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Q1. Explain the various Marketing Orientations and Concepts.

Ans 1.

Marketing Orientations

Market orientation is an approach to business that prioritizes identifying the needs and
desires of consumers and creating products and services that satisfy them. Companies that
have a market orientation consider the opinions and needs of their target market as a critical
component of their research and development (R&D) for new products.

Advocates of market orientation argue that the conventional approach to product

development is the opposite. That is, marketing strategies focus on establishing key selling
points to promote existing products rather than designing products that have the qualities
consumers say they want.

How Marketing Orientation Works

Market orientation is a customer-centered approach to product design. It involves market

research aimed at determining what consumers view as their immediate needs, primary
concerns, or personal preferences within a particular product category.

Marketing orientation can be categorized into five key groups. These are:

 Production orientation or concept

 Product orientation or concept
 Sales orientation or concept
 Societal orientation or concept
 Marketing concept
 i. Production Orientation or concept

 The Production Orientation or Concept refers that customers will always buy and
recommend products available in the market at an affordable price.
 It is the oldest concept in marketing and manufacturers following this orientation focuses
on only two things.

1. Production
2. Distribution

 This marketing strategy is useful for some products.

Advantages: Economies of scale, efficiency, low cost to customers.

Disadvantages: Disregards customer needs, set-up costs are usually high.

ii. The Product Orientation or concept

The Product Orientation or Concept refers to that customers will not go for an affordably
priced product. They will surely go for innovation, qualitative, and better product
performance. This concept is usually adopted by the electronics company.

Manufacturers under this concept always try to improve their product features. They make
marketing research, and add advanced values to the existing product in the better version like
Mobile manufacturers using a better camera, more ram, and processor.

Advantages: Focus on quality, innovation, skills development/outsourcing.

Disadvantages: Potential missed market opportunities, obsolescence.

iii. Selling Orientation or concept

The Selling Orientation keeps the ideology of selling through extra promotional activities.
They believe, their sales are not based on production and product concepts. Their sales
depend upon promotional activities they do with different types of advertising and
promotional campaigns.

The concept behind this orientation is that customers repeatedly watching ads or promotions
may buy repeatedly. They easily forget their past experience with that.

Advantages: Immediate short-term sales are generated.

Disadvantages: Risks customer confidence, costs, not always sustainable.

iv. Societal Orientation or concept

Societal Marketing Orientation thinks of doing something for welfare, both for consumers
and non-consumers.
They believe to do improvements in both and in society too. Doing something like, flood
donations, concerts and seminars for orphans and a few similar activities suits best in this
example.

This is a newer concept in marketing after the acknowledgment of global warming. Industries
and Organizations started to do social welfare and got some good responses in eyes of clients.

Advantages: Image is enhanced, appeals to upcoming markets, ethical.

Disadvantages: Marketing message is sometimes distorted, limited budget.

v. MARKET CONCEPT

A market orientated organisation looks at the market and its target audience first, before any
production or sales activities takes place, to learn what potential customers want from
organisations. The product or service offering is therefore created with the customer in mind,
resulting in a true customer-first approach.

Market orientation, in marketing strategy terms, commonly revolves around culture, values
and other internal behaviours focused on satisfying customer needs that are usually well-
researched prior.

Now a day, most markets are moving more towards a market-orientated approach as
customers have more and more access to information about what they are looking to buy.

Advantages: Customer satisfaction, loyalty, continual investment in research.

Disadvantages: Reactive, not always innovative, market always changing.

Pillars of Marketing Concept:

1. Customer need,
2. Integrated marketing communication,
3. Profitability
4. Target market

1. Companies, instead of spending on a mass, undifferentiated market, prefer to look for

specific product market which will best match their product and accordingly design a
marketing program that suits the taste of this target segment.
2. The marketers attempt to know the needs of the consumers. For this, they conduct a
marketing research. On the basis of customers’ needs, companies design and offer a
suitable product or service to the consumers. Their aim is to provide maximum
satisfaction to the consumers.
3. Companies need an integrated approach to achieve the goal of higher consumer
satisfaction. Keeping the marketing goals in mind, companies need to integrate
 various key marketing functions like product design, distribution channel selection,
advertising, sales promotion, customer service, and marketing research.
4. Companies look to earn profit. Earlier, companies worked only for profits. But slowly
this perception is changing. Now, profitability has become a by-product of the efforts
and strategies followed by firms in their pursuit to create superior product value and
higher customer satisfaction.

