UNIT -1

Broadly, international marketing refers to the exchange process across nations. It

has gained prominence with the ever increasing global trade and linkages. Whether
or not a company wants to participate directly in international business, it cannot
escape the effect of numerous companies engaged in exports, imports, and/or
manufacturing abroad and the multinationals operating in the domestic markets
giving direct and indirect competition. The advances in information technology
have facilitated the process of marketing across countries. This trend of
globalization of the scope of business has made it essential for the corporate
managers to understand international marketing operations.
Definitions of international marketing

Some of the definitions of international marketing are:

Cateora (1997) defines international marketing as performance of business
activities that direct the flow of company‟s goods and services to consumers in
more than one nation for profit.
Jain (1989) refers to international marketing as exchanges across national
boundaries for the satisfaction of human needs and wants.
Terpestra (1972) looks upon international marketing as marketing carried on across
the national boundaries.
Keegan (1997) comprehends that international marketing as going beyond the
export marketing and becoming more involved in the marketing environment in
which it is doing business.
According to the American Marketing Association (AMA) “international
marketing is the multinational process of planning and executing the conception,
pricing, promotion and distribution of ideas, goods and services to create
exchanges that satisfy individual and organizational objectives”

According to Kotler, ”Global marketing is concerned with integrating and

standardizing marketing actions across a number of geographic markets.”
Domestic & International Marketing
Basis for
Domestic Marketing International Marketing
Comparison
International marketing means the
Domestic marketing
activities of production, promotion,
refers to marketing within
Meaning distribution, advertisement and selling
the geographical
are extend over the geographical limits
boundaries of the nation.
of the country.
Area served Small Large
Government
Less Comparatively high
interference
Business
In a single country More than one country
operation
Use of
Limited Sharing and use of latest technology.
technology
Risk factor Low Very high
Capital
Less Huge
requirement
Nature of Variation in customer tastes and
Almost same
customers preferences.
Research Required but not to a very Deep research of the market is required
 Basis for
Domestic Marketing International Marketing
Comparison
high level. because of less knowledge about the
foreign markets.

Special features of International Marketing

Broader market is available
A wide platform is available for marketing and advertising products and services.
The market is not limited to some precise local market or for people residing in a
particular place, region or country but is free for all. People from different nations
sharing different cultures and traditions can actively participate in it.
Involves at least two set of uncontrollable variables
By uncontrollable variables, we mean the geographical factors, political factors
prevailing in different countries. At the global level, all the companies have to face
uncontrollable variables from different countries. While establishing business
globally, a company has to learn to deal with these variables.
Requires broader competence
International market requires more expertise and special management skills and
wider competence to deal with various circumstances and handle different
situations like changes in the strategies of the government, the mindset of the
people and many other such factors.
Competition is intense
Competition is very tough in international market, as the organizations at the
global level have to compete with both competitors in their home countries and
also in the foreign lands. Competition is high because the clash is between
developed & developing countries and both have different standards and are
unequal partners.
Involves high risk and challenges
International marketing with its own advantages is also prone to different and
tangible risks and challenges. These challenges come in the form of political
factors, regional and cultural differences, changing fashion trends, sudden war
situation, revision in government rules and regulations and communication barriers
The nature of international marketing is dependent on various factors and
conditions and above all, it is dependent on the policies framed by different
countries which are active participants in international marketing. International
marketing tends to ensure balanced import and export to all countries big or small,
rich or poor, developed or developing.
Management of international market is tough and requires thorough market
research. It is a predefined process which is directed towards designing and
delivering products based on the demands from the overseas customers. Proper
management also helps the company attain its objectives.
Large-scale operation
Large-scale operations involve relative amount of labor and capital to cater to the
needs such as transportation, and warehousing.
Domination of multinationals and developed countries
International marketing is highly dominated by multinational corporations due to
their worldwide reach. These organizations apply efficient and effective business
practices to all their business operations. They have a stable position and with their
global approach find themselves fitting into the arena of international marketing.
International restrictions
The international market needs to abide by different tariff and non-tariff
constraints. These constraints are regulated because different countries follow
different regulations. All nations tend to rationally abide by tariff barriers. All the
imports and exports between the nations participating in international marketing
follow some restrictions in foreign exchange.
Sensitive character
International marketing is highly sensitive and flexible. The demand for a product
in a market is highly influenced by political and economic factors. These factors
can create as well as decrease the demand for a product. In fact, use of advanced
technology by a competitor or the launch of a new product by another competitor
may affect the sale of a particular firm‟s product worldwide.
Importance of Advanced Technology
International market is dominated by developed countries like the USA, Japan, and
Germany as they use highly advanced technology in production, marketing,
advertising and establishing a brand name. They provide admirable quality of
products at reasonable prices. Presently, Japanese products have got substantial
existence in markets around the world. The Japanese could achieve this only
because of automation and effective use of advanced computer technology.
Need for specialized institutions
Marketing at global level is highly prone to risks & is very complex and knotty. It
undergoes lengthy and time taking procedures & formalities. Competent expertise
is required for handling various sections of international marketing.
Need for long term planning
International marketing calls for long term planning. Marketing practices differ
from nation to nation influenced by social, economic & political factors.
Lengthy & Time Consuming
The activities in international marketing are very time-consuming and knotty or
complex. The main cause of these difficulties are the local laws and policies
enforced on different nations, issues in payment as different countries use different
currencies, distance between the participating nations and time taking formalities
involved therein.
The current trend of globalization does not limit companies to their national
borders and invites them for marketing on a higher platform, i.e., international
platform. Every nation is free to trade with any nation. New markets are indicating
signs of growth and are marking signs of development in economies like China,
Indonesia, India, Korea, Mexico, Chile, Brazil, Argentina, and many other
economies all over the world.

Steps Involved in the International Marketing Process.

