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ENTRANCE TO THE PROBLEMS OF
INTERNATIONAL MARKETING
L4
Ing. Jiří Šnajdar
Mgr. Evžen Staněk
2013
Development trends
• Globalization = saturation of national markets
around the world to allocate capital optimally utilize
all the resources in the world
• technical progress = information technology
affects all communication tools, distribution,
trading
• deregulation = thanks to globalization is faster, and
the freedom to trade freely, cancels trade and
political barriers, expansion of marketing activities
• monitoring and the use of market opportunities
Nature of international marketing market offers for
target market international marketing means, that we
are able to find out merit of consumers in global market
dimension, to realise market offer at finding of
demands
- marketing definition = integrate component of
business, must be own to everybody in company
(today is preferred integration of marketing into all
elements of company)
- definition of international marketing = in international
ambience gained international marketing global
character
Aspects of formulating marketing strategy:
• Market dynamics (market is extremely dynamic,
shortens the life cycle of products, changing product
requirements, changing the quality of life ...)
• Relational marketing
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Innovation and competitive advantages supply
(related to the dynamics of the market)
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New forms of distribution and communication (information
technology gives them new dimensions and strongly influence all
options)
Prime decision in international marketing
Decision about entering in to international market
• active and passive motivation programmes
active = company wants to increase profit, to have
savings from extent, knows languages, management is
actively looking for opportunities on market
• passive = competition, reduction of domestic sale,
market saturation – management passively
forces to look for new opportunities, does not search
actively for its own advantages and risks + their
analysis
Decision about on which market enter
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definition of international marketing targets and tactics
share of international business on whole sale
rate of distribution and expansion extent
analysis of ambience of foreign markets = screening
process
• analysis of costs
Decision about way of enter on foreign market
• indirect export – direct export – licence – mutual business –
direct investment
• increase of obligations, risks and profitability
Decision about marketing programme
• rate of adaptation of marketing mix in conditions of market
• standardisation x adaptation
Decision about marketing organisation
• ways of administration of marketing activities in
international ambience relative to intensity of integration
into international business
• export department
• international division
• multinational organisation
Differences of international marketing
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social-cultural difference of markets
language barriers
legislative rules
reach of countries (about 186 countries in the world, very
high potential)
preference of domestic producers
relative testifying abilities of information
problems at market research (for example in Islamic
countries we cannot stop a woman in the street with
questionnaire)
professional lobbing
escalation of costs
different lifestyle
CHARACTERISTIC ATTRIBUTE OF CURRENT
PERIOD =
GLOBALISATION, WHICH AFFECTS ALL
SPHERES OF SOCIETY
• reaction on saturation of domestic market, capital
allocation, use of cheaper sources
• monitoring and use of comparative advantages
• intensely developing interactivity of economical subjects,
supported by modern technologies and supporting
development of consumption and investments
• power of information changes radically way of peoples
communication, changes trade and business
The natural consequence of development trends and
changes are changes in the sphere of marketing and
management.
At the beginning of 21st century came Drucker with new
principles of management – decisive are customers
values.
• requirement is to lead people (no manage, but lead) and
utilise their merits (couching),
to obtain their merits
• important is proper organisation of work to fulfil the
targets
• the management is functional when incorporate whole
economic chain in the company
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innovation of offer (competitive ambience presses to the
offer of innovated products, with pluses, ecology, …)
• strategies based on obtaining of competitive advantages
(low price, psychological aspects – luxury, uniqueness,
innovation …)
• competition on global market – new forms of
communication and distribution
• multiplying of advertising effect, firm presentation
(information technological progress – internet shop)
• increasing of geographical extent and decreasing of
geographical limitation (I can communicate with the whole
world)
Opportunities for firms
• spreading out the relative market space
• coming in useful on unapproachable markets through ebusiness (addressing of customers in world wide scale and
reduction of costs)
• opportunities for small and middle size firms – thanks to
their flexibility and rationality in costs, fill niche market also
internationally
• opportunities for firms BORN GLOBAL (= multinational ,
born for globalisation), producing, innovative, top
technologies, developed aggressive business politics
Conclusion
• proclamation for firms of 21th century = better knowledge
and satisfaction of customers needs
• firm priority = development of marketing management
Possible reactions of business subjects :
• to monitor of influence of globalisation, adapt its strategy
and its targets
• to come in actively
Global market dimension stress the importance of
marketing as integrate component of enterprise in context
with development of information technologies,
technological progress is a company in qualitative new
situation.
