MODULE 11: Globalization of Securities Market

International/ Global marketing

- refers to any marketing activity that occurs across borders.
- aims to satisfy the needs of global customers.
- enables the effective utilization of surplus production.
- help create bigger and better opportunities for business expansion.

Types of International Marketing

- Export
- Licensing
- Franchising
- Joint venture
- Foreign direct investment

Advantages/ Benefits Disadvantages

- broader customer base - cultural restrictions
- global marketing - high competition
- protection against economic downturns - government restrictions
- bigger opportunities for business expansion - war situations
- effective utilization of surplus production
- helps build relationships with other businesses
worldwide.

Types of International Marketing

1. Export
- shipping goods directly to a foreign country.
- expand their business to other countries.
- entails the lowest risk among other types of International marketing.

2. Licensing
- a company (licensor) grants a foreign firms the right to use its intellectual property and receives royalty
in return.

3. Franchising
- involves a parent company (franchisor) granting a foreign firm (franchisee) the right to do business in its
name.

4. Joint venture
- combined effort of two businesses from different countries to their mutual benefit where they
contribute assets and shares risk.

5. Foreign Direct Investment

- company places fixed asset in a foreign country to manufacture a product abroad.
- Examples: mergers, acquisitions, retail services, logistics, etc.

Benefits of International Marketing

1. Market Expansion - opportunity to extend brand’s customer base.

2. Protects against Economic Downturns - Revenue from selling to an overseas audience can offset
possible downturns.
3. Effective Utilization of Surplus Production - involves shipping goods produced in surplus in one country
to another.
4. Provides Competitive Advantages - Through expansion, you can access new customers and allows you
to remain ahead of the competition.
5. Employment opportunities - Global marketing increases employment opportunities in a foreign
country. These include marketing managers, marketing coordinators, and translators, among others.

Disadvantages of International marketing

1. Cultural Differences - varying culture and norms across the globe could lead to various marketing
challenges such as difference in preferences and consumer needs.
2. Government Restrictions - strict rules, regulations, and restrictions (high taxes, duties to import and
export goods) can impact a company’s profitability and continuity.
3. War Situations - Tensions and war-like situations among nations can severely impact international
marketing and could lead to a complete shutdown of operations.
4. High Competition - Foreign market usually have to complete with both local companies and
international brands resulting to high competition.