A firm which plans to go international has to take a series of strategic decisions or
steps. Following are the major steps in the process of international marketing:
 Deciding to Internationalize.
 Market Selection.
 Product Selection.
 Selection of Entry Mode.
 Selection of Marketing Strategy.
 Selection of Marketing Organization.
I. Deciding to Internationalize.
The first decision is whether the firm should take up international marketing or not.
This decision is based on number of important factors:
 Present and future overseas opportunities.
 Present and future domestic opportunities.
 Resources of the company.
 Company objectives.
International marketing offers a number of advantages. At the same time,
international marketing is subject to a number of risks. The decision to
internationalize requires the evaluation of international strengths, weaknesses,
opportunities and threats. This is done by SWOT analysis. If the SWOT analysis is
favorable to the firm, the firm should decide to venture into the foreign market.
II Market Selection.
Once it has been decided to internationalize, the next important step is the selection
of most appropriate market i.e., identifying the target customers. For this purpose,
a thorough analysis of the potentials of the various overseas markets and their
respective marketing environments is essential. A careful exercise to shortlist
overseas markets becomes necessary since all products cannot be sold by the firm
to all countries at all times. It is considered better to exert maximum pressure on a
minimum area to achieve the best results.
Following are some important criteria which may be used in the market
selection:
Geographical proximity: The first criterion of market selection is the
geographical proximity. Geographical proximity facilitates a firm to reach the
product fast to a nearby country and service the market quickly and more
effectively. Besides, there will be low transportation cost leading to lesser price of
the product.
Market potential of the country: A company may select its target markets on the
basis of market potential of the country. Market potential of the country can be
assessed by the prosperity of the country, the size and growth of its imports, etc.
Market Access: Another yardstick that a country may use in market selection
relates to the market access. A country‟s import policy is an important factor,
because it may be biased in favor of some items and/or some countries. It is
advisable for a company to select countries which do not discriminate against the
country of the firm and whose import policy is not restrictive.
It would be highly beneficial for a company if it selects countries having good
political and economic relationships with home country or having some
preferential trading arrangement also or having least restrictions on imports.
Market characteristics: Another factor to be considered in the selection of the
market is the market characteristics of the country. A company would like a market
having similar cultural factors, trade practices and customs.
III Product Selection.
Once the market selection decision has been made, the next important task is to
determine the products for export. Following are some important criterion which
may be used in the product selection:
Elasticity of supply: A company would not face any supply constraint in
exporting the products having elastic supply. Elastic supply is the result of natural
resource endowment or acquired skills and assets. A company may also select a
product because the product is unique i.e., it has developed it by research and
development and it is likely to take some time before competitors come out with a
suitable substitute. A company should not prefer exports of the products which are
heavily dependent on imported inputs.
Demand of the Products: A company should identify the products that are in
demand and likely to continue to be in demand in an overseas country. For this the
company has to make the analysis of a country‟s imports and production of various
commodities including substitutes and the likely future policies and plans
regarding such commodities.
IV Selection of Entry Mode.
After the selection of market and product, the next important decision is to
determine the appropriate mode of entering the foreign market. At one extreme a
company may decide to produce the product domestically and export it to the
foreign market. In this case, the company need not make any investment overseas.
On the other extreme, the company may establish manufacturing facilities in, the
foreign country to sell the product there. This policy requires direct foreign
investment by the company. In between these two extremes, there are several
options each of which demand different levels of foreign investment.
Following are various entry modes in the foreign markets:
Exporting: Exporting means sale of domestically produced goods in other country
without any marketing or production or organization overseas. Exporting may be
of two types: Direct exporting and Indirect exporting. Direct exporting means sale
of goods abroad without involving middlemen. In case of indirect exporting, a firm
sells its products abroad through middlemen.
Licensing: Under licensing an international business firm (licensor) allows a
foreign company (licensee) to manufacture its product for sale in the licensee‟s
country and sometimes in other specified markets.
Franchising: Franchising is a special form of licensing in which an international
business company (franchiser) grants another independent company (franchisee)
right to do its (franchiser‟s) business in a prescribed manner. Franchiser makes a
total marketing programme available to the franchisee.
Contract Manufacturing: Under contract manufacturing, an international
marketing company enters into contract with a local enterprise abroad to
manufacture its product and undertakes the marketing responsibility on its own.
Joint Venture: An international joint venture is an enterprise formed abroad by
the international business company sharing ownership and control with a local
company in that foreign country.
Strategic Alliance: Under strategic alliance, two or more competing firms pool
their resources in a collaboration to leverage their critical capabilities for common
gain. Although a new entity may be formed, it is not an essential requirement.
Assembly: Under assembly an international business firm produces most of the
components or ingredients in one or more countries and carries out the labor
intensive assembling in the foreign country where labor is cheap and abundant.
Mergers and Acquisitions: Under merger an international business firm absorbs
one or more enterprises abroad by purchasing the assets and taking over liabilities
of those enterprises on payment of an agreed amount. Under acquisition, an
international business enterprise takes over the management of an existing
company abroad by taking the controlling stake in the equity of that company at a
pdetermined pricce.
Each of these strategies has certain advantages and disadvantages. Each of these
strategies require different levels of investment ranging from no additional
investment to full investment in manufacturing facilities abroad, and the risks also
increase with increase in the investment level Similarly, control over the market
may be higher if the company involves itself directly in manufacturing by
investments in production facilities.
Various entry strategies must be analyzed in following respects:
 Expected sales.
 Costs of operations in a foreign country.
 Assets.
 Profitability.
 Risk factors.
The selection of a company’s best method of entry into foreign markets
depends on following factors:
 Number of markets covered.
 Level of penetration within markets.
 Degree of feedback available.
 Control.
  Possibility of sales volume over a period of time.
V Selection of Marketing Strategy or Marketing Mix Decision.
The foreign market is characterized by a number of uncontrollable variable
Marketing mix consists of internal factors which are controllable. The success of
the international marketing therefore, depends to a large extent on the
appropriateness of the marketing mix.
Following a the elements of the marketing mix:
Product strategy: In the present day competitive global market environment
marketing begins with customer and ends with the customer. The importers will
import only those items which are in demand from the customers.
The exporters have to, therefore, identify what the consumers in the overseas
markets require. It is imperative that the product selected for exports should be
unique, creative and innovative in comparison to the similar item being offered by
the competitors. As the, consumer preferences, tastes and regulations governing
product, quality, safety, health, environment protection, packaging and packing
vary from one market to another, same item cannot be offered in all the markets.
An analysis should be made of any modifications required in the products,
packaging changes needed, labeling requirements, brand name and after-sales
services expected.
Many products must undergo significant modifications if they are to satisfy
consumer and market requirements abroad. Other products require changes at the
discretion of the producer only to enhance their appeal on export markets. Products
may be modified in respect of quality, size, shape, color, material etc. Product
strategy includes packaging, branding and product service.
Pricing strategy: Pricing decision is one of the basic marketing decisions. Most
importers would decide to buy the product finally on the basis of comparison of
price of competing products. Pricing, strategy is closely linked to the cost of the
product and other factors influencing the cost. In setting the export price, the
business firm should consider additional costs that do not enter into pricing for the
domestic market.
These include such items as international freight, insurance charges, product
adaptation costs, import duties, commissions for import agents and foreign
exchange risk coverage. A company should decide whether it should charge the
same net price for a particular product in all its markets or different prices in
different markets.
Export pricing analysis should begin with these questions: What value does the
target market segment place on the business firm‟s product? How do differences in
the product add to, or to detract from its market value? In practice, these are
difficult questions to research but analyzing the prices and product characteristics
of existing competitive products may reveal critical information.
In practice, it is not the cost that determines the product‟s price but the customer‟s
perception of that value. A firm may not have much choice in export pricing
beyond a point because it has to match competitor‟s price. Extension of credit is
part of the pricing strategy.
Distribution strategy: A company should work out its distribution strategy very
carefully so that its product reaches the consumer at the right place and right time
with reasonable cost. The potential exporter should consider the following
distribution on options:
 Exporting through a domestic exporting firm that will take over full
responsibility for finding sales outlets abroad.
 Setting up its own export organization.
 Selling through representatives abroad.
 Using warehouses abroad.
 Establishing a subsidiary.
The choice of distribution channel will depend on the firm‟s export strategy and
export market. A company should be very clear about the division of risks,
responsibilities and privileges between it and the distributors and the cost of
distribution. Part of the distribution strategy relates to agency arrangements in
overseas countries.
When it is intended to create greater awareness of the product, it is better to
appoint an agent who does not handle many products and can allocate the time
needed to promote that product.
Promotion strategy: The company should decide on the optimum promotion mix
i.e., advertisement, personal selling and sales promotion. The export marketing
plan should provide details on the following aspects of the promotional strategy:
 Publicity methods.
 Advertising (who will be responsible for it and how much the firm can
allocate to it).
 Trade missions.
 Buyer‟s visits.
 Local export assistance.
Promotion strategy to be adopted by the exporter should be in tune with the
environmental rules and regulations of the host country. Further, promotion
strategy should take into account the culture of the target segment in terms of its
practices, beliefs, likes and dislikes, religion etc.
VI International Organization Decision.
The last step involved in the international marketing process involves decision
regarding the international organization. There are different organizational
structures for doing international business.
The structure is determined by the following factors:
 Extent of commitment of the organization to the international business.
  Nature of international orientation.
 Size of international business and expansion plans.
 Number and consistency of product lines
 Characteristics of the foreign markets.
A firm may organize its international marketing operations in three ways:
 Creation of export department.
 Setting up an international division.
 Development of a global organization.
The export department is the simplest form of export organization and easiest to
establish. A separate export department is established to take effective care of all
the activities connected with the export business. The internal organizational
structure of the export department may be based upon functions, territory, product
or a combination of these. A separate export department may be located at the most
suitable place which may not be the headquarters of the company.
When the activities of the firm further expand, it may create a full-fledged
international division. The international division may be organized in
following three ways:
 Geographical organization, where managers are responsible for the
marketing activities of their respective countries.
 World product groups, where managers are responsible for sale of a
particular product group.
 International subsidiaries where managers are responsible for its sales and
profits like a subsidiary.
 Now-a-days firms have preferred to develop itself as global organization
where manufacturing and marketing are planned globally.
Strategic Orientations
The various stages of International marketing involvement described above do not
necessarily coincide with the managers thinking and orientations. Researchers in
the area of International marketing revels three distinctive approaches that seem to
dominate strategic thinking in firms involved in international markets. These
strategic orientations reflect the philosophical orientation that must be associated
with the successive stages in the evolution of the international operations.
Domestic Market Extension Orientation
• The domestic firm seeks extension of domestic products into foreign markets.
• International markets are considered secondary
• Prime focus is to market excess domestic products abroad
• Firm‟s orientation is domestic and minimal efforts are made to adapt the
marketing mix to the for
Multi-Domestic Market Orientation
• Here the company recognize the difference between the domestic & foreign
markets
• Understand that different countries need different products
• Design and implement separate marketing strategies for each country
• Subsidiaries operate independent of one another
• Products are adapted, advertising is localized.
• Might not standardize products rather emphasize adaptation to the local markets.
Regional/Global Orientation
• Truly global- Entire market activity is global and consider entire globe as a single
market.
• Companies emphasize on standardization of product/process
• Firms strive for efficiencies of scale by standardizing market mix across national
borders, whenever it is cost or culture effective
• Companies with this strategic orientation pursue a global strategy for major
brands or multi-domestic strategy for other brands
International marketing decisions are same as domestic marketing; only difference
is that all marketing decisions are taken with reference to foreign or international
markets (or customers). More clearly, product, price, promotion, and distribution
decisions are made for international buyers.

