58 innovative plans for marketing

Chapter 43 International Marketing Planning (3)
In the face of different foreign markets, the pricing goals of enterprises cannot be exactly the same.Some enterprises regard the domestic market as the leading market, and regard the foreign market as the extension and supplement of the domestic market, so they often adopt relatively conservative pricing strategies for foreign markets.In addition, some companies regard the international market as important as the domestic market, and even regard the domestic market as a part of the international market. The pricing strategies adopted by such companies are often aggressive.The different goals set by the company for each foreign market also have a great influence on the pricing strategy.In rapidly developing foreign markets, companies may pay more attention to the growth of market share and temporarily lower their requirements for profits, adopting a low-price penetration strategy.However, in foreign markets with low-speed development, enterprises may pay more attention to the recovery of investment and adopt high-price strategies.For joint ventures with local manufacturers, in addition to considering their own goals in pricing, they must also consider the requirements of their partners.

The company's pricing objectives mainly include the following:

1. To survive.Enterprises have excess production capacity. When the international market is facing fierce competition and exports are hindered, in order to ensure that factories continue to operate and inventory is released, enterprises must set lower prices in order to expand sales.At this time, enterprises need to maintain survival as the main goal.

2. Maximize current profit.Considering the complex and changeable national political situation and economic situation of the target market, the enterprise hopes to recover the initial market development investment as quickly as possible and obtain the maximum profit. Determine a maximum price for the product in order to obtain the maximum profit in the shortest time.Adopting this pricing strategy will make the enterprise face two kinds of risks: first, maximizing the current profit may damage the long-term interests of the enterprise; There are often deviations in forecasts, and the resulting prices may be inaccurate, and companies may suffer losses due to pricing too high and not reaching the expected sales volume, or pricing below the highest achievable selling price.

3. Maximize market share.The adoption of this strategy requires the following conditions: the demand in the target market is relatively elastic, and low pricing can stimulate market demand; with the expansion of production and sales, product costs will drop significantly; low prices can scare off existing and potential competitor.

4. Product quality optimization.Because the products that have obtained the leading position in quality are often sold at a much higher price than the products that are ranked second, this is to compensate for the high production costs and R&D expenses that accompany leading quality.Therefore, adopting this strategy, enterprises need to implement the guiding ideology of product quality optimization in the process of production and marketing, supplemented by corresponding high-quality services.

In addition, some companies also consider the image of their products or companies in the international market, and use this as a pricing goal.

Practical points
Costing is very important in pricing.The regions where products are sold have different cost components.The cost of export products and domestic products will not be exactly the same even if they are both produced domestically.If the export product is modified to adapt to foreign weights and measures system, power system and other aspects, the cost of the product may increase.Conversely, if the export product is simplified or some functions are removed, the production cost may be reduced.

The importance of some of the same cost items for international marketing and domestic marketing can vary greatly.For example, freight, insurance, packaging, etc. account for a large proportion of international marketing costs.Other cost items are specific to international marketing, such as tariffs, customs clearance, and document processing.Now we will explain separately the cost items with special significance in international marketing.

1. Tariffs.A duty is a charge that is paid when goods pass from one country to another, and it is a special form of taxation.Tariffs are one of the most pervasive features of international trade and have a direct impact on the prices of imported and exported goods.Imposing tariffs can increase the government's fiscal revenue and protect the domestic market.Tariffs are generally expressed in terms of tariff rates, which can be levied in specific, ad valorem or mixed ways.In fact, the import visa fees, quota management fees and other management fees paid for products are also a large amount, which is actually another kind of tariff.In addition, countries may also impose transaction taxes, value-added taxes and retail sales taxes, etc., and these taxes will also affect the final selling price of the product.However, these taxes generally do not apply only to imported products.

2. Middlemen and transportation costs.There are great differences in the market distribution system and structure of each country.In some countries, enterprises can use relatively direct channels to supply products to target markets, and the cost of storage, transportation, promotion and other marketing functions borne by middlemen is also relatively low.In other countries, due to the lack of an effective distribution system, middlemen must bear higher costs for the distribution of goods.

Export product prices also include transportation costs.It is understood that the total transportation cost accounts for about 15% of the export product price.It can be seen that transportation costs are an important factor in the export price.

3. Risk cost.In international marketing practice, risk costs mainly include financing, inflation and exchange rate risks.Since the procedure of receipt and payment of goods takes a long time, the risks of financing, inflation and exchange rate fluctuations are increased.In addition, in order to reduce the risks and transaction barriers between buyers and sellers, the intervention of bank credit is often required, which will also increase the cost burden.These factors should be considered in international marketing pricing.

Scene reconstruction
1. Scenarios
In 2006, Lenovo released low-cost notebooks and desktops under the Lenovo brand in 10 cities around the world.According to the analysis of the American "Business Weekly", based on the current decline in the US market, Lenovo's move can establish a brand for itself and prepare for joining the giant club.In addition, the Think and Lenovo brands are both high-end and low-end markets, which can fill the small and medium-sized enterprises and consumer markets that IBM has long neglected.

