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Domestic marketing vs International marketing Domestic marketing and International marketing are same when it comes to the fundamental

principle of marketing. Marketing is an integral part of any business that refers to plans and policies adopted by any individual or organization to reach out to its potential customers. A web definition defines marketing as a process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational goals. With the world shrinking at a fast pace, the boundaries between nations are melting and companies are now progressing from catering to local markets to reach out to customers in different parts of the world. Marketing is a ploy that is used to attract, satisfy and retain customers. Whether done at a local level or at the global level, the fundamental concepts of marketing remain the same. Domestic Marketing The marketing strategies that are employed to attract and influence customers within the political boundaries of a country are known as Domestic marketing. When a company caters only to local markets, even though it may be competing against foreign companies operating within the country, it is said to be involved in domestic marketing. The focus of companies is on the local customer and market only and no thought is given to overseas markets. All the product and services are produced keeping in mind local customers only. International Marketing When there are no boundaries for a company and it targets customers overseas or in another country, it is said to be engaged in international marketing. If we go by the definition of marketing given above, the process becomes multinational in this case. As such, and in a simplified way, it is nothing but application of marketing principles across countries. Here it is interesting to note that the techniques used in international marketing are primarily those of the home country or the country which has the headquarters of the company. In America and Europe, many experts believe international marketing to be similar to exporting. According to another definition, international marketing refers to business activities that direct the flow of goods and services of a company to consumers in more than one country for profit purposes only. Difference between domestic marketing and international marketing As explained earlier, both domestic as well as international marketing refer to the same marketing principles. However, there are glaring dissimilarities between the two. Scope The scope of domestic marketing is limited and will eventually dry up. On the other end, international marketing has endless opportunities and scope. Benefits As is obvious, the benefits in domestic marketing are less than in international marketing. Furthermore, there is an added incentive of foreign currency that is important from the point of view of the home country as well. Sharing of technology Domestic marketing is limited in the use of technology whereas international marketing allows use and sharing of latest technologies. Political relations Domestic marketing has nothing to do with political relations whereas international marketing leads to improvement in political relations between countries and also increased level of cooperation as a result. Barriers In domestic marketing there are no barriers but in international marketing there are many barriers such as cross cultural differences, language, currency, traditions and customs.

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Conducting and managinginternational business operations is more complex than undertakingdomestic business. Differences in the nationality of parties involved, relatively less mobility of factors of production, customer heterogeneity across markets, variations in business practices and political systems, varied business regulations and policies, use of different currencies are the key aspects that differentiate international businesses from domestic business. These,

moreover, are the factors that make international business much more complex and a difficult activity.

Differences between International Trade and Domestic Trade


Scope: Scope of international business is quite wide. It includes not only merchandise exports, but also trade in services, licensing and franchising as well as foreign investments. Domestic business pertains to a limited territory. Though the firm has many business establishments in different locations all the trading activities are inside a single boundary. Benefits: International business benefits both the nations and firms. Domestic business have lesser benefits when compared to the former. To the nations: Through international business nations gain by way of earning foreign exchange, more efficient use of domestic resources, greater prospects of growth and creation of employment opportunities. Domestic business as it is conducted locally there would be no much involvement of foreign currency. It can create employment opportunities too and the most important part is business since carried locally and always dealt with local resources the perfection in utilisation of the same resources would obviously reap the benefits. To the firms: The advantages to the firms carrying business globally include prospects for higher profits, greater utilization of production capacities, way out to intense competition in domestic market and improved business vision. Profits in domestic trade are always lesser when compared to the profits of the firms dealing transactions globally. Market Fluctuations: Firms conducting trade internationally can withstand these situations and huge losses as their operations are wide spread. Though they face losses in one area they may get profits in other areas, this provides for stabilizing during seasonal market fluctuations. Firms carrying business locally have to face this situation which results in low profits and in some cases losses too.

Modes of entry: A firm desirous of entering into international business has several options available to it. These range from exporting/importing to contract manufacturing abroad, licensing and franchising, joint ventures and setting up wholly owned subsidiaries abroad. Each entry mode has its own advantages and disadvantages which the firm needs to take into account while deciding as to which mode of entry it should prefer. Firms going for domestic trade does have the options but not too many as the former one. To establish business internationally firms initially have to complete many formalities which obviously is a tedious task. But to start a business locally the process is always an easy task. It doesn't require to process any difficult formalities. Purvey: Providing goods and services as a business within a territory is much easier than doing the same globally. Restrictions such as custom procedures do not bother domestic entities but whereas globally operating firms need to follow complicated customs procedures and trade barriers like tariff etc.

Sharing of Technology: International business provides for sharing of the latest technology that is innovated in various firms across the globe which in consequence will improve the mode and quality of their production. Political relations: International business obviously improve the political relations among the nations which gives rise to Cross-national cooperation and agreements. Nations co-operate more on transactional issues.

See Also:
Domestic Trade

Domestic trade is the exchange of goods, services, or both within the confines of a national territory. They are always aimed at a single market. It always deal with only one set of competitive, economic, and... International Trade Trade that includes exchange of capital, goods, and services across nations is called International Trade. It is always a major source of economic revenue for any nation and in absence of the same nations...

