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International Marketing

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International Marketing ­ MKT630
VU
Lesson # 9
INTERNATIONAL MARKETING INFORMATION REQUIREMENTS
Firm Specific International Environment
The Competition:
A firm needs information about its competition in international markets on a continuous basis to make
appropriate decisions. Some key areas in which information is needed about competition are in the
following;
­
Relative market shares of competitors
­
New product moves of the competitors
­
Pricing & cost structure of the competing firms
­
Image & brand reputation of competitors in the markets / segments
­
Quality: Its attributes and positioning relative to competitors.
­
Competitors' strengths: favorite tactics and strategies.
The Product:
A firm also needs information regarding its product / lines to make product related decisions. Some of
the key aspects of a product related information requirements are given as follows;
­ Analysis of the users of product, including purchase behavior, usage processes, factors affecting
purchase and use decisions etc.
Who are the end-user industries and what are their behaviors?
­
Industrial & consumer buyers and influencers and their roles.
­
Characteristics of the buyers: Size, age, gender, segment growth rates etc.
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Purchasing power and intentions of the buyers.
­
Customer response to new products, price, promotion distribution etc.
­
Switching behavior of the customers.
­
Role of credit in purchasing a product.
­
Future needs of the buyers / users.
­
Impact of cultural differences on purchase and use of products.
­
Marketing Mix:
Marketing mix related information is essentially needed by marketers to decide and implement
marketing strategies. Since international marketing often involves sending products and materials to a
distant markets, aspects of logistics also becomes more important. The key areas of marketing mix for
which information is needing by international marketers are given as follows;
­
Channels of distribution: their shape, functions, evolution & performance.
­
Relative pricing, elasticities, and tactics of competitors.
­
Advertising & promotion: choices available in international markets and their impacts on
customers.
­
Service quality perceptions in various international markets and relative positioning of competing
brands/products.
­
International and domestic logistics networks, their configuration and future change.
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International Marketing ­ MKT630
VU
FIRM-Specific Historical Data:
While managers need information about their markets, suppliers, environments and external publics,
they also need to know about their own firms. A firm's history hold clues for its future. Historical
information can inform what and how a firm has been able to achieve certain things in past and that hold
clues as to what the firm can achieve in future. Historical firm data may also inform on trends in sales
and profits in various markets, which again hold clues for the future of the firm in these and other
markets.
Categories of information an international marketing manager may need regarding his or her own firm
are give as follows;
­
Sales trends by product and product line, sales force, and international market / customer.
­
Trends by country and region (sales, profits, technology diffusion etc.)
­
Contribution margins and profitability of products in various international markets.
­
Marketing mix used and marketing response functions across countries and regions.
25
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International Marketing ­ MKT630
VU
Lesson # 10
FOREIGN NATIONAL ENVIRONMENTS
Political Environments
Foreign National Environment:
An international marketer needs information about foreign countries' environments that may affect the
business in any way, positively or negatively. Some of the key aspects of a foreign market environment
that may affect international marketer's business are give below;
­
Political context: national leaders, national goals of leaders and governments, ideologies of the
foreign political institutions and leaders, key institutions in forming and implementing
regulations.
­
Economic growth prospects, levels of economic affluence (GDP, GNP), level and extent of
industrialization, business cycle stage.
­
Per capita income levels, purchasing power of the population, disposable incomes.
­
End-user industry growth trends. Industrial demands are mostly derived demands and industrial
buyers by materials and machinery to fulfill the end user demands.
­
Government: political and business orientation, legislation, regulation, standards, barriers to
trade.
Political systems in the world:
There are different political systems today in various countries around the globe. The basic political
ideologies that are existing are given below;
Basic political ideologies
­
Democracy
· Freedom Of Opinion, Expression, Elected Representation With Limited Terms For Elected
Political offices, individual's rights, liberties & social freedom, independent & fair courts,
non-political bureaucracy etc.
