1. International Marketing

2. Introduction
International marketing is defined as the performance of business activities designed to plan, price, promote, and direct the flow of a company´s goods and services to consumer or users in more than one nation for a profit.

3. Definition
The activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large in more than one country.

4. International marketing consists of the activity, institutions, and processes across national borders that create, communicate, deliver, and exchange offerings that have value for stakeholders and society.
Forms of international marketing include export–import trade, licensing, joint ventures, wholly owned subsidiaries, turnkey operations, and management contracts.
Marketing serves as a key agent of societal change and as a key instrument for the development of societal responsive business strategy.

5. Scope of International Marketing
Exports and Imports: International trade can be a good beginning to venture into international marketing. By developing international markets for domestically produced goods and services a company can reduce the risk of operating internationally, gain adequate experience and then go on to set up manufacturing and marketing facilities abroad.
Contractual Agreements: Patent licensing, turn key operations, co – production, technical and managerial know – how and licensing agreements are all a part of international marketing. Licensing includes a number of contractual agreements whereby intangible assets such as patents, trade secrets, know – how, trade marks and brand names are made available to foreign firms in return for a fee.
Joint Ventures: A form of collaborative association for a considerable period is known as joint venture. A joint venture comes into existence when a foreign investor acquires interest in a local company and vice versa or when overseas and local firms jointly form a new firm. In countries where fully owned firms are not allowed to operate, joint venture is the alternative.

6. Cont… Wholly owned manufacturing: Contract manufacturing:
 A company with long term interest in a foreign market may establish fully owned manufacturing facilities. Factors like trade barriers, cost differences, government policies etc. encourage the setting up of production facilities in foreign markets. Manufacturing abroad provides the firm with total control over quality and production.
Contract manufacturing: 
When a firm enters into a contract with other firm in foreign country to manufacture assembles the products and retains product marketing with itself, it is known as contract manufacturing. Contract manufacturing has important advantages such as low risk, low cost and easy exit.
Management contracting: 
Under a management contract the supplier brings a package of skills that will provide an integrated service to the client without incurring the risk and benefit of ownership.

7. Cont… Third country location: Mergers and Acquisitions:
When there is no commercial transactions between two countries due to various reasons, firm which wants to enter into the market of another nation, will have to operate from a third country base. For instance, Taiwan’s entry into china through bases in Hong Kong.
Mergers and Acquisitions: 
Mergers and Acquisitions provide access to markets, distribution network, new technology and patent rights. It also reduces the level of competition for firms which either merge or acquires.
Strategic alliances:
 A firm is able to improve the long term competitive advantage by forming a strategic alliance with its competitors. The objective of a strategic alliance is to leverage critical capabilities, increase the flow of innovation and increase flexibility in responding to market and technological changes. Strategic alliance differs according to purpose and structure.

8. The International Marketing Task7
Foreign Environment
(Uncontrollables)
1. Competition
7. Structure of
Distribution
Domestic environment
(Uncontrollables)
Environmental
uncontrollables
country market A
(Controllables)
1. Competition
Price
Product
2. Technology
Target
Market
5. Political-
Legal
Environmental
uncontrollables
country
market B
6. Geography and
Infrastructure
2 .Technology
Promotion
Place
4. Culture
Environmental
uncontrollables
country
market C
3. Economy
5. Political-
Legal
3. Economy
4. Culture

9. Why Firms go International
Proactive Stimuli
Profit advantage
Unique products
Technological advantages
Exclusive information
Economies of scale
Market size
Reactive Stimuli
Competitive pressures
Overproduction
Stable or declining domestic sales
Excess capacity
Saturated domestic markets
Proximity to customers and ports

10. Reasons for marketing abroad
Economies of scale and scope
Existence of lucrative markets in foreign countries
Saturated markets in the home country
High R&D costs
International opportunities
Less competition
New trade agreements …

11. Differences between domestic and international marketing
Research data is available in a single language and is usually easily accessed
Research data is generally in foreign languages and may be extremely difficult to obtain and interpret
Business is transacted in a single currency
Many currencies are involved, with wide exchange rate fluctuations
Head office employees will normally possess detailed knowledge of the home market
Head office employees might only possess and outline knowledge of the characteristic foreign markets
Promotional messages need to consider just a single national culture
Numerous cultural differences must be taken into account
Market segmentation occurs within a single country
Market segments might be defined across the same type of consumer in many different countries.

12. Differences between domestic and international marketing (continued)
Communication and control are immediate and direct
International communication and control might be difficult
Business laws and regulations are clearly understood
Foreign laws and regulations might not be clear
Business is conducted in a single language
Multilingual communication is requires
Business risks can usually identified and assessed
Environments may be so unstable that it is extremely difficult to identify and assess risks
Planning and organizational control systems can be simple and direct
The complexity of international trade often necessitates the adoption of complex and sophisticated planning, organization and control systems

13. Differences between domestic and international marketing (continued)
Functional specialization within a marketing department is possible
International marketing managers require a wide range og marketing skills
Distribution and credit control are straightforward
Distribution and credit control may be extremely complex
Selling and delivery documentation is routine and easy to understand
Documentation is often diverse and complicated due to meeting different border regulations
Distribution channels are easy to monitor and control
Distribution is often carried out by intermediaries, so is much harder to monitor
Competitors’ behavior is easily predicted
Competitors’ behavior is harder to observe, therefore less predictable
New product development can be geared to the needs of the home
New product development must take account of all the markets the product is sold in.

14. Opportunities and Challenges in International Marketing
To handle newly emerging forces and dangers of unforeseen influences from abroad, firms need to:
Be prepared and develop active responses.
Envision new strategies.
Develop new plans.
Change the way of doing business.

15. Cont…
The growth of global business activities offers increased opportunities.
Knowledge transfer around the globe helps an international firm to build and strengthen its competitive position.
International opportunities require an awareness of global developments, an understanding of their meaning, and a development of capabilities to adjust to change.

16. Benefits of International Marketing
Coca Cola in India

17. Disney International

18. The Nestlé Way
Nestlé sells more than 8,500 products produced in 489 factories in 193 countries
Nestlé is the world’s biggest marketer of infant formula, powdered milk, instant coffee, chocolate, soups, and mineral water
The “Nestlé way” to dominate markets is summarized in four points:
think and plan long term
decentralize
stick to what you know
adapt to local tastes

19. Benefits of Global Marketing
Economies of scale
Unifying product development, purchasing, and supply activities across countries
Transfer of experience and know-how across countries through improved coordination and integration of marketing activities
Stability of revenues and operations

20. 4 P’s OF INTERNATIONAL MARKETING MIX
Product adaptation and development for international marketing
Packaging and labelling
Translation of technical literature
Quality management
Licensing and contract manufacturing
Choice of pricing strategy
Competitor analysis
Determination of discount structures
Credit management
Choice of delivery terms
Costing and budgeting
Product
Price
Place
Promotion
International advertising, public relations and sales promotion
International direct marketing
Control of salespeople
Translation of sales literature
Exhibiting
Market research
International distribution
Control of agents
Export documentation
Cargo insurance
Establishment of joint ventures and subsidiaries