Unit - 1

INTERNATIONAL
MARKETING
Scope and challenges of International Marketing
International Marketing defined
“International marketing or global marketing refers to marketing carried out by
companies overseas or across national borderlines. This strategy uses an extension of
the techniques used in the home country of a firm.”

“It refers to the firm level marketing practices across the border including market
identification and targeting, entry mode selection, marketing mix, and strategic
decisions to compete in international markets.”

“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.”
American Marketing Association (AMA)
Uniqueness of Foreign Marketing

◦ Unfamiliar problems
◦ Different levels of uncertainty
1. Competition
2. Legal restraints
3. Govt. Controls
4. Weather
5. Fickle consumers etc.
Marketing Vs. International Marketing
Domestic Marketing International/Global Marketing

◦ National Currency ◦ Foreign currency

◦ Local political environment ◦ Several Political environments
◦ Short distances ◦ Long distances
◦ Local taxation ◦ Multiple taxes
◦ Single/known language ◦ Various languages
Nature of International marketing
• In International Marketing, you get a wide range of opportunities owing to the
diversified populations in different parts of the world, in contrast with local or
domestic marketing.
• While you have to cater only with one type of variable in domestic marketing, you will
face two or more sets of variables, while dealing internationally. Mostly these
variables are beyond your control. So, this may be a drawback for you.
• High level of skills and competence is required to deal with other countries in
International marketing.
• You will have to face tremendous competition when you approach the global
market. That compels you to bring the standard of your products at an
extraordinary higher level. Similarly, you have to compromise on pricing in certain
cases.
Nature Contd.…
◦ The risk factor is quite high in international markets. This may be due to political
differences, cultural variations and above all local regulations of that particular
Country. Moreover, international circumstances are vulnerable and may change
suddenly without any prior notice, as we have recently experienced with COVID-19
◦ In international market, the firms need to follow all international restrictions
(tariff and non-tariff constraints).
◦ The controlling nature of international business is due to dominance of developed
countries because of their worldwide reach, advance technology and proficiency.
◦ Global business is subject to the diplomatic relations between countries.
Organizations enter into international market of those countries, with which they have
cordial relations.
Importance of International
marketing
1. Wider market. Expansion & diversification (Amazon & Alibaba)
2. Earn foreign exchange. Increase of market share (Kellogg's)
3. Spread business risk (Nestle)
4. Uplifts standard of living.
5. Ensures Optimum utilization of resources. (Reliance)
6. Increase Competitive capacity. (Digital payment, six sigma, digital marketing)
7. Facilitates cultural exchange. (broaden the horizons)
8. Promote world peace.
9. Getting benefits from Government. (Hyundai)
Challenges in International Marketing
◦ International Company structure.
◦ Foreign Laws and regulations. (IPR, FEMA)
◦ Self Reference Criterion.
◦ International Accounting. (IFRS)
◦ Cost calculation strategy and Global Pricing. (IKEA)
◦ Universal Payment methods (Merchant’s Universal Payment Card)
◦ Currency rates.
◦ Communication difficulties & cultural differences.
◦ Political risk
◦ Worldwide Environmental issues. (Global warming, Waste disposal)
Being International

To decide the degree of marketing involvement and commitment it is prepared to

make,
Stages of international marketing involvement
1. No Direct foreign marketing
2. Infrequent foreign marketing
3. Regular foreign marketing
4. International marketing
5. Global marketing.
Stages of IM Involvement
1. No Direct Foreign Marketing:
Company does not actively pursue customers in foreign markets, but receives
them through unintended channels.
◦ Products are bought abroad through domestic wholesalers/distributors,
websites on the internet.
2. Infrequent Foreign Marketing:
Company sells to foreign market only when a temporary surplus of product
exists
◦ Once surplus is gone, foreign activity is gone.
◦ Few companies fit this model because of the need to develop long term
relationships in foreign countries.
Stages Contd…
3. Regular Foreign Marketing:
Companies produce their products and services to primarily sell domestically, but
also internationally.
◦ Through domestic/foreign middlemen, sales force in foreign countries.
4. International Marketing:
Companies are fully engaged in international marketing strategies.
◦ Companies are now international or multi-national
5. Global Marketing:
Market segmentation decisions are no longer focused on national borders. Instead,
market segments are defined by income levels, usage, patterns, or other factors.
Thank You !!