International Marketing
Module 1
International Marketing
• ...is the marketing of goods and services across
national frontiers.
• … is the marketing operations of any company that sells
and / or produces within a given country when :
• The organization is a part of, or associated with an
enterprise which also operates in other countries, and
• There is some degree of influence or control on its
activities from outside the country in which it sells and /
or produces
• The process of planning and conducting transactions
across national borders to create exchanges that satisfy
the objectives of individuals and organizations.
Global Marketing Environment
Global
Regional
Local
Marketing Mix
Environment
Major International Marketing Decisions
Differences between domestic and
international marketing
Domestic International
Research data is available in a Research data is generally in foreign
single language and is usually languages and may be extremely
easily accessed difficult to obtain and interpret
Business is transacted in a single Many currencies are involved, with
currency wide exchange rate fluctuations
Head office employees will Head office employees might only
normally possess detailed possess and outline knowledge of the
knowledge of the home market characteristic foreign markets
Promotional messages need to Numerous cultural differences must
consider just a single national be taken into account
culture
Market segmentation occurs within Market segments might be defined
a single country across the same type of consumer in
many different countries.
Differences between domestic and
international marketing (continued)
Domestic International
Communication and control are International communication and
immediate and direct control might be difficult
Business laws and regulations are Foreign laws and regulations might
clearly understood not be clear
Business is conducted in a single Multilingual communication is
language requires
Business risks can usually identified Environments may be so unstable
and assessed that it is extremely difficult to identify
and assess risks
Planning and organizational control The complexity of international trade
systems can be simple and direct often necessitates the adoption of
complex and sophisticated planning,
organization and control systems
Differences between domestic and
international marketing (continued)
Domestic International
Functional specialization within a International marketing managers require a
marketing department is possible wide range og marketing skills
Distribution and credit control are Distribution and credit control may be
straightforward extremely complex
Selling and delivery Documentation is often diverse and
documentation is routine and complicated due to meeting different
easy to understand border regulations
Distribution channels are easy to Distribution is often carried out by
monitor and control intermediaries, so is much harder to
monitor
Competitors’ behavior is easily Competitors’ behavior is harder to observe,
predicted therefore less predictable
New product development can be New product development must take
geared to the needs of the home account of all the markets the product is
sold in.
Special Problems of IM
• Political & Legal differences.
• Cultural differences.
• Economic differences.
• Differences in the currency units & their fluctuations.
• Differences in language.
• Differences in marketing infrastructure. ( In terms of
promotion channels, distribution channels etc )
• Trade restrictions.( Import controls )
• High cost if distance coverage.( Has an impact on time,
mode of transport, obsolesce and goods perishing costs)
• Differences in Trade Practices.
Why Go Global
• Firms are motivated to expand their markets
internationally for two reasons :
• Push factors : Refer to the compulsion of
domestic markets like saturation of markets,
international competition etc that amount to
reactive reasons for going global.
• Pull factors : Refer to proactive reasons, that
attract firms to global markets. This talks about
the potential in the global markets to be more
profitable and high growth prospects.
Why Go Global
• Reasons to consider going global:
– Foreign attacks on domestic markets
– Foreign markets with higher profit
opportunities
– Stagnant or shrinking domestic markets
– Need larger customer base to achieve
economies of scale
– Reduce dependency on single market
– Follow customers who are expanding
Driving Forces
• Liberalization
• MNC’s
• Technology
• Transportation and communication revolution
• Product development costs and efforts.
• Rising aspirations and wants
• Competition
• World economic trends
• Regional integration
• Leverages
Participants of IM
• Private Firms.
• MNC’s
• Other large firms
• SME’s
• Public sector undertakings
• Trading companies
• Individuals.
Objectives Of International
Marketing
• Identifying the needs and wants of International
Customer : Undertaking IMR & analyzing market
segments, seeking to understand similarities &
differences in customer groups across different
countries.
• Achieving Global customer satisfaction :
Adapting products and services & other
elements of the Marketing Mix to satisfy different
customer needs across countries
Objectives Of International
Marketing
• Staying ahead of the competitors by
providing better products / services :
Assessing, monitoring & responding to
global competition by offering better value,
developing superior Brand Image &
product positioning , broader product
range, competitive price, high quality, good
performance, better distribution & after
sales service.
Objectives Of International
Marketing
• Co-coordinating marketing activities :
Coordinating and integrating marketing
strategies across countries, regions and
global markets, which involve
centralization, delegation, standardization
& local responsiveness.
4P of INTERNATIONAL MARKETING MIX
Product adaptation and development for Choice of pricing strategy
international marketing Competitor analysis
Packaging and labelling
Determination of discount
Translation of technical literature structures
Quality management Credit management
Licensing and contract manufacturing Choice of delivery terms
Product Price Costing and budgeting
Place Promotion
International advertising, public
International distribution relations and sales promotion
Control of agents International direct marketing
Export documentation Control of salespeople
Cargo insurance Translation of sales literature
Establishment of joint ventures Exhibiting
and subsidiaries
Market research
Levels of International
Marketing
Domestic Export International Global
Marketing Marketing Marketing Marketing
• Least • Limited • Substantial • Extensive
international international international international
commitment commitment commitment commitment
• Domestic focus • Involves direct • Focus on • Focus on
or indirect export individual segments, rather
• Ethnocentric countries or than countries or
regions regions
• Polycentric or • Geocentric
Regiocentric
PHASES OF INETRNATIONAL MARKETING
INTERNATIONAL MARKET INTERNATIONAL MODE OF
SEGMENTATION TARGETING ENTRY SELECTION
MACROENVIRONMENT
INTERNATIONAL MARKET INTERNATIONAL
RESEARCH 4PS
MICROENVIRONMENT
ORGANISATIONAL
MOTIVATORS OBSTACLES FRAMEWORK
COMPANY
Orientations
• Ethnocentric
• Polycentric
• Regiocentric
• Geocentric
Ethnocentric Orientation
• Domestic strategies, techniques, 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
in-house by the international division
Polycentric Orientation
• Focuses on the importance and uniqueness of
each international market
• Likely to establish businesses in each target
country
• Fully decentralized, minimal coordination with
headquarters
• Marketing strategies are specific to each
country
• Result: No economies of scale, duplicated
functions, higher final product costs
Regiocentric Orientation
• World regions that share economic, political,
and/or cultural traits are perceived as distinct
markets
• Divisions are organized based on location
• Regional offices coordinate marketing activities
Geocentric Orientation
• 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
