CHAPTER 4 WINNER Gregory J. Baleja Alma College INTERNATIONAL MARKETING: A MAP QUIZ When discussing international marketing, it is always interesting to investigate the amount of knowledge that American college students have about any country outside of the United States. In most cases, I find that my students have very little knowledge of foreign countries or cultures. To reinforce this assumption, I give my students a Map Quiz. The map quiz is usually based on the countries of Europe (both Eastern and Western Europe). Europe is usually selected because it is the region of the world that until recently has undergone the least amount of name and/or boundary changes. To make the students’ task easier, I provide them with a list of all the European countries involved (aided recall). To make sure they legitimately try to fill in all of the correct countries, I state that the quiz will be graded. Later, I inform the students that the quiz was, in fact, graded, but that the scores were not recorded. Over the last few years, the average number of countries MISSED has totaled approximately 14.38 out of 27 possible European countries listed (an error rate of 53.25%). The number of countries MISSED has ranged from 0 to 26 (to date no student has missed all 27 countries). A number of students comment when seeing their actual scores, that they would have performed much better if they were quizzed on something more familiar, like the United States. Thus, to accommodate their request, during the next class period I distribute a quiz on the lower 48 states. For this map quiz the students are not provide with a list of states (unaided recall). The average number of states WRONG has averaged 13.76 out of 48 (an error rate of 28.6%) during the last few years. Familiarity seems to help improve the scores, but not totally. Some unique answers to both quizzes are listed below. Students have told me, for example: ·West German was located east of East Germany, ·New states such as East and West Delaware, Syracuse, and St. Louis exist, ·Ireland is located where Bulgaria is, ·Norway is located where Romania is, ·Great Britain is located where Spain is, ·North and South Carolina are located where North and South Dakota are, ·Arkansas is located where Utah is, and ·Alabama is located where Oklahoma is. The purpose of these quizzes is to reinforce exactly how little American students know about the world in general. I ask the students how they can make a conscious business decision about locational alternatives when they don’t even know where Czechoslovakia is, or for that matter, the state of Kansas. In my most recent Basic Marketing class of 46 students, 43% of them were unable to place Kansas in its correct geographical position. In addition, 35% missed placing Colorado correctly and 46% missed Arizona. The students are not only unable to show where a particular country or state is located, but they are also unable to identify the countries or states that surround it. How then, can these students intelligently discuss the implications of entering the Czechoslovakian market (caused by recent developments in Eastern Europe) with the thought of possible expansion into the rest of Eastern Europe, when they don’t even have the most basic knowledge of where it is located? By the way, the same argument holds for locating a Distribution Center in Kansas or Colorado or Arizona. Our students need to have a better understanding of geography if they are going to compete successfully in a GLOBAL marketplace. WINNER John L. Beisel Pittsburg State University FORCING INTERNATIONAL COMMUNICATION Students from other countries who are studying in the United States bring with them a rich cultural heritage and perspective that most American students seldom bother to learn about. In fact, many American students rarely even take the opportunity to talk to an international student during their college years, even though they have sat in class with them time after time. I have had international students tell me upon graduation that they regret the fact that they never became friends with an American student. I decided to force communication between the two groups at every opportunity in my classes. In my International Marketing course, the students are divided up into teams consisting of four students, and each team is assigned a country. Their task: to develop a plan for marketing a specific consumer product to their assigned country, in 25 pages or less. In a recent class, I appointed eleven teams of four students each. Each team was assigned a different country. Those eleven countries that were most represented by students in our university were eleven countries assigned. They were India, Indonesia, Japan, Malaysia, Nigeria, Pakistan, Paraguay, Singapore, South Korea, Taiwan, and Thailand. The teams were expected to personally interview a minimum of four students from the country that they were assigned. The interviews consisted of learning about the customs, product preferences, buying habits, prices, competitors, types of retail outlet shops, etc., in the home country of the students interviewed, especially relating to the product assigned. The final report for each team included, among other things, a country analysis with a brief description of the market (demographics, primary marketing areas, etc.), an economic profile of the country, business customs, consumer behavior, general U.S. relationships with the country, export prospects to the country, and the country’s restrictions on imports. Also, customs regulations had to be cited regarding documentation, packing, labeling, marking, import quotas and restrictions, tariffs, trademark protection, taxes, import licensing, shipping documents, health and sanitary requirements, etc. Much of this information could be found in Overseas Business Reports. Each team also created a brand name and a package design. A pricing policy was decided on, as well as a promotional strategy. Common distribution channel alternatives were named, and entry alternatives (i.e., licensing, trading companies, franchising, agents, joint venture, wholesalers, etc.) were chosen. The students were quite positive about the project as a learning experience, especially