The transaction cost analysis (TCA) model 83
3.4
The network model 86
3.5
Born globals 88
Exhibit 3.1 K-pop 每 a ＆born global＊ phenomenon has worldwide success 89
3.6
Summary 93
Case studies
3.1
Bumble: the ＊Feminist Tinder＊ is expanding fast 94
3.2
BYD electrical cars: the Chinese electric car manufacturer is considering sales
worldwide 95
3.3 Reebok 98
Questions for discussion 98
References 98
4 Development of the firm＊s international competitiveness 101
Learning objectives 101
4.1
Introduction 102
4.2
Analysis of national competitiveness (the Porter diamond) 103
4.3
Competition analysis in an industry 107
4.4
Value chain analysis 112
Exhibit 4.1 Hilti is selling the ＆use＊ 每 not the product 113
4.5
The sharing economy 123
4.6
The sustainable global value chain 126
4.7
Corporate social responsibility (CSR) 126
Exhibit 4.2 Chiquita 每 integrating CSR in the resource base 129
4.8
The value net 130
Exhibit 4.3 Value net 每 cooperation/competition between competitors
within each airline alliance. The three alliances are competing
against each other 131
4.9
Blue ocean strategy and value innovation 132
Contents
4.10
Summary 134
Case studies
4.1
William Demant hearing aids: different threats appear on the horizon 135
4.2
DJI Technology Co. Ltd: a Chinese ＆born global＊ is dominating the world market for
drones with its Phantom and Mavic drones 138
4.3 Nike 142
Questions for discussion 142
References 142
Part I Case studies 144
I.1
Electrolux: a white goods manufacturer is considering growth opportunities
worldwide 144
I.2
Nintendo Switch 144
I.3
Cereal Partners Worldwide (CPW): the no. 2 world player is challenging the no. 1,
Kellogg 144
Part II
Deciding which markets to enter 145
5 Global marketing research 147
Learning objectives 147
5.1
Introduction 148
5.2
The changing role of the international researcher 148
5.3
Linking global marketing research to the decision-making process 149
5.4
Secondary research 151
5.5
Primary research 155
5.6
Other types of marketing research 166
5.7
Marketing research based on Web 3.0 170
Exhibit 5.1 Amazon.com 每 sustaining a competitive advantage through market
research and analytics 172
5.8
Setting up an international marketing information system (MIS) 172
5.9
Summary 173
Case studies
5.1
Teepack Spezialmaschinen GmbH: organizing a global survey of
customer satisfaction 174
5.2
LEGO Friends: one of the world＊s largest toy manufacturers moves
into the girls＊ domain 176
5.3
e-Bikes in China 178
5.4 Hondajets: Honda enters the small-sized business jet market 178
Questions for discussion 179
References 180
6 The political and economic environment 181
Learning objectives 181
6.1
Introduction 182
6.2
The political/legal environment 182
6.3
The economic environment 191
6.4
The European Economic and Monetary Union and the euro 197
x
Contents
6.5
BRIC 每 the slowing growth is hitting the emerging countries 200
Exhibit 6.1
Chotukool 每 Indian Godrej is creating a disruptive innovation
(a low-cost refrigerator) for the BOP market 201
6.6
＆Bottom of pyramid＊ (BOP) as a market opportunity 203
Exhibit 6.2
Voltic Cool Pac 每 distribution of water in Ghana (up to 2011) 205
6.7
Summary 206
Case studies
6.1
G-20 and the economic and financial crises: what on earth is globalization about?