modifications to suit each target market. For example, Knorr soup has different
flavors for Asian markets where spices are preferred.

iPod.
International Marketing Decision
International marketing decisions are same as domestic marketing; only difference
is that all marketing decisions are taken with reference to foreign or international
markets (or customers). More clearly, product, price, promotion, and distribution
decisions are made for international buyers.
The first few important questions a firm has to answer are should a company go for
international market? Why should a company prefer to enter global market? Does
company capable to transact in international markets? Obviously, answers come
from company‟s current domestic market position and types of opportunities
available in the foreign markets. When international markets seem to more
attractive and the company is capable to exploit these markets, the company
decides to enter the international markets.
In short, a company prefers to enter the international market in following
situations:
1. When company‟s has excess production capacity and there exists attractive
opportunities outside, and/or
2. When, compared to domestic markets, foreign markets seem more attractive or
profitable, and/or
3. When company has enough capabilities to deal with international markets,
and/or
4. When domestic governments insist, force, and/or encourage businessmen for
international markets.
DECIDING WHETHER TO GO GLOBAL
Operating domestically is easier and safer. – No need to learn foreign language and
laws. – No need to deal with unstable currencies, face political and legal
uncertainties. Home markets might be stagnant and shrinking where as foreign
markets may present higher sales and profit opportunities. Must weigh risk and
answer many questions about its ability to operate globally.
DECIDING WHICH MARKET TO ENTER
Once a firm has decided to enter the international market, the next important
marketing decision is market selection. As per company‟s present product mix,
production capacity, and proposed expansion strategy, it selects one or more
countries to operate in. In the same way, it has to decide on type of foreign buyers
to be served.
Market segmentation and target market selection are two basic issues in the
decision. Initially, a firm targets the most attractive and comparatively easy
international markets. Global marketing research can help a company to study
international consumer behaviour, segment international market, and select a few
most profitable markets.
To assess international markets, following criteria may be used:
1. Present market opportunities
2. Future market opportunities
 3. Market share
4. Uncertainties and challenges
5. Cost-profit estimates
6. Return on investment

Company should define its marketing objectives and policies. Volume of foreign
sales it wants. Stay with small share or go aggressive? Discussions
DECIDING HOW TO ENTER THE MARKET
A firm has selected international markets to operate in. Now, the next imperative
marketing decision is market entry, i.e., how to enter the market; which of the
options to be used for foreign market entry. There are several options to choose an
appropriate entry strategy.
1. Exporting:
Exporting involves selling domestic products in foreign markets. It is easier and
common entry option. Exporting consists of producing the products in home
country and selling or exporting the same in the international market. There are
two options in exporting, the first, company itself exports products in foreign
markets, and, the second, company exports through intermediate agency or agent.
Some entry options in exporting, as suggested by Philip Kotler, include:
i. Export Department:
A company maintains a full-fledged export department to sell its products in
foreign markets. The department is responsible for searching export opportunities,
promotion and selling products, and performing all activities related to export
business.
ii. Opening Branch in Foreign Market:
Some companies open their branches or shops in foreign markets to serve
consumers. The head of the branch is responsible for all activities related to
promotion and distribution of the company‟s products.
iii. Appointing Traveling Salesmen:
Some companies appoint salesmen to search customers in foreign market and serve
them. They collect orders and manage necessary procedures. They can help
develop relations with foreign agencies, retailer, and customers.
iv. Appointing Distributors:
In this entry option, a firm appoints agents, representatives, or middlemen in
foreign markets. They are responsible to carry out all activities to promote and sell
the company‟s products.
2. Direct Foreign Investment:
A company sets up its own factory in other countries. It carries out all production
and marketing activities in foreign land. But, the option depends on a lot of factors
such as market stability, costs of production and marketing, competition,
government policies, and other factors determining favorableness of situation.
Company should select this strategy carefully as there are considerable risk and
uncertainties in some countries.
3. Joint Venture:
The joint venture is jointly owned and managed by host and foreign companies, by
two companies of two nations. A foreign company holds necessary equity to get
voice in management but not enough to completely dominate the venture. Structure
of joint venture depends on government policies and approach of host country.
In underdeveloped and developing countries, many multinational corporations are
operating as joint ventures. For example, HMT represent joint venture with Swiss
Machines and Tools, Proctor and Gamble has joint venture with Godrej, Suzuki of
Japan has with Maruti Udyog, etc.
At present Indian governments and companies operate with more than 50 countries
as joint ventures. When a giant company invests directly in many countries, it is
called multinational companies (MNCc). There are several forms of joint venture,
such as mixed companies, joint ownership companies, licensed companies,
contract manufacturing, management contract, etc.
Eg:
xporting Joint Venturing Direct Investment Licensing
Indirect Contract Manufac.. Assembly facilities Direct Mgmt. Contracting Manufa.
Facilities Joint Ownership Amount of commitment, risk, control, and profit
potential
t entry Mode:: Exporting • Simplest way to
enter a foreign market. • Passively export its surpluses from time to time or active
commitment to expand exports to a particular market. • Indirect Exporting: • Direct
Exporting: - Working through independent - Seller handles their own international
marketing exports. intermediaries (know-how - Can set up export Dpt. or and
services). Overseas sales branch or find - Less risk foreign based agents to do on
the behalf of company.
Deciding how to enter the market. Market entry Mode: Joint Venturing • Joining
with foreign companies to produce or market products Oriental land co. Ltd under
license from The Walt Disney Company or services. • Licensing For a fee or
royalty, the Licensee buys the right to use company‟s manufacturing process,
trademark, patent, trade secret, etc. Coca-cola markets internationally by licensing
bottlers around the world and supplying them with syrup needed to produce the
product Fig: Tokyo Disney Land
et entry Mode:: Joint Venturing
Contract Manufacturing: In which a company contracts with manufacturers in a
foreign market to produce the product or provide its service. Management
Contracting: In which a company contracts with manufacturers in a foreign market
to produce the product or provide its service. Joint Ownership: In which a
company joins investors in a foreign market to create a local business sharing joint
ownership and control. E.g.. KFC Japan.
Deciding how to enter the market. Market entry Mode:: Direct Investment •
Entering a foreign market by developing foreign-based assembly or manufacturing
facilities. • Advantages • Disadvantages Discussion Advantages and Disadvantages
faces many - Firm may - Firm may have lower costs in the form of labors or raw
risks such as restriction materials, foreign or devalued currencies, government
incentives, falling markets or and freight savings. government changes. - Firm may
improve image by - Firm have no choice creating jobs. except to accept risks. -
Deeper relationships with *
DECIDING ON THE GLOBAL MARKETING PROGRAM
Standardize Marketing mix Adapted Marketing mix- An international - An
international marketing strategy for marketing strategy for using basically the same
adjusting the marketing product, advertising, mix elements to each distribution
channels international target and other marketing mix market bearing more
elements in all the costs but hoping for a company`s international larger market
share and markets. return.. Think Globally but act locally.
Eg:
arketing program • Promotions – Companies can either
adopt the same communication strategy they used in the home market or change it
for each local market. Like, Colors also changed sometimes to avoid taboos in
other countries. Purple is associated with death in most Latin America, white is
mourning color in Japan, and green is jungle sickness in Malaysia.
Deciding on the global marketing program• Price – Gucci handbags may sell for
$60 in Italy and $240 in USA. – Dumping: price charged less than its cost – “Price
transparency”
DECIDING ON THE GLOBAL MARKETING ORGANISATION
Organisation for global marketing is an important decision. In order to implement,
direct, and control international marketing efforts, a company must adopt an
appropriate organization structure. The organisation is responsible to regulate
foreign trade.
It is same as domestic marketing organisation; the only difference is that it is
prepared to administer international marketing operations and activities. Structure
depends on a lot of factors such as type of products, number of countries, type of
buyers, etc. Sometimes, it is treated as the department or part of main organisation,
for example, foreign trade department.
There are different types of organisation structures suit with international
marketing such as:

