Balance of Payments

Aybey Boran

Balance Of Payments

In the realm of international finance, one of the most heavily

used data sources is an accounting statement known as the

balance of payment, which records the economic transactions

between the residents and government of a particular country

and the residents and the governments of the rest of the world

during a given period of time, usually a year.

For firms and individual, it provides dues about expectations for such matters as the volume of trade and capital flows, the movement of exchange rate and the profitable course of economic policy.

The balance of payments is important because it helps to determine the exchange rate, and measures the extent to which country economy is a net importer/exporter of goods, services and capital. A weak balance of payments tends to lead to a weakening of the exchange rate because market confidence in the economy is reduced. This can actually be good for business because the lower exchange rate can help to improve price competitiveness in foreign markets, and improve cash flow for exporters. The opposite is clearly also the case, that a strong balance of payments can help to keep the exchange rate high, thus potentially reducing cash flows from exports. Due to the way in which the balance of payments influences the exchange rate, government economic policy seeks to maintain a position in which there is neither an inordinately large deficit or surplus, but a stable balance.

In particular, a country’s own balance of payments is important

to investors, multinational companies, business managers, consumers and government officials because it affects the value of its currency, its policy towards foreign investments and also influences important macroeconomic variables like gross national product, interest rates, price levels, employment scenario and exchange rate. International managers may be interested in a foreign country’s balance of payments for predicting the country’s overall ability regarding exports, imports, the payment of foreign debts and dividend remittances. A country experiencing a severe balance of payments deficit is not likely to import as much as it would in a surplus position. Persistent and continuing deficits in a country’s BOP may signal future problems over payments of

dividends and interest fees or other cash disbursements to foreign firms or investors. Also, the balance of payments is an important indicator of the likely pressure on a country’s foreign exchange rate and the resultant foreign exchange gains or losses which firms trading with that country are likely to face.

What Teens Want?

Aybey Boran

What Teens Want

Market segmentation is important for the companies, because they don’t need every one to buy their product in the country or in the world. They need a large segment of the market to be willing and able to buy their product. There is only way that they can see how they adapt their marketing mix in a national or global market depend on the segment they target in that market.

Nowadays, companies and retailers are increasingly targeting the teens. First question is, whether companies have to think the teens as a global segment or not. Global segment is transnational consumer segments based on lifestyle or demographics such as age and social class rather than on nationality. According to this definition, teens have to be considered as a global segment.

Today’s teenager is a force in consumer spending, part of a highly influential consumer market. One in three high school seniors carry a credit card. As a group they earn 63% of their income independently from parents and spend it on brands they know and trust in USA. Their only online purchase $1.5 billion each year in USA. Most Teens have a significant amount of money to spend. American children’s unprecedented spending power holds considerable appeal for marketers. Older children, ages 12 to 19, spent more than $94 billion of their own money every year and younger children, ages 8 to 12, spent $11.9 billion of their own money every year.

Top 10 Countries: Average Weekly Teen Spending

1. Norway $49.70

2. Sweden $41.70

3. Brazil $41.30

4. Argentina $40.50

5. Hong Kong $38.00

6. United States $37.60

7. Denmark $37.40

8. Singapore $34.10

9. Greece $32.90

10. France $31.30

Apart from their spending power, teens are an important market for other reasons. Teens set trends, both for their peers and for younger children who emulate them. By winning the business of a teen, a company may be able to create a lifelong loyal customer.

Teenagers in Asia are certainly influenced by Western media. Japan is seen as the fashion centre for many Asian teenagers, like Thailand, Hong Kong and Singapore in particular. And trends often start there, as they do for world wide trends - take the Pokeman and Hello Kitty. Asian teens influenced by a complex mix of East Asian, Western and their own cultures. Add to that the greater influence of familial ties on Asian youth, though the "independence" trait evident in Western youth is fast taking hold, and Asian teens are a very different market altogether.

Why are brand names so important to street kids in Brazil? Because in an age of information overload, teens want assurance that they are making the right judgments that will enhance their identity. A brand says a lot about whom they are and where they stand in life. Teens love brands because, brands delight, brands provide a badge of identity, brands are enablers, brands are passports to global culture.

