Information Technology
Refers to an organization's processes for creating, storing, exchanging, using, and managing information.
Management Information System
Provides managers and other decision makers with a continuous flow of information about company operations; includes a business intelligence network that helps managers make decisions by enabling interactive access to data, manipulation of this data, and providing managers/analysts with ability to conduct appropriate analysis.
Intranet
A private network that allows authorized company personnel or outsiders to share information electronically in a secure fashion without generating mountains of paper.
Electronic Data Interchange
A system that allows a company's business units to submit orders, issue invoices, and conduct business electronically with other company units as well as outside companies; a key feature is that its transaction formats are universal, allowing computer systems at different companies to speak the same language.
Efficient Consumer Response
A joint initiative by members of a supply chain to work toward improving and optimizing aspects of the supply chain to benefit customers; utilize EPS data.
Electronic Point of Sale
Data gathered by checkout scanners to help retailers id product sales patterns and how consumer preferences vary with geography.
Customer Relationship Management
A business model that helps companies collect, store, and analyze customer data; values two way communication between company and customer.
Data Warehouses
Databases that are part of a company's CRM system; can perform multidimensional analysis.
Market Research
Project-specific, systematic gathering of data; links consumer, customer, and public to the market through information; Nielsen is worlds largest organization.
Global Market Research
Same as market research on a global scale; challenge is to recognize and respond to the important national differences that influence the way information can be obtained (cultural, linguistic, economic, political, religious, historical, and market differences).
Secondary Data
Data that has already been collected and is readily available.
Existing Market
A market in which customer needs are already being served by one or more companies.
Latent Market
An undiscovered market segment in which demand would materialize if an appropriate product were made available; demand is 0 before the product is introduced.
Incipient Market
A market that will emerge if a particular economic, demographic, political, or sociocultural trend continues; if a product is offered in this market before a trend has taken root, it will fail.
Survey Research
Utilizes questionnaires designed to elicit quantitative data, qualitative responses, or both; often conducted through mail, telephone, or in person.
Consumer Panel
A sample of respondents whose behavior is tracked over time.
Observation
Observers watch and record the behavior of actual or prospective buyers; results used to guide marketing managers in decision making.
Factor Analysis
Used to transform large amounts of data into manageable units
Cluster Analysis
Allows researcher to group variables into clusters that maximize within-group similarities and between-group differences.
Multidimensional Scaling
A technique to create perceptual maps; respondent compares products or brands, on pair at a time, and judges them in terms of similarity.
Conjoint Analysis
A tool that researchers can use to gain insights into the combination of features that will be most attractive to consumers.
Emic Analysis
Attempts to study a culture from within, using its own system of meanings and values.
Etic Analysis
A detached perspective that is often used to look at a culture from the outside in comparative or multi-country studies.
Global Market Segmentation
The process of Identifying specific segments of potential customers with homogeneous attributes who are likely to exhibit similar responses to a company's marketing mix.
Demographic Segmentation
Based on measurable characteristics of populations such as income, population, age distribution, gender, education, and occupation.
Global Teens
Young people between the ages of 12 and 19.
Global Elite
Affluent customers who are well traveled and have the money to spend on prestigious products with an image of exclusivity.
Psychographic Segmentation
Involves grouping people in terms of their attitudes, values, and lifestyles.
Behavior Segmentation
Focuses on whether or not people buy and use a product as well as how often and how much they use or consume; categorizes based on usage rates (heavy, med, light) and segments according to user status (potential users, non-users, ex-users, regulars, first-timers, and users of competitors' products).
80/20 Rule
80 Percent of a company's revenues or profits are accounted for by 20 percent of a firm's products or customers.
Benefit Segmentation
Focuses on the numerator of the value equation (the B in V=B/P).
Product-Market
Used to describe a market defined by a product category.
Marketing Model Drivers
Key elements or factors required for a business to take root and grow in a particular country market environment; drivers may differ depending on whether a company serves consumer or industrial markets.
Enabling Conditions
Structural market characteristics whose presence or absence can determine whether the marketing model can succeed.
