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Marketing Management Text and Cases

Excel Books24-1

International

Marketing

24Chapter

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Definition of International Marketing

International marketing is the performance of marketing activities across

national borders.

International marketing is the performance of business activities that directthe flow of companys goods and services to consumers or users in more than

one nation for a profit.

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Levels of International Marketing InvolvementSome companies decide to keep their degree of involvement in international

marketing low-key and some other may become totally involved. Companies

generally move gradually through different phases of involvement in international

marketing. However, it is not necessary for every company to follow the sequenceof phases and some companies may bypass one or more stages:

No Involvement

Infrequent International Marketing

Regular International Marketing

International Marketing

Global Marketing Operation

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International Market Entry StrategiesThe approaches to international marketing include exporting, contracting,

joint ventures, and direct ownership.

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Exporting

Exporting is selling products to one or more foreign countries and is an

indispensable part of all international marketing.

Sometimes a distinction is drawn between direct and indirect export. Direct

exportmeans that the producer itself performs the tasks involved in exporting.

Indirect exportrefers to selling company products in its own country to another

party operating as an exporter. The difference is in the level of involvement in

export operations and related costs, risks, and benefits.

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ContractingVarious approaches with regard to contracting involve legal relationship that

international marketers enter into, to quickly establish market presence in a

foreign country. Licensing, contract manufacturing, and franchising are fairly

popular approaches.

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Major Approaches to

Operating in

International Markets

DirectExport

MultinationalCorporation

ForeignSalesBranch

LicensingForeign

Firm

ContractProduction

JointVentureStrategicAlliance

DirectOwnership

LowInvolvement

Abroad

HighInvolvement

Abroad

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Joint Venture

A joint venture is a partnership between a domestic company and a foreign

business house, or it can be between two countries. Joint venture partner

minimises risks associated with political, economic, and cultural aspects.

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Direct Ownership

This level of involvement in international marketing entails owning a foreign

subsidiary or division.

The parent company is often based in one country and carries

manufacturing, management, and marketing operations in different countries.

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Opportunity Analysis

Different foreign countries may present vastly different opportunities and risks

in comparison to what a company has been exposed to in the domestic

market.

Political/Legal Considerations

Economic Considerations

Social/Cultural Considerations

Technological Considerations

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Key Decision Areas

Product

Advertising and Promotion

Price

Distribution