regarding the face-to-face contact with international students. During the interviews the students found new friends, and in some instances were even invited to the interviewees’ living quarters for a meal with an international flavor. RUNNER UP David J. Brennan Webster University – St. Louis, Missouri IT’S NOT FUNNY MONEY! In teaching International Marketing it is important for American students to develop a knowledge of foreign currencies. For marketing students, this need not be a detailed financial knowledge but simply an awareness of a few key international currencies, their names, symbols and relative values. Given a list of several relatively familiar countries, students are asked to name the currency of that country and to indicate the symbol used to designate that currency. Some typical countries, currencies and symbols (with the U.S. as an example) could include [answers in brackets]: Country Currency Symbol Example: USA Dollar/cent $ US Australia __________[Dollar/Cent] _____[$AUS] Belgium __________[Franc] _____[Bf] Canada __________[Dollar/Cent] _____[$CD] France __________[Franc/Centime] _____[Ff] Germany __________[Deutsch Mark/Pfenning _____[DM] Great Britain __________[Pound/Pence} _____[£] Hong Kong __________[Dollar] _____[$HK] Ireland __________[Punt] _____[Pt] Italy __________[Lire] _____[Il] Japan __________[Yen/Sen] _____[¥] Poland __________[Zloty] _____[Z] Switzerland __________[Franc] _____[Sf] These, as well as other countries and their respective currencies, can be found in the foreign exchange listings in the Financial Section of the Wall Street Journal. This listing provides the country, its major currency and foreign exchange values for the previous two business days in terms of foreign currency value in $US, and $US in terms of value in the foreign currency. If possible, it is also useful to go to a local bank and get (buy a few foreign currency bills (£, DM, Ff, $CD) for class. Several aspects of foreign currencies, as they may apply to marketing students, can be raised during class discussion. These could include: Some currencies have similar names, i.e., Dollar: U.S., Canada, Hong Kong; franc: France, Belgium, Switzerland but all have very different values. It is important for marketing students to be aware of the relative values of the currencies of key major trading partners (Canada, Germany, Great Britain, and Japan). It illustrate this one can use those foreign currencies with values less than, approximately equal to and great than the U.S. dollar. For example: The Canadian ($CD) dollar is close to the value of the U.S. dollar ($US): 1 $CD = 84¢ US or 1 $US = 1.19$ CD The German mark (DM) is less than the value of the U.S. dollar ($US): 1 DM = 68¢ US or 1 $US = 1.47 DM The Japanese Yen (¥) is worth much less than the U.S. dollar ($US): 1 ¥ = .001 $US (1¢ US) or 1 $US = 100 ¥ The British pound (£) is worth more than the U.S. dollar ($US): 1 £ = 1.91 $US or 1 $US = .52 £ (52 pence) Changes in foreign currency values in terms of the U.S. dollar can impact international business. A good example of that is of the Japanese yen (¥). In 1987, 1 $US was worth (bought) approximately 250 ¥ while in 1992 the U.S. dollar weakened (and the Japanese yen strengthened) when 1 $US was only worth (bought) approximately 128¥ while in 1996 it hovered in the 80 – 100¥ to the $US range. A useful point of discussion is the change in foreign or U.S. consumer buying power due to such a change of currency values. This exercise can educate American marketing students who are, typically, used to operating only in the U.S. dollar. Although the U.S. dollar is still a key global currency, other currencies, such as the German DM and the Japanese ¥ are becoming important. It can illustrate to our students that foreign currencies are not “funny money” and need to be taken seriously in international marketing. RUNNER UP Jacqueline J. Kacen University of Michigan-Dearborn CROSS-CULTURAL MARKETING: TAKING THE BRAND LOCAL? What must international and cross-cultural marketers think about when introducing products into foreign markets? Instead of focusing on familiar U.S. products being introduced into a new foreign market, this exercise has students introduce a foreign product into the U.S. This exercise works well as an in-class exercise, a group project, or an individual homework assignment. The product I use for this exercise is Vegemite – a Kraft product manufactured and sold in Australia and New Zealand. However, any foreign product that is not currently marketed in the U.S. can be used in class. As an introduction to the exercise, I provide students with a one-page summary of the product – its history, ingredients, uses, target market, position – in its home market. Alternatively, depending on time and resources, students can be required to research the product on their own. Information about Vegemite, for example, is available through various sites on the World Wide Web. This exercise can provide an opportunity for students to access Internet resources. I also bring in the product in to class students can see it in its “original” form. By using a food product such as Vegemite, students also actually taste the product; thus, better understanding and appreciating its composition. (Note: most American students hate the taste of Vegemite, so I also provide soft drinks and pieces of candy to students so they can “cleanse their palates”). The background information on the product and the taste experience provide students with enough information to create their own marketing strategy for the product. Individually, in groups, or as a class, students are instructed to develop a marketing plan for Vegemite’s introduction into the U.S. The plan should include the target market, the product’s positioning statement, packaging and size considerations, price (or pricing strategy), distribution strategy, and promotional strategy. A discussion of the marketing plan(s) follows. The differences and similarities between consumers in the United States and in the home country of the product should be highlighted during the class discussion. HONORABLE MENTION William C. Moncrief Texas Christian University USING GEOGRAPHY IN THE INTERNATIONAL MARKETING CLASS My strong