Page 230 - Foundations of Marketing

Reaching Global Markets | Chapter 8 197

valuable benchmarking research that will help their domestic firms become more compet-
itive globally. One example is Export.gov, a website managed by the U.S. Department of
Commerce’s International Trade Administration. Export.gov collects a variety of resources to
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help businesses who want to export to other countries. A major element of the assistance that
governmental organizations can provide for firms (especially small and medium-sized firms)
is knowledge of the internationalization process of firms.
Traditionally, most companies—such as McDonald’s and KFC—have entered the global
marketplace incrementally as they gained knowledge about various markets and opportuni-
ties. Beginning in the 1990s, however, some firms—such as eBay, Google, and Logitech—
were founded with the knowledge and resources to expedite their commitment and investment
in the global marketplace. These “born globals”—typically small, technology-based firms
earning as much as 70 percent of their sales outside the domestic/home market—export their
products almost immediately after being established in market niches in which they compete
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with larger, more established firms. Whether a firm adopts the traditional approach, the born-
global approach, or an approach that merges attributes of both approaches to market products,
international marketing strategy is a critical element of a firm’s global operations. Today,
global competition in most industries is intense and becoming increasingly fierce with the
addition of newly emerging markets and firms.

ENVIRONMENTAL FORCES IN GLOBAL LO 2 . Analyze the environmental
forces that affect global market-
MARKETS ing efforts.

Firms that enter international markets often find that they must make significant adjustments
in their marketing strategies. The environmental forces that affect foreign markets may differ
dramatically from those that affect domestic markets. It took McDonald’s 14 years of intense
negotiations before it was able to open its restaurants in Russia, but the past 20 years of operat-
ing restaurants in 60 Russian cities has been an enormous success. The first location in Russia
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was the Pushkin Square location, which remains the single busiest McDonald’s in the world.
Thus, a successful international marketing strategy requires a careful environmental analysis.
Conducting research to understand the needs and desires of international customers is crucial
to global marketing success. Many firms have demonstrated that such efforts can generate tre-
mendous financial rewards, increase market share, and heighten customer awareness of their
products around the world. In this section, we explore how differences in the sociocultural;
economic; political, legal, and regulatory; social and ethical; competitive; and technological
forces in other countries can profoundly affect marketing activities.

Sociocultural Forces

Cultural and social differences among nations can have significant effects on marketing activi-
ties. Because marketing activities are primarily social in purpose, they are influenced by beliefs
and values regarding family, religion, education, health, and recreation. In terms of families,
the world population is over the 7 billion mark, with half of the people residing in countries
where fertility is at or below 2.1 children per family. Because of these lower fertility rates,
the next wave of major population growth will likely take longer and be driven by developing
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countries. By identifying such major sociocultural deviations among countries, marketers lay
groundwork for an effective adaptation of marketing strategy. In India, for instance, half of
Taco Bell’s menu is vegetarian to appeal to Indian tastes. Chicken is used instead of beef, and
many of the options are spicier than their American counterparts. Meal options include potato
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crunchy tacos and fajita and paneer stuffed burritos.
Local preferences, tastes, and idioms can all prove complicated for international market-
ers. Although football is a popular sport in the United States and a major opportunity for many
television advertisers, soccer is the most popular televised sport in Europe and Latin America.

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