i. Product-wise Organisation
ii. Country-wise Organisation,
iii. Customer-wise Organisation
iv. Place-wise organisation
v. Matrix or Mix Organisation, etc.
INTERNATIONAL PRODUCT POLICY
A firm's product policy reflects its marketing orientation. Following the framework
of IPLC, a firm may begin exporting the products it sells in the domestic market.
Alternatively, it may recognised the significant differences in customer needs,
conditions of product use, etc., and may plan for exporting different products or
product versions to meet the specific needs of each of its different global market
segments. In the latter case, the exporting firm would thus offer a large product
mix. The other option available to exporting firms is to develop a new product for
the export markets. This new product may be the result of the firm's own R&D
acquisition or joint venture with a business partner in the host country. Interesting
examples, here, include Coca-Cola Corpor ation which having entered Japan in
1958 had added Fanta and Sprite by 1970 and s till later introduced fruit drink
products, carbonated orange fruit drinks and also potato chips which were not even
sold by the company in its US market. Similarly, IBM developed EPABX within
the U.K. An International marketer may use one of the following five strategies:
i) Product communications extension
This strategy is very low cost and merely takes the same product and
communication strategy into other markets. However it can be risky if
misjudgments are made. For example CPC International believed the US consumer
would take to dry soups, which dominate the European market. It did
not work.
ii) Extended product- communications adaptation
If the product basically fits the different needs or segments of a market it may
need an adjustment in marketing communication only. Again this is a low cost
strategy, but different product functions have to be identified and a suitable
communications mix developed.
iii) Product adaptation - communications extension
The product is adapted to fit usage conditions but the communication may stay the
same. The assumption is that the product will serve the same function in foreign
markets under different usage conditions.
iv) Product adaptation - communications adaptation Both product and
communication strategies need attention to fit the peculiar need of the market.
v) Product invention
This need a totally new idea to fit the exclusive conditions of the market. This is
very much a strategy which could be ideal an a Third World situation. This
development. costs may be high, but the advantages are also very high. This choice
of strate gy depends on the most appropriate product/market analysis and is a
function of the product itself defined in terms of the function or need it serves, the
market defined in terms of the conditions under which the product is used, the
preferences of the potential customers and the ability to buy the product in
question, and the costs of adaptation and manufacture to the company considering
these product- communications approaches.

INTERNATIONAL PRODUCT LIFE CYCLE

In International market, it is necessary to plan and develop a product according to
taste and preferences of foreign customers. In this process, a product and its stages
play a crucial role. Product life cycle (PLC) is one of the most important concepts
in the field of trade and commerce.
Initially, it was developed by Prof. Theodore Levitt but
later on many marketing expert like C.R. Wassen, B. Carthy, D. J. Luck, D. T.
Kollat, R. D. Blackwell and J. F. Robenson have contributed in it. As like of a
human life cycle a product also have the aging process. This aging process in
which all products have to pass is known as Product Life Cycle. As the life of a
human being can be divided into various stages like birth, childhood, youth, adult,
old age.
Similarly, the life of a product can be divided into
introductory, growth, maturity and decline stages. These stages are collectively
known as Product Life Cycle (PLC). A product is introduced in the International
market for sale, slowly demand and familiarity of product increased, reaches its
saturation, from where it starts decline. This concept is also known as effective
lifespan of a product.
Definition of Product Life Cycle
According to Philip Kotler, “The product life cycle is an attempt to recognize the
different stages in the sales history of a product-sales history pass through four
stages. These are known as introduction, growth, maturity and decline. By
identifying the stage that a product is in or maybe headed towards, companies can
formulate better marketing plans.”
According to William J. Stanton, “The product life cycle concept is the explanation
of the product from its birth to death as a product exist in different stages and in
different environments.”
Stages of International Product Life Cycle (PLC)
With the production process starts the life cycle of a product begins. The product
life cycle has four stages namely introduction, growth, maturity and decline stage.
As the move of a product from one stage to another, the profit and sales change.
The product life cycle is the graphic presentation of the sales history of a product
as shown in figure 1 below.
Introduction stage
Growth Stage
Maturity stage
Decline stage
Introduction stage
It is the first stage of PLC. After production planning and development, the product
is launched in the International market with full-scale production and marketing
programs. This period requires greater investment in product-related activities.
This investment should be gradually recouped as the sales pick up. This stage is
characterized by low and slow sales, high/low product price depending upon
pricing strategies, high promotional and distributional expenditure, low profit and
narrow product line.
Growth Stage
It is skimming the milk stage. In this stage as soon as the customers starts to buy
the product both sales and profits will begin to rise. In the growth stage, the
product gets considerable approval from the International market. In this stage,
marketers must consider the values of promotion, advertising and distribution as
these are the key factor.
Competition begins to rise as similar other new products appear in the International
market as substitutes. This stage is characterized by a rapid increase in sales,
increase in competition, increased in sales and profits, reduction in price,
strengthening the distributional channels and improvement in the product.
Maturity stage
When the household demands are satisfied and distributional channels are full then
the marketer feel saturated. In this stage, the manufacturer introduces new models
or adapts methods such as trading-in etc. to promote the sale of their brands with a
view to retaining their market position.
Some of the promotional efforts (as the supply exceeds demand) may lengthen the
span of this stage, but it will not be a permanent solution. This stage is
characterized by increasing sales at a decreasing rate, less profit, price stability,
modifications in a product, high dealer‟s support, less promotional expenses.
Decline stage
This is the final stage of PLC, in this stage profit margins touch a low level,
competition becomes severe and customers start using new or better products or
substitutes. Product life cycle concept may be used as a managerial tool. This stage
is characterized by a decrease in sales, no promotional expenses, a decrease in
price, and no further production.
Marketing strategies must change as the product goes through its life cycle.
Repositioning a product can lead to a new growth cycle. Repositioning is basically
changing the image or perceived uses of the product.
Importance of International Product Life Cycle
Different marketing experts have different opinion about the utility of product life
cycle. The concept can be used as a forecasting tool as it alerts management that its
product will inevitably face saturation and decline, and the host of problems these
stages pose.
Some of other have an opinion that it can be used in
useful in framing and taking sound decisions regarding marketing strategy over the
different stages of the product life cycle. It is also helpful in various promotional
devices such as advertising, sales promotion, publicity and personal selling.
Some other expert have the opinion that to achieve the
projected sales target, it formulates promotional, pricing and distribution policies.
Helpful in sales forecasting
Helpful as a predictive tool
Helpful in development of product
Helpful in price determination
Helpful in framing of International marketing program
Helpful as a planning and controlling tool
Estimation of Profits

INTRODUCING NEW PRODUCTS IN INTERNATIONAL MARKETS

In business and engineering, new product development (NPD) is the term used to
describe the complete process of bringing a new product or service to market.
There are two parallel paths involved in the NPD process : one involves the idea
generation, product design, and detail engineering ; the other involves market
research and marketing analysis. Companies typically see new product
development as the first stage in generating and commercializing new products
within the overall strategic process of product life cycle management used to
maintain or grow their market share.

