INTERNATIONAL MARKETING - Sage Publications

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PUT THE i IN YOUR iNTERNATIONAL MARKETING COURSE ... important element of its international marketing presence. ... Appendix B: Notes. B-1. Appendix ...

INTERNATIONAL MARKETING DANIEL W. BAACK | ERIC G. HARRIS | DONALD BAACK Chapter 7: International Product and Brand Marketing 229

II: International Markets and Market Research Overview

Part I of this textbook provided a backdrop for the field of international marketing. Culture, language, infrastructure, economic systems, and political and legal systems influence any domestic or global marketing operation. In Part II the central core of Figure 7.1 was examined: the market. Concepts of target market segmentation and product positioning were explained, along with international market research methods to emphasize the starting point for any marketing program: identifying consumer wants and needs.

and THE Turkey, i Pakistan and India,iand Israel and the PalestiniansMARKETING living in the West BankCOURSE PUT IN YOUR NTERNATIONAL

and the Gaza Strip. These conflicts undoubtedly influence consumer attitudes and The third part of international marketing, as shown in Figure 7.1, is the development of the physical goods and intangible services that meet the needs of those in the target behaviors. market. Products are designed and sold within the context of the cultural, linguistic,

When the United States invaded Iraq in 2002, various countries throughout the iNTEGRATED iNFORMATIVE iNSPIRING QUOTES world, especially in Western Europe, expressed disapproval. A survey completed in 2004 revealed that nearly 20 % of consumers abroadisaid they would avoid U.S. iNNOVATIVE iNDISPENSABLE NCREDIBLE VALUE companies and products such as McDonald’s, Starbucks, American Airlines, and

economic, political, legal, and economic constraints imposed by any country in which a global marketing firm intends to operate. In this chapter, product and brand management activities are detailed. Chapter 8 expands the discussion by incorporating the concepts of product and service adaptation. Making certain a product fits with a specific country and its culture helps the product compete in the international marketplace. International product marketing involves first understanding the types of products that companies sell and the main dimensions of those products from the viewpoint of the consumer. Next, product mix decisions regarding the number of products in a line (depth) and the number of product lines (width or breadth) are made. Product packaging and labeling concepts are integrated into all product decisions, as are choices with regard to the number and types of business-to-business products to be offered. In addition, marketers carefully evaluate product support services to ensure consumers and business customers receive quality attention during and after the purchasing process.

Barbie dolls (Mattel) because of the war. At that time, the more American a product was perceived to be, the more resistance it encountered.26

International services constitute a growing segment of international marketing

iNTEGRATED ILLUSTRATIONS & MAPS

Language

Culture

rice

roduct

lace

Political and Legal Systems

ALGE

Me dit er TUNIS IA S ra ne a n ea RIA

LEBAN ON PALEST AUTHOINIAN RITY

IRAQ N

LIBY

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Greate r Arab Free Tra Coopera Arab Sta tion Counc de Area il tes of the Gu for the lf

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Nationalism

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international business factors interact with the 4 Ps.

CCO

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romotion

MORO

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efforts. Companies providing financial, insurance, transportation, health-care, personal, Any animosity or anger toward a country can be worsened by political, economic, or military conflicts between countries. A considerable amount of evidence suggests that animosity toward a country strongly influences consumers.27 In the United States, animosity with regard to objections to the Iraq war reached a level in which Congress circulated a resolution to change the name of the French fries in the congressional P P cafeteria to “Freedom fries,” because France had expressed strong opposition to theMarkets war at the beginning of the conflict. Integrated illustrations demonstrate how five key P P

AN

YEME

N

Economic Systems

At times, animosity toward another country may be coupled with nationalism. Integrated maps expose students to global locations. Nationalism refers to the strong pride and devotion citizens have in a country or

Figure 7.1: The International Marketing Context

nation. Nationalism can be the internal response to activities that can also lead to animosity as consumers examine products from other countries. Nationalism should not be considered as a purely negative or positive attitude. It may be associated with heroic sacrifice, loyalty, and group cohesiveness. From a marketing perspective, it can also lead to a preference for purchasing local goods and services. Conversely, nationalism can lead to boycotts, protests, and even acts of violence toward another country or a company conducting business in a foreign land. Nationalistic consumers often perceive that buying imported isInternational wrongMarketing because it negatively impacts Chapter 1:goods Introduction To 21 the domestic economy.28

nt Current Accou s Balances in Billion s of U.S. Dollar over $100 $50 to$100 $10 to $50 $0 to $10 -$0 to -$10 -$10 to -$50 -$50 to -$100 0ver -$100 no data

iNNOVATIVE REAL-WORLD APPLICATIONS

In May of 2010, millions of Indonesian farmers threatened to boycott Nestlé INTERNATIONAL INCIDENT products. Angry atyouramarketing move to stop As part of an international junket, teamby stopsNestlé to visit an important potentialbuying crude palm oil from Indonesian new client in Spain. Within a few hours of cordial discussions, the manager of the client farms, an you action that would potentially hurt the Indonesian economy, the company invites to attend the bullfights the next day as his guest. You haveseverely little interest in attending the event and do not like the custom. What should you do? How would you farmers expressed national pride and attempted to protect their community.29 respectfully decline? Or, would you accept and then bow out, claiming illness the next day? Would you consider attending? How would your response change if you were a Hindu from India or Nepal? (Hindus hold all life to be sacred and consider bulls to be religious animals that should never be harmed.)

Religiosity

International Marketing in Daily Life It may be that most people think of something “glamorous” when the term “marketing” is used. It may feel classy or sexy to consider a marketing program for the newest hand-held mobile technology, a fancy sports car, or designer clothing. At the same time, a case can be made that the majority of marketing opportunities may come from much simpler products and services—those used in everyday life.

International Marketing in Daily Life One common theme that appears in this textbook is the marketing of products

Innovative and thought-provoking International Incident features encourage critical thinking and class discussion. International Marketing in Daily Life features help students apply marketing concepts to everyday life.

to be used daily or regularly. The approach serves a special purpose: to illustrate how the most commonplace of daily activities can lead to the identification of target markets that companies can reach with products that are adapted to individual cultures and national circumstances. Figure 1.10 lists some of the daily activities described in this textbook. When one of these activities is described, the daily living logo show above will appear as part of the presentation.