Delissa in Japan

Aybey Boran

DELISSA IN JAPAN

Historical information about product

USA launch date: 1977, market share is 12.5 percent.

Germany launch date 1980, market share is 14 percent.

U.K. launch date 1982, market share is 13.8 percent.

France launch date 1983, market share is 9.5 percent.

Japan launch date 1987, market share today is 2-3 percent.

Company:

Agria was founded in 1973 when a group of Swedish airy cooperatives decided to create a united organization that would develop and sell a line of fresh dairy products.

Delissa line was launched in 1980.

By 1997, more than 1.1 billion Delissa yogurts and desserts were being consumed per year worldwide.

In fiscal year 1996, Delissa had sales of $2.1 billion and employed 4,400 people in and outside Sweden.

Danone is the biggest competitor in worldwide.

JAPAN

The total yogurt market in Japan for 1986 is approximately 600 million cups.

Next five years’ expected market grow is at least 8%.

Company’s launch strategy would be based on expected growth rate of 10% or 15% for the total market.

First year, target of market share is 5 percent and 10 percent share of market within three years of launch.

Company’s plan to cover the three main metropolitan areas, Tokyo, Osaka, and Nagoya, within two years period and the rest of the country within the next three years.

Delissa’s share of the total yogurt market had fallen to 2 percent in 1997.

Consumption: Worldwide and Japan

Per capita consumption of yogurt in Japan is estimated at around 5.3 cups per person per year in Japan, versus 110 in Sweden and 120 in Finland.

Seasonal sale is in Japan through March to July.

The highest sales have been recorded in June so ideal launch date would be at the end of February.

80 percent of yogurt is sold through supermarkets.

Types of yogurt: Japan

Plain yogurt: 39 percent of the market in volume.

Flavored yogurt: 45 percent of the market in volume.

Fruit yogurt: 16 percent of the market in volume.

Competition: Japan

Company	Turn over (1985)
Snow Brand Milk Products	443.322 million yen
Meiji Milk Products	410.674 million yen
Morinaga Milk Industry	301,783 million yen

The Japanese also consume a yogurt drink called ‘Yakut Honsha’ which is often included in statistics on total yogurt consumption as it competes with normal yogurt.

Selecting a Franchisee `` NIKKO`` Japan

Nikko is the price leader for various food products in Japan.

Nikko is a significant political force in Japan.

Nikko is divided into two parts. ( process and distribution)

Nikko is the big and its credentials seem perfect for Agria in JAPAN.

Japanese Culture:

Japan is not a dairy product consumer.

Urban density naturally affects lifestyle, tastes, and habits.

Disposable income is high. The Japanese spend over 30 percent o their income on food.

Westernization (goat milk vs cow milk)

Japanese market has still potential for growth.

Distribution: Japan

Using of existing channels of distribution with daily schedules and enjoy lower

distribution costs for new products.

The Japanese retail system

Three major metropolitan areas in Japan are; Tokyo 11 million, Osaka 3 million, Nogaya 2 million inhabitants.

Nikko is dominant in these areas.

Initial strategy would be to accepts Nikko’s current milk distribution system as the basic system and at the same time, adopt shifting distribution routes.

Japanese complicated street identification system makes great demand for distribution and drivers.

Company, product and Japan

Entry Strategy:

The concept is ` natural dairy food is good to taste` is proposed as the basic message.

The core target is families with babies. However the product will be consumed by a wider age bracket from young children to high school students.

Advertising and point of sale message will address housewives, particularly younger ones.

It is essential that ads be attractive and stand out strikingly from the others, because

Nikko is newcomer in this competitive market.

Delissa should be positioned as a luxurious mass communication product.

SRT proposal;

SRT proposed that Japanese housewives were becoming more diet conscious, it might be advisable to mention the dietary value of Delissa in the launch rationale.

The text was ‘refreshing nature of Delissa Swedish yogurt: it’s so fresh when it’s made at the farm.’

Launch, product line

Product line was presented to distributors in 1987 January.

