G L O B A L I Z AT I O N &

I N T E R N AT I O N A L
MARKETING
UNIT 3- MARKETING
GLOBALIZATION
 FDI – Foreign Direct
Investment
This is when a business

GLOBALIZATION RESULTS IN ? sets up production or

distribution facilities in
another country
Increase in international travel
Increase in trade and instant communication
between countries across the world

Increase in Increase in money

outsourcing between moving between
countries countries and in FDI
INCREASE GLOBALIZATION- IMPLICATION ON
MARKETING?
OPPORTUNITIES

• Global branding becomes possible

• Falling tariffs and other barriers to trade
mean it is cheaper and easier to sell to other
countries
• Internet marketing enables internal
marketing- even for small businesses

RISKS

• Small businesses face increasing competition

from global businesses.
• People may focus more on their own culture
and reject global products
• Marketing campaigns are extensive, expensive
INTERNATIONAL
MARKETING
INTRODUCTION TO INTERNATIONAL MARKETING

In today’s world of interdependent economic relationships, even smaller

businesses can consider expanding and selling into another country, especially as
the internet enables communication to particular target groups with cheap
promotion and distribution. Any business considering international marketing
should be aware of the possible costs and resource implications, as well as
making sure that this move matches their business objectives.
INTERNATIONAL MARKETING

Why do we need to sell products in other countries?

• Saturated home-makers- One country having many
businesses in the same industry and has reached a
saturation level. It’s time to venture into a new market
maybe international.
• Poor trading conditions in the home country
• Legal differences creating opportunities abroad
WHY INTERNATIONAL MARKETING IS DIFFERENT?

• Political differences- e.g. if you are marketing your product in a country which is politically
instable / experience act of terrorism in such cases, international marketing can be difficult
• Economic & social differences-
e.g. Economic- income level, tax rates, age structure of the population
e.g. Social – Role of women

• Legal differences- e.g. some goods like guns can be sold legally in USA while in others you
cannot

• Cultural differences- e.g. use of male and female models in advertisements would not be
acceptable by some countries due to strong religious traditions.

• Differences in business practices- Accounting standards and businesses may vary differently in
different countries.
FACTORS THAT INFLUENCE RADHIKA JUICES’S (RJ) DECISION TO ENTER A
INTERNATIONAL MARKET (COUNTRY X)

It depends on….

• Availability of finance resources with RJ

• If going global will it meet the objectives of growth and expansion of RJ?
• Risk of operating in different cultures, legal arrangements and marketing environment in country.
• Availability of business expertise and professionals with RJ
• The potential revenue to be generated through this decision
• If going global will it enable them to experience economies of scale and lower costs in country X?
• Reliability of market research done on –
 size and growth of market in country X
 Economic conditions, rules, regulations in country X
 Existing competition in country X
 Cost of marketing and distribution in country X
 Possibility of partnership agreements with country X
METHODS TO ENTER GLOBAL MARKET
Merging with or
taking over an
Exporting Licensing Franchising
existing business

FDI (Foreign
Joint Venture
Direct Investment)
DIFFERENT METHODS TO ENTER INTO INTERNATIONAL MARKETS

• Export- Selling the product directly to a foreign customer- either

directly or indirectly through an intermediary. (appointing an agent
in another country to sell your product) (Benefits of exporting
directly and indirectly – refer to page 322)
• Joint ventures
• Licensing- When a business allows a firm in the another country
being entered to produce branded goods ‘under license’ which
involves strictly controlled terms. The ‘parent’ firm avoids the
capital cost of setting up its own operating bases abroad.
INTERESTING MARKETING FAILS
Gap’s logo from 1986 from 2016 was
iconic. The elongated serif letters
captured the 90s (the brand’s hay day)
perfectly, yet still exuded a sense of
classic-ness that seemed timeless, or
almost timeless.

But for six long days in October 2010,

Gap swapped their typeface to sans-
serif Helvetica and transformed the
navy blue background to a smaller,
gradient box to the top and right of a
lowercase p. The backlash was so
severe that the company reversed its
redesign in a matter of days. In the
marketing world, that almost never
happens.
ALTERNATIVE STRATEGIES – INTERNATIONAL
MARKETING
Ex: Samsung
Phones

Ex:
McDonalds
When McDonalds entered in
India, they did an extensive
research before zeroing upon the
menu on offer for the Indian
consumers. The entire menu was
tailer made as per Indian consumer
taste. The company stuck to 40%
Pure Vegetarian offering unlike any
other overseas market. McDonald’s
also made sure to respect Indian
culture by not serving beef or pork
recipes which on the other hand
were popular ingredients in other
markets. McDonalds also made
sure to create recipes with Indian
spices to match the local taste.
ADVANTAGES AND DISADVANTAGES OF INTERNATIONAL MARKETING