Chapter One

Introduction to International
Marketing

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 Learning Outcomes
1. What are the meanings of the terms “multinational corporation,” “born-
global,” “home country,” and “host country”?

2. What are the essential ingredients in the marketing mix as they relate to
international markets, needs, and wants?

3. How have the drivers of globalization influenced international

marketing?

4. How are the factors that create international marketing complexity

linked to creating a global mind-set for marketing activities?

5. Why are the concepts of sustainability and bottom-of-the-pyramid

consumers linked to today’s international marketplace?
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 Learning Outcome

1. What are the meanings of the terms

“multinational corporation,” “born-global,”
“home country,” and “host country”?

Copyright 2012, SAGE Publications, Inc.

 International Marketing
• The utilization and adaptation of the best
marketing practices for the purposes of
conducting commerce in other countries.

• It includes conducting commerce with

customers, clients, partners, society at
large, and the overall global community.

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Who Does International Marketing?
Multinational Corporations (MNCs)
– Businesses that conduct activities in at least
one other country that differs from the home
country in which the organization is
headquartered.

Born-global firms
– Businesses that operate in two or more
different countries from inception are born-
global firms.
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Born-global firms

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 Home vs. Host Country
• The home country is the nation in which the
business is located or the country that
houses the company’s main headquarters.

• A host country is a nation being targeted for

expansion.

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 How Do We Organize?
Ethnocentric Management
– Use home country nationals as employees in home and
host countries
Polycentric Management
– Use local nationals as employees in home and host
countries
Regiocentric Management
– Use employees from a variety of countries within a
region
Geocentric Management
– Use the best employees globally without a focus on
country location

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 Learning Objective #2

2. What are the essential ingredients in the

marketing mix as they relate to international
markets, needs, and wants?

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 Marketing Defined
Marketing may be defined as “discovering
consumer needs and wants, creating the
goods and services products that meet those
needs, and then pricing, promoting, and
delivering those goods and services.”

The marketing mix consists of the major

activities used to develop and sell goods and
services.
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 Marketing Mix
Product A good or service that satisfies consumers needs by
providing value

Price The value of what is exchanged in returned for the

product
Place (or Movement of the product from the seller to the buyer
Distribution)

Promotion Communication of product value from the buyer to the

seller

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 Markets, Wants, and Needs
A market consists of people with wants and
needs, money to spend, plus the willingness and
ability to spend money on those wants and
needs.

Needs are the necessities of life that all humans

require for their survival and well-being.

Wants are specific expressions of needs through

the desire for specific objects.

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 The STP Process
Market Segmentation
– Grouping consumers based on their needs,
attitudes, and interests.
Target market
– Specific, identifiable market segment that a
company seeks to reach.
Positioning
– Creating a perception in a consumer’s mind about
the nature of a company and its products relative
to competitors’.
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 Learning Objective #3

3. How have the drivers of globalization

influenced international marketing?

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 Globalization
• The increased interconnectedness of
consumers and businesses.

• Four Drivers:
– Channels of Communication
– Lower Transportation Costs
– Immigration and Emigration Patterns
– Governmental Actions
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 Learning Objective #4

4. How are the factors that create

international marketing complexity linked to
creating a global mind-set for marketing
activities?

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International Marketing Complexity

• Culture
• Language
• Political and legal systems
• Economic systems
• Infrastructure

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Culture and This Course

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Language and This Course

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Political and Legal Systems
and This Course

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Economic Systems and This Course

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Infrastructure and This Course

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The Framework for This Course

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Other Course Themes-Sustainability
• Sustainability or sustainable development
refers to meeting the needs of the current
generation in a way that leaves future
generations with the ability to also meet
their needs.

• “Enough—for all—forever.”

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A Sustainability Framework

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 Other Course Themes – Bottom-of-
the-Pyramid
• Approximately 4 billion people globally live on
less than $2 per day. This group of consumers
is referred to as the bottom-of-the-pyramid.

• At 4 billion consumers, even a small level of

profit per sale can lead to large profit across
the entire segment.

• Targeting this group can lead to more-efficient

processing and innovations that can then be
applied to more affluent consumers.
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Group Assignment (Four students)
Think of a Peruvian company that has no international
presence (but is ready to) one that only sells their
products in the Peru.
First, why do you think they only sell their product in
Peru?
Second, what challenges would they face when entering
into an international market? Think of the following
factors: culture, language, political and legal systems,
economic systems, and infrastructure.

Finally, what international market would you

recommend they explore? Present your findings to the
class.

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