International Marketing

15th edition

McGraw-Hill/Irwin

Philip R. Cateora, Mary C. Gilly, and John L. Graham

Copyright 2011 by The McGraw-Hill Companies, Inc. All rights reserved.

Introduction
Enterprises with international scope of operations
Need for current, accurate information magnified
Marketing research
The systematic gathering, recording, and analyzing of data
to provide information useful in marketing decision
making

International marketing research involves two

complications
Information must be communicated across cultural
boundaries
The environments within which the research tools are
applied are often different in foreign markets
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Overview
The importance of problem definition in
international research
The problems of availability and use of
secondary data
Quantitative and qualitative research methods
Multicultural sampling and its problems in less
developed countries
Sources of secondary data
How to analyze and use research information
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Global Perspective
Japan Test Market for the World
Japan has become a vast lab for Google as it tries
to refine mobile search technology
Japans 100 million cell phone users represent
the most diverse-and discriminating-pool of
mobile subscribers on the planet
Many foreign companies are beginning to use
Japan as a testing ground, offering products in
Japan before rolling them out globally
More Western retailers are opening new outlets
in Tokyo to keep an eye on trends
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Breadth and Scope

of International Marketing Research
(1 of 2)

Types of informa1ion needed by research

General information about the country, area, and/or
market
Information to forecast future marketing requirements
By anticipating social, economic, consumer, and
industry trends within specific markets or countries
Specific market information used to make and develop
marketing plans
Product
Promotion
Distribution
Price decisions
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Breadth and Scope

of International Marketing Research
(2 of 2)
Unisys Corporations planning steps for
collecting and assessing the following types
of information
1.
2.
3.
4.
5.

Economic
Cultural, sociological; and political climate
Overview of market conditions
Summary of the technological environment
Competitive situation

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Top 20 Countries for Marketing

Research Expenditures
(millions of dollars)

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The Research Process

Research process steps

1. Define the research problem and establish research objectives
2. Determine the sources of information to fulfill the research
objectives
3. Consider the costs and benefits of the research effort
4. Gather relevant data from secondary or primary sources, or
both
5. Analyze, interpret, and summarize the results
6. Effectively communicate the results to decision makers

Research steps are similar for all countries

Variations and problems can occur in implementation
Differences in cultural and economic development

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Defining the Problem

and Establishing Research Objectives
The major difficulty is converting a series of
often ambiguous business problems into tightly
drawn and achievable research objectives
The first, most crucial step in research is more
critical in foreign markets because an unfamiliar
environment tends to cloud problems definition
Other difficulties in foreign research stem from
failures to establish problem limits broad enough
to include all relevant variables

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Problems of Availability
and Use of Secondary Data
U.S. government provides comprehensive
statistics for United States
Marketing data not matched in other countries
Quality
Quantity
Exceptions are Japan and several European
countries

Continuing efforts to improve data collection

United Nations
Organization for Economic Cooperation and
Development (OECD)
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Availability
and Reliability of Data

Most countries simply do not have governmental agencies

that collect on a regular basis the kinds of secondary data
readily available in the U.S.
Researchers language skills impede access to information
Requires native speaker of language

Official statistics are sometimes too optimistic, reflecting

national pride rather than practical reality, while tax
structures and fear of the tax collector often adversely
affect data
Less-developed countries prone to optimism
Willful errors
Adjusted reporting
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Comparability of Data
Issues with data (especially in less developed,
countries)
Data can be many years out of date
Data collected on an infrequent and
unpredictable schedule

Too frequently, data are reported in different

categories or in categories much too broad to be
of specific value

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Validating Secondary Data

Questions to judge the reliability of secondary data sources
Who collected the data?
Would there be any reason for purposely misrepresenting the
facts?
For what purposes was the data collected?
How was the data collected?
Are the data internally consistent and logical in light of known
data sources or market factors?

Checking the consistency of one set of secondary data with

other data of known validity
An effective and often-used way of judging validity

The availability and accuracy of recorded secondary data

increase with level of economic development
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Gathering Primary Data

Quantitative and Qualitative Research
(1 of 2)
Primary data
Data collected specifically for the particular research
project

Quantitative research
Usually a large number of respondents
Respondents answer structured oral or written questions
using a specific response format (such as yes/no) or to
select a response from a set of choices
Responses can be summarized in percentages, averages, or
other statistics
Toto a Japanese firm with the premiers quantitative
research on bathroom and toilet technology
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Gathering Primary Data

Quantitative and Qualitative Research
(2 of 2)
Qualitative research
If questions are asked, they are almost always
open-ended or in-depth
Seeks unstructured responses that reflect the
persons thoughts and feelings on the subject

