What is International Marketing?
International marketing is the performance of business activities that direct the flow of goods and services to consumers or users in more than one nation.
Table of Content
- 1 What is International Marketing?
- 2 International Marketing Definition
- 3 Framework of International Marketing
- 4 Objectives of International Marketing
- 5 Scope of International Marketing
- 6 Challenges in International Marketing
- 7 Opportunities in International Marketing
- 8 Difference between Domestic and International Marketing
International Marketing Definition
Framework of International Marketing
International marketing is all about identifying and satisfying global customers’ needs better than the competitors, both domestic and international, and co-coordinating marketing activities within the constraints of the global environment.
Thus, international marketing would involve:
- Identifying needs and wants of customers in international markets.
- Taking marketing mix decisions related to product, pricing, distribution, and communication keeping in view the diverse consumer and market behavior across different countries.
- Penetrating into international markets using various modes of entry, and
- Taking decisions in view of dynamic international marketing environment which is highly dynamic. The environmental challenges are beyond the control of a marketer, the key to success in international markets lies in responding competitively by adopting an effective marketing strategy.
Objectives of International Marketing
- Bringing countries closer for trading purpose and to encourage large scale-free trade among the countries of the world and integration of economies of different countries and thereby to facilitate the process of globalization of trade.
For Ex: A free trade agreement (NAFTA) between US, Canada and Mexico has removed most of the barriers to trade and investments.
- Establishing and strengthening trade relations among the nations and thereby to maintain cordial relations among nations for maintaining world peace.
- To facilitates and encourage social and cultural exchange among different countries of the world. For example in country like India we love to consume Mexican, Chinese, Italian food which is a fine example of socio-cultural exchange.
- To provide better life and welfare to people from different countries of the world. In addition, to provide assistance to countries facing natural calamities and other emergency situations.
- To provide assistance to developing countries in their economic and industrial growth and thereby to remove the gap between the developed and developing countries.
- To ensure optimum utilization of resources (including surplus production) at global level.
- To encourage world export trade and to provide benefits of the same to all participating countries.
- To offer the benefits of comparative cost advantage to all countries participating in international marketing.
- To keep international trade free and fair to all countries by avoiding trade barriers.
Scope of International Marketing
International marketing has a broader connotation in marketing literature. It also means entry into international markets by:
- Opening a branch/subsidiary abroad for processing, packaging, assembly or even complete manufacturing through direct investment.
- Negotiating licensing/franchising arrangements whereby foreign enterprises are granted the right to use the exporting company’s know-how. viz. patents, processes or trademarks, with or without financial investment
- Establishing joint ventures in foreign countries for manufacturing and/or marketing
- Offering consultancy services and undertaking turnkey projects abroad
- Sub-contracting and countertrade and
- Importing for export production.
Challenges in International Marketing
Challenges in international marketing are:
- Awareness of global developments and understanding diversified and changing consumer attitudes
- Adaptation to market conditions
- Anticipating the actions of global competitors
- Developing new strategies involving – Technological innovation, process improvements and creativity.
Opportunities in International Marketing
Opportunities in international marketing are:
- Market needs are high and diverse.
- Reaching more customers
- Consumers have more variety
- Avoiding market saturation
- Outperforming domestic counterparts
- Lowering insolvency risk
Difference between Domestic and International Marketing
The significant differences between domestic and international marketing are as follows:
|S.No||Domestic Marketing||International Marketing|
|1||The activities of production, promotion, advertising, distribution, selling and customer satisfaction within one’s own country.||Marketing activities are undertaken across the globe.|
|2||There is less government influence||Companies have to deal with rules and regulations of various countries.|
|3||More reliance on indigenous technology.||There is an advantage that the business organizations can have access to the latest technology of numerous countries|
|4||Cultural adjustment issues are less challenging||Cross cultural adjustment issues are very challenging|
|5||The risk factor and challenges are comparatively less in the case of domestic marketing.||The risk involved and challenges in case of international marketing are very high due to some factors like socio-cultural differences, exchange rates, setting an international price for the product and so on.|
|6||Requires less investment for acquiring resources and involves less research due to the familiarity of the market.||Requires huge capital investment and in-depth research of the foreign markets|