Trends in the development of marketing
I. aspects of formulating marketing strategy
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The dynamics of the market brings increased
demands on the range of products and services
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Reduces the market life cycle
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Shorten delivery times
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Consumer demands are too dynamic - require more
– relation marketing (new role of suppliers and
customers)
relation marketing = relational marketing
basic function of firm marketing require :
• implementation of customer oriented philosophy the
highest priority is satisfied customer
• obtaining information about customer and communication
with him
• loyalty (commitment) – mark, style, price
• support and expansion of services CRM (Customer
Relationship Management)
• CVM (Customer Value Management)
Satisfied customer brings value to the company.
Intercultural marketing of services
Service is intangible product when its operation is based on
material principles.
Immaterial service is reason why customers :
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evaluate hard competitive services
suspect risks at service purchase
stress the personal sources of information
as basis for evaluating of service quality use price / value
Management must react :
• eliminate complexity of provided services
• emphasize material stimuli of services
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aim at visible quality spheres
• follow permanently feedback on service
Heterogeneous character of services
• In process of service are together present customers and
servants (in difference with product, which is first made,
then sold separately)
• It is not possible to estimate customer behaviour in
advance.
• It is not possible to do output controls of “product” quality
before delivering to customer.
• Services can he only hardly patented. Sometimes we meet
with franchising (providing with know how), where the
process of services is protected.
• Lower possibility of patent protection gives bigger
possibilities to competitors.
Consequence of heterogeneous service
Customer :
• Must not always get the identical service quality.
• Difficult selection in service competition.
• Must submit to rules of service, which is public open
(hotel)
Consequence of heterogeneous service
Management :
• Determine quality of norms of employees behaviour.
• Mould, motive employees.
• Plan carefully process of services.
Destruction of services
Immaterial character of services leads to that the service
cannot be stored and sold later.
Empty chair at hairdresser, empty hotel room, empty
restaurant is “now and here” lost service.
Impossibility to possess service
Customer does not possess the service, only uses it. It is
connected with it immaterial (and destructibility). He buys the
right for rendering of service in advance agreed extent.
Service distribution
• For products transferred to an intermediary ownership
law. (Warehouse buys a product from a manufacturer
sells it to retail )
• The service provider can not pass title. Therefore are
distribution channels as short and direct as possible.
SERVICE MARKETING
Marketing in general
is summary of techniques and skills, by means of which we
satisfy needs of customer and we persuade him that only
our product, service, fully conforms with his needs.
Marketing mix is :
complex of tools, marketing manager uses to form qualities
of services, provided to customers. The base is English
written principle 4 x P
Product
Price
Place
Promotion
Classical “six C” of marketing communication (Kotler model)
Marketing – most simple definition : target and integral
system of managing of business activities, oriented to
market.
1. Customer – determinate quality and price, is in the
middle of interest, process and effort.
2. Company – firm, human sources, employees,
organisation climate, business relations, propagation
3. Competitor – surrounding, environment, competition.
4. Commitment – integrating into mutual work, loyalty with
company
5. competence – qualified work on professional level with
appropriate competence,
6. Consistency – harmony with what was performed.
Required and necessary solidarity, solidarity, unity and
stabilising.
Services in intercultural ambience
If character of services is a complicated business strategy
on inner market, its international operation requires more
and profound information.
Before we enter the intercultural bindings, must be realised
SWOT analysis.
SWOT
S – strength
W – weakness
O – opportunities
T – threats
Intercultural specifics in CZ
• Foreign company offers a service in CZ
• Czech company offers service abroad. Mix firm offers
service in CZ or abroad (joint-venture)
In all mentioned examples it is necessary to count with
cultural specifics of customers more urgently than at
purchase of products.
• Customer considers service as more private value than
purchase of material product.
• What is private, that is more specific.
• The specificity influence tradition (national, religious,
family, business)
• In intercultural providing of services can arise unexpected
situation, following from ignorance of service provider.
• The only one way how to avoid this is intercultural
teaching including personal collection of experience.
Strategy of intercultural business
Penetration strategy
Make global firms, business and distribution chains, hotel
and restaurant conglomeration (Hilton, McDonald, etc.)
