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International Market
Exam1
| Term | Definition |
|---|---|
| International Marketing | The performance of business activities designed to plan, price, promote, and direct the flow of a company's goods and services to consumers or users in more than one nations for a profit. |
| The Environment | The critical difference between domestic marketing and international marketing |
| Cultural Adjustments | The most challenging and important adaptation international marketers must make is cultural adjustments |
| Cultural Conditioning | Be aware of home cultural references before making decisions |
| Self-Reference Criterion (SRC) | An unconscious reference to one's own cultural values, experiences, and knowledge as a basis for decision |
| Ethnocentrism | The nation that people in one's own company, culture, or country know best how to do things |
| Recognize the effects on our behavior | One of the most effective ways to control the influence of SRC and Ethnocentrism |
| No Direct Foreign Marketing (Reactive) | (Reactive) Products "indirectly" reach foreign markets. Foreign orders stimulate a company's interest to seek additional international sales |
| Infrequent Foreign Marketing (Reactive) | (Reactive) Firm has little or no intention of maintaining continuous market representation. Caused by temporary surpluses |
| Regular Foreign Marketing (Proactive) | (Proactive) Products are adapted for foreign markets as domestic demand grows. Firms depend on profits from foreign markets |
| Global Marketing (Proactive) | (Proactive) The firm sees the world as one market. Market segmentation is now defined by income levels, usage patterns, or other factors that span the globe. More than half of its revenues come from abroad. |
| Marketing Decision | (Controllable) Firm characteristics, product, price, place, promotion, research |
| Domestic Environment | (Uncontrollable) Political forces, legal forces, economic forces, competition |
| Foreign Environment | (Uncontrollable) Political forces, legal forces, economic forces, competition, level of technology, geography, culture |
| Political and Legal Forces | "Alien Status" |
| World Trade Organization (WTO) | Efforts have been made by many countries to reduce trade barriers, benefiting the world socially, politically, and economically. Reinforces GATT rules and legislates trade disputes |
| Significant advantage brought by the emerging global economy | Consumers benefit from a wide array of goods at the lowest prices, and viable business opportunities |
| Marshall Plan | Capitalism was promoted by the U.S. Economically rebuilding Europe and Japan |
| General Agreement on Tariffs and Trade (GATT) | Created in 1947 by world leaders to help negotiate reductions in tariffs and other trade barriers |
| In 1960s U.S. multinational corporations (MNCs) faced major challenges on two fronts | Resistance to direct investment and increasing competition in export markets |
| Balance of Payments | The system of accounts that records a nation's international finance transactions |
| Current Account | Exports, imports, services, funds |
| Capital Account | Investments and short-term capital |
| Reserves Account | Gold, foreign exchange, and liabilities |
| Reality of World Trade (Protectionism) | Countries protect its markets from foreign companies by setting up tariffs, quotas, and nontariff barriers |
| Protectionism | Is politically popular, particularly during times of declining wages, and/or high employment, but it rarely leads to renewed growth in a declining industry |
| Tariffs | Taxes imposed by a government on goods entering its borders |
| Tariffs Restrict | Manufacturer's supply sources, choices available to consumers, and competition |
| Tariffs Increase | Inflationary pressures, special interests' privileges, government control and political considerations in economic matters, and the number of tariffs |
| Tariffs Weaken | Balance of payment positions, supply and demand patterns, and international relations by starting trade wars |
| Quotas | A specific unit or dollar limit applied to a particular type of good (increases price of good) |
| Import Licenses | Limits quantities on a case-by-case basis |
| Voluntary Export Restraints (VER) | An agreement between the importing country and the exporting country for a restriction on the volume of exports |
| Basic Elements of GATT | Trades shall be conducted on a nondiscriminatory basis, Protection shall be afforded, Consultation = primary method to solve global trade problems |
| The Creation of WTO | Eliminating international trade barriers - Uruguay Round |
| WTO | Is an institution, not an agreement. Issues binding decisions, bound by the rules, looks at conflicts between countries |
| WTO Members | China (2001), Vietnam (2007) |
| International Monetary Fund (IMF) | Assists nations in becoming and remaining economically viable because of inadequate money reserves and unstable currencies (borrow money) |
| Objectives of the IMF | Stabilization of foreign exchange rate. Establishment of freely convertible currencies |
| World Bank Group | Reduces poverty and improves the standard of living |
| World Bank Group Services | Lends money to government, provides assistance to governments for poorest developing countries, lends directly to private sector, provides investors with guarantees against "noncommercial risk" and promotes increased flows of international investment |
| The Omnibus Trade and Competitiveness Act | 1988, import relief section |
| Global Perspective | The role of world trade and international marketing in producing peace. |
| International Marketer | Must deal with at least two levels of uncontrollable uncertainty instead of one |
| Trade Barriers | Limit how much U.S. companies can sell. Raise prices for imported products |
| Top ten 2009 U.S. Trading Partners | All import more than they export |
| Negotiation of GATT | Significant move toward international cooperation among trading nations |
| Newly Industrialized Countries (NICs) | Countries once classified as less developed were reclassified as this |
| Developed World | (OECD) Grow annually at 3% for the next 25 years |
| Developing World | (OECD) expected to grow annually at 6% for the next 25 years |
| Organization for Economic Cooperation and Development (OECD) | Economic power and influence will move away from industrialized nations to developing nations |
| Assets and liabilities account | Does not mean a nation is in particularly poor financial condition |
| Embargoes | Nontariff barrier - "specific limitations on trade" |
| Arguments for Protectionism | Protection of infant industry (tariff), industrialization of a low-wage nation, and national defense |
