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. Problems of gathering primary data in


international marketing research
No officialy recognized census of population
Thelack of available demographic data
Incomplete and out of data telephone directories- no
accurate maps of population census
Language and compensation the most universal surbey
research problem in foreign countires is the language
barriers,differences in terms and the difficulty of exact
transaltion create problems in collecting the specific
information desired and in interpreting the respondents
answers. Equivalent consepts may not exist in all
languages.
Marketors may use 3 different techniques in order to
aoid language problems:
Back transation the quiestionnaires is translated from
one language to another than a second person translates it
back to the original language. This process shows the
misunderstand and misinterpretations before they reach
the public.
Parallel translation ( back translation may not always
ensure an accurate transaltion because of commmonl
used terms in boh languages. Parallel translation is used
toovercome this problem. In this process more than 2
translations are used for back translation. The results are
compared differences are discussed and themost
appropriate translation selected.
Decentering is a hybrid of bacj translation ,it is a
subsesive process of translation and retranslation of a
quiestionnire each time by a different translator. The
process continues to be repetead until theoriginal and the
final versions do not have differences.
12. International research on Internet: a new
opportunity for marketers
A new opportunity for conducting international
marketing research is using the internet techniques. For
many companies the internet rovides a new and
increasingly important way for conducting a variety of
international marketing research.

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New product consets and advertising messages can


be tested over the internet for immediate feedback.
Worldwide consumer panels may be created to help
o test marketing programs across international samples.
The following types of researches on the internet may be
used.
Online surneys
Online focus group vis askype
Web visitor tracking
Advertising measurement
Email marketing lists
Customer identification system
13. New product development process
I.New product development strategy in
international marketing
New poductdevelopment process includes the
development of regional products,product
improvements,produc modifications and new brands
through the cmpanes research and development efforts.
Given the rapid changes in consumer preferences
tehnology,and competition,companies must develop a nig
number of new products and services.

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A firm can obtain new products in two ways:


Through acquisition buying a whole company a patent
or a license. To produce someone else product
Through new product developmet process
Innovation process can be very risky. New products
continue to fail at increasing scale,marketers estimate
that new consumer packaged goods fail at a rate of 80%.
Another study suggested that from 25000 new consumer
food,beverage and beauty products,that are launched on
the market each year,only 40 % will be after 5 years on
the market.Future rate for industrial products may be as
higher as 90%.

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There are several reasons of new products failure:


The market size may be overestimated

The new product has not distinguished as well as it


should have been
The new product may be incorrectly positioned on the
market
New product is priced too high
New product may be poorely advertised
To create successful new products a company must
understand its consumer markets and competitors,and
develop products that deliver by value to consumer., The
solution of this problem lays in strong new product
palnning and in setting up a systematic new product
development process. Usually,this process includes the
following stages:
Idea generation is the systematic search for new product
ideas,a company typically has to generate many ideas in
order to find a few good ones. New product ideas may be
collected from internal sources such as sales personnel.
Companys executives,engineers,manufacturing stuff on
research and development department. For the purpose
the company may use brainstorming on focus groups.
External sources may be obtained:
Competitor
Customers the company may analyze customer
question and complaints to find new products that better
deserve consumer problems,it can conduct surveys and
focus group to learn about consumer needs and wants
,and to get ideas for product improvements.
Distributors and suppliers they can tell the company
about new concepts,techniques and materials that can be
used to develop a new product resellers are also close to
the market and they can offer information about
consumers problems and new products possibilities.
Other sources such as trade
magazines,seminars,government agencies, new product
consulting firms,advertising agencies,reasons
,companies,investors and universities.
Top management may install an idea management
system that directs the flow of new ideas to a
deparment,where they are collected and evaluated, in
setting up such a system the company can do the
following :
Idea generation
Appoint a respected person to be companys idea
manager
Create an idea manager committee consisting of people
from different departments. They should meet regularly
and evaluate new product and subways ideas.
Encourage all the company state holders to send their
ideas to ideas manager
Ideac screening the purpose of idea generation is to
create a large number of ideas,the purpose of idea and
drop poor once as soon as possible. Product development
costs rise in later stages. So the company wants to
continue only with the product ideas that may become
profitable products. Many companies require
theexecutives form that can be analyzed by new product
committee.
Concept development and testing product concept is a
detailed version of the new product idea stated in
consumer terms. Its important to distinguish that a
product idea,product concept and product image. A
product idea is an idea for possible product that a
vompany can offer on the market.
A product image is the way consumer perceive of
the product potential that will be lauched in the future.
Prodict concept- is a detailed description of the
product potential that will be launched in the future.
The concept testing refers to the testing of new
product concepts with groups of forget consumers.This
stage is done in order to find out the consumersopinions
and preferences for new product. The concept may be
presented through a word or picture description.
Marketing strategy development- includes an initial
marketing strategy for few products based on the product
concept. Marketing strategy statements consists of the
following:

The first part decribes the target market,the planned


product positioning sales and market shares,and profit
goals for the first few years.
The second part outlines the products planned
price,distribution and promotion budget for the first year.
Thelast part of the marketing strategy describes the
planned long-run sales,profit goals and marketing mix
strategy.
Business analysis involves a review of the sales,costs,and
profits estimations for few product to find out whether
they satisfy the companys objectives. If they do,the
product can move to the products development stage.
To estimate sales a company might look at the sales
history of similar products and conduct surveys of
market opinions,it can than estimate min and max sales
to assess the range of risk.
Product development so far many new product
concepts have existed as a word description,if the
product concept passes the business first if moves into
product development will design a prototype that will
satisfy consumers and that can be produced quickly and
with low cost.
Test marketing-,if a product passes functional and
consumer test the next step is test marketing at which the
product and marketing program are introduced in more
realistic marketing settings. Test marketing the produced
before going to the full production. It allows the
company test the product and its entire marketing
program,positioning strategy,advertising
distribution,pricing and packaging devisions.
Test marketing costs can be very high and it takes
long time that may allow competitors to gain
advantages,thats why when the costs of developing and
introducing the product are low or when management is
aleready confident about the new product. The company
may do little or no-test marketing at all.
14. Idea generation stage and the problems of
new products failure.
There are several reasons of new products failure:
The market size may be overestimated
The new product has not distinguished as well as it
should have been
The new product may be incorrectly positioned on the
market
New product is priced too high
New product may be poorely advertised
To create successful new products a company must
understand its consumer markets and competitors,and
develop products that deliver by value to consumer., The
solution of this problem lays in strong new product
palnning and in setting up a systematic new product
development process. Usually,this process includes the
following stages:
Idea generation is the systematic search for new product
ideas,a company typically has to generate many ideas in
order to find a few good ones. New product ideas may be
collected from internal sources such as sales personnel.
Companys executives,engineers,manufacturing stuff on
research and development department. For the purpose
the company may use brainstorming on focus groups.
15. Test marketing stage and its types
Test marketing-,if a product passes functional and
consumer test the next step is test marketing at which the
product and marketing program are introduced in more
realistic marketing settings. Test marketing the produced
before going to the full production. It allows the
company test the product and its entire marketing
program,positioning strategy,advertising
distribution,pricing and packaging devisions.
Test marketing costs can be very high and it takes
long time that may allow competitors to gain
advantages,thats why when the costs of developing and
introducing the product are low or when management is
aleready confident about the new product. The company
may do little or no-test marketing at all.
Companies may use the following types of test:

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Standard tets market company finds a small number of


representatives test retires conduct full marketing
campaign in these cities and uses consumer and
distributors surveys to analyze product performance. The
result are used to forecast national sales and profits.
Standard test have some disadvantages :
They can be very costly
They may take long-time
Competitors can monitor test market results and interfere
in launching a new product
Control test market several research compaingn keep
controlled panels of stores that have agreed to carry out
new products for a fee. Control test markets usually cost
less thatn standard test and they may be done much more
quicker,but as in standard test controlled test allow
competitors to get a look at the companys new products.
Stimulated test markets companies can also test new
products in a si,mulated shop, environment. The
company can research different promotions and can offer
them to a sample of consumers,including the new
product being tested. It may give consumers a small
amount of money and invite them to a real or laboratory
store,where they may keep the money or use it to buy
items. The marketers analyze how many consumers buy
the new product and competing brands.
Advantages:
Cost less
It takes short time
Keep infor out of competitors
Commercialization introducing of the new product into
the real market and possing to the full production.
16. Problem of language for primary data
sources. Methods of avoiding this problem
Marketors may use 3 different techniques in order to
aoid language problems:
Back transation the quiestionnaires is translated from
one language to another than a second person translates it
back to the original language. This process shows the
misunderstand and misinterpretations before they reach
the public.
Parallel translation ( back translation may not always
ensure an accurate transaltion because of commmonl
used terms in boh languages. Parallel translation is used
toovercome this problem. In this process more than 2
translations are used for back translation. The results are
compared differences are discussed and themost
appropriate translation selected.
Decentering is a hybrid of bacj translation ,it is a
subsesive process of translation and retranslation of a
quiestionnire each time by a different translator. The
process continues to be repetead until theoriginal and the
final versions do not have differences.
17. Standardization versus adaptation strategies
in international marketing
There is a serious discussion around the product
development process, which focuses on the two
alternatives at their disposal firms, standardization and
adaptation. According to some opinions, the activity in
global markets should be one oriented by the unit cost
which supports standardization, others say an adaptation
of the product for each market.
The arguments offered by those who support the
standardization process of homogenization targeting the
needs, tastes and values, which is an effect of global