Three different types of yogurt were selected for launch;

Plain; packs of 2 or 4

Plain with sugar; packs 2 or 4

Flavored with vanilla, strawberry and pineapple (packs of 2)

March 1 1987 Tokyo and May 1 1987 Osaka and Nagoya

All three types were to be sold in 120 ml. cups.

A major pre-launch promotional campaign was scheduled for the month before launch with strong TV, newspaper and magazine support, as well as street shows, in store promotions, and test trials in and outside retail stores.

1990: DELISSA AFTER THREE YEARS IN JAPAN

Distribution system; it is not satisfied and should be improved. The ordering system is slow and complicated. The delivery process is long for dairy products, it takes almost three days after production of yogurt. This period should be one day.

Advertising; the company should create fashionable images in ads.

LEADING UP TO 1997

Delissa had only 3 percent of total yogurt market in Japan in 1997.

1994; the Japanese market is still tough and competition is very strong. Consumers brand loyalty seems low. But market is large with high potential. Lack of a real marketing function in nikko is a great handicap in market as competitive as Japan.

Distribution cost is high.

Distribution level is low.

1995; Delissa’s strategy in Japan is being redefined. Ads will now show happy blonde children eating yogurt. Over time, the product line has grown significantly and a line of puddings has recently been added.

1997; plain yogurt should represent almost half of Dellisa’s Japanese sales and account for about 43 percent of the total Japanese market. The plain segment has grown by almost 50% in the past three years. Delissa’s fruit yogurt segment has been disappointing. New segment, yogurt with jelly, has been selling well, 1.2 million cups in three months.

Mid-Year results:

Sales as of mid- year 1996 are below forecast.

Target is to reach over 42 million cups by year end.

Product Return:

Scandinavia countries	Japan	International rate
Almost 0%	5.06%	2-3%

Media Planning

Delissa’s primary target should be young people between thirteen and twent-four and its secondary target is children.

Ads showing time should be arranged according to these segments.

Positioning

First largest segment is plain yogurt, second is flavored yogurt, third is fruit yogurt.

Ads of plain yogurt should be traditional one and ads of fruit yogurt should be based on fashionable.

CONCLUSION

In January 1987, Delissa’s product line was presented to distributors prior to launch in Tokyo. Their main goal was having the %15 of market share on dairy products. After three year they only had the 2 percent of the Japanese yogurt market. Results were really disappointed for the company. In 1997, results were almost same, they had the 3 percent of total yogurt market.

At the beginning SRT helped to developed Delessa’s entry in to milk related products market in Japan. Company chooses the Nikko, as a franchisee company who is the country’s second largest association of agricultural cooperatives. Also Nikko was the price leader for various food products in Japan.

Agria’s executives thought that it was going to be easy to establish a brand name in Japan like they did in Thailand and Taiwan. Consumer behaviors were so different and Japanese consumers don’t consume that much milk like Scandinavians do. And Also company was having a lot of problem on their distribution channels. There are so many retailers in Tokyo and they are small retailers. Routes for their tracks were so complicated . Consumers in Japan shop daily and traditionally use the small shops so they had to negotiate with the small retailers. At the beginning Nikko’s ordering system was so slow. It takes 4 day to buy Delissa’s products which means loosing the freshness.

Language problem between Delissa and Nikko was one of the main problem. Dellisa couldn’t establish their company mentality to Nikko’s workers. There are many misunderstandings. For example TV ads, Dellisa were intended for young people in the ads, however Nikko were running TV spots at late night times. Plain yogurt makes up the largest segment in Japan . It was therefore recommended that regular advertising should concentrate on plain yogurt. However, according to Nikko, the company makes only a marginal profit on plain yogurt, thus they feel it would be preferable to advertise fruit yogurt.

In sum, Agria never controls the business. Their distribution system is a perfect example. They could never know what was going on out there because language problems forced Agria to count on Nikko. Agria’s executives think that the Japanese will kill Delissa once they’ve mastered the Swedish technology and they will develop their own brand. According to us, they have to get out of the venture agreement with Nikko and they have to get out of the Japan altogether.

