4.6 International marketing

International marketing

Marketing of an organization's g+s in overseas countries

Opportunities

External factors that create openings for a firm's growth + development in international markets

Threats

External factors that create challenges for firms wanting to expand + operate in overseas markets

Internal methods of entry into international markets

1. Exporting

2. Direct investment

3. E-commerce

External methods of entry into international markets

1. Joint ventures

2. Strategic alliances

3. Franchising

4. Mergers + acquisitions

Pros of achieving EOS

1. Higher profit margins

2. Can ↓ prices → price advantage over competitors

Opportunities of entering + operating internationally

1. Increased customer base

2. EOS

3. Increased brand recognition

4. Spread risks

5. Wider distribution channels

6. Extend PLC

7. More profit

Explanation of opportunities for operating internationally: Increased customer base

More customers (overseas buyers) → ↑ SR + MS

Explanation of opportunities for operating internationally: EOS

Operate on large, international scale / cheaper production location (RM, labour) → cost savings (↓ production costs) = EOS → higher profit margins

Explanation of opportunities for operating internationally: Increased brand recognition

Standardized marketing strategy globally (+ ↓ avg production costs)

• Can ↑ brand loyalty

Explanation of opportunities for operating internationally: Spread risks

Operate in various international markets → firm less exposed to risks in 1 particular country (eg recession / changes in tastes)

Explanation of opportunities for operating internationally: Wider distribution channels

Product more accessible → ↑ potential no. of foreign buyers

Explanation of opportunities for operating internationally: Extend PLC

If domestic market is saturated

• Sell overseas → extend PLC + ↑ SR

Explanation of opportunities for operating internationally: More profit

↑ SR + ↓ production costs

Threats of entering and operating internationally (IM)

1. Legal

2. Political

3. Social

4. Economic

Threats of IM: legal issues

Due to diff legal systems:

• Advertising laws

• Copyright, trademark and patent legislation

• Consumer protection laws

Threats of IM: political issues

Unstable political climate (obstacles) → more risky for investment + less success in overseas markets

• Eg trade protectionist measures = obstacles for IM

• Violent protests destabalise strategic decisions for international marketers

Demographics

Pros of more free international trade (for consumers)

1. Access to greater choice of products at more competitive prices

2. Access to products not supplied locally (domestic producers cant supply)

Demographics

The study of population rends in relation to its impacts on international marketing

Business etiquette

The mannerism + customs by which business is conducted in diff countries

Globalization

• The integration + interdependence of the world’s economies

• Results in cultures + tastes converging at an accelerating pace