Religions

Attitudes towards countries can also be influenced be religion and religious Bathing Brushing Teeth/Dental Hygiene Using the Restroom between countries. Wearing Jeans Increasingly, religiosity, or the degree to which similarities Sleeping and Beds Methods of Transportation consumers within a country or region are religious, has become a factor some Cosmetics Candy marketers consider when positioning products. Religiosity affects shopping CASE 10 Dining Habits and Foods Cooking Methods behaviors, attitudes toward advertising, purchase information-search processes, Drinks and Milk Consumption Coping with Headaches 30 Socialization Music and product preferences. A list of the major religions and the percentage of the Microfinance and Informative end-of-chapter brief cases cover key Religions Methods of Payment and Banking id population that follows each in select countries is presented in Table 5.1. Bottom-of-the-Pyram Figure 1.10: Selected Daily Life Activities and Marketing Opportunities Presented in This topics, including sustainability and bottom-of-themers nsu Textbook Co Each of these religions practices differing dietary programs, holds religious pyramid Six end-of-text comprehensive ceremoniesissues. in differing ways, exhibits varying viewpoints regarding the status of For most consumers in developing

iNFORMATIVE CASES

International Marketing in Daily Life

cases provide even more flexibility to your course. INTERNATIONAL EXAMPLE: MARKETING BATHING PRODUCTS As an example of the far-reaching impact of globalization on business practices and international marketing, consider this basic human activity: bathing and cleaning. Bathing and cleaning are routine activities worldwide, but the methods and products

r afterthought, an countries, credit is an Photo 10.7: Manual labo pyramid onent of making a ult for bottom-of-theeasily accessible comp Obtaining credit is diffic t scores are tracked s in developing markets. umer purchase. Certainly credi cons d for limite be can t credi and access to ruptcy or foreclosure. to repay loans, which individuals with a bank Women are more likely is rity of consumers, the next loan t market for the majo Still, for the majority of makes them the targe . away the swipe of a credit card microfinance loans. -them-of preneur botto entre for ult -two-year-old Obtaining credit is diffic Mallamma was a forty It is a microfinance loan developing markets. rabad, India. She used pyramid consumers in Hyde in lation ess. popu ’s busin world fish a s of the 00 Rs) to start estimated that two third of 10,000 rupees (10,0 s. that ss to credit from bank business to the point is unable to obtain acce one year she grew the In be an only hire to can 0 it all, 50,00 able at loan of Rs Instead, credit, if avail she is seeking a second s of , sharks and other form expanding. In Hyerabad accessed through loan employee and continue 0 10,00 Rs 25 This debt comes with a hefty an awati, used 26 organized crime. another borrower, Geet and be extremely high. machine after her husb cost. Interest rates can loan to buy a sewing usiness to

The Essence of Marketing

Drivers of Globalization: An Illustration Factors That Create International Marketing Complexity: An Illustration The International Marketing Context

The Marketing Mix Markets, Needs, and Wants Segmentation, Target Markets, and Positioning (STP)

Marketing in an International Context The Drivers of Globalization Channels of Communication Lower Transportation Costs Immigration and Emigration Governmental Actions

The Organization of This Book

The Factors That Create International Marketing Complexity

iNDISPENSABLE ONLINE RESOURCES

Part I: Essentials of International Marketing Part II: International Markets and Market Research Part III: International Product Marketing

Sustainability Bottom-of-the-Pyramid

Ethical Decision-Making and International Marketing Strategic Implications Tactical Implications Operational Implications Terms Review Questions Discussion Questions Analytical and Internet Exercises Case 1. Carrefour: Retailing in an International Marketplace

Facebook.com: Global Marketing Opportunities and Connectivity

VIDEO LINK 1.1: Facebook’s Impact

What online community signs up 700,000 new members each day? The answer— Facebook.com. The Facebook community included 750 million followers by mid2011.1 The founder, Mark Zuckerberg, was named Time magazine’s “Person of the Year” in 2010.

Indispensable online resources for the instructor

The statistics associated with Facebook take on nearly epic proportions. If Facebook users in January 2011 were members of a country, that nation would have the third highest population in the world, with only China and India ahead. One out of every twelve people on the planet has a Facebook account. And, in the world of Internet hits, one out of every four page views in the United States occurs on the Facebook site. Facebook has caused some dramatic shifts in everyday life, the core of which are new cultural patterns of interpersonal interactions. Marketing professionals have quickly moved into this realm along with the companies they serve.2

Password-protected resources at www.sagepub.com/baack include:

Many users around the world are familiar with the former Facebook.com opening page. As shown in the photo on page 5, the screen prominently displays the Facebook logo, an important element of its international marketing presence. To maintain interest, the content of the opening photos rotates, giving the website an evolving visual presence. Also, by being

• Author-created test bank available electronically and in Microsoft Word, with approximately 100 test questions for each chapter. • Author-created PowerPoint® slides highlight essential content and features from the text • Class assignments and answers to in-text questions • Full-text SAGE journal articles, carefully selected for each chapter • Video links with questions for discussion, sample syllabi, and country fact sheets Interactive online engagement for students See the inside back cover of this text for details and description of the free, open-access, interactive Student Study Site!

iNSPIRING QUOTES Reviewers say we are INTEGRATED, FRESH, REAL-WORLD, RELEVANT and GROUND-BREAKING “Who said that textbooks are boring? This is one of the few textbooks written that is comprehensive, interesting, and ground-breaking.” –John Hadjimarcou, University of Texas, El Paso “The single most impressive aspect is a fresh approach! It is really nice to see the integration amongst topics.” –Melissa Malabad, Mary Baldwin College “This is not an international business text with marketing stuff in it. . . . It resembles the textbook that I have wanted to adopt but have not seen . . .” –Brent Smith, Saint Joseph’s University “. . . there are more real-world examples in this text . . . relevant and refreshing.” –John Gironda, Florida Atlantic University

iNCREDIBLE VALUE What do your students pay for their current International Marketing text? International Marketing by Daniel W. Baack, Eric G. Harris, and Donald Baack costs students a minimum of $100 less than any of the four best-selling International Marketing texts!

INTERNATIONAL MARKETING

I dedicate this book to my parents, my wife, and especially to my grandmother Pauline Burns. The support she has provided me the past thirty-five years has been invaluable. Thanks, Nana. —Daniel W. Baack I dedicate this book to my parents, my wife, and my kids. For all the love and support, thanks to you all. —Eric G. Harris My efforts on this book are dedicated to my brothers: Steve Kepford, who has been a constant source of inspiration, and Drew (Charles) and Landis Burns, who welcomed me as family from the beginning. —Donald Baack

INTERNATIONAL MARKETING

DANIEL W. BAACK

ERIC G. HARRIS

University of Denver

Pittsburg State University

DONALD BAACK Pittsburg State University

FOR INFORMATION: SAGE Publications, Inc. 2455 Teller Road Thousand Oaks, California 91320 E-mail: [email protected] SAGE Publications Ltd. 1 Oliver’s Yard 55 City Road

Copyright © 2013 by SAGE Publications, Inc. All rights reserved. No part of this book may be reproduced or utilized in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system, without permission in writing from the publisher. All opinions expressed by the authors in this book do not necessarily reflect the opinions of SAGE. SAGE shall not be liable for any liability arising out of or related to any of the material contained in this book.

London EC1Y 1SP United Kingdom

Printed in the United States of America

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Library of Congress Cataloging-in-Publication Data

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Baack, Daniel W. International marketing / Daniel W. Baack, Eric G. Harris, Donald Baack.

SAGE Publications Asia-Pacific Pte. Ltd. 33 Pekin Street #02-01 Far East Square Singapore 048763

p. cm. Includes bibliographical references and index. ISBN 978-1-4522-2635-4 (cloth) 1. Export marketing. I. Harris, Eric G. II. Baack, Donald. III. Title.

