International Marketing - Distance Factors and Target Markets - Assignment Example

International Marketing - Distance Factors and Target Markets Article One – Distance Factors and Target Markets The purpose of the first article, “Distance factors and target market selection: the moderating effect of market potential”, is to understand the factors that determine activities of multinational firms when developing a target market strategy and conducting business in the international marketplace. The research study is attempting to uncover whether it is cultural, geographic, economic, or administrative factors that drive forward marketing strategy in diverse multinational organizations. The purpose is clearly stated, describing the ever-increasing necessity for multinational companies to consider foreign markets as a means of sustaining competitive advantage and growth. It is proposed that this is occurring due to removal of different international trade barriers and decreasing regulation that makes foreign markets desirable for profit and expansion. The arguments offered are based on a solid literature review regarding the state of international marketing in multinational firms and marketing strategy relation to distance factors associated with culture, geographical distance or economic factors. The authors hypothesize, based on the review of previous studies, that it all combined distance factors are divergent, meaning they are sometimes significant and sometimes not. They argue that it is market potential of the country that seems to drive most forward international marketing strategies and principles (Malhotra, Sivakumar & Zhu, 2009). In this article, distance factors refer to the knowledge base regarding international marketing with the multinationals and the actual market characteristics requiring unique targeting strategies. The study, itself, is based on data collected between 1990 and 2006, involving 18 different countries and over 4,800 cross-border multinational acquisitions. It is based on solid research data with a large sample population. It was discovered in the study results that cultural and geographic distances have a significant impact on the presence of cross-border acquisitions. This is due to data from the study which shows that firms in developing countries tend to look for markets with similar cultures to the home country and without significant geographical distance. The study further identified a correlation between cross-border acquisition development and the relationship between economic and administrative factors. The study identified that such acquisitions, the high volume of them, are based on multinational tendency to acquire companies with different financial structures and leadership premises. The study results are concise and well-developed. The conclusion is rather weak and does not reinforce what was learned, rather makes further hypotheses for future studies. It focuses primarily on market entry behavior rather than actual marketing strategy based on the distance factors proposed. Though based on solid results, it leaves too many questions to consider about culture and the role of foreign administrative factors. The implications are, primarily, that geographic distance factors affect forward momentum and behavior of firms in developing countries. Though based on drawn conclusions and hard data from the study, the article somewhat negates factors outside of the developing nation firms and is more of a regurgitation of what was hypothesized. The strengths of the article are the high sample size and long-term data collected while its weaknesses lie in the conclusions drawn that do not fully capture the study’s intention. It is certainly well-written as it relies heavily on previous research studies that achieved measurable results and the study methodology is clear and concise in terms of sampling and data collection. Article Two – State Level Branding Efforts The second article, “Selling the state: State branding as a political resource in South Africa”, describes the current evolution in state-level branding at the international level through adoption of traditional for-profit business marketing. The article’s purpose is to research the branding activities in the Brand South Africa governmental campaign to determine whether it is successful in meeting specific foreign policy goals by the marketer. It is a well-developed article with a high quality comparison with for-profit business strategy linked to international state-level branding efforts currently in place. Though well written, the research findings are based on assessment of only a few tangible studies and minor secondary resource consultation. The arguments seem to be, primarily, based on the researcher’s own knowledge of the South African branding campaign, but are solid evidence as it relies on actual financial statistics and a historical overview of the negative brand image usually associated with South Africa in terms of tourist perceptions of famine, war and poverty in this region (Youde, 2009). Largely, the results are based on studies of the misconceptions occurring in the international community about South Africa’s tourist potential and steps being taken by the government marketers to make this a more appealing environment through information delivery and linking to policy goals for the consumer or tourist. The results indicate that the country has been successful by repositioning itself by focusing on more contemporary themes such as music, film and sporting events. However, there is a warning that South Africa should be concerned about these lifestyle psychographics due to a variety of reasons, such as a poor performing rugby team or shifting international consumer tastes regarding music preference (Youde). They are very concise results, using common language to assist the reader in understanding how state level branding efforts are adopting more traditional for-profit business marketing models. The conclusions clearly state that