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The Global Environment

Chapter 2 The Global Environment PPt

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31 views15 pages

The Global Environment

Chapter 2 The Global Environment PPt

Uploaded by

zaniyahriego0
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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The Global

Environment
1 3 5
Legal and Cultural

4
Economic Political Adaptation

2
Environment Environment Issues

Country
Cultural Notebook
Environment Requirements
The Global
Environment
-refers to the global factors beyond a company's
control that influence its marketing decisions in
foreign markets.

These factors include economic conditions,


political systems, cultural differences, and
technological advancements.
Lesson 1:
Economic Environment

This includes things like


- refers to all the
currency exchange rates,
economic factors that
inflation, economic growth,
affect a company's and consumer spending
marketing decisions in power.
foreign markets.

Feedback

2
Market
Characteristics
Market characteristics are economic
factors of a foreign market, like how
much people earn, how they spend,
and the market's stability. These
factors help a company decide how to
price, promote, and sell its products.

3
Regional Economic Integration

-refers to agreements between


countries in a region to promote
trade and economic cooperation.

-These agreements, often called "Trade Blocs"

3
Exist at different levels of integration, ranging from:

Free Trade Area (FTA) Customs Union (CU)

' Countries form an FTA and adopt a common


- An agreement where countries remove external tariff for goods imported from
trade barriers like tariffs and quotas between outside the union.
themselves but keep their own policies for
trade with countries outside the agreement. Example:

Example: GCC: Gulf Cooperation Council


SACU: Southern African Customs Union
NAFTA: for North American Free Trade
Agreement.
AFTA: ASEAN Free Trade Area

2
Exist at different levels of integration, ranging from:

Common Market (CM) Economic Union (EU)

- Countries form a Common Market and


- Countries form a Custom Union and allow coordinate economic policies, such as
free movement of labor and capital within the monetary policy and fiscal policy.
union.
Example:
Example:
EU: European Union
COMESA: Common Market for Eastern and EAEU: Eurasian Economic Union
Southern Africa
Mercosur : Southern Common Market

2
Emerging and Developing Markets
70%

-Emerging markets are economies that are 60%

growing rapidly and transitioning from low to 50%

middle income, like China and India


40%

. -Developing markets are less advanced and 30%

still working on improving their 20%

infrastructure and economic stability, such


10%
as Vietnam or Kenya.
0%
Emerging Markets Developing Marketing
Cultural environment
- Refers to the values, beliefs, customs, and behaviors of a target market.
Understanding these cultural factors helps companies tailor their products,
advertising, and sales strategies to fit local preferences and avoid cultural -
misunderstandings.
Elements of culture

1. Values and Beliefs: Core principles and ideas that shape behavior and decision-
making.

2. Norms and Customs: Social rules and practices guiding daily life and interactions.

3. Language: The means of communication, which influences marketing messages.

4. Symbols: Objects, colors, or logos with specific meanings in different cultures.

5. Religion: Beliefs and practices that can affect consumer preferences and
behaviors.
Making culture work in
environmental success
- Means adapting business strategies to align with local
cultural norms and values.

This involves understanding and respecting local customs,


communication styles, and consumer preferences to build
strong connections with the target market and ensure
successful market entry and growth.
The legal and political environment
- Refers to the laws, regulations, and political conditions of a foreign market.
This includes trade regulations, property rights, and government stability.
Companies must understand these factors to ensure compliance, avoid legal
issues, and navigate the market effectively.
● Home country political-legal environment
- includes the rules and political conditions in a company's own country that
affect its international business. This involves things like export rules, trade
policies, and government support for overseas operations.

● Host country political-legal environment


- includes the rules and political conditions in the country where a company is
doing business. This covers local laws, trade restrictions, and political stability.
Companies need to understand and follow these rules to operate effectively
4 and legally.
Ethical issues
- in the international business environment involve following moral
standards and laws, such as avoiding corruption, respecting labor
laws, and treating employees fairly.

Example:
If a company operates in a country with weak environmental rules, it
might be tempted to cut costs by ignoring environmental damage.
This could hurt its reputation and lead to legal trouble in other
countries where it operates.

4
Country Notebook Requirements
- Refer to the detailed information and analysis a company needs to gather
about a foreign market before entering it. This includes understanding the
market's economic conditions, legal environment, cultural factors, and
competitive landscape.

Cultural Adaptation Issues


- Refer to the challenges companies face when adjusting their products,
marketing, and business practices to fit the cultural norms and
preferences of a foreign market.
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