Acquisitions Editor:  Patricia Quinlin Associate Editor:  Maggie Stanley Assistant Editor:  Theresa Accomazzo Editorial Assistant:  Katie Guarino

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12 13 14 15 16 10 9 8 7 6 5 4 3 2 1

Brief Contents Preface xxv About the Authors

Part I. Essentials

xxxii of International

Marketing

1

Chapter 1. Introduction to International Marketing

2

Chapter 2. Country Selection and Entry Strategies

36

Chapter 3. Global Trade and Integration

72

Part II. International Markets

and

Market Research

113

Chapter 4. Markets and Segmentation in an International Context

114

Chapter 5. International Positioning

156

Chapter 6. Market Research in the International Environment

190

Part III. International Product Marketing

225

Chapter 7. International Product and Brand Marketing

226

Chapter 8. International Product Standardization and Adaptation

262

Part IV. International Pricing

and

Finance

297

Chapter 9. International Pricing

298

Chapter 10. International Finance and Pricing Implications

334

Part V. International Place

Distribution

371

Chapter 11. International Marketing Channel Management

372

Chapter 12. International Distribution: Exporting and Retailing

406

or

Part VI. International Promotion

and

Personal Selling 439

Chapter 13. Globally Integrated Marketing Communications

440

Chapter 14. International Sales Promotions and Public Relations

480

Chapter 15. International Personal Selling and Sales Management

512

Chapter 16. International Marketing Planning, Organization, and Control

548

Appendix A: Comprehensive Cases

A-1

Appendix B: Notes

B-1

Appendix C: Glossary

C-1

Credits D-1 Name Index

E-1

Subject Index

F-1

Country Index

G-1

Detailed Contents Preface xxv About the Authors

Part I. Essentials

xxxii of International

Marketing

Chapter 1. Introduction to International Marketing Opening Vignette: Facebook.com: Global Marketing Opportunities and Connectivity   3 Overview  6 The Worldwide Marketplace   6 Types of Global Businesses   7 Company Orientation  7 The Essence of Marketing   9 The Marketing Mix   10 Markets, Needs, and Wants   11 Segmentation, Target Markets, and Positioning (STP)   12 Marketing in an International Context   12 The Drivers of Globalization   13 Channels of Communication   13 Lower Transportation Costs   14 Immigration and Emigration   14 Governmental Actions  15 The Factors That Create International Marketing Complexity   15 Culture  16 Language  16 Political and Legal Systems   17 Economic Systems  18 Infrastructure  19 Implications  20 International Marketing in Daily Life   21 Drivers of Globalization: An Illustration   22 Factors That Create International Marketing Complexity: An Illustration  23 The International Marketing Context   24 The Organization of This Book   24 Part I: Essentials of International Marketing   26 Part II: International Markets and Market Research   26

1 2

Part III: International Product Marketing   26 Part IV: International Pricing and Finance   27 Part V: International Place or Distribution   27 Part VI: International Promotion and Personal Selling   28 Sustainability and the Bottom-of-the-Pyramid   28 Sustainability  28 Bottom-of-the-Pyramid  29 Ethical Decision-Making and International Marketing   30 Strategic Implications  31 Tactical Implications  31 Operational Implications  31 Terms  32 Review Questions  32 Discussion Questions  32 Analytical and Internet Exercises   33 Case 1. Carrefour: Retailing in an International Marketplace  34 Chapter 2. Country Selection and Entry Strategies Opening Vignette: Teens and Jeans: Clothing in Transition   37 Overview  39 Economic Systems  40 Market Economy  40 Command Economy  41 Mixed Economy  42 Economic Development  42 Most-, Less-, and Least-Developed Economies   43 Rostow Modernization Model   44 Emerging Markets  45 Newly Industrialized Countries   46 Transition Economies  46 Effects on International Marketing   48 Stage of Development and Bottom-of-the-Pyramid   49 Global Competition and National Competitive Advantage   49 Demand Conditions  50 Related and Supporting Industries   50 Firm Strategy, Structure, and Rivalry   50 Factor Conditions  51 Government  51 Industry-Level Competitive Advantage   52 Threat of New Entrants   52 Threat of Substitute Products   52 Bargaining Power of Suppliers   53 Bargaining Power of Consumers   53 Rivalry Among Competitors   54 Economic Forces and International Marketing   54 Sustainability and International Marketing   55 Modes of Entry   57 Exporting  58 Licensing  58 Franchising  59

36

Joint Ventures  60 Strategic Alliances  60 Wholly Owned Subsidiary   61 Entry Mode Failure and Exit   63 Theories of Entry Mode Selection   63 Internationalization Theory  63 Internalization Theory  64 Eclectic or OLI Theory   65 Analysis  66 Strategic Implications  67 Tactical Implications  67 Operational Implications  67 Terms  68 Review Questions  68 Discussion Questions  68 Analytical and Internet Exercises   69 Case 2. Mobile Communications: Entry Into Africa   70 Chapter 3. Global Trade and Integration Opening Vignette: Kikkoman Soy Sauce: A Tradition of Trade   73 Overview  74 Free Trade  75 Absolute Advantage  75 Comparative Advantage  76 The Benefits of Free Trade   79 Governmental Policies Supporting Trade   80 Integration  81 Levels of Integration   81 Reasons for Integration Success   81 Integration Trends  82 The World Trade Organization and Integration   83 European Integration  86 The European Union   86 Organization of the European Union   89 Beefs Export in the European Union   90 Other European Trade Organizations   91 Integration in the Americas   92 North American Free Trade Agreement   92 Southern Cone Common Market   93 Andean Community  94 Other Trade Organizations or Agreements   95 Integration in Asia, Africa, and the Middle East   96 Association of Southeast Asian Nations Free Trade Area   96 Asia-Pacific Economic Cooperation   97 Trans-Pacific Strategic Economic Partnership Agreement   97 South Asian Association for Regional Cooperation   98 Beef Exports in Asia   99 Integration in the Middle East and Africa   99 Protectionism vs. Free Trade   103 Government Policies Limiting Trade   103

72

Arguments for Protectionism   104 The Future  106 Legal and Ethical Issues   106 Strategic Implications  108 Tactical Implications  108 Operational Implications  108 Terms  108 Review Questions  109 Discussion Questions  109 Analytical and Internet Exercises   109 Case 3. DHL and Facilitating Small Business Trade   111

Part II. International Markets

and

Market Research

Chapter 4. Markets and Segmentation in an International Context Opening Vignette: Musical Segmentation   115 Overview  117 Markets and Segmentation   118 Culture  118 Origins of Culture   118 Creating Cultural Consumption: Carnival   121 Culture and Values   122 Applying Cultural Values to Marketing Activities  122 Value Levels  123 Culture and Behaviors   126 Cultural Imperatives  126 Cultural Electives  126 Cultural Exclusives  127 Culture and Purchasing Behavior   127 Aesthetics  127 Religion  128 Subcultures and Countercultures   130 Cultural Change  130 The Nature of Markets   131 The STP Approach   131 International Market Segmentation   131 International Consumer Market Segments   132 Demographics  132 Psychographics  134 Geographic Area  135 Geodemographic Segmentation  135 Benefit Segmentation  135 Consumer Types  136 Usage Segmentation  137 International Business-to-Business Market Segmentation  137 Segmentation by Industry   138 Segmentation by Size   138 Geographic Location  138 Product Usage  139