Protests during a meeting in Buenos Aires, Argentina, November 2018 207
6.2
Danfoss Power Solutions: which political/economic factors would affect
a manufacturer of hydraulic components? 209
6.3 Debate on globalization 209
Questions for discussion 210
References 210
7 The sociocultural environment 211
Learning objectives 211
7.1
Introduction 212
7.2
Layers of culture 213
Exhibit 7.1 Electrolux adapts its vacuum cleaner for the Japanese market 215
7.3
High- and low-context cultures 215
7.4
Elements of culture 217
Exhibit 7.2 In China the Citro.n C4 brand name was changed to Citro.n
c-Quatre 217
Exhibit 7.3 Sensuality and touch culture in Saudi Arabian versus European
advertising 220
Exhibit 7.4 Polaroid＊s success in Muslim markets 222
7.5
Hofstede＊s model (the ＆4 +
2＊ dimensions model) versus the
GLOBE model 223
Exhibit 7.5 Pocari Sweat 每 a Japanese soft drink expands sales in Asia 225
7.6
Managing cultural differences 225
7.7
Convergence or divergence of the world＊s cultures 226
7.8
The effects of cultural dimensions on ethical decision-making 227
Exhibit 7.6 The quest for beauty opens a huge market for whitening
products in Asia 228
7.9
Summary 230
Case studies
7.1
Cirque du Soleil Inc.: the show that revolutionized the circus arts is
expanding its global scope 231
7.2
The Ikea catalogue: are there any cultural differences? 233
7.3 Allergan 每 the maker of Botox and breast implants 235
Questions for discussion 235
References 236
8 The international market selection process 237
Learning objectives 237
8.1
Introduction 238
8.2
International market selection: SMEs versus LSEs 238
8.3
Building a model for international market selection 239
Exhibit 8.1 Bosch Security Systems: IMS in the Middle East for fire
detection systems 252
8.4
Market expansion strategies 257
Exhibit 8.2 Sunquick＊s waterfall approach 257
Contents xi
Exhibit 8.3 An example of the ＆trickle-up＊ strategy 259
Exhibit 8.4 Bajaj is selecting new international markets ignored by global
leaders 263
8.5
The global product/market portfolio 264
8.6
Summary 264
Case studies
8.1
Waymo: the driverless Google car is finding future growth markets 266
8.2
Philips Lighting: screening markets in the Middle East 271
8.3 Oreo (Mondel言z) 273
Questions for discussion 273
References 274
Part II Case studies 274
II.1
SodaStream: managing profitable growth in an increasingly competitive
global environment 274
II.2
The Female Health Company (FHC): the female condom is seeking a foothold
in the world market for contraceptive products 274
II.3
Rolex: the luxury watch maker is facing increasing competition in the
world market 274
Part III
Market entry strategies 275
9 Some approaches to the choice of entry mode 279
Learning objectives 279
9.1
Introduction 280
9.2
The transaction cost approach 280
9.3
Factors influencing the choice of entry mode 282
Exhibit 9.1 Zara is modifying its preferred choice of entry mode, depending
on the psychic distance to new markets 286
9.4
Summary 288
Case studies
9.1
Jarlsberg: the king of Norwegian cheeses is deciding on entry modes
into new markets 288
9.2
Jissbon: is acquisition the right way to gain market shares in the European
condom market? 290
9.3
Understanding entry modes into the Chinese market 293
9.4
M邦ller Yogurts 每 entering the US market by M邦ller Quaker Joint Venture and exit
again two years later 293
Questions for discussion 294
References 294
10 Export modes 296
Learning objectives 296
10.1
Introduction 297
10.2
Indirect export modes 299
10.3
Direct export modes 303
Exhibit 10.1 Lofthouse of Fleetwood＊s (Fisherman＊s Friend) decision criteria when
selecting new distributors 305
10.4
Cooperative export modes/export marketing groups 311
10.5
Summary 312
xii Contents
Case studies
10.1
Lysholm Linie Aquavit: international marketing of the Norwegian
Aquavit brand 312
10.2
Parle Products: an Indian biscuit manufacturer is seeking agents and cooperation
partners in new export markets 314
10.3 Honest Tea 316
Questions for discussion 316
References 317
11 Intermediate modes 318
Learning objectives 318
11.1
Introduction 319
11.2
Contract manufacturing 319
11.3
Licensing 320
11.4
Franchising 323
Exhibit 11.1 Build-a-Bear workshop＊s use of the indirect franchising model in
Germany 每 Austria 每 Switzerland 325
11.5
Joint ventures/strategic alliances 329
Exhibit 11.2 Irn-Bru＊s distributor alliance (Y coalition) with Pepsi Bottling Group
(PBG) in Russia 331
Exhibit 11.3 Safedom: a Chinese condom manufacturer needed a partner with
which to enter the European market 340
11.6
Other intermediate entry modes 340
11.7
Summary 343
Case studies
11.1
Hello Kitty: can the cartoon cat survive the buzz across the world? 343
11.2
KABOOKI: licensing in the LEGO brand 345
11.3 Marriott 347
Questions for discussion 348
References 348
12 Hierarchical modes 349
Learning objectives 349
12.1
Introduction 350
12.2
Domestic-based sales representatives 351
12.3
Resident sales representatives/foreign sales branch/foreign sales subsidiary 351
