International Marketing: Brief Introduction

INTERNATIONAL MARKETING
Brief Introduction
Definition of International Marketing

The performance of business activities designed to plan, price, promote, and direct the flow of a companys goods and services to consumers or users in more than one nation for a profit. The major difference between international and domestic marketing is that domestic marketing occurs in one country.
Definition
Global Firm
A firm that, by operating in more than one country, gains R&D, production, marketing, and financial advantages in its costs and reputation that are not available to purely domestic competitors.
The International Marketing Task

The major issue in international vs. domestic marketing is that in international marketing, there are additional layers of uncontrollable elements to deal with.
Additional Layers of Uncontrollable Events Uncontrollable Events
Controllable Events
The International Marketing Task Continued

Foreign Political/Legal Domestic Price Product Competitive Competitive Economic
Political/Legal
Culture
Place o Promotion
Research
Geography and Infrastructure
Economic
Technology
Distribution
International trade is booming Many U.S. firms are successful international marketers Global competition is intensifying Global companies face several problems Companies face six major decisions in international marketing
Global Marketing in the 21st Century
Global Marketing in the 21st Century

International Marketing Decisions
Looking at the global environment Deciding whether to go international Deciding which markets to enter Deciding how to enter the markets Deciding the global marketing problem Deciding on the global marketing organization
Looking at the Global Marketing Environment

The International Trade System
Tariffs, quotas, embargos, exchange controls, nontariff trade barriers World Trade Organization and GATT Regional free trade zones
European Union North American Free Trade Agreement Other free trade areas

Economic Environment
Industrial structure
Subsistence economies Raw material exporting economies Industrializing economies Industrial economies
Income distribution

Political-Legal Environment
Attitudes toward international buying Government bureaucracy Political stability Monetary regulations
Countertrade: barter, compensation, counterpurchase

Cultural Environment
Impact of Culture on Marketing Strategy
Cultural traditions, preferences, behavior
Impact of Marketing Strategy on Cultures

Globalization vs. Americanization
Not all companies need an international presence Globalization may triggered by several factors Risk and the ability to operate globally must be carefully assessed
Deciding Whether to Go International
Deciding Which Markets to Enter

Define international marketing polices and objectives, and sales volume goals Decide how many countries to target Decide on the types of countries to enter Screen and rank each of the possible international markets using several criteria
Market size, market growth, cost of doing business, competitive advantage, risk level
Deciding How to Enter the Market

Exporting
Direct vs. indirect
Joint Venturing
Licensing, contract manufacturing, management contracting, joint ownership
Direct Investment
Assembly facilities, manufacturing facilities
Deciding on the Global Marketing Program

Standardized Marketing Mix
Same basic product, advertising, distribution, and other elements of the marketing mix are used in all international markets.
Adapted Marketing Mix

The marketing mix elements are adjusted for each international target market.

Product Strategies for the Global Market
Straight product expansion
Marketing the product with no changes
Product adaptation
Altering the product to meet local conditions or the wants of the foreign market
Product invention
Creating new products or services for foreign markets

Global Promotion Strategies
Standardized global communication
Advertising themes are standardized from country to country with slight modifications
Communication adaptation
Advertising messages are fully adapted to local markets

Global Pricing Strategies
Companies face many problems
Price escalation Pricing to foreign subsidiaries Recent economic and technological forces The Internet

Global Distribution Channels
Whole-channel view
Sellers headquarters organization Channels between nations Channels within nations Numbers and types of intermediaries
Deciding on the Global Marketing Organization

Managing International Marketing Activities
Step 1: Organize export department Step 2: Create an international division Step 3: Become a global organization
The International Marketing Task Continued

To adjust and adapt a marketing program to foreign markets, marketers must be able to effectively interpret the influence and impact of each of the uncontrollable environmental elements on the marketing plan for each foreign market in which they hope to do business. This is hard since we do not know the culture. We take our culture for granted. How do we overcome this ethnocentric view of the world?
The Self-Reference Criterion

The primary obstacles to success in international marketing are a persons self-reference criterion. The SRC is an unconscious reference to ones own cultural values, experience and knowledge as a basis for everyday decision making. We can encounter problems if we do not understand the SRC of other countries (animal treatment in Fiji, the way biscuits should be packaged in Japan, the acceptable distance between two people).
How to Avoid Errors in International Business Decisions

Define the business problem or goal in homecountry cultural traits, habits, or norms. Define the business problem or goal in foreigncountry cultural traits, habits, norms through consultation with natives of the target country. Make no value judgments. Isolate the SRC influence in the problem and examine it carefully to see how it complicates the problem. Redefine the problem without the SRC influence and solve for the optimum business goal situation.
Global Awareness
Tolerance for cultural differences Knowledge of cultures, history, world market potential, and global economic, social, and political trends.

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INTERNATIONAL MARKETING

Definition of International Marketing

The International Marketing Task

The International Marketing Task Continued

Geography and Infrastructure

Global Marketing in the 21st Century

Global Marketing in the 21st Century

Looking at the Global Marketing Environment

Looking at the Global Marketing Environment

Looking at the Global Marketing Environment

Looking at the Global Marketing Environment

Impact of Marketing Strategy on Cultures

Deciding Whether to Go International

Deciding Which Markets to Enter

Deciding How to Enter the Market

Deciding on the Global Marketing Program

Adapted Marketing Mix

Deciding on the Global Marketing Program

Deciding on the Global Marketing Program

Deciding on the Global Marketing Program

Deciding on the Global Marketing Program

Deciding on the Global Marketing Organization

The International Marketing Task Continued

The Self-Reference Criterion

How to Avoid Errors in International Business Decisions

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