­
Quasi democracy
· Partly free - (example is an appointed governor in HK but elected parliament)
­
Totalitarianism
· Decision making is restricted to one or a few individuals
Political risks in international markets:
A marketer's firm faces numerous political risks in international markets. Major political risks in
international markets are given below;
· Direct interference in a foreign company's business - expropriation, confiscation, nationalization
· Campaigns against foreign goods (from governments or people / publics)
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International Marketing ­ MKT630
VU
Kidnappings, terrorist threats & other forms of violence targeted against foreign firms or foreigners.
·
Civil wars have the potential to disrupt businesses in many foreign countries
·
Change in policies, regulations ­ too often and non-consistent ­ affect businesses in any country
·
Change in governments may also result into changing national priorities.
·
Monetary & fiscal policies - inflation, currency devaluation, increased taxation, and currency
·
controls etc. Also affect businesses of international marketers.
· Government as business competitor ­ when government becomes involved in a business in its own
country then it has access to large resources, may implement such regulations that my favor its
businesses and may become a formidable competitor.
· Multilateral investment guarantee agency (miga) - a subsidiary of the World Bank provides insurance
against some political risks. International marketers may use such multilateral agency guarantees to
protect itself from political risks in international markets
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International Marketing ­ MKT630
VU
Lesson # 11
FOREIGN NATIONAL ENVIRONMENTS
Legal Environments
Differences in legal systems:
Businesses are affected by legal environments of countries in many ways. Legal environments are not
just based on different laws and regulations concerning businesses, these are also defined by the factors
like rule of law, access to legal systems by foreigners, litigations systems etc.
·
National legal systems vary on the following aspects;
­
The rule of law
Some country have strong rule of law in that laws are applied strictly, quickly and fairly,
while in others laws are not applied for various reasons, such as corruption, strong
nationalism, weak legal institutions etc.
­
The role of lawyers
A firm depends on lawyers to access courts to seek justice or to defend in case of any
litigation against. International business firms are affected by the role of lawyers in foreign
countries. In some countries there are few lawyers and it is difficult of very costly to engage a
good lawyer. In some countries lawyers may be corrupt or biased in favor of locals.
­
Access to legal system
Access to legal system also varies from country to country, especially for foreign entities. In
some countries foreigners can easily access courts to seek remedies while in other countries
there may be restrictions.
­
The burden of proof
In some countries the burden of proof, in case of any litigation, is on the defendant, while in
other countries the applicant / plaintiff has to first prove that there is a case for the court to
proceed against someone. It may become difficult for foreigners to get proofs in certain
situations.
­
The right to judicial review
Various countries have different legal provisions for appeals and review of lower court or
earlier judgments. These provisions may also vary for foreign entities.
­
And the laws
Laws relevant to businesses (including foreign firms) also vary from country to country.
Types of legal systems:
Business environments in foreign countries also vary with the types of legal systems. Various types of
legal systems are described in the following;
· Common law
Law based on cumulative wisdom of judges' decisions on individual cases over time. Relevant
­
judgments of upper courts have bearings on lower court decisions.