12.4
Sales and production subsidiary 353
12.5
Subsidiary growth and integration strategies 354
12.6
Region centres (regional HQ) 355
12.7
Transnational organization 357
12.8
Establishing wholly owned subsidiaries 每 acquisition or greenfield 358
12.9
Location/relocation of HQ 358
12.10 Foreign divestment: withdrawing from a foreign market
359
Exhibit 12.1 Tesco＊s withdrawal from Japan in 2012 每later in China 360
Exhibit 12.2 Walmart＊s withdrawal from the German market 362
12.11 Summary 363
Case studies
12.1
Ralph Lauren Corporation: Polo moved distribution for South-East Asia
in-house 364
12.2
Durex condoms: SSL sell Durex condoms in the Japanese market through its own
organization 366
12.3 Starbucks 367
Questions for discussion 367
References 368
Contents xiii
13 International sourcing decisions and the role of
the subsupplier 369
Learning objectives 369
13.1
Introduction 370
13.2
Reasons for international sourcing 371
13.3
A typology of subcontracting 373
13.4
Buyer每seller interaction 374
13.5
Development of a relationship 377
13.6
Reverse marketing: from seller to buyer initiative 380
13.7
Internationalization of subcontractors 381
Exhibit 13.1 An example of Japanese network sourcing: the Mazda
seat-sourcing case 383
13.8
Project export (turnkey contracts) 383
13.9
Summary 384
Case studies
13.1
ARM: challenging Intel in the world market of computer chips 385
13.2
Bosch Indego: how to build B2B and B2C relationships in a new global
product market 每 robotic lawnmowers 389
13.3 Kone elevators and escalators 392
Questions for discussion 393
References 394
Part III Case studies 394
III.1
Tinder dating app: the famous dating app brand is facing increasing competition
from e.g. Badoo 394
III.2
Spotify: the online music-streaming company is growing fast but is suffering
financial imbalance 394
III.3
Autoliv Airbags: transforming Autoliv into a global company 394
Part IV
Designing the global marketing programme 395
14 Product decisions 402
Learning objectives 402
14.1
Introduction 403
14.2
The dimensions of the international product offer 403
14.3
Developing international service strategies 403
Exhibit 14.1 Salesforce.com as provider of CRM ＆cloud＊ services 409
14.4
The product life cycle 409
Exhibit 14.2 The iOS (Apple)/Android (Google) global contest in the
smartphone business 413
Exhibit 14.3 Threadless T-shirt crowdsourcing business 416
14.5
New products for the international market 418
Exhibit 14.4 Product invention 每 solar-powered portable charging systems
for India 422
14.6
Product positioning 422
Exhibit 14.5 Chinese piano manufacturers are experiencing the
＆country of origin＊ (COO) effect 423
Exhibit 14.6 Madame Tussauds 每 a brand that brings people closer to celebrities
on a global basis 424
xiv Contents
14.7
Brand equity 425
14.8
Branding decisions 426
Exhibit 14.7 Unilever＊s Snuggle fabric softener 每 an example of local brands
in multiple markets 428
Exhibit 14.8 Kellogg under pressure to produce under Aldi＊s own label 431
Exhibit 14.9 Shell＊s co-branding with Ferrari and LEGO 432
Exhibit 14.10 Roundup 每 a global brand for multiple markets 433
Exhibit 14.11 Maggi 每 local brands for multiple markets through acquisitions 434
14.9
Sensory branding 435
Exhibit 14.12 Starbucks＊ expanding product line strategy is causing problems for its
＆scent marketing strategy＊ 437
14.10 Implications of the internet for collaboration with customers on
product decisions 438
14.11 Internet of Things (IoT) and its use for marketers
440
Exhibit 14.13 Google＊s use of IoT in the form of the smart thermostat, Nest 442
14.12 3-D printing 每 a possible new industrial revolution in customization
443
Exhibit 14.14 Coca-Cola Israel increases its sales of their mini bottle though
a ＆Mini Me＊ 3-D Print campaign 445
14.13 Global mobile app marketing
446
Exhibit 14.15 L＊Or谷al is extending the customers＊ buying experience with the
mobile app Makeup Genius 447
14.14 ＆Long tail＊ strategies 448
14.15 Brand piracy and anti-counterfeiting strategies 450
14.16 Summary 450
Case studies
14.1
Danish Klassic: launch of a cream cheese in Saudi Arabia 451
14.2
Zippo Manufacturing Company: has product diversification beyond the
lighter gone too far? 455
14.3
Burberry branding 456
14.4 Tequila Avi車n 457
Questions for discussion 458
References 458
15 Pricing decisions and terms of doing business 461
Learning objectives 461
15.1
Introduction 462
15.2
International pricing strategies compared with domestic pricing strategies 462
15.3
Factors influencing international pricing decisions 462
15.4
International pricing strategies 467
Exhibit 15.1 German car manufacturers are using ＆skimming＊ price strategy
in China 468
Exhibit 15.2 A ＆market pricing＊ (＆mass point＊) strategy in use: the Converse brand is
making a comeback under Nike ownership 469
Exhibit 15.3 Volkswagen Group＊s product portfolio approach to pricing 473
Exhibit 15.4 The Gillette price premium strategy 474
Exhibit 15.5 Dollar Shave Club 477
15.5