| Protectionism | Good for developing countries and doesn't pay back to the U.S. (competition) |
| Voluntary Export Restraints (VER) | Alternative to the threat of stiffer quotas and tariffs |
| Government Approval | Trade policy tool requires importers who want to buy foreign good apply for an exchange permit |
| Predatory Pricing | Practice whereby foreign producer intentionally sells their product in the U.S. for less than cost of production to undermine competition and take control of the market |
| The Mexican State Oil Monopoly Penex | "Symbol os Mexicos historical struggles for sovereignty" |
| The Taiping Rebelling | Single most horrific civil war |
| History is Subjective | Historical events always are viewed from one's own biases and SRC |
| Mexican War of 1946-1848 | U.S. secured California and other parts of the west |
| Manifest Destiny and Monroe Doctrine | Both accepted as the basis for U.S. foreign policy during much of the 19th and 20th centuries |
| Manifest Destiny | Justified U.S. expansion. Americans were a chosen people ordained by God to create a model society |
| Mexico's attitude toward the U.S. | Geography has made us closer, tradition has made us far apart |
| Geography | An element of the uncontrollable environment that confronts every marketer. Affects a society's culture and economy |
| Climate and Topography | Altitude, humidity, and temperature extremes |
| Basel Convention | Agreed to a total ban on the export of hazardous wastes |
| Environmental Issues | Disruption of ecosystem, relocation of people, inadequate hazardous waste, and pollution |
| As countries prosper | Natural barriers are overcome |
| Environmental protection | Is not an optional extra |
| The Location, Quality, and Availability of Resources | Will affect the pattern of world economic development and trade well into the 21st century |
| Global Population Trends | Determine today's demand for goods. Rural/urban population shifts, rates of growth, age levels and population control |
| Rural/Urban Population Shifts | Due to education, health care and job opportunities |
| Procreation | Most culturally sensitive uncontrollable factor |
| Population Control | Most important deterrent is cultural attitudes about the importance of large families |
| Decline in Fertility Rate | Function of economic prosperity and will come only with economic development |
| Europe | The region of the world affected by aging, decreasing worker-to-retiree ratio |
| Free Flow of Immigration | Help to improve dual problems of explosive population expansion in less developed countries and worker shortage in industrialized |
| World Trade Routes | Minimize distance, natural barriers, lack of resources, and fundamental differences between economies |
| World Trade Routes | Represent attempts to overcome influence of geography causing economic and social imbalances |
| Edward T. Hall | Anthropologist who says culture is communication |
| Culture | The sum of the values, rituals, symbols, beliefs, and thought processes that are learned . (Socialization, acculturation, application) |
| Acculturation | Adjusting to a new culture |
| Application | Decisions about consumption and production |
| Geography | Climate, topography, flora, fauna, and microbiology |
| Jared Diamond | Historically, innovations spread faster east to west than north to south |
| History | Impact of specific events can be seen reflected in technology, social institutions, cultural values and even consumer behavior |
| Political Economy | Three approaches to governance competed for world dominance - Fascism, communism, and democracy/free enterprise |
| Social Institutions | Family, religion, school, media, government, corporations |
| Birth Control Techniques | Greatest impact on institutions and cultural values |
| Cultural Values | Geert Hofstede |
| Individualism/Collectivism Index | Reflects the preference of behavior that promotes ones self interest |
| Power Distance Index | Measures the tolerance of social inequality |
| Uncertainty Avoidance Index | Measures the tolerance of uncertainty and ambiguity |
| Rituals | Marriages, funerals, baptisms, and graduations |
| Linguistic Distance | Crossing "wider" differences increase transaction costs |
| Richard Nesbett | Westerners can provide great detail about central figures but see relatively little in the background |
| Family | Nepotism - highly effective, role of extended family, favoritism of boys in some cultures (china), and gender equality is changing |
| Religion | First institution infants are exposed to outside the home |
| School | The most important social institution. Direct link between a nation's literacy rate and its economic development |
| The Media | TV and Internet - replaced family time |
| Government | Influences the thinking and behaviors of adult citizens. Propaganda through media |
| Elements of Culture | Values, rituals, beliefs, symbols and though processes |
| Beliefs | Superstitions - 13 in western hemisphere is unlucky, 8 in China connotes "prosperity" |
| Cultural Sensitivity | Cultures are not right or wrong, better or worse, they are simply different |
| Cultural Sensitivity | The more exotic the situation, the more sensitive, tolerant and flexible one needs to be |
| Cultural Sensitivity | There must be an appreciation of how cultures change and accept or reject new ideas |
| Cultural Change | Caused by war or natural disasters |
| Cultural Borrowing | A responsible effort to learn from others' cultural ways in the quest for better solutions to a society's particular problems |
| Cultural Borrowing | Imitating diversities of other cultures make cultures unique |
| Cultural Borrowing | Habits, goods and customs are adapted to fit each society's needs |
| Similarities - An Illusion | A common language does not guarantee a similar interpretation of word or phrases. Just because something sells in one country doesn't mean it will sell in another |
| Resistance to Change | New methods, ideas, and products are held to be suspect before they are accepted. Varies between cultures |
| Degree of Interest in Particular Subject | The most important factor in determining how much of an innovation will be accepted, as well as, how drastically the new will change the old |
| Planned and Unplanned Cultural Change | Determine which cultural factors conflict with innovation and change those factors |
| Unplanned Change | Marketers can wait |
| Planned Change | Marketers can cause change |
| Cultural Congruence | Marketing products similar to ones already on the market in a manner as congruent as possible with existing cultural norms |
Created by:
sotti988
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