Differentiation strategy
Obtaining of competitive advantage thanks to difference
from competitors. (Firm Kangaroo sells in the whole world
clothing, but typically Australian and hardly imitating, or car
company made Cadillac – is in knowledge sign of luxury and
wealth).
Strategy narrow specialization
Typical example is sphere of spa treatment. Thanks to
specialisation lowers numbers of competitors and the price
for service and exclusivity of service can grow .
Leader Strategy
Typical example can be the company Microsoft. Continuous
innovation and its dictate on the market in result of fear from
Follower Strategy. The firm in stagnation would the
competition catch up fast.
Follower Strategy (strategy of firms copying big companies)
The main target is to keep (and increase) share on the
market by offering similar product, similar quality as the
“Leader firm”, but for lower price. Forasmuch as he must not
insert so much investment into research, the firms can be
successful on market.
Samples of intercultural misunderstanding
* Americans are proud of their history and do not like to hear
hoe short it is. Stress importance of individual freedom of
person in this history.
* Czechs are disappointed when American visitor does nor
enough estimate our history.
* In America is obvious national self-esteem and do not
understand humorous disparage of own (Czech) nation and
accentuating of so called “švejkovství” (clever clownery).
Americans in effort of correct negotiation (fear about
accusing from sexual harassment)
are from Czech view unsociable. They do not let the woman
go first in the door, they do not help her with coat.
When in Germany comes manager late on meeting, it is
considered as personal offence and some degrade. Delay
in CZ is normal within 15 minutes and on Balkan and in
Arabian world even one hour.
• German businessmen are very surprised why the
meeting in Czech starts with talking
about private or social problems and why is not talked
about business immediately.
• Germans can be, except business contact, especially
with glass of wine very hearty. But this has no connection
with business deal. Helpfulness by glass is not
helpfulness general. The Czech is often confused and
wondering.
• In Scandinavia people do not steal. When you carefully
lock your suitcase or hide wallet behind your shirt, you
will reap real astonishment.
• In contrast, in Naples business partner notifies you that
you have your documents stored in your briefcase quite
casually and you can lose them.
• In the Arab world will stop shop dealings with pat hand. For
honest traders is more than a written contract
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Many forms of subterfuge "within the law" in the Arab
world considers ordinary (and honest) practice It is the
attitude and actions in Europe and America, commercially
and socially intolerable.
Mohammedans follow also in business relations “Sharia”
laws of Koran.
Therefore we cannot expect that they will equipollent talk to
our or American manager (she). The woman according to
Sharia is inferior being.
Jews do not make business on Saturdays. feast starts on
Friday after sunset and finishes on Saturday after sunset.
(In complex of luxury hotels in Israel by Red Sea are so
called “feast lifts”. They stop automatically without
assistance in all floors, because on feast must not an
orthodox Jew operate with electrical appliance.)
Mohammedans follow also in business relations “Sharia”
laws of Koran.
Therefore we cannot expect that they will equipollent talk to
our or American manager (she). The woman according to
Sharia is inferior being.
Jews do not make business on Saturdays. feast starts on
Friday after sunset and finishes on Saturday after sunset.
(In complex of luxury hotels in Israel by Red Sea are so
called “feast lifts”. They stop automatically without
assistance in all floors, because on feast must not an
orthodox Jew operate with electrical appliance.)
Misunderstanding in intercultural communication is also in
colours interpretation – in so called colour-speech.
• European colour of sadness is black, in Asia mostly
white, in Brazil violet and in Mexico yellow, in Ivory Coast
purple.
• Red is connected with happiness in China, but with death
in Turkey.
• Green is in Europe accepted positively. But it is a national
colour in Egypt, it is colour of Islam, therefore products
must not be wrapped in green.
• In south-eastern Asia is green colour negative (illnesses
come from green jungle).
Chinese make long business discussions. During the
process they try to enter into something, what is in Europe
perceived as personal relationship. In its scope can
Chinese operate with emotions. Willingness, guilt,
happiness, fear. Chinese seek for minimization of
confrontational situations and are skilled negotiators.
Most impulsive in commercial negotiation are businessmen
from Southern America, especially from Brazil. It is about
some king of folklore. Feeling of success of deal would not
come when everything would proceed in quiet atmosphere.