Q2. What is Marketing Information Systems? Write down the characteristics of MKIS.

Ans.

What is Marketing Information Systems:

The marketing information system refers to the use of technology for the arrangement of

the relevant data related to the market, sales, promotion, price, competition, and allocation of
goods and services. This information is acquired after a proper analysis and understanding of
the marketing environment to ensure effective decision-making in the organization.

The marketing information system is a broader and more encompassing term than market
research and a variation of the term management information system. Marketing Information
System (MIS) is the structure of people, equipment, and procedures used to gather, analyses,
and distribute the information required by an organization.

The Marketing Information System focuses on only the marketing aspects of the management
information system. It is an organized way of continually collecting, accessing, and analyzing
information that marketing managers need to make better decisions.

Importance of MIS

o Order Processing System: It checks the inventory availability, pending orders, production
details, etc., before accepting the customer order. Computerized sales order processing
generates control reports daily on orders processed, details of backorders, etc.
o Sales Management System: Computerized sales management system uses the data from the
sales order processing system to generate various sales-related reports. This system supports
accounts management, direct marketing, sales forecasting, and Sales Presentations.
o Logistics Management: Physical distribution is a major activity of the marketing function. It
uses computer-based OR models to find the optimum location of warehouses, shipment
routes, quantity to be transported and stocked, etc.
o Consumer Research: Computerized transaction processing systems capture a huge quantity
of data about customers and their buying patterns etc. It is used to generate vital information
about consumer behavior.
o Sales Forecasting: Computer-based mathematical and operations research models are used to
forecast sales and marketing expenses.
Characteristics of marketing information system (MkIS)
1. MkIS is management oriented:

The design of MkIS starts with an appraisal of the information needs of the management. The

system is usually designed from top to bottom. However, this does not mean that MkIS fulfils

the information needs of top management only.

It only implies that information needs of the top management will serve as a basis for

assessment of information needs of lower level managers. In every case the system should be

designed to cater to the information needs of all levels of management.

2. MkIS is developed under the direction of management:

Because of management orientation of MkIS, it is imperative that, management of an

organisation actively directs the development and establishment of the MkIS in an

organisation. It is rare to find an MkIS where the manager himself, or a high level

representative of his department, is not spending a good deal of time in the system design.

It is not a onetime involvement, because continued review and participation are necessary to

ensure that the implemented system meets the specifications of the system that was designed.

Therefore, management of the organisation should not only take active part in the

development of MkIS but also play a major role in effecting subsequent changes in the

system so that it serves the information needs of the management.

3. MkIS is an integrated system:

MkIS is an integrated system which blends information from several operational areas to

serve the information needs of the management more effectively. It takes a comprehensive

view of the interlocking sub-systems which operate within an organisation.

For example, in order to develop an effective production scheduling system, the management

must balance such factors as (a) production capacity, (b) work force (c) inventory levels (d)
nature of the product (e) demand pattern of the product (f) capital requirements and (g)

marketing network. A system that ignores one of these elements will not provide an efficient

production schedule.

4. Common data flows:

MkIS seeks to avoid duplication and redundancy in data collection, storage and dissemination

of information. The designers of MkIS are aware that a few key source documents account

for much of the information flow and affect many functional areas.

The concept of common data flow requires building and using master files, for recording and

reporting information. This concept supports several of the basic principles of system

analysis avoiding duplication, combining similar functions and simplifying operations

wherever possible.

5. MkIS is based upon future needs of the business:

MkIS is designed to serve the objectives and needs of the business in an effective manner.

The MkIS designer must avoid the possibility of system obsolescence before the system gets

into operation. If MkIS is designed after taking care of future information needs of the

business, there remains little chance of its becoming obsolete.