Google And Marketing

Aybey Boran

HISTORY

Google search engine began as a research project in 1996 by Larry Page and Sergey Brin. These PhD students determined that a search engine that associated the relationships between websites would produce better results than existing techniques. At the beginning, search engine used for Stamford University website with the domain name of “google.stamford.edu” as a part of their studies. Original domain name google.com was registered 1997 and company was incorporated as Google Inc in 1998. In 2000 Google started to sell advertisements associated with search key words which are based upon the number of hits users make upon ads. It was important for the company to increase advertisement revenue.

After Google, competition between technology companies increased. Such as; competition between Google and Microsoft. Microsoft has MSN search engine and windows live search to counter Google's competitive position. Google and Microsoft are offering similar services such as “web mail” and “googlemap” vs. “WindowsLiveLocal”. Google has also started to experiment other markets such as such as radio and print publications. According to researches Google is the most used search engine on the web with a 54% market share, ahead of Yahoo! (23%) and MSN (13%).

PRODUCTION

TECHNOLOGY

Google services are run on unique combination of advanced hardware and software. They are also called server farms. Each server has a lot of low-cost computers and work with different versions of linux. In 2006 Google clarified that they have 450,000 servers all around the world which are networked together to create a super fast search engine.

One of the most important parts of their software is PageRank. PageRank relies on the uniquely democratic nature of the web by using its vast link structure as an indicator of an individual page's value. Google accumulates PageRank with different and sophisticated text-matching techniques to find pages that are both important and relevant to your search. Google goes far beyond the number of times a term appears on a page and examines all aspects of the page's content to determine if it's a good match for your search. And also Google runs relevant ads above and next to their results. Which also means no one can buy a higher page rank. This makes the Google search easy, honest and objective.

GOOGLE’S FEATURES and SERVICES

In 1998 Google started to use Cached Pages and Google Web Search. Cached Pages, Google takes a snapshot of each page and use them to judge if a page is a good match for your query.

In 1999 Google started to use “Similar Pages”. The similar pages feature is most effective on pages that are popular.

In 2000, “Make Google Your Default Engine”, “Apple-Specific Search Engine”, “University Search Feature”, “Microsoft-Specific Search Engine”, “Browser Buttons”, “Google Directory”, “SafeSearch Filtering”, “News Headlines”, “Street Maps “, “Date Restricted Search”, “Dictionary Link”, “Advanced Search”, “Preferences”, “Phrase Search”, “ Operator”, “ Stock Quotes”, “AdWords”, “OR Operators”, “Google Tool Bar”, were added in to Google search.

In 2001, “Google Phone Book”, “Spelling Corrections”, “Google Groups”, “Translation”, “Google Image Search”, “Home page tabs”, “Language Tools “, “Search stop words in phrases”, “File type conversion”, “Catalogs “, “Diacritics searching (terms with accents)” were added in to Google to improve search results.

In 2002, “Google Answers”, “Google Answers Searchable”, “Google Labs”, “Google Glossary”, “Google Sets”, “Google News”, “Froogle”, “Google Viewer” was added in to Google search.

In 2003, “Toolbar 2.0 with a pop-up blocker”, “Calculator”, “Synonym Operator”, “News Alerts”, “Search by Location”, “Definitions (Google Glossary)”, “Deskbar”, “Travel Conditions”, “Google Book Search”, “Product Search Shortcut”, “Word Variation (Automatic Stemming)”, were added in to Google data base.

In 2004, “Search by Number”, “Orkut (Social Networking Service)”, “Danish Google Guide”, “Google local”, “User Interface (ui) redesign”, “Web alerts”, “ Images is Google News search results”, “ Number range (numrange) command”, “New froogle home page”, “Personalized Web Search”, “GMAIL”, “Google Groups 2”, “Added mailing list support to Google Groups”, “Site-Flavored Google Search Box”, “Google Desktop Search”, “Google SMS”, “ Google SCHOLAR”, “Froogle Wish lists”, “ Google Help (Cheat Sheet)”, “ Google Library”, “Froogle Product Reviews”, “Google Suggest”, were added in to Google.

