Challenges of Global Marketing

Author(s): Richard C. Christian

Source: The Journal of Marketing, Vol. 25, No. 4 (Apr., 1961), pp. 72-74
Published by: American Marketing Association
Stable URL: http://www.jstor.org/stable/1248998 .
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Challenges of Global
H OW DO WE market abroad? How
much investment will it take? What
kind of people do we need? What are our
profit opportunities? What are the pitfalls
and problems? Do our products fit over-
seas markets?
These are the kinds of questions being
raised in corporate councils throughout the
United States. A tremendous amount of
high-priced talent in the form of industrial
corporation boards of directors and top
management groups are wrestling with the
opportunities of global marketing.
STATISTICSTELLTHE STORY
U.S. private investment abroad is esti-
mated to be more than $43 billion. During
1961 another $3 billion is likely to be added.
Exports of American industrial firms
increased in 1960 over 10 per cent above
1959; and 1961 probably will find an addi-
tional 5 per cent increase. Sales of U.S.
manufacturing companies in their foreign
subsidiaries were up some 11 per cent in
1960 over 1959, and may be up even more
during 1961.
Some startling examples: General Motors
will invest $11/4 billion next year in its
operations, with between 20 to 25 per cent
overseas. Ford will spend $138 million
overseas this year, $200 million in 1962.
In 1959, the IBM World Trade Corporation,
responsible for most of the firm's interna-
tional business, earned $40 million on a
gross of nearly $300 million. It is reported
that Chas. Pfizer & Co. and Schering Drug
both earn more than 40 per cent of their
income abroad. Clark Equipment, which
recently changed the location of its interna-
72
By RICHARDC. CHRISTIAN
Marsteller, Rickard, Gebhardt & Reed, Inc.
Chicago
Marketing
tional headquarters from Havana to Brus-
sels, finds its international growth consider-
ably more rapid than the domestic business.
MAJOR TRENDS
With the continuing major shift of U.S.
business abroad from export to broad-scale
international business, involving local man-
ufacture and stepped-up sales and advertis-
ing efforts, U.S. marketing methods more
than ever apply overseas. Basic to the
successful application of these methods is
the process of market auditing or the prep-
aration of local, regional, and international
marketing plans which cover all facets of
the development of the expansion of a com-
pany's sales abroad.
What is really called for is the domestica-
tion of marketing abroad, or the lifting of
overseas local standards of approach to a
level comparable with marketing develop-
ments and standards in this country.
This is particularly important because a
distinction between domestic and foreign
business is ceasing to exist. More progres-
sive managements are looking at all mar-
kets the world over, with a global concept
of management and of marketing. Profits
in Germany, Australia, or Argentina are
no less attractive than profits here. Even
though there are questions of money trans-
fer from country to country, these problems
can be overcome. To obtain profits calls
for the same level of management and
marketing approach.
Jere Patterson, of Jere Patterson & As-
sociates, international advertising and mar-
keting counsel of New York, recently re-
ported on a variety of changes and trends
INDUSTRIALMARKETING
taking place. Basic is his theme that U.S.
companies must market abroad the way
they do here, with strategically thought-out
marketing plans which include: thorough
market knowledge; fitting products to cus-
tomers' needs and wants; competitive pric-
ing; and flexible terms and services.
SOME ESSENTIAL STEPS
Patterson believes that any well-managed
American industrial corporation can suc-
cessfully establish an international organi-
zation if it carefully charts a specific course
of action. He suggests six steps as essential
procedures:
1. Foundation-The right international
staff must be selected. Men, willing to
make sacrifices, to learn new languages,
and to adjust to local customs and tradi-
tions must be found. Advertising agen-
cies and research organizations must be
selected and effectively used. Proper
outside organizations can help greatly to
lift the level of marketing performance.
2. Preparation-A marketing plan should
be prepared, embracing all aspects of
the marketing activity. If basic facts
are not available within the business,
marketing research should be under-
taken as an important factor in proper
preparation. The U.S. government, many
trade associations, publications, and
counselors can help to provide essential
facts.
3. Presentation-The
marketing plan, well
documented and thoughtfully worked
out as to objectives, strategy, tactics,
etc.-all with profit goals-should be
presented to management in proper
form and fully discussed. This will
marshal needed support for all market-
ing, advertising, and other related ef-
forts. Goals might first be established
at international headquarters, thought
through regionally, and then plans de-
veloped locally to meet targets. The
plans should then be subject to regional
and headquarters review before final
adoption.
4. Integration-The program must be in-
tegrated in terms of proper timing of
all marketing activities-for example,
73
advertising in terms of product distri-
bution, and promotion and publicity in
concert with advertising. Integration
is not just an external matter but also
an internal matter. There must be
integration of marketing activities
within the company, both in terms of
functions and departments, and in
terms of geography.
5. Co-ordination-International marketing
requires co-ordination, especially as to
corporate image, name, trade marks,
dealer-distributor identification, and ad-
vertising and promotion materials.
There are various techniques of co-
ordination, such as regional committees,
travel abroad, standards of procedure,
definition of budget categories, standard
budget categories, and basic product
classifications. Sometimes the forma-
tion of separate marketing companies
at international, regional, and local
levels can prove to be an important co-
ordinating tool.
6. Education-Inherent in all this new
level of marketing activity is education.
This implies education of local top man-
agement, marketing management, and
advertising management, and then ed-
ucation of regional management. This
is perhaps the single greatest responsi-
bility of present-day marketing man-
agement that is global in scope.
The business of doing business abroad
is profoundly changing. New levels of
marketing performance are called for.
Local and regional factors must be taken
into account. The international image of
the business and its products must be
assiduously built. A global concept of busi-
ness is called for, a concept that will break
down artificial distinctions between domes-
tic and foreign marketing.
SUGGESTED READINGS
A good first step in "getting the ball
rolling," internationally speaking, is to re-
view some of the excellent literature avail-
able. Here is a suggested reading list:
C. K. Campbell,"Sales and Marketing Poli-
cies," Case Studies in Foreign Operations,
International ManagementAssociation, Spe-
cial Report No. 1, 1957.
74 JOURNAL OF MARKETING April, 1961

