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Part 1: Challenges to Present-Day Marketers 0.5-1 page answer

1. In your own words, identify three of the greatest challenges to present-day marketing managers. Do NOT refer to the text, or any outside reference.

2. Provide a real-world example of each of the challenges you identified.

3. For EACH of the examples you gave, provide a recommended solution (or solutions) to overcoming the challenge.

Part 2: (1 page answer)

   


Healthy Happy Homes

 

After two decades of real estate investing, Healthy Happy Homes’ owner wanted to combine two personal passions: real estate and living a quality, healthy life. After creating a Healthy Home Checklist to review the environmental quality of the living space (i.e., fabric, floor, cleaning supplies, air quality, area hazards, etc.), Healthy Happy Homes provides consultations with renters, current owners, potential buyers/ sellers to analyze and improve the quality of the living environment to guide purchasing and/or renovation decisions.

 

In addition to the Healthy Home Checklist, Healthy Happy Homes has generated a content-based educational series on social media and speaking events to inform business and individuals about seeking, developing, and maintaining a quality living environment.

 

To complement the mission, Healthy Happy Homes has compiled a database of businesses and contractors that provided checklist-approved quality environmental services such as organic fabric window treatments, clean air floors, organic cleaning supplies, and quality construction materials.

 


Mission: 

To empower/enable the highest quality of living in the purest environment

Healthy Happy Homes has a mission statement yet is missing the goals that will serve in the development of measurable, achievable objectives for growing its business. Using the sample mission and goals in the example case a model (example on next page), and after reviewing the description of Happy Healthy Homes, write three to five goals with bullet points. 

As you are working on your objectives, consider these guiding questions:

Mission: Big picture vision

·     Does mission describe the overall “why” a company exists?

·     What unique vision does the Mission Statement describe?

·     What core values and principles does the company represent?

Objectives: Measurable, obtainable outcomes

·     How does your company maintain profitability?

·     How does your company present customer service?

·     What core values define your company’s growth, marketing, and interaction?

·     What aspects of managing change and marketing are important to your company?

·     What expectations do you have for your company and customer interaction

 Sample Mission and Objectives

  

 


Realty Business Leaders (RBL)

 

RBL began in 1996, to provide supportive digital technology solutions for professionals in the real estate industry. They serve agents, brokers, and investors in both residential and commercial applications. They provide online, digital, and print resources and tools for generating leads, supporting individual agents and brokers to successfully grow and manage their businesses. RBL’s cloud -based subscriptions provide total access to marketing and sales software such as websites, customer relationship management (CRM), lead generation, goal tracking, and training materials that support conversion of prospects into clients.

 


Mission:

To empower real estate industry professionals in exceeding property buyers’ and sellers’ expectations through innovative, accessible technology

 

Sample Goals:

 

Goal 1: Provide exceptional, best practice, innovative lead generation tools

a. Provide exclusive qualified lead generation

b. Generate real-time analytics to provide intuitive activity and insights 

c. Provide leads that are compatible with CRM

 

Goal 2: Provide individual agent tools

a. Provide agents with industry best customer relationship management platform

b. Grant access to agent-run website with tools to maximize the transaction process

c. Enable access to best practices education and training to support continued professional growth

 

Goal 3: Support brokers with beyond market standard tools

a. Sustain a state-of-the-art CRM system to enable maximum efficiency for broker’s team

b. Provide robust lead routing to support broker’s team success

c. Create enhanced branding materials that enable broker’s team to demonstrate true professionalism

d. Deliver the most innovative tools and education that meet the needs of the changing real estate industry

 

Mission

The mission is an essential piece of every business. It articulates an organization’s purpose, or reason for existence and generally discusses what the organization hopes to become (i.e. its strategic vision). A strong mission statement becomes the foundation for decisions and core values and a compass of sorts for leading the business in the right directions. It is a tool for guiding the customer service and staff expectations as well. When a business is starting out or going through change, defining a mission statement is a critical step.

 

A company’s mission statement and goals should feel symbiotic. The mission is broad and needs goals to direct achievement; while the goals have limited value without the vision captured within the mission. The mission statement may also serve as a guide for whom the business serves and how it serves them.

 

Goal

To monitor and evaluate a mission statement, it is essential to incorporate goals. These goals outline the connection between the mission and the operational aspects of the business. The outcome of the goals will help to drive the development of objectives that can be used to precisely measure the business’s effectiveness in living up to the mission statement. 

CHAPTER 2:
Marketing Foundations: Global, Ethical, sustainable

McGraw-Hill Education

Part 1: Discover Marketing Management

Copyright © McGraw-Hill Education.  All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.

1

Learning Objectives

Identify the various levels in the Global Marketing Experience Curve.