· Statutory law
Laws enacted by legislative actions, i.e., through parliamentary proceedings
­
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Table of Contents:
  1. OVERVIEW OF INTERNATIONAL MARKETING:Domestic marketing, Multinational marketing, Globalization of markets
  2. INETRNATIONAL MARKETING PROCESS:Situation Analysis, Implementation and Control, Relationship
  3. INETRNATIONAL MARKETING PROCESS:The Product Concept, The Societal Marketing Concept
  4. INETRNATIONAL MARKETING PROCESS
  5. ENGAGING IN INETRNATIONAL MARKETS:Expansion of technology, Merchandize export and import
  6. INTERNATIONAL TRADE & INVESTMENT THEORIES:Theory of Comparative Advantage, Country Similarity Theory
  7. INTERNATIONAL TRADE & INVESTMENT THEORIES:Global Strategic Rivalry Theory,
  8. INTERNATIONAL MARKETING INFORMATION REQUIREMENTS:Foreign exchange info
  9. INTERNATIONAL MARKETING INFORMATION REQUIREMENTS:The Product
  10. FOREIGN NATIONAL ENVIRONMENTS:Political systems in the world, Political risks in international markets
  11. FOREIGN NATIONAL ENVIRONMENTS:Types of legal systems,
  12. FOREIGN NATIONAL ENVIRONMENTS:Conciliation, Mediation, Global relevance
  13. ROLE OF GOVERNMENTS IN INTERNATIONAL MARKETS:Industry-level needs, Promotion of exports by governments
  14. INTERNATIONAL CULTURAL AND SOCIAL ENVIRONMENTS:The concept of culture, Attitudes & beliefs,
  15. INTERNATIONAL CULTURAL AND SOCIAL ENVIRONMENTS:Culture is a human medium
  16. DETERMINING EXPORT POTENTIAL IN INTERNATIONAL MARKETS:Political Environment
  17. DETERMINING EXPORT POTENTIAL IN INTERNATIONAL MARKETS:Product Potential
  18. INTERNATIONAL MARKETING RESEARCH PROCESS:market structure, Implementing the research plan
  19. INTERNATIONAL MARKETING RESEARCH PROCESS:Identify alternative information sources
  20. INTERNATIONAL MARKETING RESEARCH PROCESS:Issues with primary global research:
  21. INTERNATIONAL MARKETING RESEARCH PROCESS:Problems with data, Comparative Analysis
  22. MODES OF ENTRY INTO INTERNATIONAL MARKETS:Export intermediaries, Export and import management
  23. MODES OF ENTRY INTO INTERNATIONAL MARKETS:Licensing contract, Licensing risks
  24. MODES OF ENTRY INTO INTERNATIONAL MARKETS:The franchiser’s balance,
  25. MODES OF ENTRY INTO INTERNATIONAL MARKETS:Forms of countertrade, Specialized entry modes
  26. MODES OF ENTRY INTO INTERNATIONAL MARKETS:Demand factors, Political factors
  27. MODES OF ENTRY INTO INTERNATIONAL MARKETS:Drivers behind successful joint ventures
  28. MODES OF ENTRY INTO INTERNATIONAL MARKETS:Distribution agreements, Critical mass & optimism traps
  29. INTERNATIONAL STRATEGIC ALLIANCES:Impetus for international alliances, Management of strategic alliances
  30. INTERNATIONAL CONSUMER MARKETS:Model of Consumer BehaviorThe Buyer Decision Process
  31. INTERNATIONAL BUSINESS MARKETS:Nature of buying unit, Major influences on international business buyers
  32. INTERNATIONAL TARGET MARKETING:Market segmentation, Market positioning
  33. INTERNATIONAL MARKET SEGMENTATION:Geographic, Behavioral, Situational factors
  34. INTERNATIONAL MARKET SEGMENTATION:Basis for country segmentation, Stages of economics development
  35. INTERNATIONAL MARKET SEGMENTATION:Cultural Variables,
  36. INTERNATIONAL MARKET SEGMENTATION:Market coverage strategy, Socio-economic variables
  37. INTERNATIONAL MARKETING MIX - PRODUCT POLICY:Individual product decisions, Branding
  38. INTERNATIONAL MARKETING MIX – PRODUCT POLICY:
  39. INTERNATIONAL MARKETING MIX - PRODUCT POLICY:Modular Approach
  40. INTERNATIONAL MARKETING MIX – PRODUCT POLICY:Issues in labeling, Pricing, Distribution
  41. INTRODUCING NEW PRODUCTS IN INTERNATIONAL MARKETS:The new product development process
  42. PRICING IN INTERNATIONAL MARKETS:Factors influencing international pricing,
  43. ITERNATIONAL MARKETING CHANNELS:Channel membership, Vertical marketing, Control over distribution
  44. PROMOTING IN INTERNATIONAL MARKETS:Advertising, Direct marketing, Public Relationing
  45. REVISION