international business module.docx

8/9/2019 International Business Module.docx

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Author: Ms. Neha Gada (Maniben Nanavati Womens

college- Vile Parle)

ub!ect- "nternational #usiness

$ourse $ode -

Module no.-

%nit no.- &

$ontents- &.'

3.4 International Service Marketing

3.5 International Pricing

3.6 International Promotion and Communication Mix

3.7 Let us sum up

3. !nit end exercise

3." #eed$ack

3.%& 'e(erences


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3.4 "nternational ervice Mareting

3.4.1 Meaning of service:

Services are those activities which satisfy wants, some offered independently and

some offered as a supplement to the goods purchased. They more often have

intangible element in them and the title of ownership does not pass on to the

customer.

ccording to !otler and rmstrong, " service is an activity or benefit that one

party can offer to another that is essentially intangible and does not result in the

ownership of anything. #ts production may or may not be tied to a physical

product.$

3.4.% &eatures of services:

The ma'or difference between goods and services is that goods are produced but

service are performed, other than this there are many more characteristic feature of

services in mar(eting conte)t. The commonly accepted four features are listed

below:

1* #ntangibility

+hen a product is purchased we can see it but when services li(e travel,

communication are hired we cannot see them but 'ust get benefited. The

intangibility of services ma(e advertising and promotions more difficult than that

offered for a product because the mar(eter must communicate an idea or concept

rather than a physical ob'ect.

%* eterogeneity

-nli(e the product the services are heterogeneous in nature. They differ fromperson to person, price to price, place to place, time to time and so on. The services

are offered by humans who are sub'ected to ever changing behavior and therefore

no two individuals can provide identical service or even the same person can

provide different service during two different times, two different places or in two

distinct situations.


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3* #nseparability

The services cannot be separated from the individual offering it. &or instance, a

lawyer cannot rent his practice on hire or sell it to some another person$s, li(ewise

a doctor cannot sell this s(ill and e)pertise to someone else for performing onpatient. #n fact the doctor will use this (nowledge and e)pertise in locating the

problem faced by his patients and therefore the services are inseparable from the

service provider.

4* erishability

The goods can be stored in warehouse from the time of production to the time of

its utility but services cannot be stored. /nce the service is not consumed when

offered they go waste. &or instance, an empty airline or theatre seat represents loss

of revenue. Shift in demand can be accommodates for goods from inventory but

there is no inventory of services. Therefore the demand as well as the supply of

service must be regulated closely to avoid service perishability.

3.4.3 0lobalisation of services:

#ndia$s global ascendency in recent years has been driven by the #T based service

industries. This has been made possible due to years of pioneering wor( done by

companies such as Tata 2onsultancy Services, followed by several other

companies li(e +ipro and #nfosys for several years now. The / mar(et is the

(ey player and it has happened in two ways,

1* The multinational companies 05 or S2* transfer their own operations to

#ndia and run them.

%* /utsource the operations to third party #ndian / operators.

Many foreign brands li(e Mc6onalds$s, i77a ut are operating here whereas

8##T, S#, T2S etc. are already operating in foreign countries.

3.4.4 #nternational Mar(eting of Services:

s services are intangible in nature the mar(eting becomes very difficult.

product could be visually shown and described which people can see touch and

e)perience but it is not so in case of services and therefore special efforts are ta(en


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for mar(eting of services. Moreover in international arena where home countries

brand and services are not familiar a proper set of service mar(eting mi) is applied.

Mar(eting mi) for product comprises of product, place, price and promotion

whereas service mar(eting mi) is made up of above four as well as additional threemar(eting mi) (nown as people, process and physical evidence.

3.4.9 Significance of #nternational Services Mar(eting:

6ue growth of service sector since the recent two decades and the 06

contribution of service sector to the economic growth of our nation rise above 9;

in the last decade, this sector cannot be neglected.