communication and social forces that manifest


throughout the world. So is assisting in the development
of global markets, which manifests similar needs for
products with reasonable prices and quality.
Thus, product policy, international entrepreneur
must make fundamental decision, namely to produce a
standard product for all markets or adapt the product to
the specific needs of each market. Standardization
involves providing the same product both at home and
abroad, while adaptation involves making changes to the
product, in order to meet specific requirements. Although
standardization is very tempting for any company, it can
not always be achieved. In many cases, it is necessary to
adapt the product. Companies like Coca-Cola or Colgate
recognized for their standardization strategy of
production and marketing and selling their products in
over 160 countries of the world, have had to adapt to
local conditions. The Coca-Cola company has only three
standardized brand and one of them has a different
formula Sprite in Japan. In addition, she had to change
the brand name in Light Coke Diet Coke when he
entered the Japanese market, as Japanese women do not
like to say dieting. This is one of many examples that can
be cited to support the hypothesis of adaptation to local
products.
It can be said that there is a growing trend of
incorporating different regional characteristics into a
global product. However, it can not be considered a pure
standard. Companies like Ford and Nissan develops
global models, but adapts to local products when needed.
Although the automotive industry is a certain
convergence of tastes in terms of size and style of car,
how a car is perceived differs, however.
Factors that encourage standardization of products
are:
a) economies of scale in production
b) economies of scale in research and development
expenses;
c) cost savings in marketing;
d) consumer mobility;
e) image of the country of origin;
f) industrial products;
g) activation exports;
h) recovery of investments;
i) management of the company;
j) converging tastes.
18. Pricing Policy in international marketing:
objectives, and pricing approaches
In general,price decisions are viewed in two ways
pricing as an active instrument of accomplishing
marketing objectives,or pricing as a static element in a
business decision. If prices are viewed as an active
instrument,the company uses price to achieve a specific
objectives,whether a targeted return on profit,a targeted
market share,or some other specific goal. The company
that follows the seconf approach,pricng as a static
element,probably exports only excess inventory,places a
low priority on foreign business,and views its export
sales as passive contributors to sales volume. Profit is by
far the most importan pricing objective. When U.S and
Canadian intemational businesses were asked to rate,on a
scale of one to five,several factors important in price
setting,total profits received an average rating of 4.7
,followed by return on investment,market share,and total
sales volume. Liquidity ranked the lowest. The more
control a company has over the final selling price of a
product,the better it is able to achieve its marketing
goals. However,it is not always possible to control end

prices. The broader the product line and the larger


number of countries involved,the more complex the
process of controlling prices to the end user.
Approaches:
Both cost and market considerations are important,a
company cannot sell goods below cost of production and
remain in buisness for very long,and neither can it sell
goods unacceptable in the marketplace. Firms unfamiliar
with ovearses marketing and firms producing industrial
goods orient their pricing solely on a cost basis. Firms
that employ pricing as part of the strategic
mix,however,are aware of such alternatives as market
segmentation from country to country or market to
market,competitive pricing in the marketplace,and other
market oriented pricing factors.Full-cost versus variablecost. Firms that orient their price thinking around cost
must determine wheter to use variable cost or full cost in
pricing their goods. In the variable-ost pricing the firm is
concerned with the marginal or incremental cost of
producing goods to be sold in overseas markets. Such
firms regard foreign sales as bonus sales and assume that
any return over thei variable cost makesa contribution to
net profit. Tush,variable or marginal pricing is a practical
approach to pricing when company has high fixed cost
and unused production capacity. Any contribution to
fixed cost after variable cost are covered is profit to the
company.
Skimming versus penetration pricing. Firms must
also decide when to follow a skimming or a penetration
pricing policy. Traditionally,the decision of which policy
to follow depends on the level of competition,the
innovativeness of the product,and market characteristics.
A company uses skimming when the objective is to
reach a segment of the market that is relatively priceinsensitive and thus willing to pay apremium price for
the value received. If limited supply exists,a company
may follow a skimming approach in order to maximize
revenue and to match demand and supply. When a
company is the only seller of a new or innovative
product,a askimming price may be used to maximize
profits until competition forces lower price. Skimming
often is used int hose markets where there rae only two
income levels,the wealthy and the poor. Costs prohibit
setting a price that will be attractive to the lower-income
market,so the marketer chargs a premium price and
directs the product to the high-income,relatively priceinelastic segment.Apparently this was the policy of
Johnsons and Johnsons pricing of diapers in brazil before
the arrival of F and G. Today,such opportunities are
falling away as the disparity in income levels is giving
away to growing middle-income market segment. The
existence of larger markets attracts competition and,as is
often the case,the emergence of ultiple product lines,thus
price competition.
A penetration pricing policy is used to stimulate
market growth and capture market share by deliberatly
offering products at low prices. Penetration pricng most
often is used to acquire and hold of market as a
competitive maneuver.However,in country markets
experiencing rapid and sustained economic growth. And
where large shares of the population move into middleincome classes,penetration pricing may be used to
stimulate market growth even with minimum
competition. Penetration pricing may be a more
profitable strategy tahn skimming if it maximizez
revenues and builds market share as a base for the
competition that is sure to come.