Question 1

Joffrey is a part of the marketing team in his company. There is a conflict between the finance team and the marketing team of the company on the issue of market segmentation. While the finance team is arguing for a standardized approach toward market segmentation, Joffrey and his team members feel that it is more important to understand customer requirements on an individual basis for greater customer satisfaction. Which of these terms best describes the approach adopted by Joffrey's team?

Standardization

Homogenization

Normalization

Customization

Integration

Question 2

An American fabric manufacturing company sells its products to Big Box Store, a Japanese retailer. Big Box Store retails these products in major Japanese cities. Which form of entry best describes the strategy that the American company is engaged in?

Franchising

Direct exporting

Licensing

Joint venture

Direct foreign investment

Question 3

Doreen is a looking into franchising in a foreign country. What should she be aware of when making her decision?

Franchising is an important form of horizontal market integration.

The franchiser provides market knowledge, capital, and personal involvement in management.

Foreign laws and regulations are usually hostile toward franchising.

Franchising provides an effective blending of skill centralization and operational decentralization.

The franchiser has little control on marketing of the products at the point of final sale.

Question 4

A company has been able to successfully market most of its new inventions in its target markets because of its focus on niche areas and an efficient and experienced marketing team. The success of this company in launching most of its inventions is referred to as __________.

Conversion-ability

Product homologation

Product congruence

Green marketing

Mass customization

Question 5

An electronics manufacturer in Norway has developed a training program to train its support staff in foreign markets on the repair and maintenance of its products. The firm also ensures that there is enough stock of spare parts in all its distribution centers. According to the Product Component Model, the company is making improvements in the ________ component of the product.

Core

Support services

Packaging

Design

Global

Question 6

The government of a small country has made it mandatory for international banks and insurance firms to obtain the consent of individuals before exchanging their personal data with other branches of the firm in foreign countries. These firms cannot share the personal details of an individual such as income, employment details, and debt repayment histories, even with their branches in other countries, without the approval of the individual. Which barrier to the functioning of service firms is demonstrated?

Cultural congruence

Controls on transborder data flows

Protection of intellectual property

Cultural requirements for adaptation

Language translation barriers

Question 7

Demand in international industrial markets differs from demand in consumer markets in that

Demand is more volatile in consumer markets.

The demand for industrial products is exclusively linked to the income of the buyer.

The demand for consumer goods is derived.

The higher cost of production of industrial products makes them more expensive than consumer products.

The level of technology used in industrial goods makes their sale more appropriate for some countries than others.

Question 8

Customer training is rapidly becoming a major part of a company's ________ when selling technical products in countries that demand the latest technology.

Promotional pricing

Product innovation

Capacity utilization efficiency

After-sales service

Predatory pricing

Question 9

________ is particularly important in international markets where culture dictates strong ties between customers and companies.

Client following

The ISO certification

Relationship building

Standardization

Mass advertising

Questions 10 through 13 are related to this mini case study. Read the mini case below and answer the questions that follow.

Apple Shops for Partners Around the World

In this mini case, Apple is expanding internationally via collaborative relationships with other companies, especially in Asia. This case focuses on Apple's efforts in Japan with NTT DoCoMo and Softbank Corp.

Expanding markets around the world have increased competition for all levels of international marketing. Cost containment, customer satisfaction, and a greater number of players mean that every opportunity to refine international business practices must be examined in light of company goals. Collaborative relationships, strategic international alliances, strategic planning, and alternative market-entry strategies are important avenues to global marketing that must be implemented in the planning and organization of global management.

Here we specifically focus on the increasing importance of strategic international alliances.

Read the case below and answer the questions that follow.

Apple Shops for Partners

Apple has moved fast since its introduction of the iPhone, making distribution deals with U.S. and European operators. Now Steve Jobs is turning east, making plans to enter Japan, one of the biggest and most sophisticated mobile phone markets in the world.

People familiar with the situation say Jobs recently met with NTT DoCoMo Inc.'s president, Masao Nakamura, to discuss a deal to offer the iPhone in Japan through the nation's dominant mobile operator. These informants said Apple also has been talking to the No. 3 operator, Softbank Corp., and that executives from both companies have made multiple trips to Apple's Cupertino, California, headquarters. For Apple, finding a wireless partner soon in Japan is an important step in the company's oft-stated goal of gaining a 1 percent share of the global cell phone business by shipping about 10 million iPhones between the product's launch in late June 2007 and the end of 2008.

