Onkvisit S., Shaw J. International Marketing: Analysis and Strategy
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International Marketing
Marketing is a universal activity, regardless of the political, social, or economic systems of a particular country.
However, this doesn’t mean that consumers in different parts of the world should be satisfied in the same way.
This fourth edition of
International Marketing
has been written to enable managers and scholars to meet the
international challenges they face every day, and it provides the solid foundation required to understand the com-
plexities of marketing on a global scale.
The book has been fully updated with topical case studies, examples of contemporary marketing campaigns,
the most relevant discussion topics as well as the most up-to-date theories, references, and research findings. It
is this combination of theory and practice that makes this textbook truly unique, presenting a fully rounded view
of the topic rather than an anecdotal or descriptive one alone.
The book includes chapters on:
■ trade distortions and marketing barriers
■ culture
■ consumer behavior
■ marketing research
■ foreign market entry strategies
■ product and branding strategies
■ promotion and pricing strategies
■ currencies and foreign exchange
Accessibly written and designed, this is the most international book on marketing available which can be used by
undergraduates and postgraduates the world over. As one of the most successful textbooks in its field, the book
has been adopted in the USA, Europe, Asia, Australia, and elsewhere, at the undergraduate, MBA, and Ph.D.
levels. A companion website provides additional material for lecturers and students alike.
Sak Onkvisit is Professor of Marketing at San José State University, USA.
John Shaw is Professor of Marketing at Providence College, USA.
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Analysis and strategy
Fourth edition
Sak Onkvisit and John J. Shaw
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International
Marketing
First edition published by Charles Merrill in 1989
Second edition published by Macmillan in 1993
Third edition published by Prentice-Hall in 1997
Fourth edition 2004
Simultaneously published in the UK, USA and Canada
by Routledge
29 West 35th Street, New York, NY 10001
and by Routledge
11 New Fetter Lane, London EC4P 4EE
Routledge is an imprint of the Taylor & Francis Group
© 2004 Sak Onkvisit and John J. Shaw
All rights reserved. No part of this book may be reprinted or reproduced or utilised in any form or by any
electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording,
or in any information storage or retrieval system, without permission in writing from the publishers.
British Library Cataloguing in Publication Data
A catalogue record for this book is available from the British Library
Library of Congress Cataloging in Publication Data
Onkvisit, Sak.
International marketing : analysis and strategy / by Sak Onkvisit and
John J. Shaw. – 4th ed.
p. cm.
Includes bibliographical references and indexes.
1. Export marketing. 2. Export marketing – Management.
I. Shaw, John J. II. Title.
HF1416.O55 2004
658.8′4 – dc22 2003023746
ISBN 0–415–31132–2 (hbk)
ISBN 0–415–31133–0 (pbk)
This edition published in the Taylor & Francis e-Library, 2007.
“To purchase your own copy of this or any of Taylor & Francis or Routledge’s
collection of thousands of eBooks please go to www.eBookstore.tandf.co.uk.”
ISBN 0-203-93006-1 Master e-book ISBN
To my family and the memory of my grandparents
and Lawrence X. Tarpey, Sr.
and
Ann and Jonathan and the memory of Rebecca
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List of illustrations xiii
Preface xviii
1 NATURE OF INTERNATIONAL MARKETING: CHALLENGES AND OPPORTUNITIES 1
Process of international marketing 3
International dimensions of marketing 4
Domestic marketing vs. international marketing 5
The applicability of marketing 6
Multinational corporations (MNCs) 7
The process of internationalization 15
Benefits of international marketing 15
Conclusion 18
Case 1.1 Sony: the sound of entertainment 19
2 TRADE THEORIES AND ECONOMIC DEVELOPMENT 22
Basis for international trade 23
Exchange ratios, trade, and gain 26
Factor endowment theory 27
The competitive advantage of nations 32
A critical evaluation of trade theories 33
Economic cooperation 39
Conclusion 46
Case 2.1 The United States of America vs. the United States of Europe 47
3 TRADE DISTORTIONS AND MARKETING BARRIERS 52
Protection of local industries 55
Government: a contribution to protectionism 57
Marketing barriers: tariffs 59
Marketing barriers: nontariff barriers 62
Private barriers 73
World Trade Organization (WTO) 74
Preferential systems 76
Some remarks on protectionism 77
Conclusion 78
Case 3.1 Global war on drugs or tuna? 80
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vii
Contents
4 POLITICAL ENVIRONMENT 84
Multiplicity of political environments 86
Types of government: political systems 89
Types of government: economic systems 92
Political risks 100
Privatization 102
Indicators of political instability 102
Analysis of political risk or country risk 104
Management of political risk 106
Measures to minimize political risk 107
Political insurance 112
Conclusion 114
Case 4.1 Hoa Ni Shoe Company 115
5 LEGAL ENVIRONMENT 121
Multiplicity of legal environments 122
Legal systems 124
Jurisdiction and extraterritoriality 125
Legal form of organization 128
Branch vs. subsidiary 129
Litigation vs. arbitration 131
Bribery 132
Intellectual property 139
Counterfeiting 146
Conclusion 148
Case 5.1 International auto safety and patents 149
Case 5.2 Bribery: a matter of national perspective 150
6 CULTURE 153
Culture and its characteristics 155
Influence of culture on consumption 156
Influence of culture on thinking processes 157
Influence of culture on communication processes 158
Cultural universals 159
Cultural similarities: an illusion 160
Communication through verbal language 160
Communication through nonverbal language 167
Subculture 178
Conclusion 181
Case 6.1 Cross-cultural marketing: a classroom simulation 182
7 CONSUMER BEHAVIOR IN THE INTERNATIONAL CONTEXT: PSYCHOLOGICAL
AND SOCIAL DIMENSIONS 187
Perspectives on consumer behavior 190
Motivation 190
Learning 192
Personality 193
Psychographics 197
Perception 198
Attitude 202
Social class 203
viii
CONTENTS
Group 204
Family 205
Opinion leadership 206
Diffusion process of innovations 206
Conclusion 207
Case 7.1 Beneath Hijab: marketing to the veiled women of Iran 208
8 MARKETING RESEARCH AND INFORMATION SYSTEM 213
Nature of marketing research 214
Marketing information sources 216
Secondary research 216
Primary research 218
Sampling 220
Basic methods of data collection 222
Measurement 224
Marketing information system 232
Conclusion 237
Case 8.1 B&R Bank: developing a new market 238
9 FOREIGN MARKET ENTRY STRATEGIES 243
Foreign direct investment (FDI) 245
Exporting 246
Licensing 248
Management contract 252
Joint venture 252
Manufacturing 254
Assembly operations 257
Turnkey operations 260
Acquisition 260
Strategic alliances 262
Analysis of entry strategies 263
Foreign trade zones (FTZs) 265
Conclusion 267
Case 9.1 How to export houses 267
10 PRODUCT STRATEGIES: BASIC DECISIONS AND PRODUCT PLANNING 272
What is a product? 275
New product development 275
Market segmentation 277
Product adoption 278
Theory of international product life cycle (IPLC) 279
Product standardization vs. product adaptation 285
A move toward world product: international or national product? 297
Marketing of services 298
Conclusion 302
Case 10.1 McDonaldization 304
11 PRODUCT STRATEGIES: BRANDING AND PACKAGING DECISIONS 308
Branding decisions 310
Branding levels and alternatives 313
Brand consolidation 323
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ix
CONTENTS