113 114

Customer Value  139 Dual Channel Marketing   139 Regional and National Segmentation   140 Wants and Needs   140 Money to Spend   140 Willingness to Spend   141 Language  141 Regionally Based Market Segments   142 Segmentation and the Bottom-of-the-Pyramid   142 Products  143 Pricing  143 Delivery  144 Promotion  144 Green Marketing and Sustainability-Oriented Segments   145 Consumer Preferences  145 Green by Necessity   145 A Market Segment Analysis   145 Assessing Market Potential   146 Assessment Criteria  147 Ethical Issues in International Segmentation   147 Strategic Implications  149 Tactical Implications  149 Operational Implications  149 Terms  150 Review Questions  150 Discussion Questions  151 Analytical and Internet Exercises   151 Case 4. Electrolux: Refrigeration and Segmentation   153 Chapter 5. International Positioning Opening Vignette: The Wide World of Tea   157 Overview  159 The Nature of International Product Positioning   160 Positioning Statements and Approaches   160 Product Attributes  160 Competitors  161 Use or Application   161 Price-Quality Relationships  161 Product User  162 Product Class  162 Cultural Symbol  163 International Positioning Objectives   163 Brand Equity  164 Brand Parity  164 International Product Positioning Challenges   165 Changes in Technology   165 Country-of-Origin Effects  166 Regulations  169 Packaging and Labels   170 International Positioning Methods   170 Identify Target Markets   170 Analyze Competition Within the Target Market   171

156

Identity Points of Difference   174 Enhancing Position or Repositioning   177 Sustainability and International Positioning   180 Ethical Issues in International Positioning   182 Strategic Implications  183 Tactical Implications  183 Operational Implications  183 Terms  184 Review Questions  184 Discussion Questions  185 Analytical and Internet Exercises   185 Case 5. TOTO: Positioning Plumbing Products Globally  187 Chapter 6. Market Research in the International Environment Opening Vignette: Focus on Cosmetics   191 Overview  193 Market Research  194 The Scientific Method   194 Objectivity  194 The Pace of Change   195 Types of International Market Research   195 Product Research  195 Pricing Research  196 Promotion Research  196 Distribution Research  197 The International Market Research Process  197 Defining the Problem or Situation   198 Complete a Cost/Benefit Analysis   198 Develop a Research Design   199 Secondary Data  199 Primary Data  200 Reliability and Validity   201 Micro-Level Analysis  202 Macro-Level Analysis  202 Qualitative and Quantitative Research   204 Qualitative Methods  204 Quantitative Methods  206 Online Research: A Hybrid Approach   209 Develop a Sample   209 Sampling Issues in International Research   210 Calculating the Sample Size   211 Collect Data  212 Analyze and Interpret Data   213 Linguistic Problems  213 Metric Equivalence Issues   213 Socially Desirable Responses   214 Formulating Conclusions and Writing Reports   215 Ethics and International Market Research   215 Bottom-of-the-Pyramid and International Market Research   216 Control of the International Market Research Process   216 Strategic Implications  218

190

Tactical Implications  218 Operational Implications  218 Terms  218 Review Questions  219 Discussion Questions  219 Analytical and Internet Exercises   220 Case 6. The “Mobile You” Breathalyzer   221

Part III. International Product Marketing

225

Chapter 7. International Product and Brand Marketing

226

Opening Vignette: A Good Night’s Sleep   227 Overview  229 Types of Products   230 Classifications of Products   230 Convenience Products  230 Shopping Products  231 Specialty Products  232 Product Dimensions  233 International Product Mix Management   234 Product Lines and Mix   234 Packaging  234 Labeling  236 Sustainability and International Product Marketing   237 International Business Products   237 Raw Materials  238 Maintenance, Repair, and Operating Supplies   238 Component Parts  238 Accessory Equipment  239 Business Services  239 Process Materials  239 Installations  239 Distinctions Between Business and Consumer Products   239 Bottom-of-the-Pyramid International Product Marketing   240 International Product Support Services   240 International Services  241 International Product Quality Standards   242 Quality Standards  243 The Product Life Cycle   243 Development  244 Introduction  245 Growth  245 Maturity  246 Decline  246 Product Cycle Theory   247 Market/Product Matrix  247 Market Penetration  248 Product Development  248 Diversification  248 Market Development  248 Implications  249 International Brand Management   249 Family and Individual Branding   250

Brand and Product Line Extensions   250 Cobranding  250 Building Powerful International Brands   251 Brand Awareness  251 Brand Meaning  252 Brand Loyalty  252 Double Jeopardy  253 Brand Valuation  253 Implications for Managers   253 Ethical Issues in International Product Marketing   254 Strategic Implications  256 Tactical Implications  256 Operational Implications  256 Terms  257 Review Questions  257 Discussion Questions  257 Analytical and Internet Exercises   258 Case 7. Interface: Prize-Winning, Sustainable Modular Flooring   260 Chapter 8. International Product Standardization and Adaptation Opening Vignette: McDonald’s Global Expansion: Adaptation and Differences in Taste   263 Overview  265 Legal Systems  266 International Intellectual Property Protection  266 Intellectual Property Piracy   267 Corporate Spying  267 Reverse-Engineering  268 Country Development  268 International Dispute Resolution   269 Jurisdiction  270 Methods of Dispute Resolution   270 Marketing Implications  272 Standardization  272 Service Standardization  274 Adaptation  274 Laws and Adaptation   275 Adaptation of Services   277 Service Quality  278 Adaptation and Service Quality   279 Music: Legal Systems, Standardization, and Adaptation  279 Legal Adaptation  280 Combining Standardization and Adaptation   282 The Product and Communication Adaptation Model  282 Sustainability and Adaptation   284 Global Innovation  285 Types of Adopters   286 Global Product Diffusion   287 New Product Development and the Bottom-of-the-Pyramid   288

262

Ethical Issues in Standardization and Adaptation   288 Ethics and Laws   288 Strategic Implications  289 Tactical Implications  289 Operational Implications  289 Terms  290 Review Questions  290 Discussion Questions  290 Analytical and Internet Exercises   291 Case 8. AB InBev: Adapting Beer Products in Global Markets   292

Part IV. International Pricing

and

Finance

Chapter 9. International Pricing Opening Vignette: Wind Turbines in Finland: Pricing Sustainability and Economic Incentives   299 Overview  301 The Nature of Price   302 International Prices  303 Price and Perception   303 Value Considerations  303 Emotional Factors  305 Situational Factors  305 International Pricing Methods   306 Cost-Based Pricing  307 Demand- /Supply-Based Pricing   309 Competition-Based Pricing  313 Competition-Based Price Setting for New Products   314 Profit-Based Pricing  315 International Consideration in Pricing Goals   317 Pricing to Bottom-of-the-Pyramid Consumers   319 International Pricing Discounts   321 Loss Leader  321 Seasonal Discounts  322 Quantity Discounts  322 Early-Payment Discounts  323 Channel Discounts  323 Price Changes in International Markets   323 Price Reductions  324 Price Increases  324 Weber’s Law  325 Ethical Issues in International Pricing   326 Collusion  326 Predatory Pricing  326 Deceptive Pricing  326 Dumping  327 Strategic Implications  328 Tactical Implications  328 Operational Implications  328 Terms  329 Review Questions  329 Discussion Questions  329