First-Mover Advantage
The first company to enter a market has the best chance of becoming the market leader; disadvantage can be that competitors reap the benefits of the first company's substantial investments and also succeed by developing innovative business models.
Standardized Global Marketing
Creating the same marketing mix for a broad mass market of potential buyers; based on the premise that a mass market exists around the world and is served with a marketing mix of standardized elements.
Niche
A single segment of the global market.
Differentiated Global Marketing
Represents a more ambitious approach than concentrated target marketing (aka multisegment targeting); entails targeting two or more distinct market segments with multiple mktg mix offerings; allows wider market coverage.
Positioning
The act of differentiating a brand in customers' minds in relation to competitors in terms of attributes and benefits that the brand does and does not offer.
Global Consumer Culture Positioning
A strategy that id's the brand as a symbol of a particular global culture or segment; effective with global teens/cosmopolitan elites/laptop warriors.
Foreign Consumer Culture Positioning
Associates the brand's users, use occasions, or production origins with a foreign country or culture.
Local Consumer Culture Positioning
Associates the brand with local cultural meanings, reflects the local culture's norms, portrays the brand as consumed by local people in the national culture, or depicts the product as locally produced for local consumers.
Export Selling
Does not involve tailoring the product, price, or promotional material to suit the requirements of global markets; only mktg mix element that differs is the place.
Export Marketing
Targets the customer in the context of the total market environment; product is modified as needed to meet the preferences of international target markets, prices set to fit the marketing strategy, communication and distribution modified.
Foreign Sales Corporation
American exporters could obtain a 15 percent exclusion on earnings from intl. sales.
Free Trade Zone/Special Economic Zone
Geographic entities that offer manufacturers simplified customs procedures, operational flexibility, and a general environment of relaxed regulations.
Harmonized Tariff System
Importers and exporters have to determine the correct classification number for a given product or service that will cross borders.
Nontariff Barrier
Any measure other than a tariff that is a deterrent or obstacle to the sale of products in a foreign market; include quotas, discriminatory procurement policies, restrictive customs procedures, arbitrary monetary policies, and restrictive regs.
Discriminatory Procurement Policies
Can take form of govt rules, laws, or admin regulations requiring that goods or services must be purchased from domestic companies.
Single-Column Tariff
Simplest type of tariff.
Two-Column Tariff
General duties plus special duties.
Duties
Ad Valorem: expressed as a percentage of the value of the goods.
Specific: expressed as a specific amount of currency per unit of weight, volume, length, or other measurement.
Antidumping: used if injury is caused to domestic producers.
Countervailing: additional duties levied to offset subsidies granted in the exporting country.
Foreign Purchasing Agents
Operate on behalf of, and are compensated by, an overseas customer known as a principal; seek out manufacturers for the principals.
Export Broker
Receives a fee for bringing together the seller and the overseas buyer.
Export Merchants
Marketing intermediaries that id market opps in one country or region and make purchases in other countries to fill these needs.
Export Management Company
Independent marketing intermediary that acts as the export dept for two or more manufacturers whose product lines to do not compete with eachother.
Manufacturers Export Agent
Acts as an export distributor or as an export commission representative.
Export Distributor
Assumes financial risk by representing several manufacturers.
Export Commission Representative
Assumes no financial risk by representing manufacturers.
Cooperative Exporter
Export Organization of a manufacturing company retained by other independent manufacturers to sell their products in foreign markets.
Freight Forwarder
Licensed specialists in traffic operations, customs clearance, and shipping tariffs/schedules.
Letter of Credit
A document stating that a bank has substituted its creditworthiness for that of the importer/buyer; offers the exporter the best assurance of being paid.
Bill of Exchange
A negotiable instrument that is easily transferable from one party to another.
Draft
A payment instrument that transfers all the risk of nonpayment onto the exporter-seller.
Sourcing Decision
The decision to make or buy products and where it will make or buy them.
Market Entry Strategy
Formulated by deciding which option or options to use in pursuing opportunities outside the home country.