The world's second-largest economy, after the United States, is an attractive market because it not only has a strong base of iPod fans, but its nearly 100 million mobile phone users buy new phones every two years on average. Japanese consumers also are accustomed to shelling out hundreds of dollars for expensive phones with advanced capabilities, such as digital television, cameras, and music.

Yet Japan could be a difficult market to crack for Apple. More than 10 domestic mobile phone makers work closely with the three major operators to develop phones tailored to Japanese consumers' tastes. In the past, foreign mobile phone makers have not been willing to go to such lengths and generally have met with little success in selling their phones, especially when those phones do not contain essential Japanese features, such as the operators' proprietary mobile Internet technology or e-mail software that Japanese consumers are used to having.

The iPhone has been successful thus far in countries where it has been launched. Apple sold a total of 1.4 million iPhones by late September 2007. And though sales of the product did not quite meet some of the most bullish Wall Street forecasts, the iPhone has been one of the top-selling smart phones in the United States, where it is sold only through AT&T Inc., the nation's largest carrier by subscribers.

In the end, Apple has partnered with Softbank in Japan and China Unicom and is expecting the momentum to continue well into the future.

Sources: John Markoff, "A Personal Computer to Carry in a Pocket," The New York Times, January 8, 2007, pp. C1, C3; Yukari Iwatani and Nick Wingfield, "Apple Meets with DoCoMo, Softbank on Launching iPhone in Japan," The Wall Street Journal (online), December 18, 2007; Philip Michaels, "Apple: What Recession?" Macworld , January 2010, p. 16.

Question 10

Apple's expansion into the United States and Europe by means of distribution deals and into Asia through partnership arrangements reflects which type of planning?

Corporate planning

Strategic planning

Tactical planning

All of the answer choices are correct

Question 11

Which of the following primary relationship activities best describes this statement: "... executives from both companies have made multiple trips to Apple's Cupertino, California headquarters"?

Imaging

Dating

Initiating

Fine-Tuning

Interfacing

Question 12

Which of the following facts best demonstrates the value that the Japanese market has for Apple?

Unicom is similarly interested.

Unicom is similarly interested

NTT DoCoMo met with Apple

Japan is technologically sophisticated

Nearly 100 million mobile phone users buy new phones every two years, on average

The country's No. 3 operator, Softbank Corp., is interested in partnering with Apple

Question 13

Which of the following statements best exemplifies corporate planning?

More than 10 domestic mobile phone makers work closely with the three major operators to develop phones tailored to Japanese consumers' tastes.

The iPhone has been successful thus far in countries where it has been launched.

Apple has an oft-stated goal of gaining a 1 percent share of the global cell phone business.

Apple planned to ship about 10 million iPhones between the product's launch in late June 2007 and the end of 2008.

The iPhone has been one of the top-selling smart phones in the United States.

Questions 14 through 17 are related to this mini case study. Read the mini case below and answer the questions that follow.

Swedish Takeout

In this mini-case, IKEA is expanding internationally via franchising and other means. This case focuses on efforts in the United States, Europe, and Russia.

Expanding markets around the world have increased competition for all levels of international marketing. Cost containment, customer satisfaction, and a greater number of players mean that every opportunity to refine international business practices must be examined in light of company goals. Collaborative relationships, strategic international alliances, strategic planning, and alternative market-entry strategies are important avenues to global marketing that must be implemented in the planning and organization of global management.

Here we focus on a variety of alternative market-entry strategies, including exporting, licensing, franchising, strategic alliances, and direct foreign investments.

Read the case below and answer the questions that follow.

Fifty years ago in the woods of southern Sweden, a minor revolution took place that has since changed the concept of retailing and created a mass market in a category where none previously existed. The catalyst of the change was and is IKEA, the Swedish furniture retailer and distributor that virtually invented the idea of self-service, takeout furniture. IKEA sells reasonably priced and innovatively designed furniture and home furnishings for a global marketplace.

The name was registered in Agunnaryd, Sweden, in 1943 by Ingvar Kampradthe IK in the company's name. He entered the furniture market in 1950, and the first catalog was published in 1951. The first store didn't open until 1958 in Almhult. It became so incredibly popular that a year later the store had to add a restaurant for people who were traveling long distances to get there.

IKEA entered the United States in 1985. Although IKEA is global, most of the action takes place in Europe, more than 70 percent of the firm's $36 billion in sales. Nearly one-fourth of that comes from stores in Germany. This level compares with only about $5 billion in NAFTA countries. The firm has stores in more than 40 countries around the world.