297 298

Analytical and Internet Exercises   330 Case 9. LaPoste: Pricing Banking Services   332 Chapter 10. International Finance and Pricing Implications

334

Opening Vignette: Pricing ArcelorMitall Steel Globally: The Effects of Currency Changes   335 Overview  337 International Products  338 Money and Currency   338 Currency  338 International Finance  341 Capital Markets  341 The Financing of Transactions   342 The Nature of Currency Exchange   342 Computing Exchange Rates   343 Factors That Affect Currency Movement   344 Individual and Business Transactions   345 Trade and Investment Activity   346 Trade Deficits  348 Inflation  349 Interest Rates  350 The Law of One Price and Purchasing Power Parity   350 Purchasing Power  351 Purchasing Power Parity   351 Governmental Activity and International Finance   353 Currency Regimes  353 Global Currency Institutions   355 Managing Currency Risk   357 Predicting Currency Risk   357 Hedging Currency Risk   358 The Basics of International Finance Funding   358 Financing Ongoing Trade Operations   359 Internal Pricing  361 International Finance and International Marketing   361 Markets  361 Products  362 Prices  362 Place (Distribution)  364 Promotion  364 Strategic Implications  365 Tactical Implications  365 Operational Implications  365 Terms  366 Review Questions  366 Discussion Questions  366 Analytical and Internet Exercises   367 Case 10. Microfinance and Bottom-of-the-Pyramid Consumers   368

Part V. International Place

or

Distribution

Chapter 11. International Marketing Channel Management Opening Vignette: Fruit Around the World   373 Overview  375

371 372

International Marketing Channels   375 International Marketing Channel Decisions   376 Distribution Intensity  376 Selection of Distribution Channels   377 Direct Marketing  378 Indirect Channels  379 Channel Length  381 Selection Factors  381 Standardization of Channel Structure   382 Environmental Factors and International Marketing Channel Decisions   382 Existing Channels  383 Future Channels  383 Managing International Distribution Channels   384 Establishing International Channel Strategies   385 Selecting Intermediary Arrangements   386 Gray Markets  387 Making Channel Arrangements and Choosing Channel Partners   388 Managing Channel Power   388 Trust and Commitment in International Marketing Channels   390 Cross-Cultural Negotiation and International Marketing Channels   390 Stages in the Negotiation Process   390 Cultural Influences on Negotiations   392 International Marketing Channel Functions   394 Research Market Needs   395 Promote Products  395 Order Processing  396 Communicate With Channel Members   396 Warehousing, Inventory Control, and Materials Handling   397 Address Discrepancies of Assortment   397 Secure Payment and Extend Credit   398 Transportation  398 International Marketing Channel Structure   398 Cost  398 Coordination  399 Coverage  399 Cooperation  399 Control  399 Strategic Implications  401 Tactical Implications  401 Operational Implications  401 Terms  401 Review Questions  402 Discussion Questions  402 Analytical and Internet Exercises   402 Case 11. JDA Software Services   404 Chapter 12. International Distribution: Exporting and Retailing Opening Vignette: Exporting and the Business-to-Business Market: Alibaba.com  407 Overview  409 Exporting Choices  409 Internal Reasons for Exporting   410 External Reasons for Exporting   412

406

Market Selection  413 Export Entry Modes   413 Home-Based Direct Exporting   414 Foreign-Based Direct Exporting   414 Indirect Exporting  415 Pricing Exports  416 Exporting Documentation  416 Regulations and Documentation   417 Export and Import Licenses   417 Financing  417 Physical Distribution  419 Materials Handling  419 Inventory Location  419 Inventory Control  420 Order Processing  422 Methods of Transportation   422 Sustainability and International Distribution Systems   425 Radio Frequency Identification Development and International Transportation  425 International Distribution and the Bottom-of-the-Pyramid   426 Terrorism and International Marketing Channels   427 International Marketing Channels and Utility   427 International Retailing  428 Types of International Retail Outlets   429 Convenience Stores  429 Supermarkets  429 Hypermarkets  429 Open Air Markets and Bazaars   430 Department Stores  430 Discount Stores  430 Specialty Stores  431 Online Retailing  431 The Future  432 Strategic Implications  433 Tactical Implications  433 Operational Implications  433 Terms  434 Review Questions  434 Discussion Questions  434 Analytical and Internet Exercises   435 Case 12. Tesco Targets China   436

Part VI. International Promotion

and

Personal Selling 439

Chapter 13. Globally Integrated Marketing Communications Opening Vignette: Advertising Jewelry   441 Overview  443 The Communication Process   444 Individual Interpersonal Communications   444 Barriers to Communication   445 Overcoming Barriers to Communication   450 Communicating Marketing Messages   450

440

International Advertising Management   451 Establish International Advertising Objectives   452 Create an International Advertising Budget   452 Choose an Advertising Agency   453 Oversee the Advertising Program   454 Media Selection Factors   456 Assess Advertising Effectiveness   457 Standardization or Adaptation   458 International Law and Globally Integrated Marketing Communications   459 Message Design: Types of Appeals   459 Cultural Paradoxes  462 International Advertising Appeals   463 Advertising Executional Frameworks   466 Traditional Executional Frameworks   467 International Executional Frameworks   468 Alternative Marketing Programs   470 Buzz Marketing  471 Guerilla Marketing  472 Product Placements and Branded Entertainment   473 Lifestyle Marketing  473 Ethical Issues in International Advertising   474 Strategic Implications  476 Tactical Implications  476 Operational Implications  476 Terms  477 Review Questions  477 Discussion Questions  477 Analytical and Internet Exercises   478 Case 13. Mobile Phone Marketing   479 Chapter 14. International Sales Promotions and Public Relations Opening Vignette: Marketing Headaches   481 Overview  483 Sales Promotions and the Communication Process   483 International Sales Promotions   484 Push vs. Pull Strategies   484 International Consumer Promotions   485 Coupons  487 Premiums  488 Bonus Packs  488 Contests and Sweepstakes   489 Rebates  490 Price-off Promotions  490 Sampling  491 Social Media and Consumer Promotions   492 Legal Issues in Consumer Promotions   493 Types of Consumers and International Consumer Promotions   493 Consumer Promotions and Bottom-of-the-Pyramid Consumers   494 International Trade Promotions   494 Trade Shows  494 Trade Allowances  495

480

Cooperative Advertising  497 Trade Contests  497 Training Programs  497 Point-of-Purchase Materials  497 Challenges  498 International Sales Promotions Campaign Management   498 Consumer Promotions  500 Trade Promotions  501 International Public Relations   502 Channel Members  502 Addressing Negative Publicity and Events   502 Positive Publicity and Image-Enhancing Events   503 Social Media and Public Relations   505 Marketing Implications  506 Strategic Implications  507 Tactical Implications  507 Operational Implications  507 Terms  508 Review Questions  508 Discussion Questions  508 Analytical and Internet Exercises   509 Case 14. Nestlé, S.A.   510 Chapter 15. International Personal Selling and Sales Management Opening Vignette: International Personal Selling and Real Estate: Complications and Opportunities   513 Overview  515 The Nature of Personal Selling   515 Retail Selling  516 Business-to-Business Personal Selling   516 Culture and International Personal Selling   517 Cultural Context  517 Time and Cultural Context   518 Individualism/Collectivism  518 Transactions vs. Relationships   518 Business Etiquette  519 Cultural Adaptation  522 International Business-to-Business Selling   523 Prospecting  523 Preapproach  524 Approach  525 Presentation  526 Negotiation  526 Handling Objections  528 Closing  528 The Follow-Up  530 International Sales Force Composition   530 Technology and International Sales Force Composition  531 Sales Teams  532 Foreign Language Skills and International Sales   532 International Sales Force Management   533 Recruiting and Selection   533

