Creating a Market Plan in the Global Marketplace

What is the global marketplace?

First, let's define a market -- or marketplace.

A market is a structure that allows people and businesses to exchange goods

and services. For example, the United States is a market. China is a market.
Together, the U.S., Canada, and Mexico are a market that is governed by
NAFTA, the North American Free Trade Agreement.

Now, let's define a global market.

A global market is not defined as one geographic location, but allows the trade
of goods and services anywhere in the world. For example, Apple is a U.S.
company. It purchases supplies from several countries, and then has its
products manufactured in Taiwan. Once the product has been assembled, it is
transported to the U.S., Europe, Australia, and Asia.

Entering the global marketplace is a huge opportunity for a company to meet

the needs of an international market, while possibly increasing sales
exponentially. Of course, there are advantages and disadvantages, as with
any marketing strategy. But the global market is definitely an excellent
opportunity for any marketer.

How To Enter The Global Market

In order to enter into an international market, a company must have a mode

of entry. There are many ways to enter the global market, but we will detail
the top methods here.

1. Licensing

2. International Agents
3. Strategic Alliances

4. Joint Ventures

5. Overseas Manufacturers

1. Licensing

Licensing consists of three types of licensing contracts.

Licensing is when a company requires a fee for the use of its

brand. Franchising is when the company (the franchiser) provides branding
expertise to the franchisee. Examples include McDonald's, Subway, and
Dunkin' Donuts.

Turnkey contracts are major corporate agreements to build large plants. They
usually include the training of employees.

2. International Agents

Agents are often used as a way for a company to enter the global market.
Agents are people or organizations that are contracted by a business to
market on their behalf in a certain country. Agents don't own any of the
products --they simply earn a commission on any products sold.

Agents usually represent more than on company at a time. They are

inexpensive, but can be difficult to manage. If a company intends to go
global, it should make sure the agent contract is revocable. It can be difficult
for the marketer to work in the global market, especially in the beginning,
when it is new. So setting goals and targets can be difficult at first.

Using an agent can be an easy solution for a company new to the global
market, but be aware that the agent can represent a competitor at the same
time. So be aware there might be conflicts of interest. They can also be
costly to recruit and train, and with a global market, there can be language
and cultural issues.
Distributors are another option, and they are similar to agents, except they
do take ownership of the product. Ownership gives them incentive to move
the product quicker, and attempt to make a profit from it. Otherwise, they
have the same pros and cons as an agent.

3. Strategic Alliances

This term describes a series of different types of professional relationships

that can work as an intermediary between the company and the global
marketplace. Sometimes, there can be a strategic alliance between
competitors.

Here are some examples of strategic alliances:

1. Shared manufacturing – An example would be two car companies

sharing the same manufacturer.

2. Research and Development – This could happen when two companies

decide to share R&D facilities.

3. Distribution alliances

4. Marketing alliances

These types of alliances are non-equity, so each company remains

independent.

4. Joint Ventures

Joint ventures are usually equity relationships, with a new company being
formed to handle the global split. There are several reasons why a company
would set up a joint venture to help them enter the global market. Some of
these reasons are:

1. Access to new technology

2. Just to gain entry into a foreign market

3. To gain access to new distribution channels, manufacturing, or R&D

5. Overseas Manufacturers

If a company is large enough, owning an overseas manufacturing plant

might be the best choice. Investing in the plant, machinery, and labor can
also be cheaper, if currency rates are working in the company's favor. This is
referred to as Foreign Direct Investment (FDI).

This can be a newly built plant, or the company could acquire a current
business that has acceptable facilities.

Stages of Internationalization

Now that we have discussed the ways to enter into global markets, we can
address the last step, which are the stages of internationalization. Some
companies will never do global business, and therefore never go through this
stage.

Here are the stages:

• Indirect exporting or licensing

• Direct exporting via a local distributor

•A business's own foreign presences

• Home manufacture, and foreign assembly

• Foreign manufacturing

Now, no one marketer agrees which is the best mode of entry. For example,
some might see franchising as a stand-alone method, while others see it as
a part of the licensing process. Remember that all methods of entry into
international markets are valuable.

The Internet
The Internet is changing the way we do business. And never has the
Internet been more valuable than it is in the global marketplace. It is an
excellent channel for a smaller company or a new one to the global space.

Exporting

There are both direct and indirect avenues to exporting to other nations.

Direct exporting is very straightforward. Basically, the organization makes a

commitment to market a product overseas on its own behalf. This gives the
organization better control over its brand and overseas operations.

On the other hand, if a company uses an exporting company from heir home
country, it would be considered indirect exporting. Examples of indirect
exporting are:

Piggybacking – This is when a new product uses an existing distribution

and logistical channel of another business.

Export Management Houses – These firms assist the export department

of a company. They offer a range of services, and can be a very helpful
resource, especially when a company is new to the global market.