Learn the essential information components for assessing a global market opportunity.

Define the key regional market zones and their marketing challenges.

Describe the strategies for entering new global markets.

Recognize key factors in creating a global product strategy.

Learn the importance of ethics in marketing strategy, the value proposition, and the elements of the marketing mix.

Recognize the significance of sustainability as part of marketing strategy and the use of the triple bottom line as a metric for evaluating corporate performance.

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2

Marketing Is Not Limited By Borders

Worldwide distribution networks, sophisticated communication tools, greater product standardization, and the Internet have opened world markets.

Large and small companies do business globally.

Opportunities are greater than ever but so are risks.

Global customers needs may lead to product adaptation.

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While the opportunities have never been greater, the risks have also never been higher. Global marketing mistakes are expensive. The international competitive landscape includes sophisticated global companies as well as successful local organizations. The operating environment varies dramatically around the world creating real challenges for companies moving into new markets. Global customers demand different products, which means that successful products in a company’s local market frequently have to be adapted to new markets.

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The Global Experience Learning Curve

4

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Four distinct stages:

No foreign marketing

Foreign marketing

International marketing

Global marketing

The global experience learning curve moves a company through four distinct stages: no foreign marketing, foreign marketing, international marketing, and global marketing. The process is not always linear; companies may, for example, move directly from no foreign marketing to international marketing without necessarily engaging in foreign marketing. In addition, the amount of time spent in any stage can vary; some companies remain in a stage for many years.

4

Companies with
No Foreign Marketing

Companies with no direct foreign marketing may still do business with international customers through intermediaries or limited direct contact.

They may fulfill unsolicited orders but these are incidental.

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Of course, any company with a website is now a global company as someone can visit the site from anywhere in the world, but companies with no foreign marketing consider any sales to an international customer as incidental.

 

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Companies with
Foreign Marketing

Company follow existing customers into foreign markets.

Develops local distribution and service representation:

By using local intermediaries.

Or by establishing its own direct sales force.

Key activities are done in the home country but modified for international markets.

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Global markets are important enough for management to build international sales forecasts, and manufacturing allocates time specifically to international production. At this point, international markets are no longer an afterthought but, rather, an integral, albeit small, part of the company’s growth model.

6

International Marketing

Firm begins to manufacture products outside the home market.

Global markets are essential to corporate growth.

Firm establishes an international business division or unit.

Management may still have a “domestic first” mindset.

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International marketing aligns the company’s assets and resources with global markets, but, in the vast majority of companies, management still takes a “domestic first” approach to the business. As a result, the corporate structure still divides international and domestic markets.

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Global Marketing

Global marketing firm views the world as a single market with many different segments.

Fifty percent or more of revenue comes from international markets.

Global marketing firms see segments that may or may not align with country boundaries. International marketing firms define markets along traditional political boundaries.

Moving to global marketing depends on research critical for decision makers.

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8

Ten Examples of Global Companies and their Expansion in Global Markets

EXHIBIT 2.2

Years to Expansion U. S. Company First Expansion
29 Wal-Mart (est. 1962) 1991 – Wal-Mart opens two units in Mexico City.
20 Hewlett-Packard (est. 1939) 1959 – HP sets up a European marketing organization in Geneva, Switzerland, and a manufacturing plant in Germany.
26 Tyson Foods (est. 1963) 1989 – Tyson establishes a partnership with a Mexican poultry company, to create an international partnership.
25 Caterpillar (est. 1925) 1950 – Caterpillar Tractor Co. Ltd. in Great Britain is
founded.
19 Home Depot (est. 1979) 1998 – Home Depot enters the Puerto Rican market
followed by Argentina.
18 Gap (est. 1969) 1987 – The first Gap store outside the United States
opens in London on George Street.
12 Goodyear (est. 1898) 1910 – Goodyear’s Canadian plant opens.
10 FedEx (est. 1971) 1981 – International delivery begins with service to Canada.
1 PepsiCo (est. 1965) 1966 – Pepsi enters Japan and Eastern Europe.

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9

The Global Experience Learning Curve

There are five components of essential information that relate to global marketing experience and international expansion:

Economic environment

Culture and societal trends

Business environment

Political and legal changes

Specific market conditions

10

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Economic environment. An accurate understanding of the current economic environment, such as gross domestic product (GDP) growth, inflation, strength of the currency, and business cycle trends, is essential. Also, depending on the company’s target markets (consumer or business), additional economic data on consumer spending per capita (consumer products) or industrial purchasing trends (business products) are also needed to facilitate decision making.

Culture, societal trends. Understanding a global market’s culture and social trends is fundamental for consumer products and helpful for business-to-business marketers. Cultural values, symbols and rituals, and cultural differences affect people’s perception of products while B2B companies must learn local cultural practices to recruit employees and establish good business relationships.