One reason for the relatively slow growth in the United States is that its stores are franchised by Netherlands-based Inter IKEA Systems, which carefully scrutinizes potential franchiseesindividuals or companiesfor strong financial backing and a proven record in retailing. The IKEA Group, based in Denmark, is a group of private companies owned by a charitable foundation in the Netherlands; it operates more than 350 stores. The Group also develops, purchases, distributes, and sells IKEA products, which are available only in company stores.

Low price is built into the company's lines. Even catalog prices are guaranteed not to increase for one year. The drive to produce affordable products inadvertently put IKEA at the forefront of the environmental movement several decades ago. In addition to lowering costs, minimization of materials and packing addressed natural resource issues. Environmentalism remains an integral operational issue at IKEA. Even the company's catalog is completely recyclable.

On the day that Russia's first IKEA store opened in 2000, the wait to get in was an hour. Highway traffic backed up for miles. More than 40,000 people crammed into the place, picking clean sections of the warehouse. The store still pulls in more than 100,000 customers per week. IKEA has big plans for Russia. Company officials are placing IKEA's simple shelves, kitchens, bathrooms, and bedrooms in millions of Russian apartments that haven't been remodeled since the Soviet days.

One of IKEA's strength is its strategic learning and adjustment in its international expansion. Its approach has been called "flexible replication," wherein a strategic template is fitted to each international context. And now IKEA has opened 16 new stores in China's biggest cities.

Sources: Colin McMahon, "Russians Flock to IKEA as Store Battles Moscow," Chicago Tribune, May 17, 2000; "IKEA to March into China's Second-tier Cities [Next]," SinoCast China Business Daily News , August 6, 2007, p. 1; "IKEA Struggles to Source Sustainable Timber," Environmental Data Services , July 2009, p. 22; Anne VanderMey, "IKEA Takes on China," Fortune, December 12, 2011; Anna Jonsson and Nicolai J. Foss, "International Expansion through Flexible Replication: Learning from the Internationalization Experience of IKEA," Journal of International Business Studies 42, no. 9 (2011), pp. 1079-102.

Question 14

IKEA has used which mode(s) of foreign market entry?

Licensing

Joint venture

Marketing plan

A strategic alliance

Exporting and franchising

Question 15

Why has IKEA seen slower growth in the United States using the franchise market-entry strategy?

IKEA scrutinizes potential franchisees for strong financial backing and a proven record in retailing

IKEA focuses on lower prices.

IKEA does not know the U.S. market well enough.

IKEA has been at the forefront of a costly environmental movement.

IKEA is a private company owned by charitable organizations.

Question 16

The fact that IKEA strives to lower costs, minimizes materials and packing, and has catalogs that are completely recyclable shows the company's commitment to ___________.

Responsible retailing

Environmentalism

Franchise regulations

Innovative marketing

Question 17

The fact that IKEA has stores in more than 40 countries around the world and sells to many markets likely means that the company experiences which of the following benefits of global marketing?

Diversity of markets, bringing stability of revenues and operations

Access to the toughest customers

Transfer of experience and know-how across countries

Economies of scale in production and marketing

All of the answer choices are correct.

Questions 18 through 21 are related to this mini case study. Read the mini case below and answer the questions that follow.

China-Disney Rolls the Dice Again

In this mini case, we explore the international expansion of Disney by means of its resort, Disneyland. In doing so, we review the various concepts found in this chapter. Given the expansive nature of the case presented here, we'll review all the concepts in Chapter 13. These include quality, product homologation, innovation, diffusion, product component modeling, green marketing, and global branding.

The opportunities and challenges for international marketers of consumer goods and services today have never been greater or more diverse. New consumers are springing up in emerging markets in eastern Europe, the Commonwealth of Independent States, China and other Asian countries, India, Latin Americain short, globally. Although some of these emerging markets have little purchasing power today, they promise to be huge markets in the future. In the more mature markets of the industrialized world, opportunity and challenge also abound as consumers' tastes become more sophisticated and complex, and as increases in purchasing power provide them with the means of satisfying new demands.

Read the case below and answer the questions that follow.

Global Perspective

CHINADISNEY ROLLS THE DICE AGAIN

With the opening of Disneyland in Anaheim in 1955, the notion of the modern theme park was born. The combination of the rides, various other attractions, and the Disney characters has remained irresistible. Tokyo Disneyland has also proved to be a success, making modest money for Disney through licensing and major money for its Japanese partners. Three-fourths of the visitors at the Tokyo park are repeat visitors, the best kind.

