INTERNATIONAL MARKETING :Defn- 1.

“ International Marketing is multinational process of planning & executing the conception, pricing, promotion, and distribution of ideas, goods & services to create exchange that satisfy individual & organisational objectives’’ 2. “Marketing carried on across national boundaries” 3. “Performance of biz activities that directs the flow of goods & services to consumers /users in more than one nation” 4. “Exchanges across national boundaries for satisfaction of human needs & wants”

The Scope and Challenge of International Marketing
- Q: Why Study International Marketing? - A: There is a trend toward a global economy.
• No longer enough to look at domestic market • Markets across the world being sought after by more competitors • Explosion of international trade • Global linkages become important

The Scope and Challenge of International Marketing
International Business
International Marketing International Global Marketing Trade Figure 1.2: International and Global Marketing and Related Fields of Study

International Management

International Finance

Features :1.Economies of scale through volume transactions 2.Dominated by MNC’s from Developed / Industrialised countries • Worldwide contacts • Economic & efficient operations • Global approach 1.Trade barriers • Tariff barriers • Forex regulations • Trade blocs 1.Sensitive to changes 2.Need for research
• Policy changes, substitutes, restrictions

Support of Spl institutions • Complicated procedures • Requirement of professional experts • Fund support from fin inst . Importance of Advanced Technology • Superior quality goods at competitive prices • Promote exports .6. incentives for export promotion • Competitive techniques • Regular research 8. capture world mkts 7. Fierce competition • Competiton betn developed & developing countries • Facilities.

domestic suppliers. mission. domestic financial cos. vision to national political boundaries Cos focus its view on– – – – domestic mkt opportunities. domestic customers Formulate strategies to exploit opportunities Motto is “ if its not happening in home country . DOMESTIC COMPANY• • Limits its operations.STAGES OF INTERNATIONALISATION : • It includes 5 stages : 1.it is not happeneing” • Cos analyse natl environment – – • • Never thinks of going global Selects diversification strategy if there’s growth beyond capacity .

products are superior to others • Focus is on domestic but extend to foreign countries • Select foreign mkt and extend same domestic operations .INTERNATIONAL COMPANY. people.2.• Domestic cos having growth beyond prodn & mkting capacities • Decide to exploit opportunities outside domestic country • These cos remain ethnocentric • Believe that domestic biz .

Follow this strategy due to– Ltd resources – to learn the process of going global without much risk • It extends the domestic country mkting mix & biz model & practices to foreign countries .• Most of the cos.

e ethnocentric to polycentric • The offeces/branches/subsidiaries work like domestic co.3. in each country with distinct policies suitable to that country • Ex. MULTINATIONAL COMPANY : • Cos turn multinational when they start responding to needs of different country’s market • Also termed as multidomestic • Formulates different strategies for different markets i. Philips (Netherlands) .

Harley produces motor cycles in USA & mkts globally. Dr.Reddy’s Labs . GLOBAL COMPANY : • is the one having global marketing strategy • Either produces in home country/ single country • Focusses on marketing these products globally/ produces the products globally & mkt these products domestically • Ex.4.

5. TRANSNATIONAL COMPANY:• Produces . global mkts.Vision & aspiration are global. markets. global customers . invests & operates across the world • Its an integrated global enterprise which links global resources with global mkts at profit • There is no pure TNC CHARACTERISTICS1.Collect data & info worldwide regardless of boundaries 3.geocentric 2.

4. Analyse global opportunities regarding– Availability of resources – Customers – Mkts – Technology –R & D 5.Adaptation : products. mkt & functional strategies . Operating style– Globalise functions like• • • • R&D Product development HRM Procured of high valued material 6.

purchasing .they’re an extn ex.lighters 8.7.HRM policy 9. Calculators. Products do not require any change.

Drivers of International Expansion • Competition • Regional Economic and Political Integration • Technology • Improvements in Transportation and Telecommunication • Economic Growth • Transition to Market Economy • Converging Consumer Needs .

the advertising agency. continued COMPETITION • McCann Erickson. Coke. to all countries where company is present . follows longtime client.Drivers of International Expansion.

Drivers of International Expansion. continued REGIONAL. and the European Union lower and eliminate barriers and promote trade within common markets. • Subsidiaries are established in specific markets to take advantage of free trade within the region. ECONOMIC and POLITICAL INTEGRATION • Regional agreements such as NAFTA. .

.Drivers of International Expansion. continued TECHNOLOGY • Consumers worldwide are exposed to similar products. services. • The Web and the Internet have revolutionized the way companies conduct business. and entertainment.

and e-mail • Efficient transportation due to containerization and justin-time technology . continued TRANSPORTATION and TELECOMMUNICATIONS • Lower cost and higher quality communication due to satellite technology.Drivers of International Expansion. teleconferencing.

such as the markets of China and Vietnam • Emerging economies are becoming viable trade partners . continued ECONOMIC GROWTH • Emerging middle class with increasing buying power in big emerging markets such as Brazil and India • Opening of new markets previously closed.Drivers of International Expansion.

Drivers of International Expansion. continued TRANSITION to a MARKET ECONOMY • Transition of the Eastern Bloc to a market economy created important new markets • Created opportunities to transform inefficient government-owned local companies into successful enterprises .

global elite . continued CONVERGING CONSUMER NEEDS • Uniform consumer segments emerging worldwide: global teenagers.Drivers of International Expansion.