Business environment. Knowledge of the business environment is essential for companies moving into foreign markets where they will invest significant resources. Ethical standards, management styles, degree of formality, and gender or other biases are all critical factors that management needs to know before entering a new market.

Political and legal changes. Local political changes can create significant uncertainties for a business. Developing countries frequently limit the flow of money out of a country, making it harder for a foreign company to transfer money back home. Labor laws also vary widely around the world

Specific market conditions. Before entering a foreign market, a company has some understanding of the specific market conditions for its own products as a result of its existing business knowledge. However, it is unlikely a company has in-depth knowledge about market trends, competitors, and unique market characteristics.

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Emerging Markets

For most of the Twentieth Century, world economic growth came from the Triad (Western Europe, the United States, and Japan).

For the past 25 years, growth has been in emerging markets.

Seventy-five percent of growth will come from emerging markets, mainly China and India.

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Multinational Regional Market Zones

Multinational regional market zones consists of a group of countries that create formal relationships for mutual economic benefit through lower tariffs and reduced trade barriers (for example, NAFTA and the European Union).

They usually form as a result of four forces: economic factors, geographic proximity, political factors, and cultural similarities.

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Economic By enlarging the trading area and creating a market zone, each country benefits economically and the market zone has more power in the global marketplace.

Geographic proximity Transportation and communication networks are more likely to connect countries close to one another, making it easier to facilitate market zone activities. Other issues such as immigration also tend to be handled more effectively when the distance between partners is minimized.

Political Closely related to increased economic power is increased political clout, particularly as smaller countries form broad political alliances. A prerequisite for effective political alliances among countries is general agreement on government policies. Countries with widely disparate political structures find it difficult to accommodate those differences in a political alliance.

Culture similarities, such as having a shared language, among alliance partners also facilitate markets zones as shared cultural experiences encourage greater cooperation and minimize possible conflicts from cultural disparities.

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Top Four Regional Market Zones

EXHIBIT 2.7

Reprinted Courtesy of European Commission

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Mercosur, the most powerful market zone in South America, was inaugurated in 1995 and includes the economies of South America: Argentina, Bolivia, Brazil, Chile, Paraguay, and Uruguay. With over 200 million people and a combined GDP of more than $1 trillion, it is currently the third-largest free trade area in the world.

ASEAN (Association of Southeast Asian Nations) was founded in 1967 and comprises 10 countries in the Pacific Rim (Brunei Darussalam, Indonesia, Malaysia, Philippines, Cambodia, Laos, Myanmar, Singapore, Thailand, and Vietnam). After the 1997–1998 Asian financial crisis, the group added China, Japan, and South Korea. While the relationships with these “plus 3” countries are less developed than the full member countries, the combined economic activity of all participants makes ASEAN a powerful global economic force. 

 

Europe The European Union is the most successful regional market zone and it is also one of the oldest. Founded more than 50 years ago by six countries (Belgium, France, Italy, Luxembourg, the Netherlands, and West Germany) with the Treaty of Rome, the EU now includes 28 countries spanning all of Europe. One of the most difficult challenges for many member states is meeting targeted government spending and total debt limits. The EU has become one of the most dominant economic entities in the world, with economic output exceeded only by the United States, and its currency, the euro, is one of the leading world currencies. The European Union’s influence extends far beyond economics because member countries grant the EU significant political and social power to enact laws, create taxes, and exert tremendous social influence in the lives of citizens.

Americas The most significant market zone in the Americas is the alliance of the United States, Canada, and Mexico, which is commonly referred to by the treaty that created the alliance, NAFTA (North American Free Trade Agreement). NAFTA created the single largest economic alliance and has eliminated tariffs between the member countries for more than 19 years.

13

Select the Global Market

Deciding which countries to enter can be high risk as poor decisions lead to high costs and poor long-term investments.

Identify Selection Criteria: View competition, target market size, and growth rate. What is the size of investment? How long will it take to become profitable?

Company Review: Does the company have the personnel, managerial, and financial resources to enter the market?

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Market selection criteria incorporate the nature of the competitive environment, including both local and global competitors, as well as target market size and future growth rates. Marketing managers need to know which markets will be the easiest and which will be the most difficult to enter. In addition, the size and future growth potential of international markets is critical in making the long-term commitment to manufacture in an international market.

Moving into new foreign markets brings greater risk to the company. As a result, decision makers must consider whether their company philosophy, personnel skill sets (principally in critical areas such as marketing and logistics), organizational structure, management expertise, and financial resources support the move into new countries

Comparing the analysis of market opportunities with company characteristics drives the final selection as management looks for the best fit between each country’s mix of opportunities/threats and the company’s strengths/weaknesses.

