25-08-2017, 09:32 PM
International marketing:
International marketing.docx (Size: 207.37 KB / Downloads: 17)
International marketing:
International marketing involves recognizing that people all over the world have different needs. Companies like Gillette, Coca-Cola, BIC, and Cadbury Schweppes have brands that are recognized across the globe. While many of the products that these businesses sell are targeted at a global audience using a consistent marketing mix, it is also necessary to understand regional differences, hence the importance of international marketing.
According to Doole and Lowe, International Marketing is,
"At its simplest level, international marketing involves the firm in making one or more marketing mix decisions across national boundaries. At its most complex level, it involves the firm in establishing manufacturing facilities overseas and coordinating marketing strategies across the globe."
Organizations must accept that differences in values, customs, languages and currencies will mean that some products will only suit certain countries and that as well as there being global markets e.g. for BIC and Gillette razors, and for Coca-Cola drinks, there are important regional differences - for example advertising in China and India need to focus on local languages. Just as the marketing environment has to be assessed at home, the overseas potential of markets has to be carefully scrutinized.
Finding relevant information takes longer because of the unfamiliarity of some locations. The potential market size, degree and type of competition, price, promotional differences, product differences as well as barriers to trade have to be analyzed alongside the cost-effectiveness of various types of transport. The organization then has to assess the scale of the investment and consider both short- and long-term targets for an adequate return.
Before becoming involved in exporting, an organization must find the answers to two questions:
1. Is there a market for the product?
2. How far will it need to be adapted for overseas markets?
The product must possess characteristics that make it acceptable for the market - these may be features like size, shape, design, performance and even color. For example, red is a popular color in Chinese-speaking areas. Organizations also have to consider different languages, customs and health and safety regulations.
Factors Affecting International Business
There are 3 factors that are changing the way international business is practiced and which therefore need to be taken into account in the education of future international business lawyers. These factors are:
Tran nationalization of Economic Activity: The rapid growth in the amount of cross- border economic activity over the past twenty years is affecting the balance of power between the state and the market in the regulation of such activity. The ability of economic actors to escape national regulation by structuring their operations to take place in jurisdictions that they find congenial and to avoid those that they find unsatisfactory is undermining the regulatory role of the state. It is also creating demand for lawyers who can help their clients exploit these opportunities for private ordering of economic transactions.
Increased Concern about the Environment: The growing recognition that human activity is adversely affecting our physical environment imposes on all actors whose actions will affect this environment an obligation to account for all the costs and benefits that their activity is likely to cause. Since the impacts of these activities can extend over large areas and over long periods of time, a full accounting for their effects is also blurring the geographical and temporal boundaries that have historically circumscribed our concepts of legal responsibility and liability. This in turn is challenging us to adapt these concepts to new environmental realities and to the requirements of social and environmental sustainability and inter-generational equity.
Increased Attention to the Human Rights Obligations of Actors Other Than States: The growing scale of operations of transnational corporations is resulting in changing perceptions of the rights and obligations of all economic factors, including in regard to human rights. To date, this has initially manifested itself in two ways. First, it has stimulated the development of soft law standards of conduct for corporations—such as corporate codes of conduct, the UN Compact, IFC Performance Standards -- and an increased emphasis on corporate social responsibility. The second is the increased willingness of consumers, non-state actors, and international bodies to hold corporations accountable for the social consequences of their actions. These two developments are causing businesses and their lawyers to become much more sensitive to the human rights implications of their actions.
Components of Culture:
Language
With language one should consider whether or not the national culture is predominantly a high context culture or a low context culture (Hall and Hall 1986). The concept relates to the balance between the verbal and the non-verbal communication.
In a low context culture spoken language carries the emphasis of the communication i.e. what is said is what is meant. Examples include Australia and the Netherlands.
In a high context culture verbal communications tend not to carry a direct message i.e. what is said may not be what is meant. So with a high context culture hidden cultural meaning needs to be considered, as does body language. Examples of a high context cultures include Japan and some Arabic nations.
Education
The level and nature of education in each international market will vary. This may impact the type of message or even the medium that you employ. For example, in countries with low literacy levels, advertisers would avoid communications which depended upon written copy, and would favour radio advertising with an audio message or visual media such as billboards. The labeling of products may also be an issue.
Law and Politics
As with many aspects of Terpstra and Sarathy's Cultural Framework, the underpinning social culture will drive the political and legal landscape. The political ideology on which the society is based will impact upon your decision to market there. For example, the United Kingdom has a largely market-driven, democratic society with laws based upon precedent and legislation, whilst Iran has a political and legal system based upon the teachings and principles Islam and a Sharia tradition.
Aesthetics
Aesthetics relate to your senses, and the appreciation of the artistic nature of something, including its smell, taste or ambience. For example, is something beautiful? Does it have a fashionable design? Was an advert delivered in good taste? Do you find the color, music or architecture relating to an experience pleasing? Is everything relating to branding aesthetically pleasing?
Franchising:
Franchising is a business model in which many different owners share a single brand name. A parent company allows entrepreneurs to use the company's strategies and trademarks; in exchange, the franchisee pays an initial fee and royalties based on revenues. The parent company also provides the franchisee with support, including advertising and training, as part of the franchising agreement.
Franchising is a faster, cheaper form of expansion than adding company-owned stores, because it costs the parent company much less when new stores are owned and operated by a third party. On the flip side, potential for revenue growth is more limited because the parent company will only earn a percentage of the earnings from each new store. 70 different industries use the franchising business model, and according to the International Franchising Association the sector earns more than $1.5 trillion in revenues each year.
Conclusion:
International marketing refers to the firm-level marketing practices across the border including market identification and targeting, entry mode selection, marketing mix, and strategic decisions to compete in international markets.
According to the American Marketing Association (AMA) "international marketing is the multinational process of planning and executing the conception, pricing, promotion and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives."