INTERNATIONAL MARKETING

Chapter 1
INTRODUCTION

• International marketing is defined as the performance of

business activities designed to plan, price, promote, and
direct the flow of a company’s goods and services to
consumers or users in more than one nations for a profit.
• International marketing takes place in more than one
country
• The difference between local and international marketing
is very minor .
• The main difference is with the “environment” within
which marketing plans must be implemented.
INTRODUCTION

• Competition, legal constraints, government controls, weather

etc and other uncontrollable factors can affect the profitable
outcome of good marketing plan.
• So, it’s the challenge for the marketer to shape the
controllable elements of marketing decisions' within the
framework of uncontrollable elements of the market place.
• Environment can change from country to country.
THE INTERNATIONAL MARKETING TASKS

• In international marketing, the marketer's task is more complicated

because they have to deal with at least two levels of uncontrollable
factors.
1. Uncertainty created by uncontrollable elements of all the
business environment.(domestic market)
2. Unique set of uncontrollable factors of each country
(foreign market)
THE INTERNATIONAL MARKETING TASKS
 THE INTERNATIONAL MARKETING TASKS

• Each foreign market can present separate problems involving some

or all uncontrollable elements.
• The solution to the problem in country market A is not applicable to
a problem in B.
1. Marketing Decision Factors
• Marketer’s assumes the necessary resources and thus blend’s
4P’s and these are the decision factors for the marketers.
• The outer circle surrounding these factors represents the levels of
uncertainity,created by the domestic and foreign environment.
THE INTERNATIONAL MARKETING TASKS

2. Aspects Of Domestic Environment

• These elements are often beyond the control of companies.
• They have a direct effect on the foreign venture.

3. Aspects Of Foreign Environment.

• A business operating in a number of foreign countries might find
polar extremes in political stability, class structure, economic
condition etc.
• These are the critical elements in business decision.
• The more significant elements in the uncontrollable international
environment include political/legal forces,economic,technology etc
THE SELF-REFERENCE CRITERION AND ETHNOCENTRISM

• Key to the successful international marketing is the adaptation to

the environmental differences from one market to another.
• The primary obstacle is a person’s self reference criterion and an
associated ethnocentrism.
• SRC is an unconscious reference to one’s own cultural values,
experiences and knowledge, as a basis for decision.
• Ethnocentrism is the idea that one’s own culture or company knows
best how to do things.
• Ethnocentrism is making value judgment about another culture from
perspectives of one’s own culture system.
THE SELF-REFERENCE CRITERION AND ETHNOCENTRISM

• Your SRC can prevent you from being aware that there are cultural
differences or from recognizing the importance of those differences.

• Both SRC and ethnocentrism can influence to evaluate the

appropriateness of domestically marketing mix for a foreign market.

• When the marketers look beyond their own self reference criteria
the results are more positive.

• To avoid the errors and to isolate the SRC influences, it is important

to conduct a cross cultural analysis.

• Cross cultural analysis requires an understanding of the culture of

foreign market as well as one’s own culture.
CROSS CULTURAL ANALYSIS

1. Define business problem or goal in home-country cultural

traits, habits, or norms
2. Define business problem or goal in foreign-country
cultural traits, habits, or norms through consultation with
natives of target country
3. Isolate the SRC influence and examine it carefully to see
how it complicates the problem
4. Redefine the problem without SRC influence and solve for
the best possible business goal situation
STAGES OF INTERNATIONAL MARKETING INVOLVEMENT

1. No Direct Foreign Marketing

• Company does not actively promote the customers outside
national boundaries.

• Sales may be made to the trading companies as well as foreign

customers who come directly to the firm.

2. Infrequent Foreign Marketing

• It occurs when there is a temporary surpluses caused by the
variations in production levels or demand.

• Sales to foreign markets are made as goods are available.

STAGES OF INTERNATIONAL MARKETING INVOLVEMENT

3. Regular Foreign Marketing

• Firm having permanent productive capacity to produce the goods
for marketing in foreign markets.

• A firm may employed foreign or domestic middleman or may have

its own sales force.

4. International Marketing
• Full commitment in international marketing activities.
• At this stage a firm becomes an international firm.
STAGES OF INTERNATIONAL MARKETING INVOLVEMENT

5. Global Marketing
• Important point is the orientation of the company towards markets
and associated planning activities.
• Companies treat the world and the home market as a one market.
• Market segments are defined by income levels, usage patterns and
other factors etc.
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