Foreign environment (uncontrollable) Political/legal forces 1 Domestic environment (uncontrollable) Economic forces 7 Cultural forces Political/ legal forces 2 Competitive structure Competitive Forces (controllable) Price Product 3 Promotion 6 Channels of distribution Geography and Infrastructure Economic climate Level of Technology 5 Structure of distribution 4 .

. Planning and development of products that the consumers want.The activities in international marketing include: 1. clearly defined in suitable package. Distribution of products through channels which provide the services or conveniences demanded by purchases. Detailed analysis of current markets and potential markets. 2. 3.

Promotion of products to inform and educate consumers about products or services. and 6. Setting of prices which reflect both a reasonable value (or utility ) of product to consumers. Technical and non-technical services given to the consumers-both before and after a sale is made.The activities in international marketing include: 4. . 5.

What is International Marketing • Made up of many facets.) – Export Marketing – International Marketing • Multi National Marketing • Global Marketing . that is levels of involvement – Domestic Marketing (Domestic co.

Domestic Marketing • • • • One One One One set of Competitors Economy set of market pressures set of Customers .

Domestic Market • Manipulate a series of variables – Controllable by business • Price • Advertising • Distribution • Product – Uncontrollable by business • Economic structure • Competitors • Cultural • Legal .

. if required. • Most traditional and least complicated form of international marketing.Export Marketing • Where the company markets its goods or services across national or political boundaries • Usually a reactive situation • Emphasis on product modification.

• Understanding of different environments becomes essential.International Marketing • Entire marketing strategy will need to be adapted. • Several markets • Differing controllable variables across markets • Differing uncontrollable variables across markets .

International Marketing • Giving – Differing infrastructures – Differing advertising/promotions – Differing complexity of market .

expensive Varying stability and attitudes Attitudes towards foreign trade Varying levels Varying levels & Systems .Why is international marketing different • • • • • • • Culture Markets Data Politics Governments Competitiors Economies Diverse.different Difficult to get. Multi-cultured Widespread. Fragmented.

What makes international marketing different • Finance • Currencies • Businesses • Control Varying systems & regulatory bodies Varying & Fluctuating Cross Cultural Influences Remote & Difficult .

& Competition within the market .SLEPT Factors (Framework to analyse macro environment) • • • • • S ocial & cultural values L egislation affecting trade E conomic conditions P olitical systems & attitudes T echnological level & infrastructure.

Problems of international trade • • • • • Debt Unstable countries Protection of intellectual rights Tariff regulations Instability in Foreign exchange markets • Non tariff barriers. eg specifications .

ltd trade restrictions. short distances Absence of trading blocs & trade barriers Free from lengthy procedures & licensing & formalities PEST changes impact is less 1. At global level 2. long distances etc 3. within one country Its simple due to one currency. . uniform trade practices. PEST has larger impact on intl marketing 3. Involves licensing.international marketing marketing activities 1. Buying & selling 2. 4. permissions. 5. lengthy procedures 5. trade restrictions. Trade blocs restrict free trade 4. Difficult due to multiple currencies.

Least Govt interference 9.6.Divided into foreign & multinatl mkting 10. wholesalers.Max Govt interference 9. Conducted in large qty with high profit potentials 11. Risk is ltd due to ltd area of operations. merchant exporters. trading houses 8. retailers &trading orgn are involved . sensitive nature of mkts. as it is one integrated marketing activitiy 10. exporters. Highly competitive as different countries are in different phases 8. Heavy risk due to vast operation. political stability. Conducted in small qty with ltd profit potentials 11. export houses. No division. Not highly competitive 6. uniform rules & laws 7. political factors 7.

Barriers to International Marketing • • • • • • Control Language Red tape Cash flow Logistics Lack of trained staff .

Levels of International Domestic Export Marketing Marketing International Global Marketing Marketing Marketing • Least international commitment • Domestic focus • Limited international commitment • Substantial international commitment • Extensive international commitment • Focus on segments. rather than countries or regions • Geocentric • Involves direct or • Focus on indirect export individual countries or regions • Ethnocentric • Polycentric or Regiocentric .

and personnel are perceived as superior • International customers are considered as secondary • International markets are regarded primarily as outlets for surplus domestic production • International marketing plans are developed inhouse by the international division .Ethnocentric Orientation • Guided by domestic market extension concept: • Domestic strategies. techniques.

Polycentric Orientation • Guided by the multidomestic market concept: • Focuses on the importance and uniqueness of each international market • Likely to establish businesses in each target country • Fully decentralized. duplicated functions. minimal coordination with headquarters • Marketing strategies are specific to each country • Result: No economies of scale. higher final product costs .

political.Regiocentric Orientation • Guided by the global marketing concept: • World regions that share economic. and/or cultural traits are perceived as distinct markets • Divisions are organized based on location • Regional offices coordinate marketing activities .

Geocentric Orientation • Guided by the global marketing concept: • The world is perceived as a total market with identifiable. homogenous segments • Targeted marketing strategies aimed at market segments. rather than geographic locations • Achieve position as low-cost manufacturer and marketer of product line • Provides standardized product or service throughout the world .

Five International Product and Promotion Strategies Product Do not change product Adapt product Develop new product Promotion Do not change promotion Straight extension Product adaptation Product invention Adapt promotion Communication adaptation Dual adaptation 03/09/98 .

positioning.Market Entry Strategies • Exporting – Low investment – Low control of promotion • Joint venture – Considerable investment – More control – Able to benefit from partner’s experience – Must work with partner • Licensing – Low investment – Low control of promotion. and quality – Able to benefit from existing distribution and market knowledge • Direct investment – – – – Large investment Risky Greater control May lack knowledge of market .

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