The home country benefits enormously due to the mar(eting strategies adopted to

mar(et the home services namely,

1* #t helps to increase the mar(et share that is e)tension of the domestic product

to the international mar(et S#*.

%* 0lobali7ation of the service, ma(ing available it every part of the world

service stations for Maruti udhyog * #t also helps to cater to wants of many at a given point of time.

Activity: 3.4

+rite a case study on Mc6onald$s mar(eting of service operation in conte)t

to #ndia as the host country.

/r

repare a ?esearch pro'ect ?eport based on the upcoming #nternational

services in #ndia and mar(eting strategies adopted by the home countries.


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3.5 International Pricing

3.9.1 Meaning of price:

rice is the value of utility of goods and services e)pressed in terms of money. #t is

one of the important factors that determine the success of an international mar(eter.

#nternational mar(et is highly competitive and therefore, the mar(eter must ta(e

into account all the factors li(e @uality, cost, competition, demand, etc., before

determination of final price.

ricing is the most important factor in promoting e)ports and facing international

trade competition. The mar(eter must (eep competitive price considering all

associated costs and benefits. owever, there is no fi)ed formula for successfulpricing. #t differs from mar(eter to mar(eter depending upon whether the mar(eter

is a merchant e)porter or a manufacturer e)porter or an e)porter through a

channeli7ing agency. #nternational mar(et being buyers$ mar(et, the price @uoted

by the mar(eter should be reasonable and final.

3.9.% &actor affecting the determination of price in the #nternational Mar(et:

The following factors that affect the pricing decision of the international mar(eter:

1* 2ost of roduct:

2ost is the most important determination of the price of goods. The cost of product

constitutes direct cost which includes cost of material labor cost A other direct

e)penditure A #ndirect cost including e)penditure such as manufacturing cost,

office and administrative cost, selling and distribution cost, etc.

%* 2ompetition:

#nternational mar(et is highly competitive. #nternational mar(eter faces

competitions from 3 angles. #n order to survive intensive competition and e)porter

has to charge the reasonable price. owever, an e)porter can charge higher price

and can face competitions by innovative and improving the @uality of his goods

and services.


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3* 5lasticity of 6emand:

The price, to a great e)tent, depends upon the elasticity of demand. #n the mar(ets,

where demand for e)porter$s product is inelastic, he may charge a higher price and

can earn supernormal profitB while in the mar(ets where demand is elastic he mayearn normal profit by charging a marginal profit.

4* 0overnment olicies:

* roduct differentiations A brand #mage:

The product mar(eted by multinational M82s* and transnationals T82s* are

widely accepted in the world mar(et due to their brand e@uity and the brand

reputation. Such companies can charge higher prices for their products. +hile

e)porters, competing with such companies, should charge lower prices.


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E* 5)change ?ate:

The e)change rate provides opportunities in fi)ing the price for the products

manufactured in developing countries and mar(eted in advanced countries. #n other

words, such products can be priced high due to the advantage of foreign e)change.The vice versa is true in case of products produced in advanced countries and

mar(eted in developing countries.

F* 5conomic condition of the importing country:

Many global companies ta(e the 06, per capita income, disposed income,

spending pattern, ability to spend and such other factors of the importing countries

into consideration while fi)ing the price for the products to be mar(eted in that

country. &or instance, Gapanese automobile companies, South !orea$s !engan

2ivil 2onstruction 2ompany, Sony, and iwa ta(e these factors into consideration

in fi)ing the price.

1* /ther factors:

esides these factors, other factors are listed below that also affects pricing

decisions are mar(eting policies of the e)porter, inflation rate in home A host

countries ob'ectives of the firm, etc.

3.9.3 #mportance of ricing in #nternational Mar(et:

n e)porter intends to achieve the following ob'ectives through his pricing

strategy:

1* elps to achieve ob'ectives:

5very organi7ation has some fundamental ob'ectives for instance sales

ma)imi7ation, profit ma)imi7ation and so on. ricing helps organi7ations to

achieve these ob'ectives by suitably modifying their pricing strategy.

