Factors Affecting International

Marketing
Social, Economic, Political Factors, Competition, Legal
Environment, Logistics and Risk

Pankaj Bhatt
 Socio-Cultural Factors
The social factors of a nation determine the value
system of the society, which in turn affect the
International Marketing mix. Social factors are culture,
caste, customs, languages, life style, standard of living,
climate and marketing infrastructure etc. The demand
for goods and services is affected by all these factors.
There is a lot of change in quality of life style of the
people. They are willing to purchase many consumer
durables like T.V., Fridge, Computer etc., even when
they cannot afford to buy it. It became possible because
of availability of hire purchase system or installment
basis.

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Cultural factors also influence every aspect of International

Marketing. International marketing decisions are based on

recognition of needs and wants of the customers. The
cultural factors help to understand the behaviour patterns
and life style of the societies culture, in which individual
has grown up. Thus an individual’s perception is groomed
and influenced by cultural factors.

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 Economic factors

The economic factors are the most significant

determinants of International Marketing. They also
affect the survival of a business organization and its
success. The economic factors can be studied under
following categories:

♣ Exim Policy of the Country

♣ Commercial Policy
♣ Financial system
♣ Monetary system
♣ Currency restrictions
♣ Inflation/ Deflation.

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 Competition
Competition is an important determinant of international
marketing mix. The business firm has to face competition
in his home market as well as in the international market.
The international marketing mix is decided by keeping in
mind the strategies of the competitors for the product,
price, place and promotion.

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 Political Factors

The International Marketing mix is strongly affected by the

political environment of the country. A marketer has to
operate its business activities in a given political factors.
The business operations are greatly affected by the political
constraints at different levels. The change in political
scenario leads to change in the government policies.

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 Political Factors

The following impact is associated with the political

factors-

(i) If the government is stable, it leads to stable policies

relating to the business

(ii) If frequent changes are there in the government, then

it leads to frequent changes in the policies of the
government relating to the business operations.

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 Political Factors

The political factors play a major role in deciding the

operation of a business organization in the international

business. Thus a business organization has to study and
analyze the political environment of a particular country, if
it has decided to carry out its business operations.

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 Political Factors

Before going for any decision relating to the International

business the business organization has to carry out SWOT
analysis and cost benefit analysis of International
marketing mix. It must be analysed, keeping in mind the
political scenario of a particular country. The government
policy of a country must be assessed and the role of private
sector, small scale industry is also important. Finally it
must be analysed that what significant role of
Multinational Corporation is there in the national economy.

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 Legal Environment

International Marketing decisions are influenced by legal

environment pertaining to competition, price setting,
taxation, law etc. The legal system of a particular country
should be studied well before doing business with that
country.

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 Logistics
International Marketing mix is influenced by the Logistics.
It includes mode of transportation, cost of transportation,
inventory management, material handling and
warehousing etc. It is necessary to study all these factors,
before go in for any decision regarding international
marketing mix.

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 Risks

The analysis of the risk factor is an important task to be

performed before taking the decisions relating to the
international marketing mix.

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Thank You…

Pankaj Bhatt
October 5, 2021

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