International Marketing 4

In a multi domestic strategy, a firm manages its international activities like a portfolio

Cost Forces

Market Forces

Government Forces 

Competitive Forces

Rich consumers in emerging markets 

Organizations behaving as global customers

Growth of global and regional channels 

Establishment of world brands 

Revolution in communication technology 

Global sourcing efficiencies 

Global economies of scale and scope 

Favorable logistics

Fast-changing technology 

Steep experience curve 

Shorter product life cycles 

- Low labor cost/ High growth in LDCs

- Compatible technical standards

- Deregulation/privatization of industries

- Trade policies 

- Trading regulations 

- Interdependent countries 

- Competitors from different continents and countries 

- High exports and imports

- Globalized competitors 

Cost leadership 

Product differentiation 

Niche strategy 

Competitive industry structure 5 Forces:

- Competition level
- Threat of new entrants
- Threats of substitute products
- Bargaining power of suppliers
- Bargaining power of buyers

Direct/ In direct Exporting

Licensing

Franchising

Contract Manufactoring

Joint Venture

Aquisitions

Greenfield

- Pick the right partner 

- Clear objectives 

- Bridge cultural gaps 

- Commitment and respect 

- Step by step approach 

Waterfall strategy 

Sprinkler strategy

Global phased rollout where new products trickle down in a cascade-like manner (e.g. 22 years for McDonald's, and 20 years for Coca Cola) 

Simultaneous worldwide entry (e.g. Apple, Sony)

- Extension 

- Adaptation 

- Creation / Invention 

Offering product virtually unchanged in markets outside of home country 

Changing elements of design, function, and packaging according to needs of different country markets 

Developing new products for the world market 

- Modular approach 

- Core-product (common platform) approach 

The company offers standardized parts (modules) that can be assembled worldwide in different configurations, depending on market needs (e.g. Vaillant, Black & Decker) 

Involves using a standardized strategy for the core product worldwide, but varying certain aspects of the offering (product ingredients, advertising, for example) from market to market (e.g. the car industry).

1. Product characteristics 

- Relative advantage (comp. to existing alternatives)
- Compatibility (with existing values and attitudes)
- Complexity
- Triability
- Observability (of product benefits) 

2. Individual (personal) characteristics (early vs. late adopters)

- Homogeneous population 

- Lead vs. lag countries 

- Cosmopolitan population 

- Mobility of the population 

- Labor force profile (women) 

- National innovativeness 

Sustained losses 

Volatility 

Premature entry 

Ethical reasons 

Intense competition 

Resource reallocation