512

Training  534 Motivation  535 Evaluation  538 Compensation  540 Salary  540 Commissions  540 Salary Plus Commission   541 Bonuses  541 Benefits and Allowances   541 Repatriation  542 Repatriation Knowledge Acquisition   542 Management Issues  542 Strategic Implications  544 Tactical Implications  544 Operational Implications  544 Terms  545 Review Questions  545 Discussion Questions  545 Analytical and Internet Exercises   546 Case 15. Oriflame and the Indian Marketplace   547 Chapter 16. International Marketing Planning, Organization, and Control Opening Vignette: Nintendo: Marketing Strategies in a Turbulent Environment  549 Overview  551 International Marketing and Strategic Planning   551 International Marketing Efficiency and Effectiveness   552 Planning Levels  552 International Strategic Planning   553 International Marketing Organization   556 Organizational Structures  556 Internal Factors and Organizational Design   561 External Factors and Organizational Design   563 International Marketing Tactics and the Marketing Plan   564 The International Marketing Plan   565 Planning Tactics and Strategic Plans   566 Internal Marketing Communications   566 International Internal Communications   566 Formal Communication in Global Companies   566 Barriers to International Formal Communications   568 Overcoming Barriers to Formal Communications   569 International Marketing Control   570 Control Measures  571 Corrections  571 Emerging Trends in International Marketing   573 Technological Issues  573 Cultural Issues  574 Economic Issues  575 Emerging Markets Ascending   577 Bottom-of-the-Pyramid  578 Strategic Implications  579 Tactical Implications  579 Operational Implications  579

548

Terms  579 Review Questions  580 Discussion Questions  580 Analytical and Internet Exercises   581 Case 16. Virgin Galactic and Space Travel   582 Appendix A: Comprehensive Cases

A-1

Case 1. Alpen Bank: Launching the Credit Card in Romania   A-1 V. Kasturi Rangan and Sunru Yong   Case 2. United Cereal: Lora Brill’s Eurobrand Challenge   A-8 Christopher A. Bartlett and Carole Carlson   Case 3. Clayton Industries: Peter Arnell, Country Manager for Italy   A-17 Christopher A. Bartlett and Benjamin H. Barlow   Case 4. Best Buy Inc.: Dual Branding in China   A-29 R. Chandrasekhar   Case 5. La Hacienda del Sol   A-43 Neeta Khera   Case 6. Dabur India   A-50 Manish Khandelwal   Appendix B: Notes

B-1

Appendix C: Glossary

C-1

Credits D-1 Name Index

E-1

Subject Index

F-1

Country Index

G-1

Preface “Marketing is marketing, no matter where you are. There is still a marketing mix. The focus continues to be on creating value for customers and building relationships with them. It just becomes a great deal more complicated when you operate on an international scale.” This observation by a noted international marketing instructor succinctly summarizes the challenges international marketers face. Globalization, technological advances, economic upheaval, political shifts, and cultural trends are transforming society at an escalating rate. In this ever-changing global environment, the field of marketing must continually adapt to remain on the cutting edge. Communicating the complexities and nuances of marketing on an international scale in a single course can be a daunting task for instructors. Students taking this course also face a unique set of obstacles. We believe many international marketing textbooks currently available complicate these challenges by focusing too much on international business in the first portion of the book and then introducing marketing topics later on. Instead of segregating the two topics, we concluded that a better approach would be to present marketing in an international context. We wrote this book out of our desire to help resolve some of the issues confronting both students and professors.

Market and Course The textbook is for undergraduate courses in international marketing. It also can be used in undergraduate international business courses and in topical international marketing courses at the MBA level.

Instructor Challenges The international marketing course is typically taught by either a marketing instructor or a business instructor. Marketing instructors, including Daniel Baack, the lead author on this book, often find the standard international marketing textbook to be fairly daunting, especially the opening chapters, which are typically packed with international business concepts. The pages are filled with charts, tables, and statistics that can overwhelm the reader. This group of instructors may be inclined to gloss over these topics and move quickly to the more standard marketing materials presented. When international business instructors teach the course, they may be more inclined to focus on international business concepts and are tempted to cover marketing material in less depth. In essence, neither the needs of the marketing instructor nor the needs of the business instructor are met by the currently available textbooks. Our book utilizes an integrated framework designed to cover both the international business and the

xxvi International Marketing

marketing concepts found in traditional international marketing textbooks in a new and integrated way, meeting the wants of both types of instructors.

Student Challenges Students encounter several major challenges when taking an international marketing course. First, many students will have been exposed to only one of two topics areas. Some students may have already taken international business courses but have had little exposure to marketing. Other students may have backgrounds in marketing but an international marketing course might be their first and only exposure to international business. In essence, students taking this course may have little experience in marketing, international business, or both. We have endeavored to present the material in a manner that engages and reaches all three groups of students. To assist students in learning the concepts, each chapter opens with a figure that integrates five key international business elements with the main elements in marketing. The figure provides students with a visual illustration of the connections between the marketing elements presented in the chapter with the most closely associated international business issues. Some students may struggle when trying to integrate marketing concepts with international business concepts. The textbooks that begin with an overview of international business and then discuss marketing may worsen this problem by segregating the two topics and diluting the marketing focus. To help overcome this obstacle to learning, we outline the differences and similarities in domestic and foreign markets while maintaining a strong focus on core marketing concepts. This assists in understanding how to conceptualize the international marketing process. The third complication some students face can be either ethnocentrism or a degree of naïveté. We try to overcome these impediments to learning with careful attention to the nature of culture and the cultural nuances of countries around the world. Our goal is to expand student awareness and understanding along with acceptance and appreciation of business practices in other parts of the world. We have created features and selected photographs designed to help students engage more deeply with the chapter materials. The International Incident boxes challenge students to make ethical or cultural decisions in international situations. The International Marketing in Daily Life boxes reveal how products they use in their everyday lives are impacted by global marketing.

Our Approach We have backgrounds in marketing, international business, brand management, consumer behavior, market research, management, and marketing communications. We hope our academic and professional experiences and areas of expertise helped us to design a textbook that provides an important and fresh contribution to the field of international marketing. There are several primary differences and advantages between our book and the books currently available: core marketing concepts are integrated with international business principles, an emphasis on bottom-of-thepyramid markets, and the incorporation of sustainability concepts.