Then came EuroDisney. Dissatisfied with the ownership arrangements at the Tokyo park, the EuroDisney deal was structured very differently. Disney negotiated a much greater ownership stake in the park and adjacent hotel and restaurant facilities. Along with the greater control and potential profits came a higher level of risk.

Even before the park's grand opening ceremony in 1992, protestors decried Disney's "assault" on the French culture. The location was also a mistakethe Mediterranean climate of the alternative Barcelona site seemed much more attractive on chilly winter days in France. Managing both a multicultural workforce and clientele proved daunting. For example, what language was most appropriate for the Pirates of the Caribbean attractionFrench or English? Neither attendance nor consumer purchases targets were achieved during the early years: Both were off by about 10 percent. By the summer of 1994, EuroDisney had lost some $900 million. Real consideration was given to closing the park.

A Saudi prince provided a crucial cash injection that allowed for a temporary financial restructuring and a general reorganization, including a new French CEO and a new name, Paris Disneyland. The Paris park returned to profitability, and attendance increased. However, when the temporary holiday on royalties, management fees, and leases expired, the Saudi prince injected another $33 million into the park. Most recently, a new $150 million attraction based on the movie Ratatouille has opened, tweaking Disney's offerings for Europeans. Now the Paris park attracts more than 11 million visitors annually.

In 2006, Hong Kong Disneyland opened for business. The Hong Kong government provided the bulk of the investment for the project (almost 80 percent of the $3 billion needed). As in Europe, the clientele is culturally diverse, though primarily Chinese. Performances are done in Cantonese (the local dialect), Mandarin (the national language), and English. The park drew 5.2 million visitors in 2006, but attendance fell sharply to about 4 million in 2007. Disney has had to renegotiate its financial structure and schedule as a consequence. On the positive side of the ledger, the Hong Kong park produced its first profits in 2013 and 2014$14 million and $31 million, respectively. This has allowed the company to add the first Marvel attraction among all its parks worldwideIron Man will be added in 2015.

In 2009 the Chinese government approved a new park in Shanghai to be managed by the Hong Kong groups with a price tag of $4 billion, to be completed also in 2015. The two Chinese parks will offer somewhat a different array of characters and rides toward keeping both north and south Chinese customers pleased with their differentiated "personalities." Disney now has 11 major parks worldwide that attract more than 120 million visitors and deliver about $2 billion in profits annually. Indeed, it continues to be quite interesting to follow Mickey's international adventures; you might say it's been a rollercoaster ride.

Sources: http://www.disney.go.com; Frank Longid, "Disney, China Partner Will Spend $4.4 Billion Building Resort in Shanghai," Bloomberg News, April 8, 2011; Brady MacDonald, "Disneyland Paris Pulls Back the Veil on Ratatouille Dark Ride," Los Angeles Times, March 7, 2013, online; Brooks Barnes, "Disney to Add Hotel to Its Hong Kong Park," The New York Times, February 17, 2014, online.

Question 18

The several attempts to open successful Disney theme parks in multiple countries are examples of Disney using its _________________ to its advantage.

Competitiveness

Global brand

Products

Services

Innovation

Question 19

To some extent, Disney produces a product and a service. When it went to Japan, it represented an innovation to the Japanese market. The fact that it did well speaks to the ___________ of that innovation and the role that the Japanese partner played in addressing the specific cultural issues.

Marketing offering

Diffusion

Contemplation

Complexity

Rejection

Question 20

Part of the problem Disney had in Europe, and specifically in France, may be attributed to the lack of _________________ by the French culture of the Disneyland concept and the ineffective nature of the corporate structure.

Market research

Quality assurance

Acceptance

Competition

Control

Question 21

As an example of ______________ by Disney, you will note that Hong Kong Disneyland went back to a structure similar to the structure proposed in Japan, where business is good. In Hong Kong, Disney performances are in Cantonese, Mandarin, and English.

Quality assurance

Homologation

Adaptation

Diffusion

Green marketing

Questions 22 through 25 are related to this mini case study. Read the mini case below and answer the questions that follow.