belief is that students should have some sense of geography when studying international marketing. The first day of class I put a world map on the overhead and ask them to identify 25 countries (France, China, Japan, etc.). The results as might be expected are abysmal. Most students indicate that they have never studied geography or they were so young as to be non-interested. My goal is to give them some geographical knowledge and to make it fun. Several years ago, I was given a board game called Where in the World. The game has a card for every country in the world and gives information such as capital, chief export, chief import, religion, language, currency. I have put all of this information on a handout along with maps of Europe, Asia, Africa, and North and South America. Groups of 5 are formed for a geography competition. On an announced day we have the geography bowl with 6 to 8 groups competing. Typically, the students have divided up the world so that two students within the group are “experts” on a particular continent. I shuffle the approximately 200 cards and I randomly pick a card for a group 1. Each group has a map in front of them with each country numbered but not named. “Group 1, where is Argentina.” If they are correct they receive a point and then answer, “What is the capital of Argentina?" If they are correct again they have a chance at a third question. I have created a spinner with export, import, currency, and language divided equally on the spinner. I spin the spinner and it might indicate “export.” If the group can name the chief export, they receive a third point. If the group misses the country or capital, I roll a die and the corresponding numbered competitive group has a chance to “steal” the question and receive bonus points for the correct answers. After the question has been answered by group 1 or stolen by some other group, I then move to group 2 and draw a country. This process continues until all groups have been asked a country. Round 2 ensues. The game will continue throughout the class period, usually lasting somewhere from 10 to 20 rounds (depending on the length of the class). The game becomes very competitive and the amount of information learned is phenomenal. It is rare that a group misidentifies a country and usually they can name the capital. In about half the cases, they even can come up with exports, imports, currency, and language. As midterm I give an exam with a map in which the students must identify 20 “significant” countries and capitals that are active in the international markets. The results are impressive. In my last two classes, exactly 50% of the class did not miss a single country. The average misidentified country and the capital was 3.4 out of 4.0 possible answers. The geography game is fun. The students love it and want to play it again. More importantly, they learn some geography and as we talk about world markets, most of the students now know where the countries are located and something about them. HONORABLE MENTION Andrew Banasiewicz Louisiana State University GLOBALIZING THE THINKING OF BUSINESS STUDENTS During the last decade, we have seen a strong emphasis being placed on providing business students with a more global orientation. To accommodate this, we need to make the students realize that being raised in a particular culture results in their “business perceptions,” as employed in a particular context, being not only a function of the actual attributes, but their respective cultural background as well. I have devised a simple exercise aiming at forcing students to think of other cultures no in terms of the potential differences, but rather in terms of strengths, weaknesses, opportunities, and threats that these diverse environments may provide. On a first day of class, I ask students to write on an index card their name, major, classification, and then two groups of countries. The students are instructed to, for Group one, create a list of foreign countries, which they perceive as being most culturally similar to their own. Conversely, Group Two is to be composed of five countries that they perceive as being culturally most dissimilar to their own country. Lastly, the students are asked to consider a generic industrial product (such as a bearing), and use a scale of 1-10, rate the perceived quality of that product which is being manufactured in their own country of origin, the country they judged as most culturally similar, and lastly the country they judged most culturally dissimilar. Due to the fact that the product under consideration is rather hard to compare on its functional attributes, the students are forced to base their ratings on their culturally based attitudes. Having collected all that information, I then group the lists of the most culturally similar and dissimilar cultures. Then I divide students into groups where each of the groups has a specific country or region assigned to it. The groups are usually composed of about four students who are paired and matched in such a way that two of the students have listed their group’s country as one which they believe to be most similar to their own country, while the other two listed it as being culturally most dissimilar to their own country. Following that, I announce that each of the groups is to choose a product or service and attempt to market it in the country assigned to them. The groups are to view themselves as consulting teams responsible for creating the marketing mix comprised of product, price, promotion, and distribution. The groups are given most of the semester to work on the project, which is culminated by formal presentations. Following the presentations, the students are asked to once again rate the perceived quality of a generic industrial product being manufactured in their own country, the country most culturally similar, as well as the country most culturally dissimilar to theirs. Following that, the ratings are compared against those recorded in the beginning of the semester and a presentation is made regarding the differences. Lastly, the culturally motivated perceptual bias is discussed and the opinions are solicited regarding the learning process, which took place while working on the project.