International Marketing

 The performance of the business activities that direct the flow of a company’s goods and services
to consumers or users in more than one nation for a profit is International Business
 International Marketing refers to marketing activities carried out by such companies overseas or
across national borderlines.
 International Marketing is the application of marketing principles across national boundaries.
 Global marketing refers to marketing activities integrated across multiple country markets
 More complicated, at least two levels of uncontrollable uncertainty instead of one.
 Uncertainty is created by the uncontrollable elements of all business environments, but each
foreign country in which a company operates adds its own unique set of uncontrollable.
 Marketer cannot control or influence these uncontrollable elements, but instead must adjust or
adapt to them in a manner consistent with a successful outcome.

Marketing objectives are achieved in a way that mold

1. The controllable elements of marketing decisions (product, price, promotion and distribution)

Within the framework of

2. The uncontrollable elements of marketplace (competition, politics, laws, consumer behavior,

level of technology, and distribution).

International Environmental Forces

• Marketing controllable: The successful manager constructs a marketing program designed for
optimal adjustment to the uncertainty of the business climate.

• Domestic uncontrollable: This includes home-country elements that can have a direct effect on
the success of a foreign venture: political forces, legal structure, and economic climate.

 Foreign uncontrollable: The problem of uncertainty is further complicated by a frequently

imposed “alien status” that increases the difficulty of properly assessing and forecasting the
dynamic international business climate.

Thus a strategy successful in one country can be rendered ineffective in another by differences in political
climate, stage of economic development, level of technology, or other cultural variation.

The key to successful international marketing is all about adaptation to the environmental
differences between markets.
SRC and Ethnocentrism: Major Obstacles

Self – Reference Criterion - An unconscious reference to one’s own cultural values, experiences, and
knowledge as a basis for decisions.

 SRC impedes the ability to assess a foreign market in its true light.

Cross-cultural analysis isolating the SRC influences

1. Define the business problem or goal in home-country cultural traits, habits, or norms.
2. Define the business problem or goal in foreign-country cultural traits, habits, or norms.
Make no value judgments.
3. Identify and Isolate the SRC influence in the problem and examine it carefully to see how it
complicates the problem.
4. Redefine the problem without the SRC influence and solve for the optimum business goal
situation.
5 Stages of International Marketing
1. No Direct Foreign Marketing: trading companies, foreign customers, domestic
wholesalers, distributors

2. Infrequent Foreign Marketing: Temporary surpluses caused by variations in production

levels or demand, few companies today fit this model

3. Regular Foreign Marketing: foreign or domestic overseas intermediaries, own sales force
or sales subsidiaries.

4. International Marketing: fully committed and involved in international marketing

activities. Such companies seek markets all over the world and sell products that are a
result of planned production for markets in various countries.

5. Global Marketing: Market segmentation decisions are no longer focused on national

borders. Instead, market segments are defined by income levels, usage patterns, or other
factors.

Social Environment
The social environment includes all factors and trends related to groups of people, including their
number, characteristics, behavior, and growth projections.

Cultural Environment
The cultural environment refers to factors and trends related to how people live and behave.

Factors influencing new Dimensions in Cultural Environment

 Changing Roles
 Emphasis on Health & Fitness
 The Desire for Convenience
 Consumerism
 Consumerism

Economic Environment
 The economic environment includes factors and trends related to income levels and the
production of goods and services.

 Economic trends in different parts of the world can affect marketing activities in other parts of
the world.

 GDP
Political and Legal Environment
 The political/legal environment encompasses factors and trends related to governmental
activities and specific laws and regulations that affect marketing practice.

Political Trends
International political events greatly affect marketing activities.

A second important political trend is movement toward free trade and away from protectionism.

Legislation
Legal Framework

Regulations and Regulatory Agencies

 Most legislation in the United States is enforced through regulations developed by a variety of
agencies, and marketers must often work with regulatory authorities at the federal, state, and
local levels.

Technological environment

 The technological environment includes factors and trends related to innovations that affect the
development of new products or the marketing process.

Competitive Environment

 The competitive environment consists of all the organizations that attempt to serve similar
customers.

Brand Competitors

The most direct competition, offering the same types of products as competing firms. For example, Nike
is a brand competitor of Reebok as both companies manufacture shoes.

Product Competitors

Offer different types of products to satisfy the same general need. Domino’s Pizza, McDonald’s, and
Kentucky Fried Chicken are product competitors.

Institutional Environment

 The institutional environment consists of all the organizations involved in marketing products
and services.

Market Research Firms

The whole of SC

Capitalism
An economic and political system in which a country's trade and industry are controlled by private
owners for profit, rather than by the state.

Socialism
A political and economic theory of social organization which advocates that the means of
production, distribution, and exchange should be owned or regulated by the community as a
whole.

Market Capitalism
 Individuals and firms allocate resources
 Production resources are privately owned
 Driven by consumers
 Government should promote competition among firms and ensure consumer protection
Centrally planned Socialism
 Opposite of market capitalism
 State holds broad powers to serve the public interest; decides what goods and services are
produced and in what quantities
 Consumers can spend on what is available
 Government owns entire industries

Centrally planned Capitalism

 Economic system in which command resource allocation is used extensively in an environment of
private resource ownership

Examples:
 Sweden
 Japan

Market Socialism
 Economic system in which market allocation policies are permitted within an overall environment
of state ownership