Categories of new products:

• Six categories of new products in terms of their newness to the company and to
the market place:
1. New-to-the-world products
• new products that create an entirely mew market
2. New product-lines
• new products that allow a company to enter an established market for the first
time
3. Additions to existing product-lines
• new products that supplement a company‟s established product lines (package
sizes, flavors, so on)
4. Improvements or revisions to existing products
• new products that provide improved performance or greater perceived value and
replace existing products
5. Repositioning
• existing products that are targeted to new markets or new market segments
6. Cost reductions
• new products that provide similar performance at lower cost

Issues in new product development:

The companies need the development of original products, product improvements,
product modifications & new brands on a consistent basis to survive competition
but most new products fail.
• New-product failure
– nearly 80% of new packaged consumer goods & line extensions fail
– nearly 33% of new industrial products fail at launch
• New successful products
– are unique superior products
• higher quality, new features & offer higher value
– have well-defined concept
• by carefully defining and assessing the target markets, product requirements &
benefits
To remain successful companies must continuously develop new products - but the
odds weigh heavily against success. The solution lies in strong new-product
planning
Successful new products are the ones;
• that have relative advantage
• have compatibility with other technology and distribution systems
• allow trialability / divisibility for buyers to try and learn
• can be judged through observation
• just right in terms of complexity of technology and use
• offer value for the price
The new product development process:
Successful new product development process consists of eight major steps;
1. Idea generation:
systematic search for new-product ideas
- internal sources
- customers
- competitors
- distributors
- suppliers
- others
2. Idea screening:
to spot good ideas and drop poor ones
- is the product truly useful to consumers & society
- availability of market
- does it mesh well with company‟s objectives & strategies
- do we have the people, skills & resources to make it succeed
- does it deliver more value to customers than competing products
- is it easy to advertise and distribute
- availability of technology
- availability of raw materials
- risk exposure, profitability, cost/benefit
- government priority
- any other factor
- CRITICAL SUCCESS FACTOR
3. Concept development & testing
– product concept is a detailed version of the new-product idea stated in
meaningful consumer
terms
– concept development - a new product idea is developed into alternative product
concepts
– concept testing - calls for testing new-product concepts with groups of target
customers
4. Marketing strategy development
– describe target market
– planned product positioning
– planned sales & market share
– & profit goals for first few years
5. Business analysis
– a review of the sales, costs & profit projections for a new product to find out
whether these
factors satisfy the company‟s objectives
– sales forecast
– estimation of costs & profits
6. Product development
7. Test marketing - in realistic market setting
8. Commercialization (launch)
Introducing new products to the world markets:
Waterfall Model:
- Global phased roll out - new products tickle down in a cascade like manner.
Sprinkler Model:
-
- Simultaneous worldwide entry.
- Growing prominence of universal segments.
- Concerns about competitive pre-emption in the foreign markets.
The waterfall strategy of segmentation entry is preferable over the sprinkler model
when ;
1. The lifecycle of the products is relatively long
2. Non-favorable conditions govern the foreign market, such as:
� Small foreign markets (compared to home market)
� Slow growth
� High fixed cost of entry
3. Weak competitive climate exists in the foreign market, because of such things as
� Very weak local competitors
� Competitors willing to cooperate
� No competitors
Superior quality can reduce a customer's life-cycle ownership costs, enhancing
customer loyalty, repeat buying, and word-of-mouth advertising ISO 9004 suggests
the roles that marketing should play: Take the lead in establishing quality
requirements for the company by determining customer needs and communicating
them throughout the company
- Translate customers needs into specifications including performance and sensory
characteristics, installation configuration, statutory and technical standards,
packaging and quality standards
- Set up an information system to monitor customer satisfaction and dissatisfaction,
and feedback such pertinent information to facilitate design and manufacturing
changes
- Develop early warning systems to spot performance problems with new-product
introductions; continuously monitor product performance against quality
specifications such as reliability and safety, and track and analyze customer
complaints so that corrective action can be taken in design and manufacturing
PRODUCT BRANDING
Product Branding and packaging decisions are very important decisions as in the
present age of globalization, a large number of brands of various products are
available to the consumer to choose and select from. As all brands are not equally
liked by a consumer and he selects his brand after a careful analysis of a number of
factors associated not only with the product but also the manufacturer, the brand
name, the packaging, the price, the contents and also the various other factors.

The marketers of all the competitive brands of a

product try to reach to the consumers by the means of marketing communications
and appeal them to buy their brand. For making the consumers to take favorable
decisions for their products, the marketers need to build strong brands and nourish
them overtime so that its market strength is not deteriorated on account of
introduction of equally competitive brands by their existing competitors or by the
entry of an altogether a new brand with attractive product features including
appealing packaging.

The marketers therefore need to continuously undertake

research and developmental activities to keep intact the brand image. In order to
ensure that the other brands of washing power do not erode the market share of
their brand „surf‟, Hindustan Lever Limited has been taking very cautious
measures from time to time about this brand and its packaging.
Product Branding
Branding is personalizing the product by giving it a name. Just as all of us have
been given names to have our unique identity in the society, similarity the
companies give unique brand names for their products to facilitate their distinction
from the competitor‟s brands.
The word „brand‟ owes it origin to the Norwegian word
„brandr‟ which means to burn. The farmers, there, used to put some identification
marks on the body of their livestock to distinguish their possession. Therefore, the
marketers taking clues from it, resorted to branding, in order to distinguish their
offerings from the similar products and services provided by their competitors.
Branding with benefits accruing to the consumer is particularly effective as such a
brand name would make a product appear as if it had some added value. When
placed alongside a competitor offering an identical product, a benefit-based name
positions itself above the competition in the consumer‟s mind. As a result, the
name will register quickly when people make their buying decisions. However
there is no one magic formula that can be applied to quickly and efficiently
generate a brand name.
The right name has to be the product of a carefully
prepared strategic brief, showing creativity, selected with a lot of linguistic and
cultural research. A good name is an incredibly valuable asset. Naming, in today‟s
global market, has evolved into a complex creative process and is also subjected to
stringent legal checks.
Creating Brands
For launching new brands and for repositioning existing ones in the contemporary
competition driven market demand, an abundance of customer loyalty is required
to optimize marketing expenditure.
For new brands, the task of designing the brand
experience requires creativity to differentiate the brand is unusual ways in the
market place. For existing brands, the task includes decision making about which
features, look and feel, and messages should be kept, which should be dropped and
which should be changed. All this is required to be done before the brand re-
launching is to be undertaken. This is also sometimes called brand dressing.
Overall it can be summed that for making a stable
position in the mindset of the consumers and hence the market, a new brand
requires creativity to differentiate while an existing brand relies on innovations
undertaken to enhance the brand‟s market image.
Important Considerations for Branding
The following considerations should be made before making a final choice of
brand name in order to make it more effective.

It should be catchy and easy to recall.

It should be easy to pronounce.
It should have a distinctive appeal.
It should suggest product benefit.
It should not infringe on existing registered brand names.
It should be such that it can be registered as a trade mark*.

(* A trade mark is a brand registered under the law).

A brand can be any of the following:

Company‟s name (e.g. Cadbury chocolates).