Qualitative research interprets people in the

sample
Qualitative research is helpful in revealing the
impact of sociocultural factors on behavior
patterns and in developing research hypotheses
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Problems
of Gathering Primary Data
Hinges on the ability of the researcher to get
correct and truthful information that addresses
research objectives
Problems in international marketing research
Stem from differences among countries
Range from inability or unwillingness of
respondents to communicate their opinions
Inadequacies in questionnaire translation

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Ability to
Communicate Opinions
Formulating opinions about a product or concept
Depends on the respondents ability to recognize the
usefulness of such a product of concept
Product or concept must be understood and used in
community

The more complex the concept, the more difficult it

is to design research that will help the respondent
communicate meaningful opinions and reactions
Gerber has more experience in trying to understand
consumers with limitations
Babies can neither answer questions or fill out
questionnaires
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Willingness to Respond
Cultural differences provide best explanation for
unwillingness or inability of many to respond to
research surveys
The role of the male, the suitability of personal
gender-based inquiries, and other gender-related
issues can affect willingness to respond
Less direct measurement techniques and
nontraditional data analysis methods may also
be more appropriate

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Sampling in Field surveys

Problems in sampling stem from the lack of
adequate demographic data and available lists
from which to draw meaningful samples
Affected by a lack of detailed social and
economic information
No officially recognized census information
No other listings that can serve as sampling
frames
Incomplete and out-of-date telephone directories
No accurate maps of population centers

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Language and
Comprehension
The most universal survey research problem in
foreign countries is the language barrier
Literacy poses yet another problem
Marketers use three different techniques to help
ferret out translation errors ahead of time
Back translation
Parallel translation
Decentering

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Multicultural Research
a Special Problem
As companies become global marketers and seek
to standardize various parts of the marketing mix
across several countries, multicultural studies
become more important
Multicultural research involves dealing with
countries that have different languages,
economies, social structures, behavior, and
attitude patterns
In some cases the entire research design may have
to be different between countries to maximize the
comparability of the results
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Research on the Internet

a Growing Opportunity
One billion users in more than 200 countries
One-sixth in U.S.

International Internet use is growing almost twice as fast as

American use
Uses for Internet in international research

Online surveys and buyer panels

Online focus groups
Web visitor tracking
Advertising measurement
Customer identification systems
E-mail marketing lists
Embedded research
Observational research
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Estimating Market Demand

(1 of 2)
To assess current product demand and forecast
future demand
Requires reliable historical data
When the desired statistics are not available, a
close approximation can be made
Using local production figures plus imports,
with adjustments for exports and current
inventory levels

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Estimating Market Demand

(2 of 2)
Two methods of forecasting demand
Expert opinion
The key in using expert opinion to help in
forecasting demand is triangulation
Analogy
Assumes that demand for a product
develops in much the same way in all
countries as comparable economic
development occurs in each country
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Personal Computer and Mobile Phone

Diffusion Rate (per 1,000 people)
Exhibit 8.1
Personal Computer

Mobil Phone

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Problems in Analyzing and

Interpreting Research Information

Accepting information at face value in foreign

markets is imprudent
The foreign market researcher must posses three
talents to generate meaningful marketing
information
1. The researcher must posses a high degree of cultural
understanding of the market in which research is being
conducted
2. A creative talent for adapting research methods is
necessary
3. A skeptical attitude in handling both primary and
secondary data is helpful
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Responsibility for Conducting

Marketing Research (1 of 2)
A company in need of foreign market research can
rely on an outside foreign-based agency or domestic
company with a branch in that country
A trend toward decentralization of the research
function is apparent
Local analysts appear to be able to provide information
more rapidly and accurately
Control rests in hands closer to the market
Disadvantage lies in ineffective communications with
home-office executives
Unwarranted dominance of large-market studies in
decisions about global standardization
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Responsibility for Conducting

Marketing Research (2 of 2)
A comprehensive review of the different
approaches to multicountry research suggests
Ideal approach is to have local researchers in
each country,
Close coordination between the client company
and the local research companies

Two stages of analysis are necessary

Individual-country level
Multi-country level

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Communicating
with Decision Makers
Gathered information must be given to decision
makers in a timely manner
Decision makers should be directly involved not
only in problem definition and questions
formulation, but also in the fieldwork
Even when both managers and customers speak
the same language and are from the same
culture, communication can become garbled in
either direction

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Managing the Cultural Barrier

in International Marketing Research
Exhibit 8.2

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Summary (1 of 2)
The basis objective of the market research
function is providing management with
information for more accurate decision making
Customer attitudes about providing information
to a researcher are culturally conditioned
Foreign market information surveys must be
carefully designed to elicit the desired data and
at the same time not offend the respondents
sense of privacy

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Summary (2 of 2)
Many foreign markets have inadequate or
unreliable bases of secondary information
Three keys to successful international marketing
research
The inclusion of natives of the foreign culture on
research teams
The use of multiple methods and triangulation
The inclusion of decision makers, even top
executives, who must on occasion talk directly to
or directly observe customers in foreign markets
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