International Marketing & Operations

International Marketing
• What is meant by “marketing ”? Is it the same as sales?

 Definition of marketing according to American Marketing Association (AMA,

2004):

 “ Marketing is an organizational function & a set of processes for creating,

communicating & delivering value to customers & for managing customer
r/ships in ways that benefit the organization & its stakeholders.”

 Thus, marketing is:

 a process & function

 It is also

 a philosophy

 an attitude

 an orientation
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 International Marketing
 It has multi-stakeholder application:
 Customers
 Suppliers
 Distributors
 Internally (Employees)
 Owners / investors
 Local community
 Government
 Unions, etc.
 Actually, there are several definitions of marketing & some of them are:
 Any interpersonal & inter-organizational r/ship involving an exchange is
marketing ( William J . Stanton)
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 International Marketing
 The essence of Marketing is a transaction – an exchange – intended to satisfy human
needs & wants
 Accordingly, there are three elements in the marketing process:
 Marketers
 What is being marketed
 Target market
 Marketing is a social process by which individuals & groups obtain what they need &
want through creating & exchanging products & value with others (Philip Kotler)
 This definition includes the following core concepts:
 Needs, wants & demands
 Products & services
 Value, satisfaction & quality
 Exchange, transaction & r/ships
 Markets & marketers
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 International Marketing
 Marketing can not be considered as a separate function; it is the
whole business, seen from the point of view of its final results, that is
profit, through customer satisfaction (Peter Drucker)
 A Simple Marketing System
Communication

Industry Market

Information/Feedback 5
 Marketing & Sales Concepts Contrasted

Starting Point Focus Means Ends

Selling Profits
Existing
Factory & through
Products
Promoting Volume

The Selling Concept

Profits
Customer Integrated
Market through
Needs Marketing
Satisfaction

The Marketing Concept

Source: Philip Kotler & Gary Armstrong, Principles of Marketing,6 1999

 Definitions of International Marketing & operations

International marketing
 “ The multinational process of planning & executing the conception,
pricing, promotion & distribution of ideas, goods & services, and to create
exchanges that satisfy individual & organizational objectives.” (Onkvisit
& Shaw)

 The performance of business activities designed to plan, price, promote

& direct the flow of a company’s goods & services to customers or users
in more than one nation for a profit (Cateora & Graham, 2002)

 What is the main difference b/n domestic & international marketing?

 Marketing activities take place in more than one country

 This might seem apparently minor difference but accounts for the
complexity & diversity found in international marketing operations
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 Definitions of International Marketing & operations

 Thus, the answer lies not with different concepts of marketing but with
the environment within which marketing plans must be implemented

 The uniqueness of foreign marketing comes from:

 the range of unfamiliar problems encountered in foreign markets

 the variety of strategies necessary to cope with different levels of

uncertainty

 Several uncontrollable elements (legal restraints, unpredictable

consumers, etc.

 All these do affect the profitable outcome of sound marketing plans

 Therefore, the marketer must adapt to those uncontrollable factors in a

manner consistent with a successful outcome
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 Definitions of International Marketing & operations

 What is interesting is the challenge of moulding the controllable

elements of marketing decisions (product, price, promotion &
distribution) within the framework of the uncontrollable elements
of the marketplace (competition, politics, laws, consumer
behaviour, level of technology, etc.) in such a way that marketing
objectives are achieved (Cateora & Graham, 200 2 )

 The challenge of international marketing is to develop strategic

plans that are competitive in the intensifying global markets

 F or growing number of companies, being international is no longer

a luxury but a necessity for economic survival

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 International Marketing
 Of all the trends affecting global business the most dynamic are:

 The rapid growth of the WTO & regional free trade areas

 The trend toward the acceptance of the free market system

among developing countries

 The burgeoning impact of the Internet & other global media on

the dissolution of national boundaries

 These & other issues affecting the world economy, trade, markets &
competition should be the focus

 Successful marketing is difficult & challenging & international

marketing even more so
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 International Marketing

 Complexity theory: Argues that the world is complex and – importantly –

that it is often not possible to understand complex systems by looking
at their individual parts.

 “ The standard approach of breaking things up into individual pieces,

solving those & then summing the solutions of the independent parts
together simply doesn't work for complex systems.

 Are you skeptical or not?

Complexity theory: See for example Dolan et al, Understanding and managing
chaos in organisations, International Journal of Management, Vol. 20, No. 1, March
2003
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 Definitions of International Marketing & operations

Operations
 Operations is concerned with the design & the operation of systems for
manufacture, transport, supply or service (Thomson, 2002)

 Operations management (OM) is defined as the design, operation, and

improvement of the systems that create & deliver the firm’s primary
products & services

 Specifically, the emphasis of OM is in the transformation process

 A transformation process is defined as a user of resources to transform

inputs into some desired outputs

 Examples of transformations:

 Physical – manufacturing
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 Definitions of International Marketing & operations

 Locational – transportation
 Exchange – retailing
 Storage – warehousing
 Informational – telecommunications, etc.
 OM must focus on core services that customers want
 Core services are basic things that customers want from products
they purchase
 The importance of operations management
 Synergies must exist with other functional areas of the
organization
 Operations account for 6 0 - 8 0% of the direct expenses that
burden a firms profit
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Core Services Performance Objectives

Quality

Flexibility Operations Speed

Management

Price (or cost

Reduction)
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 Operations Strategy

Strategy Process Example

Customer Needs More Product

Corporate Strategy Increase Organization

Size

Operations Strategy Increase Production Capacity

Decisions on Processes
and Infrastructure Build New Factory
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 International Marketing & Operations: Two Key Issues

 Customise or Adapt?
Standardisation “is the central managerial issue in
international marketing if marketing itself is defined in terms
of formulating & implementing policies regarding the four (or
more) Ps of product, price, promotion & place [distribution]
”.

Source: Boddewyn, JJ & Grosse, R , “ American Marketing in

the European Union”, European Journal of Marketing, 19 9 5,
Vol. 2

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 International Marketing & Operations: Two Key Issues

 Operations as the key factor for success?

“ Successful companies... tend to be those that have
recognised that competitive advantage comes from their
strategic position and, second, from their operating
efficiency. Clearly a combination of the two is better still”.

Source: Christopher, M, “ Reaching the customer: Strategies

for marketing and customer service”, Journal of Marketing
Management, Summer , 8 6 , Vol. 2 Issue 1

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