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International Marketing (Class-8)

Arun Bhattacharyya
Faculty Member
JIM, Noida
B2B is not equal to B2C
• Complexity: B2B Products are more complex; requires qualified
experts on both sides; tend to be individual solutions that require high
levels of fine tuning; information needs higher

• Demand: Demand for B2B Products is more volatile; demand is generally


derived pulled through the value chain as a result of demand for the final
end product.

• Internationality: Choice of B2B Products not affected by culture;


industrial products are mostly similar across the world, requiring much
less adaption in cross-border transactions

• Organisational Buying: B2B Products is associated with larger


volumes/ customer; Fewer customers than B2C: mostly Users, OEMs and
Middlemen.

• Buying Situation: B2B markets looks at closer and longer lasting


supplier –customer relationships; The straight re-buy, the modified re-buy,
new task
B2B customers: The Buying Center
As a B2B marketer one has to identify the members involved in the buying process

• Initiators: detect the need for a purchase

• User: who will use it at the end

• Influencers: have the power to guide the buying decision

• Decider: final decision for the purchase


• Approver: approves the purchase

• Buyers: formally authorised to select the supplier & arrange purchase


• Gate keepers: control information flow to the buying center
Sizing up Marketing Opportunities: Population and
Demographics

* Those in the 25-45 age group are the most affluent consumers of all
* Northern Europe will show nearly zero population growth for the
next 30 years, while that of Africa might triple.

* Age distribution & life expectancy correlate strongly with levels of


market development (e.g. adult diapers in US)

* Size of households in European Union has shrunk from 2.9 to 2.7


persons since 1977 & will decline further. Reason: divorce & sole
survivor households. Opportunities- single-serving portions of
frozen foods & smaller appliances

* The concept of urbanisation varies from country to country: USA- an


urban area is a place of 2500 or more inhabitants; Sweden- a built-
up area with at least 200 inhabitants with no more than 200 meters
between houses; Mauritius-is a town with proclaimed legal limits
Sizing up Marketing Opportunities: Income Distributions
GDP figures to be used with caution- In industralised countries the richest
10% of population consume 20% of all goods & services; developing
countries almost 50%
* The more developed the economy, more the income distribution converge
towards the middle class.
Some classifications based on income are:

* Very low family incomes: Rural populations, consumption relies on personal


output or barter. Urban centres may provide markets (Cameroon)

* Very low, very high family incomes: Bimodal income distributions. Majority
of population at subsistence level, strong market in urban centres &
growing middle class. Affluent consume a lot. (India, Mexico)

* Low, medium, high family incomes: Industrialisation produces emerging


middle class with increasingly disposable income. The very low & very high
income class remain due to social class barriers. (Portugal)

* Mostly medium family incomes: Advanced industrial nations tend to reduce


extremes in income distributions, resulting in very large & comfortable
middle class, ability to purchase wide variety of offerings. (Denmark)
Planning for Global Markets….
Should companies plan on country-by-country basis or should plg. be
portfolio based that focus simultaneously across a broad range of
markets to balance risks, resource requirements, competitive EOS &
long-term gains/positions?
International * Long term planning, incorporating
generalised goals for the enterprise as a
Corporate whole
* Choice between immediate profit & poor long-
Planning run outlook and long-term profitability

International * At the top management levels & consists of


Strategic long & short-term goals of the enterprise
* Deals with products, capital, research
Planning
* Made normally at the local level and address
International marketing & advertising/promotion
Tactical questions
* Pertains to specific actions & to allocation of
(market) resources to implement strategic planning
Planning goals in specific markets
Questions need to be asked….
* What adjustments, if any, you need to
make to the…
* Product line (Which products have the best chances of
making it?)
* Product's positioning and market mix (Optimising the firm’s
sales message for best results)

* Product's design (to better satisfy market requirements, but


also to satisfy regulatory demands)

* What is the cost of ‘entry’ in


the market…
* The strengths and weaknesses of potential competitors, their
investment level, their marketing savvy.

* How soon will the firm be


successful…
* Sales revenue generation
* What ROI (also ROTI?) should the firm
expect…
Planning for Global Markets (contd.)
* Phase-I: Preliminary Analysis and
Screening:
* Matching company and country needs (stand-alone attractiveness of
the market; global strategic importance and possible synergies)
* Should we go for Emerging Markets?
* Company: philosophy &objectives, management styles & skills, resource
constraints
* Home country constraints: P, L, E, others
* Host-country constraints: PESTLIED, Competition, Structure of
distribution
* Phase-II: Adapting the Marketing Mix to
Target Markets
* Identifiable market segments that allow common marketing mix
(Product, Price, Promotion, Distribution) tactics across countries

* Product (brand name, features, packaging, service, warranty, style),


Price (credit, discounts), Promotion (adv., personal selling, media,
message), Distribution (logistics, channels)
* Cultural/environmental adaptations necessary for adaption of the
marketing mix
* Will adaption costs allow profitable market entry?
Planning for Global Markets (contd.)
* Phase-III: Developing the
Market Plan
* Can the company marketing objectives/goals be met

Situational
Objectives & goals Strategy & tactics
analysis

Selecting entry
Action program Budgets
mode

* What is to be done, by whom, how and when

* Phase-IV: Implementation and


control
Assign
Objectives Standards
responsibility

Correction for Performance


errors measures
The new kid on the block….
The Mininational
Who are they:
Newer companies with sales between $ 200 m & $ 1b
Able to serve the world from a handful of manufacturing
bases
Ability to move swiftly because of their size and seize new
markets
Characteristics:
Focus on being number one or two in a technology niche
Stay lean by having a small HQ to save costs & accelerated
decision making
Take idea and technology to and from wherever they can be found
Welcome employee expertise regardless of nationality to globalise
thinking.
Examples:
Cochlear, Australia: Production of implants for profoundly deaf.
Symbol Technologies, Bohemia, New York: Hand held laser scanners
Cisco Systems, California: grew from a Mininational to an entity
Thank you for
Participating