6. MkIS is composed of sub-systems:  

MkIS although viewed as a single entity, must be broken down into sub-systems. The

breakdown of MkIS into meaningful subsystems sets the stage for a prioritized

implementation. It also enables the MkIS designer to focus on manageable entities that can be

assigned and computerised by selected systems and programming teams.

7. MKIS requires flexibility:

MkIS is designed to fulfill the information needs of management for future decision making.

Despite a careful analysis of future information needs of the management, it is impossible to

predict accurately all the events of three to five years ahead.

This is true in most industries and especially in those industries with rapid changing patterns.

Therefore, the MkIS should be designed in such a manner so as to permit appropriate changes

in future, if the MkIS does not allow any modification, it is bound to become obsolete very

soon.

8. Distributed data processing:

In case of companies having geographical network of sales offices, distribution points,

manufacturing plants, divisions and subdivisions, some form of distributed data processing is

necessary, since some of these units may be operated in a completely independent fashion.

The purpose of distributed data processing is to ensure that information is placed in the hands

of those who need it at the time when they need it. However, the sub-systems designed for

distributed data processing should be considered as the integral parts of the MkIS of the

company.

9. MkIS is mostly computerized:

Now-a-days, all activities of MkIS viz., data collection, data processing and data retrieval are

accomplished through electronic media. The use of computer assures accuracy and

consistency in processing data and speeds up dissemination of information.

Q3. Determine various Buying Motives. Also explain the influences of these motives on
the consumer purchase process.

Ans.  It is the buying motives which induce a consumer to buy a particular product.  
Types of buying motives and influences of these motives on the consumer purchase
process.

1. Physical, Psychological and Sociological Buying Motives:

The physical buying motives are related to the satisfaction of basic human needs for
subsistence such as satisfaction of the needs for food, shelter and clothes, and security. The
psychological buying motives relates to the need for prestige or self-preservation, etc. the
sociological buying motives are related to the motives that exist at present and is expected in
all the social situations.

Influences of these motives on the consumer purchase process

It assumes that the buying behaviour of an individual is influenced more by his/her

personality elements and psychological drives than social environment and is guided by the
Freudian school of thought.

Men cannot purchase any thing without the sanction and recognition of the society. Their
consumption motives are shaped by their interactions with the members of their family and
society.
2. Acquired and Inherent Buying Motives:

The acquired buying motives are learned motives and are influenced by the environment
factors. Such motives are related to socioeconomic conditions and the level of education,
such as economy, information, work efficiency, profit facility, quality, beauty, fashion, social
presage, acceptance, etc.

The inherent buying motives are present in a person from his birth. It belongs to basic
human instincts whereas the acquired buying motives are concerned with the environment.
They are influenced by hunger, thirsts, sleep, leisure, security, playing entertainment, etc.

Influences of these motives on the consumer purchase process

Both types of motives play a very important role in consumer decision process. Out of these
two motives, inherent motives are stronger, more useful, and urgent. Inherent buying motives
are more instinctive in nature and influence the consumer the maximum.

In satisfying the acquired motives, consumers do not care for the price of the product.
 3. Rational and Emotional Buying Motives:

Rational motives : When a buyer decides to buy after careful consideration or logical
thinking, his decision is said to be rational. Thus rational buying motives are motives where a
consumer takes the decision of purchasing a product by his head and mind. In making
rational purchases, the consumer considers price, durability, dependability, efficiency,
convenience etc.

Emotional buying motives : Lipson and Darling state that emotional buying motives are
related with motives to maintain health, security, better living, power, satisfaction of ego
needs, maintaining of good image in the society, acquisitiveness, curiosity, love and
affection, habits of purchasing or collection of certain goods, desire to achieve economy,
desire to do some creative activity, cautiousness, desire to be praised by others, desire to be
seen good and attractive to be seen, etc.

Influences of these motives on the consumer purchase process

Both emotional and rational motives are important for marketers. Marketers should decide
which type of motive i.e. emotional or rational, should be aroused in selling their product,
keeping in mind the merit of the product. While buying Over the Counter (OTC) medicine, a
consumer is more rational, whereas in the case of buying a chocolate, a consumer is driven by
emotional motive.

