Appendix 7 - Schematic Representation: Alliances as Dynamic Processes for Acquiring Marketing Knowledge

Summary

This appendix provides a schematic representation of the main types of alliances used by a standard leading alcoholic beverages firm, P₁, over time. It offers a visual illustration of the process through which firms acquire and transfer marketing knowledge using four main types of alliances: with local agents, with local distributors, with different kinds of competitors – leading alcoholic beverages firms in their domestic markets, and other leading multinationals in the industry.

Each of the four columns represents a different country. Country 1 is the origin of P₁. The second, third, and fourth columns change with the type of alliance. There are n countries, each one dominated by an alcoholic beverages firm. Countries 1 and n develop large multinationals and countries 2 and i only develop large firms, leaders in their domestic markets.

The analysis in Figure A7.1 is static, and does not reflect that at a particular moment in time firms from different countries might form distinct types of alliances. Production and distribution operations are symbolized by squares, marketing knowledge by a circle, and knowledge about brands by a triangle. Ownership of production and distribution by P₁ is indicated by shading; otherwise, these activities appear unshaded or with stripes. When ownership is shared in an alliance, the square appears half-shaded.

Flows of marketing knowledge, which include the routines and procedures within the firm about marketing methods and the management of brands and distribution channels, are represented by single arrows.