Consortia – These are groups of small businesses that work together to

market similar types of products in the international market

Trading companies – These companies go back to the original overseas

colonies. Some date back to the British, French, and Spanish colonies.
Today, they exist to help large businesses deal with all the logistics involved
in the global market.

Key Words!

Piggybacking

Export Management Houses

Consortia

Trading Companies

Competing in the global marketplace

Whether the company is large or small, any company can have a global
presence. If a company doesn't currently have a global strategy, it probably
will have one soon. Companies are not asking if they should expand, the
question is when. A global presence for a business brings tremendous
benefits to a company, especially if the expansion is planned well.

The Internet has changed markets all over the world, and has made it very
easy for even small companies to compete on a global scale. More than 95
percent of the world's consumers live outside of the U.S.; global expansion
gives a company a broader marker to increase sales. In addition, having a
global presence can lower costs if less expensive suppliers and employees
can be used.

Of course, expanding to a new market is not without risks, but here are
some ideas to keep in mind:

1. Focus on the customer

Yes, this sounds easy. But as a marketer, you know the customer
relationship is key. Not all customers want the same thing. They all have
different needs and wants, and the marketer must address those needs
moving into the global market.

Make sure time is spent with new customers, and get to know them, just as
you would with a domestic customer. Understand their needs, their
environment, and most importantly, their challenges.

2. Have a great staff

The four P's rear their ugly head again! And here the key word is people.
Every person in your company, and the international chain, must be
experienced and have the company's objectives in mind. New global
employees should know the global market well, and be able to assist with
any language or cultural issue that arises. A company can work with
international trade associations to find suitable people. Remember to
network!

Want to learn more? Take an online course in Marketing.

3. Understand different cultures.

In the global marketplace a company must expect to work with many

different people, who often speak different languages and have different
cultural ideas. Knowing this ahead of time is the best way to form trusting
relationships. If possible, learn the local language, or at least some key
words. Become knowledgeable about the local culture. It will help show that
you have a commitment to them.

4. Act Local!

Even if the business is U.S. based, find opportunities to act local. A

promotion campaign in the U.S. won't work in another country. Some
languages don't translate easily, like English and Japanese. So be sure to
work with locals to help you bridge these cultural divides.

Competing globally can be challenging at first, especially when you are

working through the cultural divides. Investing in the areas will help foster a
relationship of trust with your partners and employees. Ultimately, this trust
will help the company excel in the global market

Creating a Marketing Plan

Creating the marketing plan

A marketing plan is the full beginning-to-end strategy used to bring a
product to market, and get it in the hands of the consumer. It requires
planning and excellent organizational skills. The marketer wants to
understand the consumer insight, and meet those needs with the product
and marketing plan.

Small businesses will obviously have a smaller plan than a large corporation,
and it's important the marketer doesn't over-do it. Small businesses should
have a marketing plan that is around 15 pages or less.

Before the plan can be written, the following information should be

available:

• The company's latest financial statements, as well as sales figures

broken down by product and location

•A list of each product or service the company offers, including the

markets they target

•A table that breaks down the organization, especially if it is a large

company

•A written statement from the marketing team detailing their

understanding of the marketplace

• Statements from each employee involved in the marketing process

that detail what they think must be included in the new marketing
plan

When beginning, the marketer will want to focus on three items:

1. Completion date – The marketer must set a date for when the plan
should be completed. It can be a long process, involving many people and
departments. So it is key the marketer has a goal end-date.
2. Who is responsible – Each member of the marketing team should have
a defined role, which they should clearly understand and be prepared for.
They must be responsible for their part; otherwise the plan will never come
together.

3. The budget – A marketing plan can cost a lot of money, so establish a

budget and stick to it. You don't want to end up with no money, and have to
finish the marketing plan without funds.

Think!

Do you think one marketer should write the marketing plan, or should it be a
team effort?

Once the marketer has considered the above, it is time to write the
marketing plan.

Here are the steps the marketer should take to write a marketing plan.

1. Set Objectives

2. Do Research

3. Define Strategies

4. Outline Tactics

5. Build in Measurements

6. Develop the Plan (And Stick To It!)

7. Implement the Plan

1. Set Objectives

The first step to writing the plan is to determine the objectives you are
seeking to meet. What are the goals? Does the company want more
customers? Does the company need additional revenue? Does the company
want a great market share? Is the company considering a new product
launch? This is the time to define those objectives and goals.

One of the easiest ways to define objectives is to create a vision statement.

A vision statement is the long-term vision for the company.

Every company has its own brand, so start to imagine what attributes the
product has that helps to further that brand, and how it can be positioned
for the long term.

When setting objectives, SWOT analysis can be very helpful. It allows the
company to identify its strengths and weakness, and it's opportunities and
threats. This analysis will provide important insights and help planning for
the upcoming three to five years.