traditional branding exercises are assisting the country in developing a more positive image. It is based on knowledge of the researcher and considerable examination of secondary source materials regarding the South African historical marketing focus and its current repositioning strategy for lifestyle marketing. The implications of the study are for other countries working with consumer image problems to adopt psychographic marketing concepts in order to get their agenda across and change misconceptions. It also describes taking into consideration certain limits such as population and location that can impede lifestyle marketing. The strengths of the article are that it gives a full view of current South African strategies in marketing, including social, cultural and geographical factors. The largest weakness is that it does not use qualitative or quantitative research results from other researchers to further build support for the concepts offered. It is extremely well-written, however, and the theme and tone used would have value for a generic citizen readership without complicated technical presentations. Article Three – Business to Business Marketing This article, “Business-to-business marketing and globalization: two of a kind”, has a purpose of showing the reader the many challenges being faced by B2B marketers in the international environment. In an effort to expand and consider ongoing cost reduction, the article proposes that international businesses are rapidly moving their production to foreign markets and it is having a negative long-term impact. The findings indicate that such efforts are causing subcontractors and suppliers to witness their home marketing shrinking and it is impacting quality and the ability to guarantee supply deliveries to serve the global customer base (Matthyssens, Kirca & Pace, 2008). The article bases its findings on secondary analysis of previous researchers and experts in international marketing, delivered in a clear and concise manner using non-technical language for the layperson reader. The results indicate that centralization efforts in areas of procurement and supply are causing considerable problems for the B2B marketer. Such centralization is causing suppliers to have less tangible access to the centralized headquarters, created as a cost reduction effort, and limits the bargaining power of suppliers. These efforts are also relying on technology for what is referred to as e-internationalization, causing problems with suppliers losing their own intellectual property because of its sudden exposure on the web. Largely, the results indicate that centralizing efforts in procurement causes problems with suppliers that ultimately turns the situation around to cause the business problems in areas of quality and delivery of supplier services and materials. These assessments are based on solid secondary resource consultation in areas of international marketing and the relationship between suppliers and the newly centralized businesses. The conclusions essentially offer that there is still limited knowledge of the impact of e-internationalization since it is in its infancy stage and certain scenarios have not been determined as of yet regarding the impact on the broader international markets. The conclusions are largely based on six different papers from other researchers in areas of logistics, e-sourcing, knowledge management, culture and supply chain coordination. Though based on solid evidence, the conclusions leave much for consideration without actual proof of the impact of B2B efforts. The implications are that there is much opportunity to continue these studies, using an e-internationalization measurement tool and research study. Since no specific implications are given, science curriculum planning benefits as it provides virtually unlimited research potential using surveys, interviews, or any other qualitative/quantitative tool to expose more aspects of the electronic environment in areas of international marketing. The study has a main strength, as it clearly identifies the functional areas of international marketing that require examination and gives the reader a clear view of what these functions mean and their relationship to other business partners and suppliers. Its weakness is that there is no primary study conducted to substantiate results, rather just reliance on the works of others. It is well-written using terminology that is understandable for all readership and transitions well from one concept to another. Article Four – Internet International Marketing The purpose of this article, “Factors that impact on the perceived benefits of internet international marketing in Taiwanese SMEs”, attempts to shine light into the role of the Internet for international marketers in relation to information technology support, e-commerce and organizational marketing theory. Though clear in its presentation, it relies on statistical equations that can be difficult to interpret without advanced knowledge in statistical analysis. The purpose of the article was “to explicate the nature of SMEs' global mindset and EC capability and their relationship to the perceived benefits of IIM” (Hsu, Chou & Hsu, 2008, p.251). The focus was on electronic commerce (EC) and the functional needs for support in Internet-based marketing. The results indicate that a small- to medium-enterprise does not necessarily rely on their level of knowledge regarding international marketing theory. The authors propose a danger in this relationship at the economic level, in technical competence, and overall marketer enthusiasm when attempting to adopt Internet marketing models. This is due to a growing desire to take the business overseas but not considering the importance of international marketing principles and a sound e-commerce system. The conclusions identify that though e-systems open new opportunities, customer-centric organizations have a specific mindset, allowing consumers to dictate their global marketing strategies, thus