Chapter 8:

Importing, Exporting and Sourcing

Overview

• The global cosmetics giants’ worldwide success is a convincing example of the power of skillful global market segmentation and targeting.  

  • Market segmentation represents an effort to identify and categorize groups of customers and countries according to common characteristics.

  • Targeting is the process of evaluating the segments and focusing marketing efforts on a country, region, or group of people that has significant potential to respond. Such targeting reflects the reality that a company should identify those consumers it can reach most effectively, efficiently, and profitably.

  • Finally, proper positioning is required to differentiate the product or brand in the minds of target customers. 

• Global markets can be segmented according to buyer category (e.g., consumer, enterprise, and government), gender, age, and a number of other criteria. 

• Market segmentation and targeting are two separate but closely related activities. These activities serve as the link between market needs and wants and specific decisions on the part of company management to develop products that meet the specific needs of one or more segments. Segmentation, targeting, and positioning are all examined in this chapter.

Lecture Outline
 

Discussion Questions

1.

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Describe the stages a company typically goes through as it learns about exporting.

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Test your knowledge
 

1.

  True

  False

Many Chinese women use whitening creams to lighten and brighten their complexions since white skin is associated with wealth.

2.

  True

  False

Market Segmentation is the process of evaluating the segments and focusing marketing efforts on a country, region, or group of people that has significant potential to respond.

3.

  True

  False

Sushi, Falafel, Tandoori Chicken or Pizza are in demand in many parts of the world. This phenomenon can be due to pluralization of consumption and segment simultaneity.

4.

  True

  False

The process of global market segmentation begins with the choice of one or more variables to use as a basis for grouping customers.

5.

  True

  False

The fact that significant numbers of pizza-loving consumers are found in many countries indicates that they are eating the exact same thing in all parts of the world.

6.

  True

  False

A fact found by demographic segmentation is that by the year 2030, 20 percent of the U.S. population or 70 million will be 65 years old or older.

7.

  True

  False

The assumption of homogeneity should be the cornerstone of a company's market segmentation effort.

8.

  True

  False

Swedish companies such as IKEA, Ericsson, and Saab have looked beyond their borders for significant growth opportunities since they have a high per capita income.

9.

  True

  False

An extrapolation of current economic growth trends suggest that China, with its combination of high real income growth and relatively low population growth, is a strong candidate to become a leading world economic power.

10.

  True

  False

When assessing market segments in terms of income data, global companies should avoid targeting countries with per capita incomes of less than $755.