Features of International Marketing - Coursework Example

International Marketing AFFILIATION: Introduction of International Marketing Since international business has become the latest trend, the managers around the world are realising the mandatory requirement for their organisations and companies to develop the aptitudes, skills and knowledge for effective competition in the international markets (Yang, Su & Fam, 2012). Across the globe, the key trends which have ignited international marketing are an open world economy, the expansion of the Internet access worldwide for enhancement of the interconnection and interdependency of the economies of various countries and the globalisation of customers’ tastes (Baack, Harris & Baack, 2013). Thus, it has become crucial for the managers to understand the dynamics of international marketing so that they can reap the benefits of operating in a profitable and attractive market. At the simplest level, the international marketing is described as involvement of the firm in making either one or more decisions for marketing mix across a wide range of national boundaries. However, on the extremely complex side, it involves a firm in the establishment of its processing/manufacturing facilities across the globe and make sure that the marketing strategies are effectively coordinated (Doole & Lowe, 2008). Some companies choose to go for international marketing just by signing an agreement of distribution with a well-known foreign agent who is assigned the responsibility for the promotion, pricing, market development and distribution. Whilst, there are other organisations like Ford which have an integrated network of production facilities worldwide and it operates in more than 150 countries. Therefore, international marketing is a phenomenon which emphasizes the need of managing a firm’s operations on a global level and it is broken into three categories on the basis of marketing level i.e. international marketing, global marketing and domestic marketing (Ngo & O’Cass, 2011). When entering into international markets, a firm has to select from three forms of marketing i.e. export marketing, international marketing and global marketing. Regardless of the strategy adopted by the company, it is crucial to understand the environment of the market so that the offerings are tailored in compliance to the customer requirements (Hult, 2012). For instance, McDonald’s makes sure that its menu items in every country are developed in accordance to the market requirement like there are mostly vegetarian meals in India, fish items in Thailand, beef options in Pakistan, healthy food in China and etc. If a company is planning to export its products or services in the international market, then it will have to get an understanding about the local market so that they are presented the offerings in the most compatible form. Usually, the companies have to collect information about the macro environment factors such as political, legal, social, economical and technological so that it can develop right strategies for successful penetration in the market (Alimiene & Kuvykaite, 2008). Even the entry mode such as export, licensing, franchises, joint ventures and others have to be decided so that the business operations can be managed effectively. Hence, each and every aspect of the international market has to be carefully evaluated to avoid any form of setback. One of the major areas of concern is to decide between moving ahead with standardised or adapted international marketing strategy (Chung, 2012). Coca-Cola has the similar international marketing strategy around the world as it has the same distribution network, product range, price and operations. However, Coca-Cola makes sure that its marketing activities are adapted to suit the local market taste so that the message is communicated effectively. Key factors to be considered when entering international markets The environment of international marketing is basically a multifaceted collection of requirements and limitations which are faced by the companies as they try to compete and expand their businesses. At the same time, identification of the customer’s values in the international market mandates the need of a sophisticated understanding of the different expressions of consumer needs and most of them are influenced by the country’s culture (Wong & Merrilees, 2007). Likewise, the mission of communication of the values identified by delivering them appropriately in the international markets is complicated which requires a great deal of the environmental know-how and the factors influencing them. Moreover, the international marketing is depicted by the junction of the company’s entire marketing process which is usually of one country and the purchasing decision of a customer in amother country. Majority of the elements of the international marketing environment are outside the control of the company (Peng, Lawrence & Koo, 2009). (Source: Ghauri & Cateora, 2009) The above figure depicts a true picture of the international market in which the companies operate. The inner circle is representing the controllable elements which fall in the manager’s decision area. While, the second circle highlights the environmental elements at home which have some effect on the company’s foreign operations’ decision. Finally, the