Product‟s name (Nescafe)
Symbols (e.g. Symbol of Maharaja in case of Air India).
Letters generally standing for company‟s name e.g. ICICI.
Names or figures unrelated to the product e.g. classic.
Manufacturer‟s family name e.g. Godrej.

Through their meaning and sound, names project the personality of a product and
should communicate to customers, the quality, integrity and strength of what they
represent. As brand names are the first public act of interaction of a company with
the potential customers, these can prove out to be assets of enormous value.
Kinds of Brands: The brands of the following kinds.

a) National Brands
b) Individual Brands
c) Blanket Brands
d) Multiple Brands
e) Private Brands

National Brand
A national brand is a manufacturer‟s brand. A successful national brand builds not
only the image of the product, it builds also the image of the company. A
successful national brand is a great help to a company in introducing new products
in future. A disadvantage of the national brand is that if one product fails, it also
badly affects the other products of the company. Besides this, creating a national
brand is expensive.
Individual Brand
An individual brand means that each product of a company has an individual brand
name. It has the advantage of highlighting the benefits of the individual product. It
has the further advantage that if an individual brand flops, it does not hurt the other
products. Individual brand is however an expensive proposition. Hindustan Lever,
HMT etc., have been following this method of giving different names to each of
their products.
Blanket Brand
A blanket brand is one brand which covers all the products of a company. It is
usually the company‟s or the manufacturer‟s family name. This practice is also
called family branding or umbrella branding. It has the same advantages as well as
the disadvantages of a national brand.
Multiple Brand
A multiple brand gives different names to the same product having only minor
differences. The idea is to appeal to different segments of the market and have a
larger market share. But the customers often see it as a „trick‟, not a fair play, and
they lose faith in the company.
Private Brand
Sometimes, mainly for reasons of cost-saving, the manufacturer hands over the
responsibility of branding to the distributor. A private brand is, in fact, the
distributor‟s brand. It can be highly successful. The manufacturer, however, cannot
get all the benefits which accrue from it.
Trademarks
Popular brands are many times imitated. A trademark is a legal right of a firm to
protect a brand name or brand mark by getting their brands registered at the patent
office. It confers the proprietor a statutory right to exclusive use of that mark or
name. It is meant to safeguard against ditto imitation.
Benefits of Branding
Establishing a brand involves a good deal of expenses on advertising and
promotion. But once established, a brand has several advantages to offer. If a brand
is properly nourished, it grows and has a long shelf life.

a) A brand serves as a guarantee for quality and creates confidence among the
consumers.
b) A branded product acquires a special identity and appeal. The customer finds
easy to select and buy.
 c) The greatest advantage, however, comes from the product differentiation it
creates. Once that is done, the product can compete on a non-price basis.
Testing Brand Names
There is no fool proof method for testing brand names but the following are some
important considerations which may prove useful in building a successful brand
name.
The selected brand name should be:
(i) Emotional; (ii) Stick to the brain; (iii) Have personality; (iv) Have depth

Overall, while the brand name is very important, a brand cannot survive on its
name alone. The brand name and its execution are equally important for a
successful and sustained brand life. Further, also it is not enough to have a winner
brand, in order to stay ahead, the brand must also live up to its promise better than
anyone else.
Brand Loyalty

Brand loyalty is the measurement of the attitude or the behavior of the consumer
for a particular brand. In other words, it is the intentions of the buyers to make a
repeated purchase of a product on account of the previous experiences from the
consumption of that brand. Higher loyalty to a brand is an important asset. It can
be utilized to persuade customers for more purchase or for spreading word of
mouth. Loyalty provides fewer reasons for consumers to engage in extended
information search among alternatives. Purchase decisions based on loyalty may
become simplified and even habitual in nature which may be out of the satisfaction
with the brands being used presently. A base of loyal customers will be
advantageous for an organization as it reduces the marketing cost of doing
business.
Interest in loyalty in the field of marketing dates back to 1923. Since then the
concept of loyalty has been subjected to intense discussion in marketing literature
and numerous empirical studies have been conducted with a view to explain this
concept.

A large number of loyal customers are an asset for any

brand and this phenomenon has been identified as major determinant of brand
equity.

Loyalty provides fewer reasons for consumers to engage in extended information

search among alternatives as purchase decisions based on loyalty may become
simplified and even habitual in nature and this may be a result of satisfaction with
the current brands. A base of loyal customers will also be advantageous for an
organization as it reduces the marketing cost of doing business. The brand loyal
customers repeatedly buy the same brand until they are compelled by the strong
market forces by offering them a certainly better product which they perceive to be
worthy enough to buy shifting from the loyal brand.

The marketers which have a strong base of loyal

customers need to take extra care of such loyal customers by nourishing and
serving them in such a way that they keep intact their loyalty.
Brand Equity
Brand equity is the perceived value of the brand in the corporate world. Companies
build brands and nourish them overtime to make them stronger and widely
acceptable by the consumers. For building and nourishing brands the companies
have to spend a lot of money and by doing so they develop their brand‟s equity.
Thus the value of a brand‟s overall strengths in the market is called brand equity.
Brand equity is the sum total of all the different values
people attach to the brand. It may also be termed as the additional income expected
from a branded product over an unbranded one.
As it is costly to build brand recognition, some firms
prefer to acquire established brands rather than try to build their own. They pay
money to take over these brands. This amount varies with the perceived worth of
the brand and is termed as brand equity. A brand is nearly worthless unless it
enjoys some equity in the market place.
Brand equity refers to a set of assets and liabilities
linked to a brand, its name and symbol that add to or subtract from the value
provided by a product or service to a firm and or to that firm‟s competitors.
Brand equity is a measure of brand‟s worth. Strong
brands have higher brand equity because they are perceived favorable over the
others by the buyers. For evaluating brand equity, the brand‟s market share, its
profitability and future potential are the crucial considerations.
A brand‟s equity is a sum total of the perceived values of the brand‟s:
Customer loyalty
Awareness
Perceived quality
Brand association
Proprietary assets

A strong brand equity also pushes the market share prices of its parent firms which
is the main consideration while selling and buying of firms i.e. acquisition / take
over decisions are made. Coca Cola paid Rs. 40 crores (around $7.3 million USD)
for buying out Barle‟s brands – Thums Up, Limca, Gold Spot and Citra and Heinz
paid Rs. 110 crores (around $21.3 million USD) for taking over Glaxo‟s food
brands.

Thus it can be concluded that strong brands have their

equity too and the value of which depends upon their market share, their level of
customer loyalty, its profitability, future potential and also the several other
considerations.