4. Conscious and Dormant Buying Motives:

The conscious buying motives are such motives, which are identified by the buyer without
any help from marketing functions, like advertising, personal selling or promotional tools.

The dormant buying motives are silent motives. Thus, dormant buying motives are related
with satisfaction of those needs which are created by the marketing functions.

Influences of these motives on the consumer purchase process

The conscious buying motives influence the satisfaction of presently existing needs of a
customer. Such buying motives take shape within the sub-conscious minds of the customers
and are not influenced by the external environmental factors.
Dormant buying motives do not influence the buyers until their attention is invited by the
marketing functions. A consumer does not possess the knowledge of such needs without the
persuasion of marketing activities.

5. Product and Patronage Buying Motives:

Product buying motives motivates a person towards purchasing a special products. This
motive is generated by the physical and psychological features of the product, such as design,
colour, size, package, quality, price etc.

Prof. Copeland writes that reliability of the seller, punctuality on delivery, promptness,
securing exact fulfillment of specifications, variety for selection, engineering and designing
services, and dependable repairing service, etc. are the basis of patronage motive.

Influences of these motives on the consumer purchase process

Patronage motive influences a person to purchase the products of a specific seller, dealer or a
producer. If a customer is satisfied with the product of a specific seller/producer, he prefers to
buy the products of that seller/producer because of certain advantages, such as home delivery
of goods purchased, a reasonable price, location of the seller/shop, assortment of goods,
goodwill demonstration of the product and decoration of the shop, and the good behaviour of
the seller.

Q4. How do you define Brand Equity? Also elaborate its Components.

Ans.

Brand Equity:

Brand Equity is the loyalty, perception, and awareness of a customer towards a brand. Brand
equity can be created over a period of time by offering products that give a memorable
experience, excellent quality, and highly reliable products to its customers. 
Brand equity is an asset that is the most valuable for a company, and even though it is
intangible, it is vital for the success of a company.

To summarize, brand equity is like the public’s valuation of a brand. Brand equity depicts the
consumer’s emotions with a brand.
Brand Equity is kind of power that the brand has over its competitors or the generic brands
and is developed over time. It represents the overall value of the brand in the market.

Brand equity is important to increase the valuation of a brand. The value of a strong
brand translates into numerous business benefits: 

Increases Market Share

Good brand equity results in loyal customers who prefer one brand over the other and
increases its market share.

Business expansion
Brand equity gives the opportunity to a company to spread its business into new products and
new geographies by using the positive brand name that already exists.

Price Premium
Positive brand equity can charge more for its product than the actual market price.

Asset
Brand equity is an intangible asset of an organization and like any other asset; this too can be
licensed, leased or sold to others.

Extension of Product Line

Having positive brand equity, it is easier to introduce new product lines. For example, Apple
started with Mac operating systems and easily converted its equity with iPhones.

Intangible Asset
Brand equity is an intangible asset. Positive brand equity has higher value and can be
licensed, sold, or leased to others. 

Components of Brand Equity: David Aacker’s model

Aacker has derived a simple framework, which features the key components comprising
brand equity: brand awareness, brand association, perceived quality, brand loyalty, and other
proprietary assets.

Brand Loyalty
Brand loyalty is a situation where a consumer consistently buys from the same brand over
time rather than buying from different suppliers from the same category. Loyal customers do
not buy from different sellers and do not like to substitute for any other brand in case their
brand product is unavailable.

Brand loyalty influences brand equity.

Brands experience repeated purchases from its loyal customers even when there is an
increase in its price or decrease in convenience.

Loyal customers do not get influenced by the marketing efforts of its competitor brands,
thereby ensuring there is continuous use of its brand products.

Brand Awareness
Brand awareness is a key component of Brand equity. When a customer is able to identify a
brand and can associate it with a product or service, it is referred to as brand awareness. This
is the first stage of building brand equity as the consumers have to be first familiar with the
brand before the brand can start building value.

Brand awareness can be built over time by proper advertising on an appropriate medium such
as social media and television, adding an eye-catching visual, blogs, and case studies. The
key aspect of brand awareness is to build a good image of your brand so that your audience
notices your brand.