INTEGRATED APPROACH As noted, in this book we utilize an integrated framework that combines marketing concepts and international business concepts. This integrated approach was designed to ameliorate

Preface xxvii

the challenges that students and instructors face. To do so, five key international business principles are defined in the opening chapter of the text: • cultural differences • language differences • political and legal differences • economic differences • technological/operational differences These concepts are placed into a figure along with the five key marketing elements: markets, products, prices, distribution (place), and promotion. The figure reappears in each chapter, noting when each will be given special emphasis as the topics are presented. Next the text moves directly into the primary marketing areas (markets and the 4 Ps) and concludes with operational, organizational, and managerial issues. International business concepts are presented in depth at points in which they have the greatest value in demonstrating international marketing concepts.

BOTTOM-OF-THE-PYRAMID One major international target market consists of individuals who earn less than $2 per day. The bottom-of-the-pyramid segment is large and increasingly relevant to international marketing scholars and practitioners. The relatively untapped nature of the market appeals to many international companies. We argue that targeting this group of 4 billion people is viable and could lead to more efficient processing and innovations. We have incorporated issues associated with reaching this group in each chapter throughout the book.

SUSTAINABILITY Sustainable business practices are of growing significance. Many students express strong interests in the topic. Sustainability issues are noted in the text, in various chapteropening vignettes, and in end-of-chapter cases. We also link sustainability to bottomof-the-pyramid marketing because these two crucial forces have generated a dramatic impact on globalization and international marketing programs. Successfully targeting the bottom-of-the-pyramid segment often necessitates the incorporation of business practices that emphasize sustainability. The synthesis of these themes provides a rich context for the exploration of international marketing concepts.

Features To help students think critically about the concepts and principles provided throughout the text, we developed a series of features designed to reinforce learning and help maintain reader interest.

OPENING VIGNETTES The chapters begin with presentations about companies with an international marketing presence or about widely-used products such as aspirin and fruit. Each vignette effectively sets the stage for the chapter material. Three questions then are posed to help students reflect on the company and prepare them to read about and discuss the issues that follow in the chapter materials.

xxviii International Marketing

INTERNATIONAL INCIDENTS Each chapter contains brief boxes that describe an unusual event or challenge that arises in a specific international setting. Each hypothetical scenario is accompanied by discussion questions in a “What would you do?” type of approach. This helps foster critical thinking and prepares students for situations that will come up as they work in a global economy.

INTERNATIONAL MARKETING IN DAILY LIFE Throughout the text, we note that many international marketing efforts deal with products that are not “sexy” or high-tech. In fact, items as mundane as toothbrushes, headache remedies, and toilets represent approachable markets for international companies. The incorporation of these products as illustrations helps explain how marketing works on a global scale when seeking to sell everyday life products, recognizing that the same concepts often apply to more glamorous and sophisticated items.

STRATEGIC, TACTICAL, AND OPERATIONAL IMPLICATIONS This book does not provide the standard summary section at the end of each chapter. Instead, each chapter’s materials will be reviewed under three headings: Strategic Implications, Tactical Implications, and Operational Implications. Strategic implications allow students to a integrate materials at the conceptual level, typically at the level of decision making directed by a company’s CEO and top management teams. Tactical implications link strategic concepts to the various marketing functions, such as advertising, personal selling, and creating promotions. Operational implications explain the practical implementation of the various international marketing tools at the individual level, such as how a program might affect an individual salesperson in a retail store. This approach not only summarizes the materials but also integrates analytical thinking with actual marketing practices.

END-OF-CHAPTER RESOURCES We created end-of-chapter resources for several reasons. We wanted to give students the opportunity to assess their understanding of the chapter, apply ideas and concepts in various settings, use mathematical and statistical methods when applicable, generate discussion, and analyze a case. Each chapter concludes with the following: Terms. Each bolded key term defined in the text is presented in the same order each appears in the chapter to help students both review the chapter and reexamine the terms to make sure they understand them. Review Questions. Brief questions were written for each chapter to help students quickly summarize and test their comprehension of what they have read in the chapter. These questions appear in the order that chapter concepts have been presented and are designed to highlight and test the primary points, concepts, and definitions addressed in the chapter. Discussion Questions. These items can be used for individual analyses of marketing management concepts or to guide in-class conversations. Some of the questions require students to apply the mathematical and statistical models and formulas they have learned about in the chapters. Analytical and Internet Exercises. Completing these exercises provides students with the opportunity to apply what they have learned in the chapter. The items are often web-based assignments that challenge students to use their analytical skills.

Preface xxix

Cases. Each chapter concludes with a brief case designed to illustrate the major concepts in the chapter. Case questions can be used for class discussion or completed as an assignment. Comprehensive Cases. Six comprehensive cases provided at the end of the book spotlight various international companies. The cases are designed to challenge students’ abilities. They require an in-depth analysis and synthesis of the case material with textbook material. The cases are also accompanied by questions that lead students to apply knowledge across multiple chapters.

BOOK DESIGN We hope you agree that this book is visually exciting. Our thanks to Ryan Kuo from clearspace.tw for his willingness to share pictures from his many global travels. By incorporating photographs and advertisements from around the world, we believe the text comes alive. We hope the colorful and meaningful graphs, tables, and photos will appeal to the visual learner.

Ancillaries FOR THE INSTRUCTOR The password-protected Instructor Teaching Site available at www.sagepub.com/ baack gives instructors access to a full complement of resources to support and enhance their course. The following assets are available on this site: • An author-created Test Bank contains multiple-choice, true/false, short-answer, and essay questions for each chapter. The test bank is provided on the website in Word format as well as in an electronic format that can be exported into popular course management systems such as Blackboard or WebCT. • The book’s authors also developed PowerPoint slides for each chapter. They can be used for lecture and review. Slides are integrated with the book’s distinctive features and incorporate key tables, figures, and photos. • Video Resources vividly illustrate key information in each chapter. Video icons are strategically placed within the textbook to indicate where a video resource is available on the companion site. These links allow both instructors and students to access videos directly related to the content. • Full-text SAGE Journal Articles accompany each chapter, providing extra commentary and analysis on important topics from SAGE’s marketing journals. • Answers to End-of-Chapter and Discussion Questions provide valuable tools for facilitating classroom discussions. • Suggested Class Assignments offer instructors a wide range of group and individual activities designed to enhance student learning. • Learning Objectives and Chapter Outlines from the book provide an essential teaching and reference tool. • Sample Course Syllabi for quarter and semester systems include suggestions for structuring an international marketing course. • Country Fact Sheets provide detailed information and unique facts about various countries highlighted in the text.

xxx International Marketing

FOR THE STUDENT The open-access Student Study Site available at www.sagepub.com/baack is designed to maximize student comprehension of international marketing and to promote critical thinking and application. The following resources and study tools are available on the student portion of this book’s website: • Flashcards reiterate key chapter terms and concepts. • Self-quizzes include multiple-choice and true/false questions, allowing students to test their knowledge of each chapter. • Learning Objectives and Chapter Outlines from the book provide an essential study tool. • Video Resources vividly illustrate key information in each chapter. Video icons are strategically placed within the textbook to indicate where a video resource is available on the companion site. These links allow both instructor and student to access videos directly related to the content. • Full-text SAGE Journal Articles accompany each chapter, providing extra commentary and analysis on important topics from SAGE’s marketing journals. • Interactive Maps allow students to increase their knowledge of geography and engage with course content in a dynamic and meaningful way. • Country Fact Sheets provide detailed information and unique facts about various countries highlighted in the text. • Guidelines for Developing an International Marketing Plan are included.

