MKT442

INTERNATIONAL MARKETING FINAL STUDY GUIDE QUESTIONS AND

CORRECT DETAILED ANSWERS WITH RATIONALES (VERIFIED

ANSWERS) |ALREADY GRADED A+


Quiz Investment Cost of Marketing Entry Strategies
Ans> Exporting
Licensing
Contract Manufacturing
Joint Venture
Equity Stake or Acquisition

Quiz Licensing

Ans> A contractual arrangement whereby one company (the licensor) makes a legally protected
asset available to another company (the licensee) in exchange for royalties, license fees, or some
other form of compensation.

Quiz Contract manufacturing

Ans> limited commitment of financial and managerial resources and quick entry into target
countries, especially when the target market is too small to justify significant investment

Disadvantage: companies may open themselves to public scrutiny and criticism if workers in
contract factories are poorly paid or labor in inhumane circumstances

Quiz Franchising

Ans> Great appeal to local entrepreneurs anxious to learn and apply Western-style marketing
techniques

ex) McDonalds

Quiz Foreign direct investment (FDI)

,Ans> Reflect investment flows out of the home country as companies invest in or acquire plants,
equipment, or other assets. Foreign direct investment allows companies to produce, sell, and
compete locally in key markets

Quiz Brand equity

Ans> The total value that accrues to a product as a result of investments in the marketing of the
brand
An asset that represents the value created by the relationship between the brand and customer
over time

Quiz Three Categories products & brands can be broken into

Ans> local, global, international

Quiz Co-branding

Ans> Engender customer loyalty and allow companies to achieve synergy. However, co-
branding can also confuse consumers and dilute brand equity. The approach works most
effectively when the products involved complement each other

Ex) Credit card companies have discounts for cars and frequent flyer miles

Quiz Maslow's hierarchy of needs

Ans> provides a useful framework for understanding how and why local products and brands
can be extended beyond home country borders

Quiz Extension Strategy

Ans> Strategy 1: Common for B2B
Strategy 2: Low-cost because the product is unchanged, communication is adapted
Strategy 3: Cadillac wanted to sell 20,000 autos outside the U.S. by 2010; will adapt to local
market requirements
Strategy 4: Combines local market conditions recognized in Strategies 2 and 3

Quiz Countertrade

Ans> • Countertrade occurs when payment is made in some form other than money

,• Options
- Barter
- Counterpurchase or parallel trading
- Offset
- Compensation trading or buyback
- Switch trading

Quiz Skimming Strategy

Ans> setting a deliberately high price, demand is limited to innovators and early adopters who
are willing and able to pay the price. When the product enters the growth stage of the life cycle
and competition increases, manufacturers start to cut prices

Quiz Global pricing

Ans> • Extension or Ethnocentric
• Adaptation or Polycentric
• Geocentric

Quiz Types of Retailers

Ans> • Hypermarkets are hybrid retailers combining the discounter, supermarket & warehouse
club; 20,000-30,000 sq. ft.
• Supercenters have lower priced groceries plus general merchandise; half the size of a
hypermarket
• Superstores aka Category Killers & Big-Box sell vast assortments of a product category
- Toys "R Us, Home Depot, IKEA
• Full-line discounters
- Wide variety of merchandise; Ex. Walmart
• Warehouse clubs
- Memberships fees; Ex. Sam's Costco
• Dollar stores
- Sell at a single low price; Ex. in U.S. Family Dollar, Dollar Tree, Internationally, My
Dollarstore has rapid growth
• Hard discounters
- Limited assortment, rock bottom prices

Quiz Retail Market Entry Strategy

Ans>

, Quiz Transportation

Ans> - Method or mode a company should utilize when moving products through domestic and
global channels; the most common modes of transportation are rail, truck, air, and water

Quiz Peer to Peer Marketing

Ans> • The Internet and other related media are dramatically altering distribution
• Interactive TV may become a viable direct marketing channel in the future
• eBay pioneered P2P
- Helped Disney and IBM set up auction sites for B2C auctions
• Interactive TV is coming when homes are wired for 2-way

Quiz Four difficulties that compromise an organization's communication efforts

Ans> - The message may not get through to the intended recipient.
- The message may reach the target audience but may not be understood or may even be
misunderstood.
- The message may reach the target audience and may be understood but still may not induce the
recipient to take the action desired by the sender.
- The effectiveness of the message can be impaired by noise.

Quiz Pattern Advertising

Ans> • A middle ground between 100% standardization and 100% adaptation
• A basic pan-regional or global communication concept for which copy, artwork, or other
elements can be adapted as required for individual countries

Quiz Advertising Appeal

Ans> • Rational appeal
- Depend on logic and speak to the consumer's intellect; based on the consumer's need for
information
• Emotional appeal
- Tugs at the heartstrings or uses humor

Quiz Advertising as PR function

Ans> • Corporate advertising