In 2005, “Raised search limit to 32 words”, “Picasa 2”, “ Google VIDEO”, “ Google MAPS”, “ Google Movies”, “Google weather”, “Live stock quotes”, “ Results Prefetching”, “Personalized Google news”, “Google ride finder”, “Google Suggest In Japanese”, “Google Q&A(Question and answer)”, “Multilingual Google Definitions”, “My search History”, “Satellite view from Google Maps”, “Google Mobile- Local Search”, “Enterprize Desktop Search Tool”, “Google web Accelerator”, “Personalize Your Homepage”, “Toolbar for Firefox”, “Google Desktop2”, “Useful Links From Within a Site”, “Google Talk”, Google Blog Search” were added in to Google Search.

COMPANY CULTURE

“Never settle for the best” says Google co-founder Larry Page. Everyone knows that Google has relaxed corporate culture. There are ten important things for Google’s philosophy;

1. Focus on the user and all else will follow.	6. You can make money without doing evil.
2. It's best to do one thing really, really well.	7. There's always more information out there.
3. Fast is better than slow.	8. The need for information crosses all borders.
4. Democracy on the web works.	9. You can be serious without a suit.
5. You don't need to be at your desk to need an answer.	10. Great just isn't good enough.

"Twenty percent" time; Engineers who work for Google are encouraged to spend their 20 percent of their work time on projects that based upon their individual interests. According to Google, their 50 percent of new products comes from 20% time. Such as “Orkut”, “Gmail” and “Google News”.

GOOGLE DATABASE

In 2000 Google announced a database of 560 million pages. In 2004 it became 4 billion pages and according to current estimates it is more than 20 billion pages. Google database are basically formed from 10 databases.

Web, This component is all about indexed web pages included file types of Html, PDF, .ps, .doc, .xls, .txt, .ppt, .rtf, .asp, .wpd, and more.

Book Search, Text books with only limited viewing.

Google Scholar, All articles included Academic papers and reports.

Groups, which are about use net database.

News, past 30 days of Web-based news sites.

Images, image database.

Froogle, product and shopping search database.

Catalog Search, Product catalogs that indexed by Google.

Directories.

Ads, they usually shown on right side of the result page under the sponsored links.

Strength parts of Google database:

Google search covers so many types of files and database size is so big.

Relevance based on sites' linkages and authority.

Cache archive that can be seen in the search after indexed.

And additional databases make Google powerful such as books, scholars and groups.

Weaknesses

Google has some limited search features such as; there are no truncations available on Google. This search technique refers to the ability to search just a portion of a word. Link searches must be exact and are incomplete. Google only index first 101 Kb of a page and 120 Kb PDF files. Google also may search plural, singular and grammatical variants with out telling you.

Google also has language, domain, date, file type, and adult content limits. Date limit added on 2001 but it is also available on advanced search page.

Google’s Marketing Strategies

Google has always had great word of mouth and also Google has been effective at generating grass roots public relations. The future direction for Google is to continue enhancing their search technology, and to provide innovative features and services that efficiently connect people to the information they're seeking.

Google’s Direct Marketing Evaluation

As you know, there is always competition between Google, AOL and Microsoft. I was thinking about what makes Google different and why other companies are trying to emulate Google’ advertising model and marketing strategies. Google hasn’t only taking a big part from traditional media advertising market; Google also has also created a new, much bigger, advertising market. Google has created the perfect storm of real-time shopper-meet-supplier direct marketing. Actually, Google didn’t invent this

Model; yahoo and Microsoft do the same thing. What Google has done is to cleverly package up a set of capabilities in a customer-pleasing and advertising-pleasing way like the same thing Apple did with itunes and ipods.

Everyone knows that traditional advertising model is one of demand generation. Google’s advertising model connects suppliers directly to buyers. Product suppliers use Google that’s because to help customers who are looking, find and buy their products. Actually this is the buyer-direct advertising. In this system buyer finds the seller without going anywhere. Buyers don’t have to go to store or go on e-bay or a portal site. Just they have to ask and they will find the answer on Google. If we look at from advertiser part, this is what they looking for because advertiser gets qualified buyers, people who are actually looking for what they offer and the advertiser don’t need to have prior relationship with the costumer. Advertisers also get real-time control over advertising spending and they can easily see what the returns from advertisements are.