creating a divergence between the actual and perceived benefits of the Internet in marketing. The conclusions are based on the results of 82 surveys delivered to innovative firms that had received the SME Innovative Research Award and based on the results of a pre-test questionnaire to add more validity to the study. The implications are clearly stated and concisely, “managers need to pay special attention to the proposed factors and should especially focus on the holistic view to integrate global mindset with EC capability in order to enhance the understanding of SMEs' IIM” (Hsu, Chou & Hsu, 2008, p.260). The implications are directed toward the management of these international organizations when it comes to determining the best course of action using Internet based marketing concepts. The logic of the conclusion is that there is more data that should be collected as the results are largely based on self-perceptions from the sample group rather than through observation, case studies or experimentation studies. The strengths of the article is that it is based on considerable secondary resource consultation using 42 different source materials from experts in the field. This gives it more validity. The main weakness is that the study did not take into account the non-participation problem and therefore the original proposed sample of 391 individuals was shortened to only 20 percent of the intended participant group. This severely limits drawing conclusions successfully as only a small percentage of SME judgment is considered and not the broader international marketplace. Despite its technical jargon and equation modeling, the article is well-written and clearly meets its intended objectives and is presented in a method that can be understood by virtually all readerships. Article Five – Offensive Advertising and Culture This article, “Consumers' response to offensive advertising: a cross cultural study”, has a purpose of identifying the role of advertising in foreign cultures and how it might be perceived by different international groups based on cultural demands and social belief systems. This article is particularly well-written, using solid examples from a variety of international locations and countries for support. The findings are based on a methodology involving the use of what might be considered offensive advertising, using cultural dimensions most commonly understood in specific country culture. For the study’s purpose, 307 undergraduate students from China and a sample from Germany were recruited using a survey template. The sample was shown unique advertising to determine their opinion of the ad in a questionnaire format as a supplement. The study used one ad, as the example, of a woman who had her legs open when approached with a diamond. Thirty percent of those questioned found the ad offensive, ridiculous, and uncomfortable (Chan, Li, Diehl & Turlutter, 2007). Germans, however, found elements of creativity in the article instead of the same volume of offensive statements. The results indicate that there is a strong cultural difference between German consumers and Chinese consumers in terms of how they perceive and analyze advertising materials based on content aspects. It was determined that marketers must consider content elements along with cultural characteristics as it could lead to long-term rejection of the product when it is launched and offered to these consumer groups. They are listed in a very clear and concise manner using terminology that is easily interpreted by domestic and international readership. The conclusions drawn are that there should be careful consideration about sexual-themed content for advertisers in both Germany and China, thus limiting their usage. It proposes that there should be a preliminary check of cultural dimensions before launching such explicit advertising with sexual body themes. This is based on hard primary research evidence. The implications are supportive of the idea that there are distinct cultural and social values that must be taken into consideration before launching an expensive ad campaign for product sales in these two countries. Context of advertising must be a primary focus before launching such a campaign or advertising material. It reinforces some of the secondary research findings in the review of literature about cultural tendencies and known social values. The strengths of the article is that it relies on primary data with a relatively large sample of both consumer groups in these countries. The weakness, however, is that there was no solid translation matrix used to make sure the content and wording was understood fully by these foreign consumer groups. Additionally, it relied only on the opinion and perceptions of a younger consumer audience, the student groups, rather than using a large-scale sample using diverse demographics with different lifestyle and educational backgrounds. This limits the study’s validity to a certain degree. Though well-written, these limitations cast some doubt on the study and its ability to be used as a template for international advertising. References Chan, K., Li, L., Diehl, S. & Terlutter, R. (2007). “Consumers’ Response to Offensive Advertising: A Cross Cultural Study”, International Marketing Review. 24(5), p.606. Hsu, L., Chou, T. & Hsu, T. (2008). “Factors that Impact on the Perceived Benefits of Internet International Marketing in Taiwanese SMEs”, Journal of Targeting, Measurement and Analysis for Marketing. 16(4), pp.249-261. Malhotra, S., Sivakumar, K. & Zhu, P. (2009). “Distance Factors and Target Market Selection: The Moderating Effect of Market Potential”, International Marketing Review. 26(6), p.651. Matthyssens, P., Kirca, A. & Pace, S. (2008). “Business-to-Business Marketing and Globalization: Two of a Kind”, International Marketing Review. 25(5), p.481. Youde, Jeremy. (2009). “Selling the State: State Branding as a Political Resource in South Africa”, Place Branding and Public Diplomacy. 5(2), pp.126-141. Read More