Domestic marketing is the marketing practices within a marketer's home country. Foreign marketing is the domestic operations within a foreign country (i.e., marketing methods used outside the home market). Comparative marketing analytically compares two or more countries' marketing systems to identify similarities and differences. International marketing studies the "how" and "why" a product succeeds or fails abroad and how marketing efforts affect the outcome. It provides a micro view of the market at the company level. Multinational, global, and world marketing are all the same thing. Multinational marketing treats all countries as the world market without designating a particular country as domestic or foreign. As such, a company engaging in multinational marketing is a corporate citizen of the world, whereas international marketing implies the presence of a home base. However, the subtle difference between international marketing and multinational marketing is probably insignificant in terms of strategic implications. Answer Domestic marketing is the marketing practices within a marketer's home country. Foreign marketing is the domestic operations within a foreign country (i.e., marketing methods used outside the home market). Comparative marketing analytically compares two or more countries' marketing systems to identify similarities and differences. International marketing studies the "how" and "why" a product succeeds or fails abroad and how marketing efforts affect the outcome. It provides a micro view of the market at the company level. Multinational, global, and world marketing are all the same thing. Multinational marketing treats all countries as the world market without designating a particular country as domestic or foreign. As such, a company engaging in multinational marketing is a corporate citizen of the world, whereas international marketing implies the presence of a home base. However, the subtle difference between international marketing and multinational marketing is probably insignificant in terms of strategic implications.

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Introduction to global marketing : Introduction to global marketing The process of focusing the resources (people, money, and physical assets) and objectives of an organisation on global market opportunities and threats Keegan 1995

Slide 2: Theodore Levitt - Marketing Myopia

Slide 3: Marketing is now a universal discipline the new concept of marketing appeared 1960 - Marketing Myopia - Levitt now strategic concept

The Three Principles of Marketing : The Three Principles of Marketing Customer value and the value equation i.e. value greater than competitors Value equation is: VALUE = PERCEIVED BENEFITS / PRICE Competitive or differential advantage advantage vis--vis competition

Slide 5: Focus i.e. the concentration of attention IBM was focused on customer needs and wants for data processing IBM crisis in early 1990s - lost focus achieved through concentrating resources

From Domestic to Global/Transnational Marketing : From Domestic to Global/Transnational Marketing Where is it made? V Where is it marketed? Domestic marketing Export marketing International marketing Multinational marketing Global/transnational marketing

Driving forces : Driving forces Global Village Mashall Macluhan Market needs - X-Box for leisure Technology - Third Generation phones (3G) Cost - low cost production e.g. Gap Quality - Is now taken for granted. Communications and Transportation

Driving forces (2) : Driving forces (2) Leverage (i.e. advantages of operating in numerous markets simultaneously) experience transfers systems transfers scale economies resource utilisation global strategy. Scanning the globe!

Restraining forces : Restraining forces Market differences - diversity History - Guanxi Management myopia as a barrier Organisational culture as a barrier National controls/Barriers to entry e.g tariffs and Quotas.

Slide 10: How have things changes after September 11th 2001?

Underlying forces : Underlying forces Dr. Howard Perlmutter Orientation of Management and Companies International money framework and exposure to currency fluctuations post WWII World trading system - WTO (GATT) Global peace - post September 11th Arrival of global/transnational companies

International Marketing Environment


Environment analysis for international marketing
One of the fundamental steps that needs to be taken prior to beginning international marketing is theenvironmental analysis. Of course there are many tools on Marketing Teacher that would prove useful at this stage such as lessons on the marketing environment, PEST Analysis, SWOT Analysis, POWER SWOT and Five Forces Analysis. However, the very specific and unique nature of each individual nation needs to be looked into. Below we consider the nature of an international PEST Analysis, and the influence of tariff and non-tariff barriers.

An International PEST Analysis.


PEST is a well-known and widely applied tool when considering the external nature of the domestic market. However, it is equally as useful when applied to the nature of the international marketing environment. International PEST Analysis would consider:


Political

How easy will it be to move from purely domestic to international marketing? Would your business benefit from inward foreign investment? What is the nature of competition within each individual market, and how will companies from other nations compete when you meet with them head-to-head in unfamiliar countries? Many other factors that are specific to your organization or industry.

Is there any historical relationship between countries that would benefit or hinder international marketing?

What is the influence of communities or unions for trading? E.g. The European Union and its authority over European laws and regulation. What kind of international and domestic laws will your business encounter? What is the nature of politics in the country that you are targeting, and what is their view on encouraging foreign competition from overseas?

Economic

What is the level of new industrial growth? E.g. China is experiencing terrific industrial growth. What is the impact of currency fluctuations on exchange rates, and do your home market and your new international market - share a common currency? E.g. Polish companies trading in Eire will use Euros.

There are of course the usual economic indicators that one needs to be aware of such as inflation, Gross Domestic Product (GDP), levels of employment, national income, the predisposition of consumers to spend savings or to use credit, as well as many others.

Socio-cultural

Culture, religion and society are of huge importance. What are the cultural norms for doing business? E.g. is there a form of barter? Will cultural norms impact upon your ability to trade overseas? E.g. Putonghua is very difficult for many Western people to learn.

Technology

Do copyright, intellectual property laws or patents protect technology in other countries? E.g. China and Jordan do not always respect international patents. Does your technology conform to local laws? E.g. electrical items that run on non-domestic currents could be dangerous. Are technologies at different stages in the Product Life Cycle (PLC) in various countries? E.g. versions/releases of software.

Tariff and Non-Tariff Barriers.


There are a number of fences that companies need to plan for when initialising international marketing. Tariff and non-tariff barriers are still very common, even today. Tariff barriers are charges imposed upon imports - so they are a form of import taxation. This could mean that your margins are reduced so much that trading overseas becomes too unprofitable. However they are normally transparent and you can plan to take them into account. Non-tariff barriers are trickier to spot. Governments sometimes act in favour of their own domestic industries rather than allow competition from overseas. Bureaucracy is a hurdle often encountered by exporting companies - it takes many forms and includes unnecessary hold-ups and red tape. Quotas

are another form of non-tariff barrier i.e. restricting the quantity of a product that can be imported into a particular country.