Implications of the internet for pricing across borders 485
15.6
Terms of sale and delivery 487
15.7
Terms of payment 489
15.8
Export financing 491
15.9
Summary 494
Contents xv
Case studies
15.1
Harley-Davidson: how should the pricing strategy be affected by the
new EU tariffs in 2018? 494
15.2
Gillette Co.: is price standardization possible for razor blades? 496
15.3 Vaseline pricing strategy 497
Questions for discussion 498
References 499
16 Distribution decisions 500
Learning objectives 500
16.1
Introduction 501
16.2
External determinants of channel decisions 502
16.3
The structure of the channel 504
Exhibit 16.1 Burberry: the iconic British luxury brand targets 25 of the world＊s
wealthier cities 507
16.4
From single-channel to omnichannel strategy 508
Exhibit 16.2 Dell＊s use of the multichannel distribution strategy 509
16.5
Managing and controlling distribution channels 511
16.6
Blockchain technology and its influence on international marketing and SCM 516
Exhibit 16.3 Maersk＊s use of blockchain in their shipping 518
16.7
Implications of the internet for distribution decisions 519
16.8
Online retail sales 520
16.9
Smartphone marketing 522
16.10 Channel power in international retailing
523
Exhibit 16.4 The ＆banana split＊ model 524
16.11 Grey marketing (parallel importing) 527
16.12 Summary 528
Case studies
16.1
De Beers: forward integration into the diamond industry value chain 529
16.2
Tupperware: the global direct distribution model is still working 531
16.3 DHL 534
Questions for discussion 535
References 535
17 Communication decisions (promotion strategies) 537
Learning objectives 537
17.1
Introduction 538
17.2
The communication process 538
Exhibit 17.1 Husqvarna＊s consumer wheel 541
17.3
Communication tools 542
Exhibit 17.2 LEGO Ninjago＊s 360-degree marketing communication 547
Exhibit 17.3 Ricola is using celebrity endorsement in the international marketing
of its herbal drops 551
Exhibit 17.4 Ambush marketing strategy 每 Dutch Bavaria vs Anheuser Busch＊s
Budweiser during the Fifa World Cup 2010 553
17.4
International advertising strategies in practice 559
Exhibit 17.5 Jarlsberg. cheese 每 cross-border communication 561
17.5
Implications of the internet for communication decisions 562
17.6
Social media marketing 563
Exhibit 17.6 Abena is using ＆influencer marketing＊ to penetrate the US
diaper market 570
17.7
Categorization of social media 571
xvi Contents
17.8
The social media funnel 574
17.9
Development of the social media marketing plan 575
17.10 Developing a viral marketing campaign 579
17.11
Summary 581
Case studies
17.1
Helly Hansen: sponsoring fashion clothes in the US market 582
17.2
Morgan Motor Company: can the British retro sports car brand still be successful
after 100 years? 583
17.3 BMW Motorcycles 587
Questions for discussion 587
References 588
Part IV Case studies 588
IV.1
Swarovski: the jewellery/crystal manufacturer is expanding into e-commerce and
social media 588
IV.2
Levi Strauss: expanding in new international markets 588
IV.3
Guinness: how can the iconic Irish beer brand compensate for declining sales in the
home market? 588
Part V
Implementing and coordinating the
global marketing programme 589
18
Cross-cultural sales negotiations 591
Learning objectives 591
18.1
Introduction 592
Exhibit 18.1 Google gives a clock as gift in China 592
18.2
Cross-cultural negotiations 593
Exhibit 18.2 Euro Disney becomes Disneyland Resort Paris 每 Disney learns
to adapt to European cultures 602
18.3
Intercultural preparation 603
18.4
Coping with expatriates 604
18.5
Knowledge management and learning across borders 607
18.6
Transnational bribery in cross-cultural negotiations 610
18.7
Summary 611
Case studies
18.1
ZamZam Cola: marketing of a ＆Muslim＊ cola from Iran to the European market 612
18.2
TOTO: the Japanese toilet manufacturer seeks export opportunities for its high-tech
brands in the US 614
18.3
Dunkin＊ Donuts 615
18.4 Stella & Dot 616
Questions for discussion 617
References 617
19 Organization and control of the global marketing programme 619
Learning objectives 619
19.1
Introduction 620
19.2
Organization of global marketing activities 620
19.3
The global account management organization 625
Contents xvii
Exhibit 19.1 Danfoss Power Solutions＊ GAM 635
19.4
Controlling the global marketing programme 636
19.5
The global marketing budget 642
19.6
The process of developing the global marketing plan 646
19.7
Summary 646
Case studies
19.1
Mars Inc.: merger of the European food, pet care and confectionery divisions 647
19.2
Henkel: should Henkel shift to a more customer-centric organization? 647
19.3 McDonald＊s 649
Questions for discussion 650
References 650
Part V Case studies 651
V.1
Tencent: the Chinese online giant is seeking new alliances 651
V.2
Huawei smartphones: expanding into the international markets
for smartphone 651
V.3
Tetra Pak: how to create B2B relationships with the food industry
on a global level 651
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