Sewage and Swamps: A Preview of Renewable Energy Technologies

As global climate change continues to manifest itself; the human response is creating a complex goo of opportunities for international marketers. Two are described here. One involves burning sewage gas, the other pine trees from swamps. If Toyota has its way, its new hydrogen-powered Mirai could revolutionize the automobile industry and save the environment. Instead of an engine, the Mirai uses Toyota Fuel Cell Technology, has two hydrogen tanks, emits only water vapor, and has a range of 300 miles. The car takes just three to five minutes to refuel and was designed to have a premium driving feel, similar to a Lexus. Long known for its focus on sustainability, Toyota hopes that the Mirai will reduce even more CO2 from the environment; hydrogen generates the least amount of greenhouse gas and can be made from garbage, corn, and solar and wind power. The automaker has partnerships to build 19 fueling stations in California by 2016 and to roll out additional stations along the East Coast later. It is also offering state incentives and high occupancy vehicle (HOV) stickers to encourage local governments and consumers to get on board. General Motors, Honda, Hyundai, and Mercedes also have prototypes on the road, and Volkswagen is also in the game.

The momentum behind fuel cells suggests that automakers see their principal challengessparse fueling infrastructure and high costas potentially more surmountable over the long term than the ones facing battery electric vehicles, including limited range and long charging times. Toyota had already lent more than $7 million to Southern California startup FirstElement Fuel to begin construction of 19 stations across the state, in connection with a large state grant. Last week, Honda agreed to a $13.8 million loan that would help FirstElement propose construction of a dozen more stations in California.

Among FirstElement's founding executives are engineers who helped design a unique hydrogen fueling station at the Orange County Sanitation District in Fountain Valley, California, that makes hydrogen out of sewage. The station, which was the first of its kind when it opened in 2011, was a collaboration among the University of California-Irvine, California Air Resources Board, Orange County Sanitation District, Air Products, and FuelCell Energy Inc. Hydrogen for the cars can be derived from a variety of sources, including solar, wind, and even nuclear. All the companies involved are eyeing opportunities in Asia and Europe as well.

Speaking of Europe, the EU Commission has mandated a 20 percent reduction in greenhouse gas emissions there by 2020. One of the options for meeting that goal is replacing coal (a fossil fuel) with wood (current carbon) as a fuel in electrical power plants. American forests supply the wood scrap that is turned into pellets that can be shipped by sea to Europe and handled there by equipment suited for coal. Critics complain that releasing the CO2 sequestered in trees adds to the problem. But supporters point out that newly planted forests eat CO2 faster than the old stands of trees, often from swamps, being converted to pellets. These projects mean both jobs and burgeoning exports for the U.S. companies involved.

Sources. Justin Scheck and Ianthe Jeanne Dugan, "Europe's Green-Fuel Search Turns to America's Forests," The Wall Street Journal, May 27, 2013, online; Donya Blaze, "The 2016 Toyota Mirai Could Mean the End of Oil Changes Forever," NewsOne.com, November 23, 2014; Sherri Cruz, "Fuel Cell Research Powers Industry," Orange County Register, May 5, 2014, online; Kenneth Chang, "A Road Test of Alternative Fuel Visions," The New York Times, November 18, 2014, pp. D1, 6; Susan Carter, "In O.C., Toyota Debuts First Commercially Available Hydrogen Fuel-Cell Vehicle," Orange County Register, November 20, 2014, online; http:/www.nfcrc.uci.edu, accessed 2015. Brian Bremner, Craig Trudell, and Yuki Hagiwara, "Remaking Toyota: The Internal Combustion Engine Is Over. The World's Biggest Auto Company Is Ready," Bloomberg Businessweek, January 11, 2015, pp. 44-49.

Question 22

The demand for low-emission cars like the Mirai is derived from the __________.

Desire to limit global climate change

Need to dispose of sewage

Need for specialized fueling stations

Desire to clean up swamps

Desire for Japanese products

Question 23

Even as it begins to produce the Mirai for the U.S. market, Toyota continues to manufacture its traditionally fueled cars, trucks, and SUVs. Doing this helps Toyota manage the ______ of industrial demand.

Durability

Division

Volatility

Development

Question 24

The Toyota Mirai is a prime example of advanced technology. However, there are no refueling stations available or planned in the Midwest, so to someone in Michigan, the Mirai would be a poor purchase. This is an example of _____________.

Poorly designed technology.

Quality being defined by the buyer

The market not wanting advances in technology

A product designed for all markets

A product being of low-quality

Question 25

What are the major problems facing the Mirai and limiting its demand?

Poor construction and limited range

Long charging times and high cost

High emissions and limited range

Lack of interest and waste issues

High cost and limited fueling infrastructure