Acknowledgments There are many persons who have assisted us in the development of this book. We would first like to acknowledge our executive editor Lisa Shaw for her tremendous support and enthusiasm. We are very grateful to Deya Saoud Jacob for her initial interest in signing this project and for her later editorial work. A special word of appreciation goes to Maggie Stanley for her assistance, as well as to Theresa Accomazzo. We would also like to note the work of Helen Salmon with regard to marketing the book. We would like to thank the following individuals who assisted in the preparation of the manuscript through their careful and thoughtful reviews: Mark Young, Winona State University Ruth Lesher Taylor, Texas State University Yun Chu, Robert Morris University Laurie Babin, University of Louisiana at Monroe Brent Smith, Erivan Haub School of Business, St. Joseph’s University Douglas Hausknecht, University of Akron John Gironda, Florida Atlantic University at Boca Raton William Lesch, University of North Dakota Eric C. Wittine, John Carroll University Xueming Luo, University of Texas at Arlington Nicholas Didow, University of North Carolina at Chapel Hill Mark Burgess, Rider University David Crain, Whittier College

Preface xxxi

Catherine E. N. Giunta, Seton Hill University John Hadjimarcou, University of Texas at El Paso Ron Lennon, University of South Florida at Tampa Melissa Huffman Malabad, Mary Baldwin College Mary Lee Stansifer, University of Colorado at Denver Loy Watley, Nebraska Wesleyan University Fekkri Meziou, Augsburg College Ken Fairweather, Letourneau University Finola Kerrigan, King’s College, London Robert A. Lupton, Central Washington University Mark Mitchell, Coastal Carolina University Ben Oumlil, Western Connecticut State University Al Rosenbloom, Dominican University Mee-Shew Cheung, Xavier University Andrew C. Gross, Cleveland State University Donald Hsu, Dominican College George V. Priovolos, Hagan School of Business, Iona College Finally, Daniel Baack would like to thank his father Donald for inviting him to work on this project. It has been memorable and enjoyable, and has led to much learning about writing. He will always be grateful for the opportunity to publish a book with his dad; it was a once-in-a-lifetime experience. Thanks also to Eric G. Harris for making this such an enjoyable process. Daniel would also like to thank his mother and grandmother for their support, as well as his three great kids, Andy, Emilee, and Jason. His close friends Jason, Dan, Ben, and Ed, and his brother David provided a valuable stress release throughout the process. His talented brother-in-law, Ryan (Chih-Kuo) Kuo, provided many of the wonderful pictures used in the book. Thanks to him, and Daniel’s wife’s family, for their support. The support of individuals at the University of Denver has also been invaluable, including Carol Johnson, Donald Bacon, and, of course, Gloria Valdez. His graduate assistant, Julia Mariano, provided key last minute contributions. Eric G. Harris would like to thank both co-authors, Donald Baack and Daniel Baack, for their cooperation and for including him on this project. He would like to thank his two children, Christian and Sydney, for their patience and support. He would also like to thank Paula Palmer, administrative specialist, for her assistance with his many work assignments. Finally, he would like to thank his mentor, Dr. John Mowen, for his guidance throughout his career. Donald Baack would like to thank his son Daniel for convincing him to make this journey. Eric and Dan made this an extremely enjoyable project. It has turned into a wonderful learning experience and resulted in some great times while completing the manuscript. He would also like to thank his graduate assistant, Matt Carr, and the office staff, including the student workers in his department at Pittsburg State University, for the help they have given. He would also like to acknowledge his other two children, Jessica and David, and his grandchildren, Rile, Danielle, Andy, Emilee, Jason, Tatum, Damon, Joe, and Tommy. We would like to especially thank our wives, Yen-Wen Kuo, Tara Harris, and Pam Baack, for being patient and understanding during those times when the work seemed monumental. They have been wonderful partners to us over the years.

About the Authors Daniel W. Baack is an assistant professor of marketing and director of the Integrated Marketing Communications Program at the Daniels College of Business at the University of Denver. Previous positions include Ball State University and Saint Louis University, where Professor Baack received his Ph.D. in international business and marketing. Professor Baack has published academic research in the Journal of Advertising, Journal of Advertising Research, Journal of International Management, European Journal of Marketing, Journal of Business Research, International Business Review, Journal of Product and Brand Management, International Journal of Commerce and Management, Journal of Electronic Commerce Research, and the International Journal of Emerging Markets. He serves on the editorial board of the Journal of Promotion Management. Professor Baack is an active member of the Academy of International Business, having attended all but one conference since 2003. When not writing or traveling internationally, Professor Baack stays busy with his Taiwanese wife and their three joint ventures (or children). He also enjoys playing and watching basketball, particularly while in foreign countries. Eric G. Harris is chair and associate professor in the Department of Management and Marketing at Pittsburg State University. He has also served on the faculty at the University of South Florida. He has B.B.A. and M.B.A. degrees from Pittsburg State University, and a Ph.D. in marketing from Oklahoma State University. Dr. Harris’s academic work has appeared in journals such as Journal of the Academy of Marketing Science, Journal of Advertising, Journal of Business Research, Psychology & Marketing, Journal of Personal Selling & Sales Management, Journal of Services Marketing, Journal of Business & Psychology, Journal of Consumer Marketing, and others. He has also contributed to the Wiley International Encyclopedia of Marketing. He also serves on the editorial review boards for Journal of Business Research, Journal of Marketing Theory and Practice, Journal of Services Marketing, and Services Marketing Quarterly, and also serves as a consulting editor for the Journal of Managerial Issues. In addition to International Marketing, Dr. Harris has also published CB “Consumer Behavior” with Cengage Learning (4LTR Press), which is co-authored with Barry

About the Authors xxxiii

Babin. He is affiliated with a number of professional associations, including American Marketing Association, The Academy of Marketing Science, Society of Marketing Advances, and Marketing Management Association, and others. Donald Baack holds the rank of university professor of management at Pittsburg (Kansas) State University. He previously held positions at Southwest Missouri State University, Missouri Southern State College, and Dana College. Baack received his Ph.D. from the University of Nebraska. Professor Baack is a consulting editor and has published in the Journal of Managerial Issues. He has also published in the Journal of Advertising Research, Journal of Euromarketing, Journal of Nonprofit and Public Sector Marketing, Journal of Customer Service in Marketing, Journal of Professional Services Marketing, Journal of Ministry Marketing and Management, Journal of Business Ethics, Journal of Global Awareness, Human Relations, and Journal of Management Inquiry. Dr. Baack has authored International Business (Glencoe/McGraw-Hill) and Organizational Behavior (Dame). He co-authored Integrated Advertising, Promotion, and Marketing Communications (Prentice Hall), Marketing Management (Sage), and The Concise Encyclopedia of Advertising (Haworth) with Kenneth D. Clow. He also has published three popular press books in the area of romance/self-help. Baack has been active in the Southwest Academy of Management. He was nominated for SWAM’s Distinguished Educator award in 2007, 2008, and 2010. He has been recognized as a Distinguished Alumnus at Lincoln (Nebraska) East High School and by Dana College.