Licensing
A contractual agreement whereby one company makes a legally protected asset available to another company in exchange for royalties, license fees, or some other form of compensation.
Contract Manufacturing
Companies provide tech specs to a subcontractor or local manufacturer to make their product.
Franchising
A variation of licensing which allows a franchisee to operate a business developed by the franchiser in return for a fee and adherence to franchise-wide policies/practices.
Foreign Direct Investment
Reflect investment flows out of the home country as companies invest in or acquire plants/equip/assets; allows companies to produce, sell, and compete locally in key markets.
Joint Venture
An entry strategy for a single target country in which the partners share ownership of a newly created business entity.
Equity Stake
An invetment; if investor owns less than 50%, it is a minority stake, if greater than 50%, it is a majority stake.
Greenfield Investment
Start up of new operations.
Strategic Alliances
Three Characteristics:
1) Participants remain independent subsequent to the formation of the alliance.
2) Participants share the benefits of the alliance as well as control over the performance of assigned tasks.
3) Participants make ongoing contributions in technology, products, and other key strategic areas.
Keiretsu
An interbusiness alliance or enterprise group that resembles a fighting clan in which business families join together to vie for market share (Japan); basically cartels that are blessed by government.
Chaebol
Corporate alliance groups in South Korea that are composed of dozens of companies centered around a central bank or holding company and dominated by a founding family.
Market Expansion Strategy
4 options:
1) Country and Market concentration: involves targeting a limited number of customer segments in a few countries (starting point for most companies).
2) Country concentration and market diversification: a company serves many markets in a few countries.
3) Country diversification and market concentration: a company seeks out the world market for a product.
4) Country and market diversification: corporate strategy of a global, multi-business company.
Product
A good, service, or idea with both tangible and intangible attributes that collectively create value for a buyer or user.
Brand
A complex bundle of images and experiences in the customer's mind; represent a particular promise about a particular product and enable customers to better organize their shopping experience by seeking out a particular product.
Brand Image
Perceptions about a brand as reflected by brand associations that consumers hold in their memories.
Brand Equity
Represents the total value that accrues to a product as a result of a company's cumulative investments in the marketing of the brand.
Local Product/Brand
A product or brand that has achieved success in a single national market.
International Products/Brands
Offered in several markets in a particular region.
Global Product
Meets the wants and needs of a global market; a true global product is offered in all world regions.
Global Brand
Has the same name and, in some instances, a similar image and positioning throughout the word; three characteristics associated with: quality signal, global myth, social responsibility.
Combination/Tiered Branding
A corporate name is combined with a product brand name (sony walkman); leverages the company's reputation while developing a distinctive brand id; powerful for introducing new products.
Co-branding
A variation on combination branding in which two or more different company or product brands are featured prominently on product packaging or in advertising; can engender loyalty and promote synergy, but can also confuse and dilute brand equity.
Brand Extension
Uses an established brand name as an umbrella when entering new businesses or developing new product lines that represent new categories to the company.
Global Brand Leadership
Using organizational structures, processes, and cultures to allocate brand-building resources globally, to create global synergies, and to develop a global brand strategy that coordinates and leverages country brand strategies.
Maslow's Needs Hierarchy
Provides a useful framework for understanding how and why local products and brands can be extended beyond home-country borders; physiological, safety, social, external/internal esteem, self-actualization (lowest to highest).
Country-of-Origin Effect
Perceptions about and attitudes toward particular countries are often extended to products and brands that originate from these countries; these contribute to brand's image and equity.
Express Warranty
A written guarantee that assures the buyer is getting what he or she has paid for or that provides recourse in case a product's performance falls short of expectations.
Extension Strategy
Offers a product virtually unchanged in markets outside the home country.
Adaptation Strategy
Involves changing the elements of design/function/packaging in response to the needs or conditions in particular country markets.
Product-Communication Extension
Selling the same product with virtually no adaptation, using the same ad and promotional appeals used domestically, in two or more country markets or segments; to be successful, the advertising message must be understood across different cultures.