outer circle indicates the foreign environmental elements of each foreign market within which the company operates (Ghauri & Cateora, 2009). Analysis of environments When undertaking the analysis of international markets, it is crucial for the companies to analyze both micro and macro environments also known as internal and external environments. An in-depth assessment of the environment will identify the areas which need to be modified according to the respective markets. For instance, Nike has strong brand reputation and it is easily replicated in all of its global operations because it is offering consistent level of quality to the customers. Nike has competitive production facilities, efficient value Supply Chain framework and enhanced distribution network; all of these aspects give it an opportunity to expand efficiently in the international markets (Gogolava, 2008). Internal Analysis Before moving ahead with the decision of expanding in the international markets, it is vital for the companies to conduct an internal analysis. This assessment of a firm’s position sheds light on the strengths and weaknesses of the company and allows it to make necessary developments to be competent and enter the international market successfully (Doole & Lowe, 2008). The major areas which have to be analysed are the management expertise, financial resources, production facilities, supplier agreements, distribution networks, marketing budgets, competent workforce, access to IT experts and many more. When a company will be assured that it has strong internal infrastructure along with all other crucial elements, then it will be able to enter in the international market effectively. It will also have to make sure that it has a resilient Research and Development department so that it can undertake proper studies and make the final international operation decisions effectively (Yong, Su & Fam, 2012). SLEPT Analysis Another important aspect of the environmental analysis is the gathering of information about the uncontrollable elements such as SLEPT (Social, Legal, Economic, Political and Technological), competition, culture, geography and infrastructure development. For the legal environment, the company has to get information about the home domestic laws, international laws and local domestic laws. Since the legal requirements change on a frequent basis, it is crucial to make sure that all business operations are in compliance with the international market. Liquor and alcohol are prohibited in the Muslim countries and it is mentioned in their laws as well. Any company which is involved in such business cannot enter these markets as they will never get the permission of running their companies in the markets (Baack, Harris & Baack, 2013). The political and economic structure of a market is important because it is the major driver of the company’s profitability. If the political structure is instable or the economy is weak, then these are unfavourable conditions for the relevant market. A stable political situation is required in the country to make sure that the company will be able to prosper successfully. Similarly, economic indicators such as GDP, Inflation rate, balance of payments and others have to be evaluated to make sure that the customers have sufficient disposable income to be spent on the goods and services (Ghauri & Cateora, 2009). For instance, developed countries such as USA and UK appear to be attractive markets than developing countries like India and China as they have more established infrastructure and booming economy. On the other hand, India and China have developed themselves to become the ideal destinations for the production facilities. Almost all the leading companies have transferred there manufacturing plants in these regions such as Pfizer, Unilever, GSK, Gillette, Colgate-Palmolive and many more. Recently, the technological advancements especially the Internet has revolutionised the way in which business operations are managed. With easy access to all the important files and documents on highly developed IT systems, decision making has become quicker and effective. Now-a-days, the companies have implemented the latest IT software so that their systems become efficient and communication is fast. Even the organisations operating on an international level can easily communicate with the help of the new highly integrated systems. Thus, it is mandatory to evaluate the technological competencies in the respective region before starting the operations in the new international market (Chirapanda, 2012). The most important element in the external environment is the social and cultural aspect. As the business is dependent on the customers, it has to make sure that they are offered the products and services which will meet or exceed their satisfaction level. It is vital for every company to make changes in its business operations to meet the social and cultural values of the respective international market (Gogolava, 2008). When Pizza Hut started its operations in India, it made sure that it had an entire range of vegetarian pizzas so that it could meet the demands of the customers. It even adapted its marketing strategy according to the market so that the right message was communicated and the ads were created especially for the Indian market. On the