Principles of Marketing

Dr. Norman Peng

Sr. Lecturer in Marketing

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Last week
Last week, we discussed service marketin
g, marketing for non-profit organisation, a
nd the ethical issues
Finally, we will discuss international mark
eting

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Why market internationally?

Saturated domestic market

Smaller domestic markets
Low growth domestic markets
Customer drivers
Competitive forces
Cost factors
Portfolio balance
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Mobile phone for example

Domestic market, customers, competition
, cost
UK #of phone/population= 122.95%
UK number of phones= 75,750, 000
China #of phone/population= 55.97%
China number of phones= 747,380,000
India #of phone/population= 44.73%
India number of phones= 525,147,922
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Which international market to explore?

PEST
Political and legal
copy right, bribery, political structure

Economic
GDP, saving habit, # of rich and poor people etc
.
US per capita= $46,443; Japan per capita= $ 39,573; Sou
th Korea= $16,450; China= $ 3,566

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Which international market to explore?Macro

Social
Family structure
Birth rate (France: 2.36; Hong Kong: 0.97)

Age structure
Baby-boomer (Japan: 82.6; Russia: 65.5)

Technology
TV per household, internet access

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Which international market to explore?Macro

Culture
Culture, geographic, language
Examples

In
di
vi
d
u
culture
al
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Universal

Cultural dimensions

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Culture
Shared knowledge, beliefs, art, morals, law, cust
oms
Culture can be expressed through:
Symbols- McDonalds, Nike
Hero- Harry Potter, Micky Mouse
Rituals- ways of conduct business and political meeti
ngs
Values- good/bad, lucky/unlucky etc

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Culture dimensions

High context vs low context

Conflicts situation
Decision making and thinking pattern
Risk taking
Time (Monochronic vs polychronic-time)

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Culture dimensions
Hofstedes IBM study
High vs Low power distance
Individualist vs collectivist
Masculinity vs feminity
High vs Low uncertainty avoidance
Long vs short-term oriented

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International Marketing Strat

egy and Marketing Mix

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Which international market to explore?Macro

Market attractiveness
Size, competition, cost of serving this market,
profit potential, market access

Company capability
Skill, resources, products, competitive advant
ages

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Entry strategy
Indirect exporting
Agent, merchant, cooperative
Zara and H&M

Direct exporting
Foreign agent or domestic sales rep.?
Overseas subsidiary
Internet

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Entry strategy
Licensing
Licensing
TV programmes

Franchising
McDonalds
http://www.the-franchise-shop.com/list/524/McDonaldsFranchise.html

Joint venture/strategic alliance

Two companies create a new company
Sony Ericsson
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Entry strategy
Direct investment / direct subsidiaries
New facilities
Acquisitions

Things to consider
Risk of losing proprietary information
Resource required
Level of control

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International setting- Product and Promotion

Product
Ikea

Promotion
Globalisation and Localisation

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International setting- Promotion

Toward a global advertising culture?
TV, international advertising firm, mobility and e
ducation
US count for 75% of the television export

Basic assumption
Similar needs, emotion and frame of mind in eva
luating information
Different in the product/service to satisfy that ne
ed, how emotions are expressed, ways of evaluat
ing information
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International setting- Promotio

n
Advantage for globalised campaign
Cost control, simplified planning
Uniform brand image
Maximise the use of good ideas
Quality control
Knowledge sharing

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International setting- Promotio

n
How dog barks in different countries
Woof-woof in Italy and Britain
Wuff-wulff for Austrian
Vov-vov for Norwegian
And Ham-ham for Romanian

Regulation
Advertising targeting at children (Sweden)
Alcohol advertising (France)
Blue jeans appear in ad (Malaysia)
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International setting- Promotio

n
Advantage for localised campaign
Culture, mentality and product usage
Country of origin
Local regulation and competition

Strategic choice
Global consumer culture positioning
Foreign consumer culture positioning
Domestic consumer culture positioning
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International setting- Promotion

Think global act local
HQ and local office relationship
Strategic versus tactic

Type of product is most important

Industrial versus consumer

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International setting- distribution

Place/distribution
Retail environment
maturity of consumer
Refund policy

infrastructure
motorway, airport, seaport

Middlemen

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International setting- pricing

Pricing
Uniform or price discri
minating strategy

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Ultimately
Centralisation or decentralisation?
Level of control required
The cost

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Thank you
Any Questions?

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