BUS615: International Marketing

Competition in the grocery industry in Germany is fierce. There is a growing number of discount supermarket chains that are all competing for business. When Walmart entered this market, they anticipated the same kind of success they enjoyed in other countries. However, because they didn't sufficiently understand the marketplace, their efforts were a failure. There were breakdowns in communication due to language barriers. They didn't fully understand the laws and regulations in the country. They didn't understand how consumers approached their shopping trips, and there were insufficient locations available for expansion. As you read, think about how you might have approached this market entry. What steps could Walmart have taken to have an ongoing presence in Germany?

In this article, we will look at differing points of view about globalization. Many years ago, Theodore Levitt posited that global markets would accept the products sold by international organizations. However, he didn't consider the push-back from some markets based on cultural differences. In more recent times, Thomas Friedman echoed similar thoughts. He believed that several events he called "flatteners", such as distance, language, and geography, would create a unified business world. Several other economists have sought to demonstrate that these theories are not valid and that the differences in global markets prove that it is essential to understand the factors that drive business operations in different countries and cultures. The examples of Toyota, Coca-Cola, and Walmart all point to the need to understand each market into which a company is entering, and adapt products, marketing strategies, and operations, to suit cultural, political, and social characteristics and variations.

This introduction will set the foundation for the factors we will explore in this section. Pay close attention to the definitions of these strategies and think about them as you read the rest of the materials in this section.

As we've learned, marketing on an international scale requires attention to many elements beyond political and economic factors. We also need to look at social and cultural issues that define different populations. Language is one of the most important of these components. However, even within a single country, people may speak several different languages or different dialects of the same language. Colors also have different meanings among cultures. For example, it is important to avoid using white or purple on packaging in Japanese and Hispanic cultures because these are the colors of mourning and death. Customs also vary, and some things that are acceptable in one part of the world may be improper somewhere else. Read this section for a more in-depth look at the many considerations marketers must make when developing international marketing strategies.

Tariffs and trade agreements significantly affect international markets and how companies and countries interact for mutual benefit. This section explores the various agreements and organizations that govern and monitor international trade. These began with the GATT (General Agreement on Tariffs and Trade), which was replaced by the WTO (the World Trade Organization) in 1995. Consider these rules and regulations, what they mean to countries around the world, how they affect local markets, and their effects on fair trade.

Global market segmentation involves an analysis of various consumer characteristics, including the measurable factors of demographics and geography and the more qualitative descriptors of behavior and lifestyles. Macro-segmentation relies on measurable factors within markets to identify countries that have a demand for similar products. However, this method does not take into consideration differences between countries or even within the same country. Micro-segmentation focuses on behaviors and lifestyles that are similar among consumers in different locales. Read this section for a more in-depth look at how these factors affect marketing strategies.

This section takes a more in-depth look at demographics, which are the measurable factors we use to identify a segment of the population. We use this information to determine which group of people to focus our marketing efforts on. While this may seem like a simple way of choosing a market, studying the variations among consumers in international markets, the many factors that impact their purchase decisions, and what motivates them to make a purchase takes on a much deeper and more complex meaning. Read this section to see the many traits that differentiate a group of people in one country from the people in another country.

Watch this as you work through the unit and prepare to take the final exam.