global competition
it's shortening the product life cycles and focusing on the importance of quality, competitive prices, and innovative prices
-more competition and more choices puts more power in the hands of the customer, and that drives the need for quality
quality
-consumer perceptions of a quality product often have more to do with market-perceived quality than performance quality
-market-perceived quality: the physical or core product and all the additional features the consumer expects
-performance quality: expe
Fair Trade USA
provides certification that ensures that farmers in emerging economies receive a fair prices for the coffee, tea, chocolate, rice, and other products they produce, instead of selling at the lower market price to a middleman
maintaining quality
-a product that leaves the factory with performance quality is damaged as it passes through the distribution chain
-Russia
-quality is not just desirable, it is essential for success in today's competitive global market, and the decision to standardize or
product homologation
used to describe the changes mandated by local product and service standards
-mandatory adaptions were more frequently the reason for product adaption than adapting for cultural reasons
-legal, economic, political, technological, and climatic requirements
green marketing
used to identify concern with the environmental consequences of a variety of marketing activities
-worldwide but especially in Europe and the US
-no country's law yet require products to carry an ecolabel to be sold.. except Hoover washing machines
-desig
EU laws?
each level of the distribution chain is responsible for returning all packaging, packing, and other waste materials up the chain
-by law, the retailer must take back all packaging from the customer if no central recycling locations are available
Products
-a product is a bundle of satisfactions (or utilities) that a buyer receives
-the market relates to more than a products physical form and primary function
-is the sum of the physical and psychological satisfactions it provides the user
-a product physica
adaption
-may require changes of any one or all of the psychological aspects of a product
-can be affected as much by how the product concept conforms with consumer norms, values, and behavior patterns as by its physical or mechanical attributes
-when analyzing a
innovative products and adaption
-the 1st step in adapting a product to a foreign market is to determine the degree of newness as perceived by the intended market
-products in the US in maturity or decline stage may be new in another country or culture
innovation
any idea perceived as new by a group of people
diffusion
process by which innovation spreads
-successful new product diffusion is dependent on the ability to communicate relevant product info and new product attributes
-diffusion research- research on the process by which innovations spread to the members of a
crucial elements in the diffusion of new ideas
1. an innovation
2. which is communicated through certain channels
3. over time
4. among the members of a social system
*the element of time, shorten the time lag between intro of a product or idea and its widespread adoption
-product innovations have var
3 extraneous variables affect the rate of diffusion of an object
1. the degree of perceived newness
2. the perceived attributes of the innovation
3. the method used to communicate the idea
-the more innovative a product is perceived to be, the more difficult it is to gain market acceptance. Innovations are often disrup
5 characteristics of an innovation to assist in determining the rate of acceptance or resistance of the market to a prodcut
1. relative advantage: the perceived marginal value of the new product relative to the old
2. compatibility: its compatibility with acceptable behavior, norms, values
3. complexity: the degree of complexity associated with product use
4. trialability: the
production of innovations
-bad trend: the growth of American R&D spending is slower than most other competitive countries; Russia, India & China are experiencing double digit growth compared with America's 4% annual growth rate over the last 5 years
-Japanese firms take advantage
3 main factors that favor conversion in the global pharmaceutical industry
1. patience (9 years)
2. focus on a few important innovations
3. experience
product component model
the impact of the cultural, physical, and mandatory factors that affect a market's acceptance of a product can be focuses on the core component, packaging component, and support services component
-these components include all of a product's tangible and
core component
consists of the physical product- the platform that contains the essential technology- and all its design and functional features
-major adaptions may be costly because a change in the platform can affect product processes and require additional capital i
packaging component
includes style features, packaging, labeling, trademarks, brand name, quality, price, and all other aspects of a product's package
-frequently require both discretionary and mandatory changes
-take into account label requirements (bilingual?), trademark s
Japan
-japanese attitudes about quality include the packaging of a product and the size of the package
-soft drinks are sold in smaller sized cans than in the US to accommodate the smaller japanese hand
-most food is sold fresh or in clear packaging, cans are c
4 barriers
1. protectionism
2. controls on transborder data flows
3. protection of intellectual property
4. cultural requirements for adaption
agent middlemen
work on commission and arrange for sales in the foreign country but do not take title to the merchandise
-manufacturer assumes trading risk but maintains the respect to establish policy guidelines and prices and to require its agents to provides sales rec
merchant middlemen
take title to manufacturers' goods and assume the trading risks, so they tend to be less controllable than agent middlemen
advantages of using merchant middlemen
-ease of contact
-minimized credit risk
-elimination of all merchandise handling outside the US
home-country middlemen
domestic middlemen; located in the producing firms country, provide marketing services from a domestic base
-companies regulate foreign-market distribution to others
-a major trade-off when using home-country middlemen is limited control over the entire p
types of home country (domestic) middlemen
-manufacturers retail stores
-global retailers
-export management companies
-trading companies
-U.S. Export trading companies
-complementary marketers
-manufacturers export agent
-webb-promerene export associations
-foriegn sales corporation
services are distinguished by 4 unique characteristics
1. intangibility
2. inseparability
3. heterogeneity
4. perishability
intangible
insurance, dry cleaning, hotel accommodations, and airline passenger or freight service, have intrinsic value resulting from a process, a performance, or an occurrence that exists only while it is being created
intangibility of services
-it is inseparable in that its creation cannot be separated from its consumption
-its heterogeneous in that it is individually produced and is thus unique
-it is perishable in that once created it cannot be stored but must be consumed simultaneously with
other services entering global markets
automobile rentals, airline services, entertainment, hotels, and tourism-- are inseparable and require production and consumption to occur almost simultaneously; thus exporting is not a viable entry method for them
-the vast majority of services (85%) ent
brands in international markets
a successful brand is the most valuable resource a company has. the brand name encompasses the years of advertising, goodwill, quality evaluations, product experience, and other beneficial attributes the market associates with the product
global brand
the worldwide use of a name, term, sign, symbol, design or combo thereof intended to identify goods or services of one seller and to differentiate them from those of competitors
-even global brands must be positioned locally
-vary with cultural values aro
country of origin effect (COE)
any influence that the country of manufacture, assembly, or design has on a consumer's positive or negative perception of a product
-stereotypes
-ethnocentrism
private brands
buyers prefer to buy less expensive, more local private brands during recessions
-allows retailers to outsource production while still appreciating the advantages of a local brand
-private brands provide the retailer with high margins; they receive prefer