cyprus institute of marketing - contribution to cim marketing summit 2013 - 20.04.2013

Svend Hollensen

GLOBAL MARKETING 5th Edition

How to Develop a profitable Global

Marketing Strategy CIM Marketing Summit

The Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

How to Develop a profitable Global

Marketing Strategy

Agenda:

1.Introduction (about myself, International

environment, Global Marketing Process etc.)

2. Glocalization strategy (B2B + B2C)

3. Global Account Management (GAM) (B2B –

seen from supplier)

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Global Marketing Strategy Cyprus Institute of Marketing, 17.04.2013

By: Svend Hollensen, svend@sam.sdu.dk

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

It nearly came to the situation that the US Government even

had to print new 1 dollar notes with a desperate George

Washington ………

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

The new world order (US loosing its

leadership in the world economy) –

provides new opportunities for

emerging regions to position

themselves in the long-term

development of the world economy

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Some background information

about myself, my university and my

books

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Here I live

SDU

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

University of Southern Denmark

Sønderborg

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013 19-18

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

1st ed. came

in 1998

2nd ed. came in

2001

3rd ed. came

in 2004

4th ed. came

in 2007 5th ed. came

in 2010

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013 08-10-2013 21

Global roll-out of Concepts / High speed

Global Low-cost Production and Selling

Low complexity

Regional and local market penetration

Culturally Close to Consumer

Flexible Response to local customer needs GLOCAL

Global Marketing Strategies

Globalization (Standardization)

Localization (Differentiation)

100% 100%

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Persil Black (for Europe) Persil Abaya (for women in Arabic

World)

2011:

Henkel

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013 17-24

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Global Account

Management

(GAM)

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013 19-27

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Three key reasons for increasing

importance of CRM/KAM and GAM:

1.Internationalization / globalization of key

customers

2.Worldwide consolidation of industries

3.Increasing use of outsourcing on the

customer side

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013 19-29

1. Reason for GAM:

Internationalization of customers:

- An example from the wind

turbine industry

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013 13-30

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013 13-31

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013 19-32

2. Reason for GAM:

Consolidation of Industries

= Fewer customers in the market

for the supplier to approach

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Consolidation takes place everywhere and not only in the pharmaceutical industry ……..

Kilde: www.ims-global.com/.../ news_story_010425.htm

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013 19-35

3. Reason for GAM:

Outsourcing of activities

= The 1st tier suppliers will get

more business from the key

global customers

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

R&D Production Marketing Sales and

services

Support functions: - Firm infrastructure

- Human Ressource Man.

Support functions: - Technology development

- Procurement (buying)

Upstream Downstream

- Product dev.

- Design

- Petents

- Product features

- Engineering

- Prod. capaciy

- Component parts

- Assembly

- Material flow

- Quality Man.

- Marketing info.

- Product

- Price

- Distribution

- Communication

- Branding

- Sales force

- Logistics

- Terrms of sales

- Inventory

- Payment

-Customer

service

Suppliers Cus-

tomers

Value chain of focal firm:

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Aluminium

Prod

End - co

nsu

mers

First tier:

B2B B2C

Suppliers: Customers:

Upstream Downstream

Focal firm:

Braun (Gillette)

Second tier:

Nylon prod. /

DuPont Brushhead

Oil / Refiner

Chemicals /

Plastic molder

Plast parts

Electric motor

Wires / Plugs /

Timer / chip /

Printed circuit

Rechargeable

Battery pack

B2B B2B B2B

Rubber / Metal

/ Wire producer

Chemicals /

Producer of

NiCd batteries

Mass Merchan-

disers:

Marks&Spencer

Sainsbury

Tesco, B&Q etc.

Second tier: First tier:

Electrical retail

chains:

Dixons

Curry

Comet

Electrical

wholesaler

Independent

electrical

stores

Internet:

Amazon.com

Dentist.net

etc.

’Internal’ value chain:

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Figure: The trend towards increasing outsourcing among European car manufacturers

Source: Focus Money, Wertschöpfung von Autozuliefern14. Juli, p. 13

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Seller Buyer

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013 19-41

Development of GAM

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Customer (GA) HQ

Supplier HQ

…….. Country

A

Country

B

Country

C

Country

N

Traditional HQ-HQ negotiations

with central distribution

Centralized coordination of the GAM relationship:

(GAM relationship with relative high customer power):

Customer (GA) HQ

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

……..

……..

Dec

entr

ali

zed

an

d l

ocal

ad

ap

tati

on

of

GA

M

Supplier HQ

Customer (GA) HQ

Local

Coordina-

tion

Local

Coordina-

tion

Local

Coordina-

tion

Country

A

Country

A

Country

B

Country

B

Country

C

Country

C

Country

N

Country

N

Mix - coordination af GAM-relation:

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

……..

……..

Dec

entr

ali

zed

an

d l

ocal

ad

ap

tati

on

of

GA

M

Supplier HQ

Customer (GA) HQ

Local

Coordina-

tion

Local

Coordina-

tion

Local

Coordina-

tion

Country

A

Country

A

Country

B

Country

B

Country

C

Country

C

Country

N

Country

N

Decentralized coordination of

the GAM relationship:

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

One example of centralized negotiation of GAM:

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

(DC = Distribution Centres)

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Customer (GA) HQ

Supplier HQ

…….. Country

A

Country

B

Country

C

Country

N

Traditional HQ-HQ negotiations

with decentralized distribution

GAM relationship with relative high customer power:

DC logistics DC logistics

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Production units

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Global Marketing of:

= GAM

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Outside Europe: Adaptation

of ‘Global Marketing’

Russia – pure translation

India – Co-authorship

Latin America – Co-authorship

Europe:

China – pure translation

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Textbooks for courses in ”International Marketing”:

• Fragmented market

• No clear market leader

• Intensive competition on the publisher level

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Textbooks for courses in ”International Marketing”:

High degree of competition between textbooks on publisher level:

and many more ..

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Textbooks for courses in ”International Marketing”:

High degree of internal competition:

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

= The wold’s biggest

publisher within business

literature for uni. courses

Reps in UK

(home)

Reps in

Benelux

Reps in

Skandinavia

Reps in

Eastern

Europe

Reps in

Africa and

Asia

Reps in

North

America

Business schools = end customers

Lecturers Students

Lecturers Students

Lecturers Students

Lecturers Students

Lecturers Students

Lecturers Students

Supplier:

R & D

Product development

Customer:

Production & Marketing

GAM -relation

HQ in UK (London)

What to do as a supplier with small relative power?

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Recommendations for the supplier in GAM-relationships: 1. Try to increase the level of your ’value’, which is perceived by the

customer, e.g. by suggesting an extension of your product

solution, for example by offering special after-sales-services

2. Try to offset the customer’s central buying power by

communicating directly to the local end-customers. In this

connection, local partners (agents etc.) can be of great help

3. Try to take advantage of local differences in the decision

processes of the global customer organization. In a global

consolidation process with many M&As it is hard for the

customer HQs to implement central negotiation processes. They

have to decentralize and this provides opportunities for the

supplier to achieve good local deals.

Svend Hollensen, CIM Marketing Summit, Cyprus Institute of Marketing, 20.04.2013

Thank you !