Perceived Quality
Perceived quality is the way that a customer feels about the quality of a product with respect
to its ability to fulfill their expectations when compared to the intended purpose of the
product. 

Perceived quality plays a major role in building brand equity.

The perceived quality of a product depends on its performance, reliability, features,

durability, conformity with specifications, finish, service, and fit. But for a service, perceived
quality depends on responsiveness, tangibles, competence, reliability, responsiveness, and
empathy.

Brand Association
When a consumer interacts with a brand, the brand association starts building.

The most straightforward definition of brand association is how customers remember a

brand—what’s burned in their minds from interactions with a brand. Positive emotional
associations with people, places, and things connected to a brand are what
define positive brand association. In order to build a strong, long-lasting brand, positive traits
need to be entrenched in customers’ minds in connection to that brand. Positive brand
association sells products and increases company value.

Other Proprietary Assets

Proprietary assets include patents, trademarks, and channel or trading partner relationships.

These assets are vital to ensuring that other brands cannot compete by operating under a
similar name or using very similar packaging, which may confuse consumers and compete
away from a brand’s customer base.
Q5. Demonstrate the various types of Advertisement.

Ans.

Advertising is the promotion of a company's products and services though different mediums
to increase the sales of the product and services.

Types of advertisements:

i. On this basis of area coverage:

Local Advertising
It is also known as „retail advertising‟. It is undertaken by local retail stores, departmental
stores, co-operative stores, selling cloth, saris, and other consumer goods and consumer
durables.

It is directed at local customers. Media, used for local advertising, are shop decorations, local
newspapers, magazines, posters, pamphlets, hoarding, new signs, local cinema houses, etc.

Regional Advertising
It has wider coverage, as compared to local advertising. It covers a particular region, which
may be one state, or, more than one state, the people of which may be having a common
tongue, or, use one common product.

It is undertaken by the manufacturer, or, a regional distributor of a product. Media, used for
regional advertising, include regional newspapers, magazines, radio, regional T.V., outdoor
media, etc. It is considered to be an ideal form of advertising for launching and marketing a
new product in a specific region.

National Advertising
It is generally undertaken by manufacturers of branded goods, for which, advertising
messages is communicated to consumers all over the country. Almost all possible mass
media, including national newspapers, radio, and television networks, are employed for
national advertising.

Product services, and ideas, which have been demanded all over the country, are suitable for
national advertising. In India, Indian Airline Hindustan Lever Ltd., Vicco, Godrej, Bajaj, and
Kirloskar are a few leading advertisers at the national level.

Likewise, detergents, soaps, kinds of toothpaste, cosmetics, scooters, cars, and bicycles, are
some of the products, which are advertised all over the country.
International Advertising
This type of advertising is undertaken by those companies, which operate in more than one
country, known as „multi-national‟ companies. Exporters, generally advertise their products
and services in foreign countries, where ready markets are available.

Air India and other airlines, and multinational companies advertise their products and
services all over the world. Coca-Cola and Pepsi are advertised globally, as the sales are
almost all over the world. International advertising is extremely expensive, involving the
services of professional advertising agencies in different countries.

ii. On the Basis of Audience

Consumer Advertising
This type of advertising is directed to the ultimate consumers of the consumer products, i.e.,
the individuals, who buy, or, use the consumer products, or services, say, for example, toilet
soap, toothpaste, toothbrush, tea, textiles, etc., for themselves and for their families.

All types of consumer products need continuous and extensive advertising on T.V., radio, and
press.

Industrial Advertising
This type of advertising is used by manufacturers and distributors of industrial goods. Such as
machinery, plants, types of equipment, spare parts, and components, and are directed at
industrial users or customers.

Such advertisements usually appear in trade journals, trade dictionaries, business magazines,
and so on. The appeal made is tactual and rational.

Trade Advertising
This kind of advertising is employed by manufacturers and/or distributors to influence and
persuade wholesalers and dealers (retailers) to stock and sell the goods of the advertiser by
offering incentive schemes to them, or, by inviting dealerships for their particular products(s).

