Question 1

Global trade can be divided into two categories:

Accepted Answer

Global trade primarily involves the exchange of goods and services across international borders, which is fundamentally categorized into importing (buying goods and services from foreign countries) and exporting (selling goods and services to foreign countries).

Question 2

When expanding to the Indian market, McDonald's understood that the cow was a sacred animal in the Hindu religion - the largest religion in India. As a result, McDonald's in India does not sell beef products, but rather chicken, paneer, and veggie burgers. This is a result of the international:

Accepted Answer

McDonald's adaptation to the Indian market by not selling beef products and offering alternatives like chicken, paneer, and veggie burgers is a response to the social-cultural environment. This decision respects the religious beliefs and cultural practices of the Hindu majority in India, where the cow is considered sacred.

Question 3

Proctor & Gamble sells Head and Shoulders shampoo and conditioner in Brazil. The company uses similar advertising and scents in Brazil as they do in the United States. This would be an example of:

Accepted Answer

Using similar advertising and scents in Brazil as in the United States without making changes to the product or promotional strategies is an example of a straight extension strategy. This approach involves selling the same product with the same marketing approach in a new market.

Question 4

A company may choose a ________ strategy to take advantage of economies of scale in marketing and production.

Accepted Answer

A straight extension strategy involves selling the same product in foreign markets without any modification. This approach allows a company to take advantage of economies of scale in marketing and production because it can produce and market the same product in a larger volume across different markets, reducing per-unit costs.

Question 5

Proctor & Gamble (P&G) recognized a need for clean drinking water for more than 1 billion people in developing countries. The company developed PuR, a water purification packet that eliminates disease causing microorganisms in drinking water. P&G is utilizing a:

Accepted Answer

P&G developed a new product (PuR water purification packet) specifically to address a problem (lack of clean drinking water) in developing countries, which is an example of a product invention strategy. This strategy involves creating new products or significantly modifying existing ones to meet the unique needs of a market.

Question 6

When KFC expanded to China, the company opened locations in smaller cities because other fast food restaurants, like McDonald's, were expanding to the bigger cities. KFC was considering the international _____ environment when it made this decision.

Accepted Answer

KFC was considering the competitive environment, as their strategy was based on the actions of their competitors (like McDonald's) and how to find a unique market space by expanding into smaller cities where competition was less intense.

Question 7

When expanding to China, KFC built warehouses and used its own fleet of trucks to distribute food items to its locations. KFC was considering the international _________ environment.

Accepted Answer

The answer of When expanding to China, KFC built warehouses...

Question 8

Which of the following is an advantage of implementing a one-product, one-message approach to international marketing?

Accepted Answer

Implementing a one-product, one-message approach enhances brand recognition as it provides a consistent message across different markets, making it easier for consumers to identify and remember the brand.

Question 9

Indian company Godrej & Boyce developed a small, portable refrigerator for rural India. The refrigerator uses batteries to run a cooling chip and fan, keeping food items cold. This is an example of:

Accepted Answer

The development of a small, portable refrigerator specifically designed for rural India represents a product invention, as it involves creating a new product to meet the unique needs of a specific market.

Question 10

Foreign licensing offers advantages to the manufacturer, such as:

Accepted Answer

The answer of Foreign licensing offers advantages to the manufacturer,...

Question 11

Nike is a global brand, selling the same athletic shoes in each country. The company's advertisements change in some countries, however. For example, Nike ran ads in China to change the perception that "running is boring." Nike is using:

Accepted Answer

Nike is using a promotion adaptation strategy because it changes its advertising approach in different markets (like China) to suit local tastes and perceptions, while the product itself remains unchanged.

Question 12

If a country did not import any goods and sold only what was produced within their borders, which of the following would likely occur?

Accepted Answer

Without imports, consumers would have fewer choices since only domestically produced goods would be available, leading to a decrease in product variety. Prices on goods could increase due to the lack of competition from foreign products, potentially leading to monopolies or oligopolies in certain sectors. Additionally, some types of products that cannot be produced domestically due to climate, expertise, or resource constraints wouldn't be available at all.

Question 13

Cremant Cellars is a family-owned winery located in the Loire region of France. Cremant is a sparkling wine and the winery owners are interested in gaining access to markets outside of France as a way to generate alternative sources of revenue. The owner, Jacques, has met with several firms and decided to work with Export Partners, a firm that has expertise in obtaining business with alcohol distributors across Europe as well as Asia and the United States. Export Partners will also provide assistance in managing the necessary paperwork, complying with local laws and regulations regarding proper labeling and food/beverage testing. Export Partners is most likely serving as a(n) ___________ to assist Cremant Cellars with their international expansion.

Accepted Answer

Export Partners is acting as an export-management company (EMC) because it is providing services to help Cremant Cellars export its products, including finding distributors, managing paperwork, and ensuring compliance with local regulations.

Question 14

A consumer food product company is looking to quickly and firmly establish a presence in a new market. What is the best market entry strategy?

Accepted Answer

Acquisition allows the company to quickly gain market presence by purchasing an existing company with established operations, customer base, and market knowledge.

Question 15

If the exchange rate for the Japanese yen is strong compared to the U.S. dollar, then:

Accepted Answer

When the Japanese yen is strong compared to the U.S. dollar, it means that the yen has more purchasing power relative to the dollar. This makes U.S. goods cheaper for Japanese consumers and businesses, likely increasing U.S. exports to Japan.

Question 16

Subway restaurants operate in many countries including Germany, Puerto Rico, Spain, Australia, and Japan. Menu items in other countries change to reflect local tastes. Promotions in some countries may focus on educating the consumer about the Subway brand. Subway is utilizing a ______ strategy.

Accepted Answer

Subway is using a dual adaptation strategy by adapting both its product offerings to local tastes and its promotional strategies to educate consumers about the brand in different countries.

Question 17

British Petroleum (BP) distributes petrol (or gasoline) to many countries around the world. BP changes the petrol formula in order to meet each country's regulations. This is an example of:

Accepted Answer

Product adaptation involves modifying a product so it fits with the local requirements or preferences of different markets, which is what BP does by changing the petrol formula to meet each country's regulations.

Question 18

A company looking to expand internationally with little risk would choose:

Accepted Answer

Exporting is the least risky method for a company to expand internationally as it involves selling products to foreign markets without significant investment or commitment in those markets.

Question 19

Danone, makers of Activia yogurt, launched a campaign in 55 countries featuring global pop star Shakira. Her international appeal combined with the tagline, "feeling good starts from the inside" helped Danone have a global impact. This is an example of:

Accepted Answer

This is an example of a straight extension strategy, where a company uses the same product and marketing strategy in multiple countries without making significant changes to adapt to local markets. Danone used Shakira's global appeal and the same tagline across 55 countries, indicating they did not alter their product or promotional strategies significantly for different markets.

Question 20

Despite being the world's largest retailer, Walmart did not succeed in Germany. German customers were not accustomed to greeters at store entries, could find lower prices on groceries in local stores, and the employment of grocery baggers was unappealing to German's who were used to self-service formats. Walmart failed to fully understand the international _________ environment.

Accepted Answer

Walmart's failure in Germany was primarily due to not understanding the competitive environment, including local preferences for self-service, pricing expectations, and the overall shopping experience, rather than issues related to economics, politics, law, or technology.

Quiz 8: Global Marketing