Name of Institution

International Market Selection

Module II
Ms. Mona Chaudhary

Why is it important to identify

Name of Institution
the right market to enter?
Influences likelihood of success
Influences nature of marketing
programmes
Affects firms ability to coordinate foreign
operations

8-2

Determinants of the firms choice

of
Name of Institution
foreign markets
The firm related factors

The environment

International
market segmentation
INTERNATIONAL MARKET SELECTION

Process of Market Selection

Country Identification

Name of Institution

Preliminary Screening
In-depth Screening
Final Selection
4

Determinants of the FirmName of Institution

Degree of
internationalization
Size/amount of resources
Type of industry/nature of
business
Internationalization goals
Existing networks of
relationships
8-5

Environment Factors

Name of Institution

International industry
structure
Home market conditions
Degree of
internationalization of the
market
Host country:

Market potential
Competition
Distance
Market similarity

Name of Institution

Market Related Factors/country attractiveness

Market size
Market growth
Buying power of
customers
Market seasons
Average industry
margin
Competitive
conditions

Market prohibitive
conditions
Government
regulations
Infrastructure
Economic and
political stability

8-7

Preliminary Screening Criteria

Name of Institution

General characteristics
Geographic
Language
Political factors
Demography
Economy
Industrial structure
Technology
Social organization
Religion
Education
Specific characteristics
Culture
Lifestyle
Personality
Attitudes and tastes

High degree of measurability,

accessibility, and actionability

Low degree of measurability,

accessibility, and actionability,
but high degree of relevance
8-8

Name of Institution

Criteria of In-depth Screening

Political stability
Economic growth
Currency convertibility
Labour cost/
productivity
Short-term credit
Long-term
loans/venture capital

Nationalization
Monetary inflation
Balance of payments
Enforceability of
contracts
Bureaucratic delays
Communications
Local management
Professional services

Name of Institution

Categories of Markets

A countries: primary markets offering the

best opportunities for long-term strategic
development
B countries: secondary markets where
opportunities are there but risk is high
C countries: tertiary markets with high
risk

8-10

Question for Discussion

Name of Institution

Do you think Wal-Mart's strategy to

capture Indian retail market was
strategically correct?

11

Basic Entry Decisions

Name of Institution

When to enter the markets?

What scale of entry?

14-2

Name of Institution

Market Expansion Strategies : Waterfall

Approach

Gross national product

per capita

High

Advanced
countries
Developing
countries
Less developed
countries

Low
Time

Market expansion strategies:Name

Shower
of Institution
Approach

Advanced
countries

Developing
countries

Less developed
countries