Professional Advertising
It is directed at professionals like doctors, professors, engineers, and others, who are expected
to recommend, prescribe, or, specify the advertised products to ultimate consumers. This is
done through professional journals and representatives of the advertisers.

iii. On The Basis of Media

Print Media Advertising

The print media consists of newspapers, magazines, journals, handbills, etc. No newspaper
or, journal, today, can survive without advertising revenue.

Print media advertising, even today, is the most popular form; and revenue derived by mass
media from advertising has, therefore, been progressively increasing year after year. Print
media appeals only to the sense of sight, i.e. eyes.
Electronic or Broadcast Media Advertising
Electronic, or, broadcast media consists of (i) radio, (ii) television, (iii) motion pictures, (iv)
video, and (v) the internet. The radio is audio in nature, appealing only to the sense of sound
(ears). Radio advertising is more effective in rural areas, as compared to urban regions.

Television, as an advertising medium, is more attractive and effective because it is an audio-

visual medium appealing to both the senses of sight and sound (eyes and ears). Different
methods, such as spot announcements, sponsored programs, etc., are used for broadcasting
advertising messages.

However, broadcasting media are a very expensive form of advertising. Advertising is also
undertaken through movies, videos, and the internet.

Outdoor Media
This includes posters, neon signs, transit, point of purchase (POP), etc. Outdoor advertising
can be a good supporting media for other forms of advertising. It is a good form of reminder
advertising, especially, POP advertising.

Other Media
This includes direct mail, handbills, calendars, diaries, cinema advertising, the internet, and
so on. These miscellaneous media can play an important supporting role to the major media
such as television, and newspapers.

iv. on The Basis of Function

Primary and Selective Advertising

Primary Advertising is undertaken by trade associations or by cooperative groups. It is
undertaken to create generic den1 and for products and services. For example, the Coffee
Board may advertise to consume more coffee.

Selective Advertising is undertaken by marketers of branded products. The advertiser intends

to create selective demand for his brand. Examples include Pepsi Cola, Coca Cola.

Product and Institutional Advertising

Product or Service advertising is undertaken to promote the sale of products and services
branded or unbranded. Institutional advertising is undertaken to build the name and goodwill
of the organization. It is also, known as corporate advertising or image advertising. It is
mostly undertaken by large firms.

v. The Basis of Advertising Stages

Advertising at Pioneering Stage

Advertising at the pioneering stage is undertaken to make the audience fully aware of the new
brand of a product and to inform, influence, and persuade them to buy, or, use it by
highlighting its unique features.
Advertising at Competitive Stages
Once the brand survives the introductory stage, it has, soon faces stiff competition from other
well-established brands in the market. At this stage, competitive advertising is undertaken to
promote sales effectively.

Advertising at Retentive Stage or Reminder Advertising

When the product has captured a large share of the market, retentive advertising is
undertaken to maintain, or retain the stable position in the market for as long as possible.

Moreover, if the same product is passing through the declining stage in the market, this type
of advertising is used to remind the buyers about the product hence, it is also known as
reminder advertising.

Q6. Describe the various International Market Entry Strategies.

Ans.

There are a variety of ways in which organisations can enter foreign markets. Here is a brief
overview of the methods applicable to international market entry.

1. Exporting

Exporting is the most traditional and well established form of operating in foreign markets.
Exporting can be defined as the marketing of goods produced in one country into another.

The advantages of exporting are:

· manufacturing is home based thus, it is less risky than overseas based

· gives an opportunity to "learn" overseas markets before investing in bricks and mortar
· reduces the potential risks of operating overseas.

The disadvantages of exporting are:

The disadvantage is mainly that one can be at the "mercy" of overseas agents and so the lack
of control has to be weighed against the advantages.

Exporting methods include direct or indirect export.

Direct exporting:

In which they sell the product they manufacture in international markets without third-party
involvement. Companies that sell luxury products or have sold their goods in global markets
in the past often choose this method.

Indirect exporting:
A company may export indirectly by using the services of agents, such as international
distributors. Businesses often choose indirect exporting if they’re just beginning to distribute
internationally. While companies pay agents for their services, Indirect exporting often
results in a return on investment (ROI) because the agents know what it takes to succeed in
the markets in which they work and they have local networks.