Google for Business

One of the Google’s new plans is search system for business systems. This new system enables organizations to find information within their business systems. For this project Google is now working with Oracle, Cisco Systems and Cognos Inc.

This new system which is known as “Google OneBox for Enterprise” will enable company customers to make company-specific searches which also allow employees to use the Google search to find information such as employee benefits, purchase orders, sales leads, contacts and calendars. And also employees are going to be able to search specific office documents and the new software will allow office workers to dig deeper into business databases.

Internet Search Marketing

After Google’s power another thing came out for companies which is internet search marketing. They have to use internet search marketing in order to increase their website traffic. Due to the increased access and use of online resources, businesses are now finding that internet search marketing services are an essential part of the company’s overall marketing plan. According to me, internet search marketing actually about establish the target audience, specify key phrases and optimization techniques.

Now, a lot of company use Google for Knowledge Management. A lot of information that previously required extensive researches now it available through Google that’s because Google has partnerships with different types of companies including a long-term research partnership with NASA and also they have partnership with Sun Microsystems to help and share each other’s technologies. These days Google has started a partnership with American Online, News Corp’s and the popular social networking site MySpace. If we look at Google’s history, we can easily see there are many small companies that been bought by Google. These companies had the innovative teams and products. “Pyra labs” was one of them. They were creators of a weblog publishing platform, and Blogger.

Google also has a software which is called “Google analytics” provides analysis of the performance of Websites. This program tells you everything you want to learn about how your visitors found you and how they interact with your site. In the software they show you, how many people visit your website, which words are more usable, to find your website on Google or not. Which websites have links to your website. And there are a lot of suggestions from Google which is related to your web design and your marketing strategy.

Criticisms of Google

First thing I have to write about drug search. There were a lot of drug ads which says “no prescription needed and next day delivery”. These days Google really reduced the amount of this kind of ads but there are still some which were added by rogue pharmacies .Even though Google has already changed the search results but Google didn’t touch the main index results. Question is why? Answer is easy, all we have to do is just looking their add revenue tables.

In some cases, Google also seems like so commercial. For example, there are a lot of free information, groups and non profit organization about teenager psychological problems on internet but if you try to search on Google, results are incredibly commercials. I said “incredible” because this is against their pagerank software which says “you can’t buy higher page rank”. It makes you think may be you can. This example only one of them which I found in Google, there are more.

The last thing I have to write about Google and China issues, Google seems like sacrificing its ethics by blocking pro-democracy websites and “Falun Gong” for the huge China market.

Why Youtube.com?

Google Inc bought youtube for 1.65 billion dollar. Youtube is number one video sharing website with market share of 43%. According to me, there are three reasons to buy youtube,

If we look at the Google’s advertisement spending on myspace.com, it is more than 900 million which is more than buying “News corp” as they did. I think, Google already knows how much they can make from youtube. It seems like youtube would add 70% or 80% share of Google’s ad revenues.

Another reason for Google is, if you can’t beat them, you can buy them. It is sure that Google has resource and technology to build another youtube but they couldn’t have the youtube’s traffic which is really the key behind this purchase.

Last reason is, actually this is a question that why youtube wants to be bought from Google? According to my research youtube was going to face substantial risk with lawsuits coming from music and video copyright holders. If we think about who is in a better position to develop technologies that identify copyrighted materials against a body of work provided by the copyright holders. Answer is for me, “Google”.

Work Cited

http://www.google.com

http://news.com.com/

http://www.gerrymcgovern.com/

http://googlesystem.blogspot.com/

http://blog.searchenginewatch.com/

http://searchengineshowdown.com/

http://www.techcrunch.com/

http://www.searchengineblog.com/

http://www.googleguide.com/

http://www.johnchow.com/

http://www.yahoo.com

http://www.youtube.com

http://www.AdwordsStrategy.com

http://www.bizwaremagic.com/

http://www.searchengineposition.com/

http://www.newscorp.com

http://www.tech.netscape.com

http://www.marketingvox.com

http://www.internet-search-marketing.com