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International Marketing

15th edition

McGraw-Hill/Irwin

Philip R. Cateora, Mary C. Gilly, and John L. Graham

Copyright 2011 by The McGraw-Hill Companies, Inc. All rights reserved.

Introduction
To understand a societys actions and its points
of view, you need to appreciate:
The influence of historical events
The geographical uniqueness to which a culture
has had to adapt

Culture can be defined as society's accepted basis


for responding to external and internal events
To interpret a cultures behavior and attitudes, a
marketer must have some idea of a countrys
history and geography
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Overview
Historical perspective in global business
Geography and global markets
Climate and topography, geography, nature, and
economic growth, social responsibility and
environmental management, and resources

Dynamics of global population trends


Controlling population growth, rural/urban
migration, population decline and aging, and worker
shortage and immigration

World trade routes


Communication links
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Global Perspective
Birth of a Nation Panama in 67 Hours
History and geography can affect public and
political attitudes of a nation in the present and
far into the future
The Panama Canal is but one example of the
many U.S. intrusions during the early 20th
century that have tainted U.S. - Latin American
relationships
A Chinese-company has operational control of
both the Pacific and Atlantic ports making the
control of the Canal a sensitive issue
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Panama Canal

www.pancanal.com

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History Perspective
in Global Business
History helps define a nations mission
How it perceives its neighbors
How it perceives itself
Its place in the world

Insights into history are important for


understanding current attitudes
It is necessary to study culture as it is now as
well as to understand culture as it was
A countrys history
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History and
Contemporary Behavior
Japanese history

Seven centuries under the shogun feudal system


The isolation before the coming of Admiral Perry in 1853
Threat of domination by colonial powers
Rise of new social classes
Western influences
Humiliation of World War II
Involvement in the international community

Historically, loyalty and service, a sense of responsibility, and


respect for discipline, training, and artistry were stressed to
maintain stability and order
A historical perspective gives the foreigner a basis on which to
begin developing cultural sensitivity and a better
understanding of contemporary Japanese behavior
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History is Subjective
Historical events always are viewed from ones
own biases and SRC
A crucial element in understanding any nations
business and political culture is the subjective
perception of its history
Relationship between U.S. and Mexico
Monroe Doctrine

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Territorial Expansion
of United States from 1783
Exhibit 3.1

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Manifest Destiny
and the Monroe Doctrine

Both accepted as the basis for U.S. foreign policy during


much of the 19th and 20th centuries
Manifest Destiny justified U.S. expansion
Annexation of Texas, Oregon, New Mexico, and California
U.S. involvement in Cuba, Alaska, Hawaii, and the
Philippines

Three basic dicta of the Monroe Doctrine


No further European colonization in the New World
Abstention of the U.S. from European political affairs
Nonintervention of European governments in the
governments of the Western Hemisphere

Change in the Monroe Doctrine


1881 Roosevelt Corollary

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U.S. Intervention
in Latin America Since 1945
Exhibit 3.2

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Geography and Global


Markets
Geography an element of the uncontrollable
environment that confronts every marketer
Affects a societys culture and economy
Physical makeup limits a nations ability to supply
its peoples needs

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Climate and Topography


Altitude, humidity, and temperature extremes
South America
British resistance of the English Channel
Trade through the Alps

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http://www.msnbc.msn.com/id/19248748/

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Geography, Nature
and Economic Growth
As countries prosper, natural barriers are
overcome
Environmental issues

Disruption of ecosystems
Relocation of people
Inadequate hazardous waste management
Industrial pollution

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Social Responsibility
and Environmental Management
Environmental protection is not an optional extra
Pollution is on the verge of getting completely out of
control
China has 16 of the worlds 20 most polluted cities
Critical issue: the disposal of hazardous waste
Sustainable development
http://www.time.com/time/specials/2007/0,28757,1661
031,00.html
http://www.forbes.com/2006/03/21/americas-most-poll
uted-cities-cx_rm_0321pollute.html
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A Comparison of Green-House Gas


Emission Rates and Pledges for Reductions
Exhibit 3.3

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Resources (1 of 2)
The availability of minerals and the ability to generate
energy are the foundations of modern technology
The principal supplements to human energy

Animals
Wood
Fossil fuel
Nuclear power
Ocean tides
Geothermal power
The sun

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Resources (2 of 2)
United States in perspective
1942 nearly self-sufficient
1950 major importer
1973-2000 increased dependency from 36% to
66%
Mid-2000s predicted to be importing more
than 70% of needs

The location, quality, and availability of


resources will affect the pattern of world
economic development and trade well into the
21st century
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World Energy Consumption


Exhibit 3.4

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World Energy Consumption


Exhibit 3.4

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Dynamics of Global
Population Trends
Global population trends determine todays demand
for goods

Rural/urban population shifts


Rates of growth
Age levels
Population control

Changes in population will profoundly affect future


demand
The most important deterrent to population control
is cultural attitudes about the importance of large
families
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World Population by Region 2005-2050


Life Expectancy at Birth 2005-2010
(millions)
Exhibit 3.5

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Controlling
Population Growth
Procreation is one of the most culturally sensitive
uncontrollable factors
Perhaps the most important deterrent to
population control is cultural attitudes about the
importance of large families
Family planning and all that it entails is by far the
most universal means governments use to control
birthrates, but some economists believe that a
decline in the fertility rate is a function of
economic prosperity and will come only with
economic development
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Rural/Urban Migration
Result of a desire for greater access to:
Sources of education
Health care
Improved job opportunities

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Population Decline and Aging


Population growth in many countries has
dropped below the rate necessary to maintain
present levels
A nation needs a fertility rate of about 2.1
children per woman
Not one major country has sufficient internal
population growth to maintain itself

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Age Density for World


and Selected Countries
Exhibit 3.6

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Worker Shortage
and Immigration
The free flow of immigration will help to
ameliorate the dual problems of explosive
population expansion in less-developed
countries and worker shortage in industrialized
regions
Europe will need 1.4 billion immigrants over the
next 50 years
Japan and the U.S. will need 600 million
immigrants between now and 2050

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World Trade Routes


Progression of trade routes

Overland
Sea routes
Air routes
The Internet

Trade routes bind world together, minimizing:

Distance
Natural barriers
Lack of resources
Fundamental differences between and economies

Trade routes represent attempts to overcome influence


of geography causing economic and social imbalances
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Communication Links
Telegraph

Telephone

Television

Satellites

Computer

Internet

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Summary (1 of 2)
A prospective international marketer should be
reasonably familiar with the world, its climate,
and topographic differences
Geographic hurdles must be recognized as
having a direct effect on marketing and the
related activities of communications and
distribution

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Summary (2 of 2)
Without a historical understanding of a culture,
the attitudes within the marketplace may not be
fully understood
The study of history and geography is needed to
provide the marketer with an understanding of
why a country has developed as it has rather
than as a guide for adapting marketing plans

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