Edward de Robert, "Advertising in Overseas Edward T. Krieger, "Defining and Measur-

Operations," The Challenge of a New Envi-
ronment, International Management Asso-
ciation, Series Number 2, 1956.
Frank Montgomery Dunbaugh, Marketing
in Latin America (New York: Printers'
Ink Book Company, 1960).
John Fayerweather, Management of Inter-
national Operations (New York: McGraw-
Hill Book Company, Inc., 1960).
William B. B. Fergusson, "Effective Mar-
ket Research Abroad," The Challenge of a
New Environment, International Manage-
ment Association, Series Number 2, 1956.
"Fight for Survival," booklet published by
Steel magazine, (Cleveland, Penton Publish-
ing Co.). An analysis by Steel editors of
U.S. Metalworking's competitive position in
the new world market. Compiled from Sep-
tember 5, 1960 issue.
"Financial and Tax Considerations in Or-
ganizing for Foreign Operations," Increas-
ing Profits from Foreign Operations, Part
Three, International Management Associa-
tion, Special Report No. 3, 1957.
ing the International Market," Increasing
Profits from Foreign Operations, Interna-
tional Management Association, Special Re-
port No. 3, 1957.
R. D. McManigal, "Sales Policy and Opera-
tions," Case Studies in Foreign Operations,
International Management Association, Spe-
cial Report No. 1, 1957.
Albert F. Watters, "Patterns of Foreign
Distribution," The Challenge of a New En-
vironment, International Management Asso-
ciation, Series Number 2, 1956.
Harvey Williams, "New Dimensions for
American Foreign Operations," Increasing
Profits from Foreign Operations, Interna-
tional Management Association, Special Re-
port No. 3, 1957.
For additional information, write:
McGraw-Hill International Corporation, 330
W. 42nd Street, New York 36, New York.
World Trade Information Service, Division
of Commercial Intelligence, Bureau of For-
eign Commerce, Washington, D.C.
Foreign Commerce Department of the U.S.
Chamber of Commerce, Washington, D.C.

MARKETING MEMO
Men Don't Live by Sense!
Man lives in an environment of symbols, and it is extremely
important to understand something about the symbol-making
process because symbols are the raw material of human thought
and all communication. Superficially we think that words are the
only form of communication, because we live in such a highly
verbal atmosphere. Yet in actuality there is a far greater amount
of nonverbal communication going on all the time through the
use of other symbols than words. And though we believe that
all thinking must be logical and intellectual, there is an entirely
different mode of thinking also used by the brain, which has a
different order and a different way of conveying meaning than
intellection, hinging on a different kind of symbol-the non-
verbal symbol.
-Pierre Martineau, Motivation in Ad-
vertising, (New York: McGraw-Hill
Book Co., Inc., 1957), p. 133.

DO NOT BIND VOLUME 25 UNTIL YOU HAVE RECEIVED

BOTH JULY, 1961, AND OCTOBER, 1961, ISSUES. VOLUME
25 WILL HAVE SIX ISSUES (July, 1960, through October, 1961.)