international level, Pizza Hut promotes its offerings with emphasis on chicken variety but it had to alter them for the Indian market. Developments in the International Business Environment The international business environment has undergone drastic changes because of the accelerating use of technology like Internet, increased globalisation, accessibility to wide range of audience in economical way, utilising opportunities for cost reduction and increased competition on domestic and international level (Baack, Harris & Baack, 2013). Some of the major developments which have taken place in the international business environment are as follows: Internet/E-commerce As the Internet has grown in popularity and it has become an integral part of the business operations and customer’s routine, majority of the companies are developing their websites. Some companies have initiated their online organisations known as E-commerce so that they can serve their customers all over the world. The best examples of E-commerce are Amazon, eBay, Dell, OLX and many more (Hult, 2012). Sustainability Due to increased reliance on technological gadgets, severity of economic recession and enhanced production of goods and services, it is imperative for the organisations to create a sustainable work environment. Almost all the organisations are making sure that they implement those business operations which will allow them to protect the environment, boost the industry and focus on the business sustainability. Green environment Since the environment is getting damaged at an exceptionally high level due to industrial revolution, it has become mandatory for the firms to promote the green environment concept throughout their businesses. Every company has to make sure that its business procedures are conducted in such a way that something beneficial is done for the environment. For instance, all well-known companies have made sure that they use those materials for packaging which can be recycled so that the waste amount is reduced (Doole & Lowe, 2008). Likewise, the pharmaceutical companies have made it vital that there production plants are located in areas which are far off from the residences. Even those equipment and machines are bought which allow it to eliminate the problem of excessive emission of Carbon Dioxide. Therefore, all organisations have to make sure that they support such green environment strategy in the international markets as well (Ngo & O’Cass, 2011). Conclusion The international marketing is the latest norm in the business environment and almost all the companies are trying to enter into a range of markets on a global level. There is heightened competition among the firms on domestic and international level as each one of them is trying to avail the opportunities and benefits available for them. It is mandatory for the companies planning to enter in the international markets that they first evaluate all the imperative factors of the new market so that they are able to prosper effectively and manage the business operations as well. When a company wants to enter in the international market, it has to modify the strategy so that it adheres to the market needs. The culture is the most crucial element of any market as it is the beliefs, values and norms which shape the customer’s set of preferences for the products and services. Hence, international marketing is the ideal choice for all those companies which are willing to expand their operations on a global level. References Alimiene, M. and Kuvykaite, R., 2008. Standardization/Adaptation of marketing solutions in companies operating in foreign markets: An integrated approach. Emerging Economics, 1(56), pp. 37-47. Baack, D.W., Harris, E.G. and Baack, D., 2013. International Marketing. Thousand Oaks, California: SAGE Publications Inc. Chirapanda, S., 2012. Technological Environment – International Marketing Strategy Relationship. World Academy of Science, Engineering and Technology, 64, pp. 1107-1110. Chung, H.F.L., 2012. Export market orientations, managerial ties and performance. International Marketing Review, 29(4), pp. 403-423. Doole, I. and Lowe, R., 2008. International Marketing Strategy. London: South-Western Cengage Learning. Ghauri, P. and Cateora, P., 2009. International Marketing. Edinburgh, United Kingdom: Edinburgh Business School, Heriot-Watt University. Gogolava, M., 2008. International Marketing Environment. [Online] Available at: [Accessed 3 December 2013] Hult, G.T.M., 2012. A focus on international competitiveness. Journal of the Academy of Marketing Science. 40(2), pp. 195-201. Ngo, L.V. and O’Cass, A., 2011. The relationship between business orientations and brand performance: A cross-national perspective. Asia Pacific Journal of Marketing and Logistics, 23(5), pp. 145-157. Peng, J., Lawrence, A. and Koo, T., 2009. Customer knowledge management in international project: a case study. Journal of Technology Management in China, 4(2), pp. 145-157. Wong, H.Y. and Merrilees, B., 2007. Multiple roles for branding in international marketing. International Marketing Review, 24(4), pp. 384-408. Yang, Z., Su, C. and Fam, Kim-Shyan, 2012. Dealing with institutional distances in International Marketing channels: Governance strategies that engender legitimacy and efficiency. Journal of Marketing, 76, pp. 41-55. Read More