Product Extension-Communication Adaptation
Product is unchanged, but advertising, sales promotions, point of sale material, and other communications are modified.
Product Transformation
Same physical product ends up serving a different function or use than that for which it was originally designed or created.
Product Adaptation-Communication Extension
Adapting the product to local use or preference condition while extending the basic home-market communications strategy or brand name.
Product-Communication Adaptation (dual adaptation)
The product and one or more promotional elements are adapted for a particular country or region.
Innovation
The process of endowing resources with a new capacity to create value.
Not Invented Here Syndrome
Ignoring decisions made by subsidiary or affiliate managers and abandoning any effort to leverage product-communication policies outside the home-country market.
Discontinuous Innovations
When products create new markets and consumption patterns that represent a break with the past.
Dynamically Continuous Innovations
Intermediate category of newness that is less disruptive and requires less learning on the part of consumers; products share features with earlier generations but incorporate new features.
Continuous Innovation
Products that are "new and improved" versions of existing ones and require less R&D to develop than dynamically continuous ones.
Line extensions
New sizes, flavors, low fat versions etc.
Market Skimming
Charging a premium price for a particular brand or for a specialized product that people are willing to pay for; used by companies that seek competitive advantage through differentiation or premium positioning.
Market Penetration Pricing Strategy
Calls for setting price levels that are low enough to quickly build market share.
Export Price Escalation
The increase in the final selling price of goods traded across borders that reflects the factors of destination, transport mode, tariffs, and fees.
Cost-Based Pricing
Based on an analysis of internal and external costs.
Incoterms
International commercial terms, 4 categories:
1) Ex-works: buyer takes delivery at the premises of the seller and bears all risks/expenses from that point on. Delivery Duty Paid: the seller agrees to deliver the goods to the buyer at the place he/she names in the country of import, with all costs, paid.
2) Free Carrier: transfer from seller to buyer is effected when the goods are delivered to a specified carrier at a specified destination.
3) Free Alonside Ship Name Port: seller places the shipment alongside the vessel upon which the goods will be transported out of country and pays for all charges up to that point. Legal responsibilities of seller end once shipment cleared for export.
4) Free On Board Named Port: responsibility and liability of seller do not end until the goods have cleared the ships rail.
Market Holding Strategy
Use of flexible cost-plus method to reduce prices in response to unfavorable currency swings.
Price Transparency
Buyers will be able to comparison shop easily because goods will be priced euros.
Extension/Ethnocentric Pricing Policy
Calls for the per-unit price of an item to be the same no matter where in the world the buyer is located.
Adaptation/Polycentric Pricing
Permits subsidiary or affiliate managers or independent distributors to establish whatever price they feel is most appropriate in their market.
Geocentric Pricing
Neither fixes a single price worldwide nor allows subsidiaries or local distributors to make independent pricing decisions.
Gray Market Goods
Trademarked products that are exported from one country to another where they are sold by unauthorized persons or organizations.
Parallel Importing
Occurs when companies employ a polycentric, multinational pricing policy that calls for setting different prices in different country markets.
Price Fixing
Representatives of two or more companies secretly set similar prices for their products.
Transfer Pricing
Refers to the pricing of goods, services, and intangible property bought and sold by operating units or divisions of the same company.
Market-Based Transfer Price
Derived from the price required to be competitive in the global marketplace.
Cost-Based Transfer Pricing
Uses an internal cost as the starting point in determining price.
Countertrade
A sale results in product flowing in one direction to a buyer; a seperate stream of products/svs is also created flowing in the opposite direction.
Barter
Direct exchange of goods or services between two parties; nonmonetized.
Counterpurchase
Each delivery in an exchange is paid for in cash.
Offset
Reciprocal arrangement whereby the government in the importing country seeks to recover large sums of hard currency spent on expensive purchases.
Compensation Trading
A form of countertrade that involves two seperate and parallel contracts.
Switch Trading
A mechanism that can be applied to barter or countertrade in which a third party steps into a simple barter or countertrade when one of the parties is not willing to accept all the goods recieved in a transaction.