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International marketing

From Wikipedia, the free encyclopedia

International marketing (IM) or global marketing refers to marketing carried out by companies overseas or across national borderlines. This strategy uses an extension of the techniques used in the home country of a firm.[1] It refers to the firm-level marketing practices across the border including market identification and targeting, entry mode selection, marketing mix, and strategic decisions to compete in international markets.[2] According to the American Marketing Association (AMA) "international marketing is the multinational process of planning and executing the conception, pricing, promotion and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives."[3] In contrast to the definition of marketing only the wordmultinational has been added.[3] In simple words international marketing is the application of marketing principles to across national boundaries. However, there is a crossover between what is commonly expressed as international marketing and global marketing, which is a similar term. The intersection is the result of the process of internationalization. Many American and European authors see international marketing as a simple extension of exporting, whereby the marketing mix4P's is simply adapted in some way to take into account differences in consumers and segments. It then follows that global marketing takes a more standardised approach to world markets and focuses upon sameness, in other words the similarities in consumers and segments.

1 Topics covering the micro-context of international marketing 2 Differences between domestic marketing and international marketing 3 Mode of engagement in foreign markets

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3.1 Exporting 3.2 Joint ventures 3.3 Direct investment

4 References


covering the micro-context of international marketing

According to Kotabe, the following topics covers the micro-context of international marketing.[4] Organisational and consumer behaviour:

organisational buying behaviour; international negotiations; consumer behaviour; country of origin.

Marketing entry decisions:

initial mode of entry specific modes of entry

exporting; joint ventures.

Local market expansion: marketing mix decisions:

global standardisation vs. local responsiveness Marketing mix:

product policy; advertising; pricing; distribution.

Global strategy:

Competitive strategy: conceptual development; competitive advantage vs. competitive positioning; sources of competitive advantage and performance implications.

Strategic alliances:

learning and trust; recipes for alliance success;

performance of different types of alliance.

Global sourcing:

global sourcing in a service context; benefits of global sourcing; country of origin issues in global sourcing.

Multinational performance:

determinants of performance; a different interpretation of performance. Analytical techniques in cross-national research:

measuerment issues; reliability and validity issues.


between domestic marketing and international marketing

Internation is developed by various multinational companies on a global level in order to set a common brand platform for their products and brands. It is then passed on to each local or domestic market who makes adjustments for their country and manages its implementation. Such a structure ensures a global brand consistency, pricing and messaging. It also can have significant cost savings as major advertising and marketing campaigns can be developed centrally

of engagement in foreign markets

After the decision to invest has been made, the exact mode of operation has to be determined. The risks concerning operating in foreign markets is often dependent on the level of control a firm has, coupled with the level of capital expenditure outlayed. The principal modes of engagement are listed below:

Exporting (which is further divided into direct and indirect exporting)

Joint ventures Direct investment (split into assembly and manufacturing)


Direct exporting involves a firm shipping goods directly to a foreign market. A firm employing indirect exporting would utilize a channel/intermediary, who in turn would disseminate the product in the foreign market. From a company's standpoint, exporting consists of the least risk. This is so since no capital expenditure, or outlay of company finances on new non-current assets, has necessarily taken place. Thus, the likelihood of sunk costs, or general barriers to exit, is slim. Conversely, a company may possess less control when exporting into a foreign market, due to not control the supply of the good within the foreign market.


A joint venture is a combined effort between two or more business entities, with the aim of mutual benefit from a given economic activity. Some countries often mandate that all foreign investment within it should be via joint ventures (such as India and the People's Republic of China). By comparison with exporting, more control is exerted, however the level of risk is also increased.


In this mode of engagement, a company would directly construct a fixed/non-current asset within a foreign country, with the aim of manufacturing a product within the overseas market. Assembly denotes the literal assembly of completed parts, to build a completed product. An example of this is the Dell Corporation. Dell possesses plants in countries external to the United States of America, however it assembles personal computers and does not manufacture them from scratch. In other words, it obtains parts from other firms, and assembles a personal computer's constituent parts (such as a motherboard, monitor, CPU, RAM, wireless card, modem, sound card, etc.) within its factories. Manufacturing concerns the actual forging of a product from scratch. Car manufacturers often construct all parts within their plants. Direct investment has the most

control and the most risk attached. As with any capital expenditure, the return on investment (defined by the payback period,Net Present Value, Internal Rate of Return, etc.) has to be ascertained, in addition to appreciating any related sunk costs with the capital expenditure.