Marketing Channels & Going Global

Week 5 Instructional Guidance

This week, make sure to complete the following:

1. TWO Discussion Board Postings- initial postings by Thursday

2. Written Assignment 

Marketing in a Global Economy

Read the article: " Airbnb and the Unstoppable Rise of the Share Economy ". 

A recent trend in the consumer marketplace is the ability for a consumer to share their personal belongings, such as their homes/apartments, autos, tools, bicycles, and so forth. The shared economy has now become a multibillion dollar business.  In a three- to four-page paper (not including the title and reference pages):

· Explain how this concept is disrupting our traditional economy.

· Describe whether the shared economy is creating new value for the consumer or if it is just replacing existing business.

You must use at least three scholarly sources from the Ashford University Library, one of which must be peer reviewed, in addition to the textbook. Your paper must also be formatted according to APA style as outlined in the Ashford Writing Center. Required Text

Read the following chapters in your text,  Managerial Marketing :

· Chapter 12: Marketing Channels and Distribution Decisions

· Chapter 13: Marketing Challenges in the New Economy

· Chapter 14: Managing Marketing in the Global Economy

In regards to brand management, many global brands try to have global standardization.  My experience at General Motors Corporation is that we did try to achieve this.  We wanted to have Global Brands and decided that our two primary global brands would be Chevrolet and Cadillac.   But when we decided to enter China, we found that people had the strongest brand recognition for the nameplate Buick so we modified our global focus for this hugely important country.

 One of the job responsibilities I had in Japan was to get our web sites aligned well to support the global branding of Cadillac and Chevrolet.  In fact, check out the GM web site for Cadillac in Japan at http://www.cadillac.co.jp/ 

We worked closely with our leaders in Detroit to ensure that the Japan web site would be user-friendly for Japanese consumers.  But still addressing the global branding requirements from our home office. 

The products have to be tailored for the marketplace that they are sold in.  In the auto industry we call this homologation.  Vehicles need to be, as required by law, homologated for sale in that country.  To be sold in Japan that means specific headlamps, folding outside rearview mirrors, and more.  In fact, I think the list was about 50 items that needed to be changed / modified for the Japanese consumer.   

Surprisingly, selling a right-hand-drive (RHD) version is not a requirement.  You can sell either left-hand-drive (LHD) versions or right-hand-drive (RHD) versions.   For Cadillac, we experimented with a new model that was coming out and sold it in both versions.  To engineer a new car in a right-hand-drive (RHD) version it is rather expensive – probably in the area of $10-25 million.  So the business case has to be there to support the RHD marketing need.

So after the Cadillac was engineered we sold it in both LHD and RHD versions and you know that the sales were about 50/50!   We thought we might sell more vehicles if we had the RHD version – but that really did not happen. 

It came down to the buyer.  Japanese are ‘nationalistic’ in their buying habits.  About 95% of all cars sold in Japan are Japanese.  Of the 5% imports, the unique Japanese that would want to buy an imported vehicle often times wants to have it as close to the home country as possible.  So in this case, a Cadillac or Corvette should be LHD even in their RHD world!

Reference:

Walker, D., Walker, T., & Schmitz, J. (2003). Doing Business Internationally: The Guide to Cross-Cultural Success (Second ed.). New York: McGraw-Hill.