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Key Company Characteristics in Global Market Expansion

EXHIBIT 2.10

15

Company

Characteristics

Philosophy

Objectives

Products

Management/

Marketing

Skills

Resources

Financial

Limitations

Organization

Management

Style

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15

Develop Global Market Strategies: Exporting

Exporting requires minimal investment and risk.

Ten percent of all global economic activity.

The Internet has increased both domestic and international sales through the use of credit cards and other payment systems plus global delivery systems like FedEx and UPS and DHL. Amazon has gone global.

Exporters provide expertise in global shipping.

Distributors know local market conditions best.

Direct sales force is expensive but needed with technology or high-end industrial products.

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Exporter and Distributor. The next of level of exporting involves having country representation, which can take several forms. Exporters are international market specialists that help companies by acting as the export marketing department. They generally do not have much contact with the company, but exporters provide a valuable service with their knowledge of policies and procedures for shipping to foreign markets. For small companies with little or no international experience, exporters expedite the process of getting the product to a foreign customer.

Distributors represent the company and often many others in foreign markets. These organizations become the face of the company in that country, servicing customers, selling products, and receiving payments. In many cases, they take title to the goods and then resell them. The primary advantages are that distribu- tors know their own local markets and offer a company physical representation in a global market, saving the company from committing major resources to hire and staff its own operations. The disadvantages are lack of control since distributors do not work directly for the company and lower profitability resulting from the distributor’s markup.

Direct Sales Force. Staffing a direct sales force in foreign markets is a significant step for a company moving into global markets. It is expensive to staff and maintain a local sales team in a foreign market; however, companies will often make the commitment because of the level of control and expertise offered by company-trained salespeople. For some industries, creating a direct sales force is required because customers will demand that company salespeople be in the country. This is often the case in the technology and high-end industrial product industries.

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Market Entry Strategy: Contractual Agreements

Contractual agreements are non-equity relationships with another company, often in the target country.

Licensing: May be required by law, direct importing may be restricted, or the company has limited financial resources.

Franchising: Franchise agreements allow the firm to retain control of quality. It has low capital investment, rapid expansion, local market knowledge.

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Contractual agreements allow a company to expand participation in a market by creating enduring, nonequity relationships with another company, often a local company in that market. Most often these agreements transmit something of value such as technology, a trademark, a patent, or a unique manufacturing process in return for financial compensation in the form of a licensing fee or percentage of sales.

Licensing. Companies choose licensing when local partnerships are required by law, legal restrictions prohibit direct importing of the product, or the company’s limited financial resources limit more active foreign participation. Companies seeking to establish greater presence in a market without committing significant resources can choose to license their key asset (patent, trademark) to another company, effectively giving the company the right to use that asset in that market. Small and medium-sized companies with a specific product competence that lack the willingness or expertise to invest heavily in foreign operations can identify a license partner in a particular foreign market to manufacture products or provide critical services such as local distribution.

Franchising, as a global market entry strategy, really took off in the 1990s and has been the first point of entry for many retailers looking to expand international operations. McDonald’s, Burger King, KFC, and others have created large franchising networks around the world. Nearly two-thirds of McDonald’s restaurants are outside the United States. Combining low capital investments, rapid expansion opportunities, and local market expertise, franchising offers many advantages as a market entry strategy. However, there are also challenges. Worldwide, consumer tastes vary significantly and franchisors need sufficient resources to create products that will meet demands of global customers while maintaining quality control.

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Market Entry Strategy: Strategic Alliances

Strategic alliances spread risk of foreign investment among partners. For example, they dominate the airline industry with oneworld, Skyteam, and Star.

International joint ventures allow companies to enter markets that would be closed because of legal restrictions or cultural barriers. They are formed by two or more companies that share management duties in a defined structure and also hold equal equity positions. They cannot be formed by individuals.

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Market Entry Strategy: Direct Foreign Investment

Direct foreign investment is the riskiest strategy, but it offers potential for long-term growth.

The following factors are important to consider: timing, legal issues, transaction costs, technology transfer, product differentiation, and marketing communication barriers.

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Timing—unknown political or social events, competitor activity.

Legal issues—growing complexity of international contracts, asset protection.

Transaction costs—production and other costs stated in various currencies.

Technology transfer—key technologies are more easily copied in foreign markets.

Product differentiation—differentiating a product without increasing cost.

Marketing communication barriers—local market practices vary a great deal.

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Organizational Structure Choices

Decision-making authority becomes more complicated with added layers of authority and differences in global time zones. Clearly defined protocols for decision-making are needed.

The degree of centralization affects resource alloca