Description
GLOBAL ORIENTATION
As we indicated at the outset, the term, global, epitomizes the competitive pressure and market opportunities from around the world and the firm’s need to optimize its mar-ket performance on a global basis. Whether a company operates domestically or across national boundaries, it can no longer avoid the competitive pressure and market oppor-tunities. For optimal market performance, the firm should also be ready and willing to take advantage of resources on a global basis and at the same time respond to different needs and wants of consumers. In a way, global marketing is a constant struggle with economies of scale and scope needs of the firm and its responsiveness and sensitivity to different market conditions. While some people call it a glocal orientation, we stay with the term, global, to emphasize marketing flexibility on a global basis.
Let us take a look at a hypothetical U.S. company exporting finished products to Europe and Japan. Traditionally, this export phenomenon has been treated as a bilat-eral business transaction between a U.S. company and foreign customers. However, in reality, to the executives of the U.S. company, this export transaction may be nothing more than the last phase of the company’s activities they manage. Indeed, this company procures certain components from long-term suppliers in Japan and Mexico, other components in a business-to-business (B2B) transaction on the internet with a supplier in Korea, and also from its domestic sources in the United States, and assembles a finished product in its Chinese plant for export to Europe and Japan as well as back to the United States. Indeed, a Japanese supplier of critical components is a joint venture majority owned by this American company, while a Mexican supplier has a licensing agreement with the U.S. company that provides most of technical know-how. A domes-tic supplier in the United States is in fact a subsidiary of a German company. In other words, this particular export transaction by the U.S. company involves a joint venture, a licensing agreement, a B2B transaction, subsidiary operation, local assembly, and R&D—all managed directly or indirectly by the U.S. company. And add the realities of market complexities arising from diverse customer preferences in European, Japanese,and North American markets. Think about how these arrangements could affect the company’s decisions about product policy, pricing, promotion, and distribution channels.
Many existing textbooks have focused on each of these value-adding activities as if they could be investigated independently. Obviously, in reality, they are not indepen-dent of each other and cannot be. We emphasize this multilateral realism by examining these value-adding activities as holistically as possible.
At the same time, we are fully aware of the increased importance of the roles that emerging markets and competitive firms from those markets play in fundamentally reshaping the nature of global competition. In this seventh edition, we have expanded Chapter 18 to highlight various marketing issues related to emerging markets.
Furthermore, we also recognize the importance of the sustainability of global mar-keting. We would like you to be knowledgeable about, and act on, not only ethical but also environmental implications of marketing activities on a global basis. In this seventh edition, we have added Chapter 20 to address various issues related to global CSR.
INTERDISCIPLINARY PERSPECTIVE
To complement our global orientation, we offer an interdisciplinary perspective in all relevant chapters. We strongly believe that you cannot become a seasoned market-ing executive without understanding how other functional areas interface with mar-keting. The reverse is also true for nonmarketing managers. Some of the exemplary areas in which such a broad understanding of the interface issues is needed are prod-uct innovation, designing for manufacturability, product/ components standardization, and product positioning. In particular, Japanese competition has made us aware of the importance of these issues, and leading-edge business schools have increasingly adopted such an integrated approach to business education. Our book strongly reflects this state-of-the-art orientation.
PROACTIVE ORIENTATION
Market orientation is a fundamental philosophy of marketing. It is an organizational culture that puts customers’ interests first in order to develop a long-term profitable enterprise. In essence, market orientation symbolizes the market-driven firm that is willing to constantly update its strategies using signals from the marketplace. Thus, mar-keting managers take market cues from the expressed needs and wants of customers. Consequently, the dominant orientation is that of a firm reacting to forces in the mar-ketplace in order to differentiate itself from its competitors. This reactive outside-in perspective is reflected in the typical marketing manager’s reliance on marketing intel-ligence, forecasting, and market research.
While not denying this traditional market orientation, we also believe that market-ing managers should adopt an inside-out perspective and capabilities to shape or drive markets. This aspect of the link between strategic planning and marketing implementa-tion has not been adequately treated in existing textbooks. For example, recent trends in technology licensing indicate that it is increasingly used as a conscious, proactive com-ponent of a firm’s global product strategy. We believe that it is important for marketers to influence those actions of the firm that are some distance away from the customer in the value chain because such actions have considerable influence on the size of the market and customer choice in intermediate and end-product markets.