International Marketing

Click to edit Master subtitle style

3/3/12

Introduction
International marketing is the process of planning and

conducting transactions across national borders to create exchanges that satisfy the objectives of individuals and organizations
In contrast to the definition of marketing only the word

multinational has been added. In simple words international marketing is the application of marketing principles to across national boundaries. However, there is a crossover between what is commonly expressed as international marketing and global marketing, which is a similar term.
3/3/12

Reasons for Global Marketing

Growth
Access to new markets and access to resources

Survival
Against competitors with lower costs (due to increased

access to resources) e.g. India and China

Or push and pull factors

3/3/12

International Marketing Decisions

Deciding whether to go abroad

Deciding which markets to enter

Deciding how to enter the market

Deciding on the market program

Deciding on the market organization

3/3/12

Deciding whether to go abroad?

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

3/3/12

Deciding which the company to enter? markets should try to Before going abroad,
What Volume of Foreign Sales is Desired? How Many Countries to Market In? What Types of Countries to Enter?

define its international marketing objectives and policies.

Choose Possible Countries and Rank Based on

Market Size, Market Growth, Cost of Doing Business, Competitive Advantage, and Risk Level
3/3/12

Deciding how to enter the market?

3/3/12

Deciding how to enter the market?

Joint Venturing:
Joining with foreign companies to produce or market

products or services.
Approaches:
Licensing Contract manufacturing Management contracting Joint ownership

Direct Investment:
The development of foreign-based assembly or 3/3/12

manufacturing facilities.

Deciding on the market program

Standardized Marketing Mix:
Selling largely the same products and using the same

marketing approaches worldwide.

Adapted Marketing Mix:
Producer adjusts the marketing mix elements to each

target market, bearing more costs but hoping for a larger market share and return.
3/3/12

Deciding on the market organization

Organize an export department Create international divisions Geographical organizations World product groups International subsidiaries Become a global organization
3/3/12

Strategies

Global

strategy
3/3/12

Global Strategies Continued

A global strategy is effective when differences between

countries are small and competition is global.

It has advantages in terms of Economies of scale Lower costs Co-ordination of activities Faster product development However, many regret the growing standardization across

the world.
3/3/12

Domestic Strategies
A multi-domestic strategy involves products tailored to

individual countries
Innovation comes from local R&D There is decentralization of decision making within the

organization
One result of decentralization is local sourcing Responding to local needs is desirable but there are

disadvantages: for example high costs due to tailored products and duplication across countries
3/3/12

Management Orientation
The ERPG Concept E---- Ethnocentric P---- Polycentric R---- Regiocentric G--- Geocentric

3/3/12

The Ethnocentric Orientation

-- It is a belief which considers- ones own country/ culture, products as superior -- It views similarities in all markets/ foreign country market. -- Products/ services/ management practices/ methods that is being offered/ followed in ones own country/ successful in ones own country will be acceptable in other world markets, anywhere. -- Adaptation of the product is not required.
3/3/12 -- Shades of egoism encircled herewith

The Polycentric Orientation

-- Opposite of Ethnocentrism . -- It views each country as unique. -- Each subsidiary is to develop its own unique business. -- Each subsidiary to develop its own marketing strategies to succeed in its own right.

3/3/12

The Regiocentric Orientation:

Management views regions as unique. -- Management seeks to develop an integrated regional strategy, to market product/services- in the particular identified region. -- Regions are considered to be one- i.e. consumers having one taste, choices, preferences, one regional identity etc. -- NAFTA, EU, SAARC etc are examples.

3/3/12

-- The Company views the entire world as a potential

market.Geocentric Orientation: The -- Company strives to develop integrated world market strategies. -- It views similarities and differences in markets and countries. -- It seeks to create a global strategy- responsive to local needs and wants.

3/3/12

The Importance of Global Marketing

For US-based companies, 75% of sales potential is outside

the US.

About 90% of Coca-Colas operating income is generated

outside the US.

For Japanese companies, 85% of potential is outside Japan. For German and EU companies, 94% of potential is outside

Germany.

3/3/12

Marketing Mix Adaptation

In India, McDonalds serves chicken, fish, and vegetable burgers, and the Maharaja Mactwo all-mutton patties, special sauce, lettuce, cheese, pickles, onions, on a sesame-seed bun.
3/3/12

U.S. Globalization
Many U.S. companies have made the world their market.
3/3/12

Cultural Difference
When Nike learned that this stylized Air logo resembled Allah in Arabic script, it apologized and pulled the shoes from distribution.

3/3/12

Colgate Goes to China

Using aggressive promotional and educational programs, Colgate has expanded its market 3/3/12 share from 7% to 35% in less than a decade.

Joint Ownership

KFC entered Japan through a joint ownership venture with Japanese conglomerate Mitsubishi. 3/3/12

International Pricing

Twelve European Union countries have adopted the euro as a common currency, creating pricing transparency and forcing companies to harmonize their prices throughout 3/3/12 Europe.

Any
Click to edit Master subtitle style

3/3/12

Thank You
Click to edit Master subtitle style

3/3/12