INTERNATIONAL MARKETING Planning and conducting transactions satisfying objectives Across national borders Constantly changing macroenvironmental factors Firm (controllable): marketing mix, research Domestic environment (uncontrollable): political/legal, economic, competitive structure Foreign environment (uncontrollable): political/legal, economic, competitive forces, technology, distribution structures, geography and infrastructure, cultural factors Intl. marketing questions: adjust marketing mix, sourcing, global competition Globalisation: boundaries between national markets are fading. Countries, institutions, individuals all linked – spread and analysis of information, role of technology. Firms globalise international strategies to take advantage of underlying market, cost, environmental and competitive factors Global presence means viability against other local and global players Globalisation drivers: market Growth in world trade, emergence of trade blocs, globalised distribution channels Firms made global investment, shifting location of industries, impact of new technology Convergent consumer demand Globalisation drivers: cost Avoid inefficiencies and duplication in single-country approach. Need to achieve economies of scale, synergies Size as a major assets – M&As Globalisation: environment Decreasing government barriers Rapid technological evolution Emergence of born global businesses Globalisation drivers: competitive factors Leading companies taking advantage of globalisation – unchallenged players. New markets for growth Strategic planning process: 1. assessment, analysis Understand and adjust core strategy Market and competitive analysis: customers, structure of global industry Internal analysis: assess international readiness 2. Objective setting Competitive strategy: cost, differentiation, focus Country market choice Segmentation: standardisation Bases for global segmentation Environmental: geographic, political, economic, sociocultural Marketing management: product, price, promotion, distribution 3. Develop global marketing program Standardisation, marketing program, location of value-additive activities, competitive moves 4. Implement – balance local and global concerns Challenges of global marketing Local resistance and patriotism Balancing country managers and global managers Ability to develop and implement strategy through management, structure, culture Management process Ensure local managers participate in strategy development, control their marketing budget Local managers – generate ideas Portfolio of brands (local, regional, global) Organisational structure Matrix structure: focus on customer, replaces country by country approach Global account management: relationships with important customers (internal systems) Corporate culture Commit to global marketplace, no country favouritism Transparent management development system Benefits of international marketing: Economies of scale Spreading risk, reduce vulnerability to increased competition Increased technical and managerial skill Motivations to internationalise Proactive: profit, unique product, technology advantage, exclusive information, managerial urge, tax benefits, economies of scale Reactive: competitive pressure, overproduction/excess capacity, declining/saturated domestic market, proximity to ports and customers Change agents (internal): same as proactive Change agents (external): demand, other firms, distributors, export agents, government activity Cultural environment Culture: integrated system of learned behaviour patterns, distinguishing characteristic of members of any given society (code of conduct). Gives individuals an identity. Major elements: language, religion, values/attitudes, customs, materialism, education, social institutions Acculturation: adjust/adapt to another culture, key to international success Context culture High context: social context strongly affects meaning of message (e.g. Saudi Arabia) - implicit Low context: meaning explicitly expressed by words, less affected by social context (e.g. North America) International marketers can act as change agents – introduce new products, ideas, practices (though can be accused of cultural imperialism) Cultural universals are generalisations concerning a given culture; e.g. music, cuisine, personal names, etiquette, jokes Language: verbal (words, gestures, body position, eye contact). Local language important in international marketing (information gathering, communications, context) non-verbal: time flexibility, rapport, physical space and touching, non-verbal gestures Religion: belief in higher power, reason for being. Shapes attitudes toward entrepreneurship, consumption and social organisation Values and attitudes: shared beliefs, particularly toward change (positive in industrialised countries, less in tradition-bound countries) Manners and customs: understanding, negotiations, decision-making and personal relations.