Question

When considering market segmentation in a foreign country, what two things should managers be aware of?

O the total cost of goods sold the differences between countries in the structure of market segments.

O the existence of segments that transcend national borders.

O the production capabilities of domestic manufacturing units

Answer 1

Managers must be aware of the differences in market segments between countries and the existence of cross-border segments when considering market segmentation in a foreign country. They should also consider the impact of currency exchange and governmental trade policies on their business strategies.

Step-by-step explanation:

When considering market segmentation in a foreign country, managers should be aware of two key aspects:

1. The differences between countries in the structure of market segments which may reflect variations in consumer behavior, needs, and cultural influences.
2. The existence of segments that transcend national borders, known as cross-border segments, which consist of consumer groups with similar characteristics and needs irrespective of their geographical location.

Understanding these elements is crucial for effectively targeting marketing efforts and adapting business strategies to the local context. Additionally, managers should consider the complexities of currency exchange as costs are typically in the currency of the production country while sales revenue may be in that of the sales country. Moreover, environmental and security concerns can influence governmental trade policies, which may affect market access and segment attractiveness.