Within six months of Lenovo's acquisition of IBM's PC business, Lenovo moved its headquarters to Winchester County, New York (not far from IBM headquarters), retained key IBM executives, and launched the IBM ThinkPad brand in the United States. Several new PCs.

Now, it's time for Lenovo to call itself Lenovo. On February 2006, 2, the company launched a line of low-priced PCs aimed at consumers and SMEs.While Lenovo dominated those markets in China, sales to consumers and small and medium-sized businesses were relatively weak in the U.S., a legacy of IBM's continued focus on large corporate clients.

In the US market, Lenovo's share is only 4.2%, which is far from Dell's 30.5% and HP's 19%.In addition, Lenovo's tiny share was shrinking in the fourth quarter of 2005.Therefore, although Lenovo has further consolidated its advantages in China, as JP Morgan Hong Kong analyst Johnny Chan said in his report, the setbacks in the United States and other overseas markets have made the actual profit beyond the expectations of financial people.

To change that, Lenovo, China's leader in low-cost laptops, has decided to take a stab at selling new designs of low-cost laptops and desktops to consumers and small and medium-sized businesses.For example, new laptops cost as little as $600.Those products will use processors from longtime partner AMD, rather than pricier Intel.

Question: Why is Lenovo selling a laptop for only $600?

2. Role simulation
If you are a domestic manufacturer of mid-to-low-end automobiles and plan to enter the international market, how do you adjust your price positioning?

3. Thinking Enlightenment
After studying this section, do you think there are other pricing factors for export products other than those introduced by the administration?

4. Physical training games
Props: some paper, some pens.

Number of participants: 12 people.

Method: 12 people were divided into two groups, 6 people in each group.Set a specific scenario, and the two groups write a product pricing strategy plan for a certain export product.

Rules: In the specified time, which group's plan is more reasonable, which group wins.The time is 30 minutes.

Purpose: Through the game, cultivate the player's ability to price export products.

5. Improve plan
Reference answer

1. Scenario case: The biggest factor for Lenovo to sell notebooks at low prices may be to maximize market share.

2. Role simulation: The answer is omitted.

3. Thinking enlightenment answer ideas: The lowest price of a product depends on the cost of the product, while the highest price depends on the market demand for the product.There are differences in the cultural background, natural environment, economic conditions and other factors of different countries, which determine the consumption preferences of consumers in different countries are not the same.The number of consumers interested in a product and their income levels are important in determining the final price of the product.Even for low-income consumer groups, the urgent need for a certain product will lead to high prices for this product, but demand alone is not enough, and it needs to be backed by the ability to pay.Therefore, the payment ability of foreign consumers has a great influence on the pricing of enterprises' export products.A detailed understanding of demand and ability to pay also requires an in-depth study of the customs and income distribution of the country's citizens.

Classic look back
In the internationalization of Tsingtao Brewery, the agency management mechanism is its unique feature.So how to effectively manage agents?What are the pros and cons of the current management model?What are the areas for improvement?

At present, Tsingtao Brewery's agency mechanism in overseas markets generally has three models: the first is the overseas agent mechanism adopted by the US market; the second is the overseas branch model, which is divided into two types: one is the Australian The market and the European market use the overseas branch to manage the market, and the local agent is responsible for the distribution of the market; the second is the direct control of the market by Tsingtao Brewery in the Chinese Hong Kong market, the Canadian market and the Southeast Asian market. model.

As early as 30 years ago, when Tsingtao Brewery entered the overseas market, it only implemented a simple overseas agency system.The overseas agency mechanism implemented in the US market today is mainly due to the fact that Tsingtao Brewery was not familiar with the overseas market in the early stage and had almost no marketing network, and it was carried out under the restrictions of local laws.It played a certain role in the initial stage of developing overseas markets.For example, in the development of the U.S. market, Tsingtao Brewery has become the best-selling beer in the U.S. and one of the highest-selling beers in the U.S. under the packaging of the U.S. general agent company, Monarch.However, with the passage of time, the overseas agency mechanism implemented in the European and American markets has exposed many problems.For example, in the European market, Tsingtao Brewery's agency in the European market is mainly done by two companies. For their own interests, they often compete disorderly, which leads to chaotic sales of Tsingtao Brewery and a large backlog of inventory.

Since the development of the agency mechanism to a certain extent restricts further expansion in overseas markets, Tsingtao Brewery has adjusted the agency model according to the different conditions of overseas markets, so the form of branch companies has emerged.The most notable example is the overseas branch company model that is directly responsible for marketing in the Hong Kong market and the Southeast Asian market.Tsingtao Brewery has been marketing in Hong Kong for more than half a century. In 1997, when Hong Kong returned to the motherland, Tsingtao Brewery began to break through the decades-old foreign trade agency form mainly based on pure product export, and tried to operate independently in overseas markets.Under this model, even in the case of Hong Kong's economic downturn, the actual sales volume increased by 2000% in 5, 2001% in 13, and 2002% in 29. There are three series and 12 varieties, all-round Entered, the market share quickly rose to about 8%, showing a strong momentum of expansion.

The third mode of Tsingtao Brewery's overseas agency is: use branch companies to manage the market in a unified manner, and local agents are responsible for market sales. This mode is more typical in Europe.

(End of this chapter)