2. Joint venture

Some companies attempt to minimize the risk of entering an international market by creating
joint ventures with other companies that plan to sell in the global marketplace. Since joint
ventures often function like large, independent companies rather than a combination of two
smaller companies, they have the potential to earn more revenue than individual companies.

A joint venture consists of two or more different entities (companies) establishing a jointly-
owned business. One of the owners will be a local business (local to the foreign market). The
companies would then provide the new business with a management team and share control
of the joint venture.

3. A strategic alliance

A strategic alliance is an arrangement between two companies to undertake a mutually

beneficial project while each retains its independence. The agreement is less complex and
less binding than a joint venture, in which two businesses pool resources to create a separate
business entity.

A company may enter into a strategic alliance to expand into a new market, improve its
product line, or develop an edge over a competitor. The arrangement allows two businesses
to work toward a common goal that will benefit both.

The relationship may be short- or long-term and the agreement may be formal or informal.

4. Foreign direct investment

Foreign direct investment (FDI) involves a company directly investing in facilities in a

foreign market. It often requires sizeable levels of capital to cover costs such as premises,
technology and staff. FDI can be performed either by establishing a new venture in the
overseas country or acquiring an existing company.

There is often a wide range of support in-country for those companies participating in FDI.
Government incentives vary by location but items such as talent attraction, R&D and capital
investment incentives, tax credit programs and so forth are normally available.
Greenfield investments are complex market entry strategies that some companies choose to
use. These investments involve buying the land and resources to build a facility
internationally and hiring a staff to run it. Greenfield investments may subject a company to
high risks and significant costs, but they can also help companies comply with government
regulations in a new market. These investments typically benefit large, established
organizations.
 5. Licensing

In a Licensing, a business in your target market will pay for limited rights to your product.
This contract may allow them to manufacture, promote, and sell your product in their region.

In some respects, licensing is quite similar to the direct export model. Both systems allow
you to pass everyday operations to local experts in your target market. The main difference is
that your customer is the licensee, not the end consumer.

This system has several benefits. They allow you to avoid sticky subjects such as logistics,
while making a profit on both physical and digital goods. Such agreements can also be highly
lucrative, with a guarantee of revenue.

6. Franchising

Franchising is somewhat similar to licensing in that intellectual property rights are sold to a
franchisee. However, the rules for how the franchisee carries out business are usually very
strict – for example, any processes must be followed, or specific components must be used in
manufacturing.

Franchising typically requires strong brand recognition, as consumers in your target market
should know what you offer and have a desire to purchase it. For well-known brands,
franchising offers companies a way to earn a profit while taking an indirect management
approach.

7. Piggybacking

For smaller businesses, talk of joint ventures might be a little far-fetched. However, there are
other ways to expand into new markets with the help of local experts.

Piggybacking is where a small or medium-sized business adds its products and services to the
sales inventory of a larger business in a foreign market. Such arrangements are usually made
between companies that are not in direct competition, so that cross-selling can take place.
For a small business, piggybacking is one of the least risky strategies for entering foreign
markets. You also get the benefit of a local, well-established presence.

For the local company, the reward usually comes in the form of commissions. Ensuring there
is enough profit for everyone involved is the key to securing an arrangement of this kind.

8. Turnkey Solutions

The final key strategy for entering foreign markets starts with product development.

In industries where most contracts have similar requirements, many businesses now
offer turnkey solutions. These products are designed to slot into any workflow and start
operating almost instantly. You can find them in construction, engineering, manufacturing,
technology, and elsewhere.
 9. Outsourcing

Outsourcing involves hiring another company to manage certain aspects of business

operations for your company. As a market entry strategy, it refers to making an agreement
with another company to handle international product sales on your company’s behalf.
Companies that choose to outsource may relinquish a certain amount of control over the sale
of their products, but they may justify this risk with the revenue they save on employment
costs.

10. Wholly owned subsidiary

A wholly owned subsidiary is somewhat similar to foreign direct investment in that money
goes into a foreign company but instead of money being invested into another company, with
a WOS the foreign business is bought outright. It is then up to the owners whether it
continues to run as before or they take more control of the WOS.

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