Overall it may be said that a brand represents all the

tangible and intangible qualities and aspects of a product or service. A brand
choice represents a collection of the buyer‟s feeling and perceptions about quality,
income, life-style and status. A brand promises to deliver value upon which
customers and prospective purchasers can rely to be consistent over a long period
of time.
Product Packaging
Packaging is an integral component of a product and it plays an important role in
its salability. Packaging is no longer a mere outer covering of a product for its
protection; it is very much a contributing factor for its increasing marketability. A
vividly beautiful packaging of a product, to some extent, develops a positive image
about it in the minds of the consumers. Thus packaging is not merely used as a
means of product‟s protection during transportation and storage but it is also used
as a marketing and promotional tool.
Earlier the role of packaging was merely to protect the
product from sun and dust and also from damage during handling. With
advancement of the nations, new legislation has been incorporated for the
merchandising of the goods. This has resulted into the importance as well as the
necessity for an appropriate quality and type of packaging.
Today marketing is a game of names of brands who sell
the most in the market place. Lee Cooper, Coca-Cola, Pepsi and Reebock are the
status icons for young and old alike. These brands speak for the prestigious and
social stature of any persons.
The present era of cut throat competition has enabled
the consumer to select the brand of product to be consumed from amongst a vast
number of competing brands. This availability of brand choice has resulted into a
fast eroding of the consumer‟s loyalty for a particular brand. Consumers are not
resorting to more of impulse buying and are eager to try new brands. Hence the
companies today not just take research and development activities for improving
the product quality but also try to add value to their products means of via
innovative packaging.
Packaging Functions
These days packaging is designed to take care of the convenience for its use and
also to differentiate a brand from the others. In case of many products reusable
packaging is also used to attract consumers for its purchase.
Packaging is a function of both physical distribution as
well as advertising. It is essential that latest techniques and materials of packaging
be used. Many institutes, including the Indian Institute of Packaging render useful
advice to the marketers on the nature of packaging designs and the materials to be
used which would be suitable for a particular product.
Importance of Packaging
Depending on the products and the industry, the packaging can have different
levels of importance. Sometimes packaging becomes the most important way of
delivering the good, and its cost represents the largest part of the total cost of the
product.
Packaging becomes the most important way of
delivering the goods, and its cost represents the largest part of the total cost of the
product”.Packaging serves a number of utilities which the marketer‟s want to
communicate to the consumer to attract him to purchase his brand. Through
packaging the important information about the product, price, manufacturer and
the consumption precautions etc. can be conveyed to the buyer.
Product packaging decisions are very important and the
marketers need to be very careful about it, as packaging is sometimes the key
factor of success or failure of a new launch.
Packaging, as a function, has two separate dimensions –
the science and technology and the behavioural aspect related to the art of product
design which enhances the value of the contents and passes on the impression to
the consumer directly or subtly.
Overall it can be concluded that packaging is an
integral and an important component of the product. It not only helps in protecting
the product from being damaged during its handling but also protects it as an
attractive packaging works as a silent salesman.
Packaging Decisions
Packaging decisions are very important for the marketing because now-a- days the
consumers pay a lot of attention and care for selecting a product. They usually
prefer a product which is adequately packaged; the outer cover contains all the
necessary information about the product and the manufacturer and also the method
of using, consuming or operating the product. More so, packaging carries some
aesthetic value also. So, in the modern days, the marketing managers pay a lot of
care for making the packaging decisions of the products being marketed by them.
The marketers, in the present era of cut throat competition, are also turning to
innovative packaging in order to establish a distinctive edge over the competitor‟s
brands. This is especially true in the case of marketing of consumer products,
cosmetics, perfumes, toiletries and other personal care products. Marketers try to
add value to their brands by way to packaging as a tool. Thus they want to pass on
greater benefits to the customers and attempt to increase their brand‟s value.

The marketers have to take the packaging decisions which should meet the twin
tasks of keeping the packaging cost low and yet carry it safely enough up to the
customer without any damage. It might not always be possible to merely reduce
the cost of packaging without affecting the various components of the marketing
mix because the packaging decisions affect all the four components of the
marketing mix. Good and attractive packaging adds to product attraction but not
without adding to its cost. It may also add to the convenience of handling and act
as a tool of promotion. So, the marketing firms have to take such decisions which
will be beneficial for all and the overall equation of cost benefit analysis is
favorable for each.

Packaging designs are also of vital importance as they often help the consumer to
recognize the product and literally sell it off the shelf, especially at the point of
sale. The labeling used on the packaging also serves as a means of communication
about the product contents, quality, quantity etc. e.g. eco-labeling on the packaging
of a product is a proof that the product is environmentally friendly.

Since the last few years, the packaging material has become more and more an
object of creativity of the marketing people rather than the domain of the
production and technical engineers. From being functional initially and addressing
the need for protection during the time in-between production and consumption of
the products, packaging is becoming vehicle for communication, used to
effectively influence the end consumer.

These days when we talk about innovation, we not only refer to product quality but
include its packaging also. These days the consumer readily pays the price of the
packaging if it helps in adding to its quality and hygiene, so therefore, the
marketers should take decisions in favor of improving the acceptance level of their
brand by adopting appropriate packaging designs made with appropriate materials.
Useful Features of Packaging

Packaging deals with the nature of the container/wrapper, its size, shape, color and
the message printed on it. It represents the talents of the various specialists viz.
researcher, designer, engineer, marketer and others.

The packaging of a product may also attract the attention of the consumers at the
very first sight if its features appear to be attractive. The marketers need to take
care of these marketing aspects also.

The usual features of packaging are the following:

a) The container should be strong so that it can stand the strain of transportation
and handling. It should be strong also to ensure a long shelf-life.
b )While being strong, it should avoid being too heavy so that it remains easy to
handle and inexpensive on freight.
Over and above the usual features, the packaging should also have certain features
from the marketing angle, as a well-designed packaging is often described as the
silent sales representative. These marketing features of packaging are as follows:
a) It must advertise the brand and the manufacturer.
b) It must be distinctive and capable of „differentiating‟ the product.
c) It must be suitable for display.
d) It must be helpful in identifying the product.
e) It must carry the brand name, brand / trade mark and all the other required
information.
f) It must be attractive.
g) It must be so designed as to add convenience for carrying and handling the
product.
h) It should require the minimum shelf space.
i) The colors and the material used for outer packaging must not create any
socially or psychologically bad image about the product.
j) Packaging must be capable of keeping intact the hygiene of the product for its
shelf life.
However, due care must be taken as an overenthusiastic
approach may lead to cost over-runs as packaging has a direct bearing on the
product cost. Therefore, the cost aspect of packaging should be strictly controlled
so that the product may not be overpriced.
Brand Positioning
Brand positioning is the conscious promotional efforts
which the marketers undertake to develop an image, in the mindset of their target
consumers, about the benefits and quality stands of the promoted brand. In
positioning, the marketer decides how and around what parameters, the product
offer has to be placed before the target consumers.
The consumers vary on the benefits which they seek to draw from a product and no
single brand of a product category can incorporate all the features which can
satisfy these needs of all the types of the consumers. Hence, the marketers need to
first incorporate such features in their brands which would be able to meet the
desired benefits of one or more segments of the consumer and then promote their
brands by highlighting these product features so as to target their brands on these
segments of consumers. Thus brand positioning is the process of developing a
positive association between the target segments of the consumers and the
promoted brands.
Brand positioning decisions are consciously taken
because if the promoted brand fails to deliver consumers the benefits claimed by it,
the consumers will rather develop a negative image about the product. Thus for
product positioning to succeed, it must be based on an identifiable, meaningful and
compelling value proposition. The brand should match the value gained by the
consumers (after its consumption) to the value promised by it.

A value proposition is the assertion/statement of the benefits and satisfaction that

the marketers claim in the brand.

According to Kotler and Keller, “Positioning is the act of designing the company‟s
offering and image to occupy a distinctive place in the mind of the target market.
The goal is to locate the brand in the minds of the consumers to maximize the
potential benefit to the firm. A good brand positioning helps guide marketing
strategy by clarifying the brand‟s essence, what goals it helps the consumer
achieve and how it does in a unique way. The result of positioning is the successful
creation of a customer focused value proposition a cogent reason why the target
market should buy the product.
Thus, the overall conclusion from the concept of brand
positioning, can be drawn that it is the act of building an image for perception
about a brand‟s ability or capability to provide the perceived satisfaction/ benefits
to the consumers.
Emerging trends in International marketing
International marketing trends have changed significantly over recent years.
Thanks to the advent of the Information Age, today‟s global marketplace is more
connected than ever before. It is this connectedness that has led to a major change
in the way that international brands market themselves.
Companies that are looking to succeed in the new age
of international marketing must be sure they are paying attention to how
communications are changing. Marketing isn‟t what it used to be. In today‟s world,
more and more companies are doing business in countries around the world, and
that means a greater number of challenges for professional marketers. If you‟re
planning on expanding your business into the global marketplace, it‟s important to
stay informed on current trends in international marketing so you can pick and
choose which would be most effective for your company. Here then, are some of
those trends and some basic information about each one.
Leading with a Purpose
Every company should lead by example. In this case, you want to lead the
purpose of your brand; going by your company‟s promise. This shows consumers
that you‟re committed and invest in their needs. Hence, it‟s important to come up
with a value-centric brand purpose that sounds straightforward and genuine.
Valuing the Most Important Assets of your Organization
 When you value important assets, consider what makes your company great.
Ask yourself, “what is this company notorious for, and how can we move forward
in making it better?” Doing so will make your marketing tactics easier, and benefit
you over time.
Conversational Marketing is a Must
Conversational marketing is a one-on-one connection that customers and
businesses often have nowadays. If you want to dominate the marketing world,
start with conversational marketing. Every business should take a personal
approach towards consumers because it enhances a customer‟s experience when
marketing efforts make it about them.
Implement Video Marketing
Video marketing has become one of the top trends dominating the marketing
world. When implementing video marketing, you‟re one step closer to promoting
technological advances for your company.
Use A.I.
Artificial Intelligence continues to be on a roll with marketing trends. Using
Artificial Intelligence into your marketing strategy will create more engaging
customer services for your business. The future is here, and it‟s here to stay.
Influence Marketing with B2B
When you influence your marketing with B2B, think about other businesses that
your business has partnered with. When it comes to B2B or business-to-business
marketing, you‟re reaching out to an audience that‟s beyond your typical consumer
audience.
Visual Search Applications
Just like artificial intelligence, visual search applications continue to dominate
the marketing industry. Visual search applications improve search engines and
customer experience. Hence, why it‟s a good tactic to use with your marketing.
Marketing visual search applications for your company will invite more customers
to use it and increase the recognition of your company‟s brand.
Web Apps are Progressing
Progressive web applications make your company‟s media more available to
more customers. Whether it‟s a mobile version of your business‟s website,
developing progressive web applications using HTML, CSS or JavaScript will
increase marketing revenues.
Elevate your Customer Experiences
Improving customer experience is always a great way to elevate your marketing.
From experiential retail to visual searches, having better customer experience over
time is what makes a successful business. One way that you can elevate customer
experience is to engage with your customers online on social media.
Leveraging User-Generated Content
Having user-generated content is another innovative way to increase the
attraction of your business as well as create more improvement over time. When
applying leverage to user-generated content, create polls, or ask questions of social
media to hype the engagement of users and potential customers.
Amplify your Consumer Participation to Unlock New Values
When amplifying customer participation, you‟re opening up new values that can
be applied to your brand. Many global brands use this tactic because this is a way
for them to keep up with other competitive brands and pave the way for a dynamic
two-way engagement between product life cycles and consumer journeys.
Consider Adopting Programmatic Advertising
It‟s been known that programmatic advertising has become a stable for digital
marketing strategies of businesses. If you plan to apply programmatic advertising,
think about the perks that it will give your marketers such as making most of their
time and budgets. Another way to use programmatic ads is through social media.
 Overall, global brands should take initiative when it
comes to taking on new trends for marketing strategies. When it comes to global
marketing(1), it‟s important to think about how you want to sell your products to
consumers worldwide. If you haven‟t already, take advantage of this time of
modern technology and adapt to the conditions of other countries into your
marketing tactics. Think about what kind of web applications are right for your
company or figure out how visual search and A.I. can fit into your brand.
Difficulties & Barriers in International Marketing
International marketing is not as easy as domestic marketing. International
marketing environment poses a number of uncertainties and problems. As against,
national markets, international markets are more dynamics, uncertain, and
challenging. Especially, cultural diversities and political realities in several nations
create a plenty of barriers that need special attention. In the same way,
geographical constraints cannot be totally undermined. Widespread terrorism has
created a new threat to international trade.
Though the world is advancing in terms of information
technology, innovative and superior methods of organizing marketing efforts (like
horizontal organisation, network organisation, virtual organisation), global efforts
for smooth international trades, and so forth, yet international marketing is not that
much easy to pursue, it has become a challenge to accept.
1. Tariff Barriers:
Tariff barriers indicate taxes and duties imposed on imports. Marketers of guest
countries find it difficult to earn adequate profits while selling products in the host
countries. Sometimes, to prevent foreign products and/or promote domestic
products, strategically tariff policies are formulated that restricts international
marketing activities. Frequent change in tariff rates and variable tariff rates for
various categories of products create uncertainty for traders to trade internationally.
Antidumping duties levied on imports and defensive strategies create difficulty for
exporters.
2. Administrative Policies:
Bureaucratic rules or administrative procedures – both in guest countries and host
countries – make international (export and/or import) marketing harder. Some
countries have too lengthy formalities that exporters and importers have to clear.
Unjust dealings to get the formalities/ matters cleared create many problems to
some international players. International marketers have to accustom with legal
formalities of several courtiers where they wants to operate.
3. Considerable Diversities:
Different countries have their own unique civilization and culture. They pose
special problems for international marketers. Global customers exhibit
considerable cultural and social diversities in term of needs, preferences, habits,
languages, expectations, buying capacities, buying and consumption patterns, and
so forth. Social and personal characteristics of customers of different nationalities
are real challenges to understand and incorporate. Compared to local and domestic
markets, it is more difficult to understand behaviour of customers of other
countries.
In the same way, as against domestic markets, to design
and modify marketing mix over time for international markets seem more difficult.
Market segmentation, product design, pricing, and distribution need more
information and efforts. Promoting products in international markets is a
formidable task. Message preparation and execution in suitable media in
international markets is not easy game to play.
Language and religious diversities are the real challenge for international business
players. There are 6000 languages in the world. China (20%) is the largest in term
of native speakers, followed by English (6%), and followed by Hindi (5%). Yet
English is recognized as global business language.
English speaking countries can contribute the largest
share (40%) in global business. Religious diversities seem difficult to cope with as
they determine needs and wants of people. At present Christianity is the largest in
the world (1.7 billion), followed by Islam (1.0 billion), followed by Hinduism (750
millions), and followed by Buddhism (350 millions).
4. Political Instability or Environment:
Different political systems (democracy or dictatorship), different economics
systems (market economy, command economy, and mixed economy), and political
instability are some of real challenges that international markers have to face.
Political atmosphere in different courtiers offer opportunities or pose challenges to
international marketers.
Governments in different nations have their priorities,
philosophies, and approaches to the international trades. They may adopt
restrictive (protectionist) or liberal approach to international business operations.
Especially, political approaches of dominant nations have more influence in
international marketing activities.
Long-term trend of global political environment is
unpredictable and uncertain. Economic policies of different nations (industrial
policies, fiscal policies, agricultural policies, export-import policies, etc.,) do have
direct impact on international trade. Drastic change in these policies creates
endless difficulties to international traders. While dealing with international
markets, international political and legal environment needs a special attention.
5. Place Constraints (Diverse Geography):
Trade in foreign countries of far distance itself practically difficult. In case of
perishable products, it is a real challenge. Exporting and importing products via sea
route and making arrangements for effective selling involves more time as well
risks. Segmenting and selecting international markets require the marketers to be
more careful.
6. Variations in Exchange Rates:
Every nation has its currency that is to be exchanged with currencies of other
nations. Currencies are traded every day and rates are subject to change. Indian
Rupee, European Dollar, US Dollar, Japanese Yen, etc., are appreciated or
discounted at national and international markets against other currencies. In case of
extraordinary and unexpected moves (ups and downs) in currency/exchange rates
between two courtiers create serious settlement problems.
7. Norms and Ethics Challenges:
Ethics refers to moral principles, standards, and norms of conduct governing
individual and firm‟s behaviour. They are deeply reflected in formal laws and
regulations. In different parts of the world, different codes of conduct are specified
that every international business player has to observe. However, globalization
process has emphasized some common ethics worldwide. Corruption is another
issue relating to business ethics.
8. Terrorism and Racism:
Terrorism is a global issue, a worldwide problem. People of the world are living
under constant fear of terrorists attracts anywhere in the world. To trade
internationally is not economically risky, but there is the threat to life. Racism also
restricts international trade activities.
9. Other Difficulties:
Besides these problems, there are many obstacles in international markets, such as:
a. Changing ecological environment and global warming
b. Difference in weathers and natural climates
c. Inappropriate or inadequate role of international agencies supporting and
regulating international trades