%* #ncreases profitability:

ricing decisions directly affect the sales revenue and thereby overall profitability.

&or #nstance, low pricing helps mar(et penetration but reduces revenue. /n the

other hand, s(imming pricing generates more revenue, if demand conditions are

favourable.


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3* elps to penetrate the mar(et:

+hen there is an intense competition in the mar(et low pricing helps to penetrate

in the mar(et by driving away competitors.


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*ercise: &.+

Put tick mark ) * against correct ans+ers

Identi(, t-e correct (actors aecting international pricing/

a* Cost o( t-e commodit, exported.

$* 0conomic condition o( t-e -ost and -ome countr,.

c* 0lasticit, o( demand (or t-e exported goods.

d* 1overnment Policies and 'egulation o( t-e countries.

e* Interest rate prevailing in t-e -ost countr,.

3.9.4 Methods of costing in international Mar(et:

The primary motive of all economics activities is to ma(e profit. rofitability

depends upon a suitable pricing policy of the firm. rice directly depends upon the

method of costing adopted by the organi7ation. There are mainly two methods of

costing adopted in international mar(et:

1* 2ost plus pproach:

2ost lus pricing is a common method of pricing. -nder this method, the price

includes cost of goods plus a certain percentage of profit. The relation can be

e)pressed mathematically as, riceH Total cost &i)ed cost I Dariable costs* I

rofit margin.

%* Marginal 2osting:

Marginal cost pricing is a pricing method according to which firms set the prices of

their products by ta(ing into consideration the marginal cost of production, whichis the cost of producing one e)tra unit of the product.


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3.9.9 5)port pricing strategies:

ricing Strategies may be defined as the strategy adopted by e)porters with

respect to pricing of goods while mar(eting them to ultimate consumer. The

e)porter may charge a uniform price in different mar(ets of the world or he maypractice price discrimination ta(ing into consideration the situations prevailing in

different mar(ets. Darious pricing strategies used in the international mar(et are:

1* S(imming pricing Strategies:

pricing Strategy in which e)porter charges very high price initially in order to

recover the cost incurred on initial promotion e)penditure, research and

development, etc. is (nown as S(imming pricing strategies. fter e)ploiting the

?ich mar(et the e)porter can gradually reduce the price in order to increase his

mar(et share.

%* enetration pricing Strategy:

pricing strategy in which an e)porter charges very low price initially in order to

get hold of the mar(et and drive away competitor is (nown as penetration pricing

strategy. Sometimes, such strategy is referred to as dumping. This strategy is

suitable for the items of mass consumption.

3* Transfer pricing:

Transfer pricing refers to the pricing of goods transfer from one subsidiary to

another or to the parent company. 6ue to this profit of one subsidiary are

transferred to another subsidiary or to the parent company. Transfer pricing

decisions are affected by factors such as differences in ta) and tariff rates, foreign

e)change restrictions and import restrictions.

4* Marginal cost pricing:

Marginal cost is the cost of producing one e)tra unit of a product. -nder this

approach an e)porter simply considers variable costs or direct costs while arriving

at the price to be charged in the international mar(et and fi)ed costs are fully

recovered from the domestic mar(et. This approach can be used when unused

production capacities are available.


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9* Mar(et oriented pricing:

This is a very fle)ible method of arriving at a price as it ta(es into consideration

the changing mar(et conditions. The price charged may be higher when demand

conditions are favorable and viceversa. This method is sometimes, referred to aswhat the traffic will bear method. This is a very fle)ible and realistic method of

pricing.

=* 2ompetitors pricing:

-nder this method pricing strategy of dominant competitors is ta(en into

consideration while arriving at the pricing decisions. price leader is the firm

which initiates the price trends in the mar(et. owever, if the competitors pricing

policy is faulty the follower will also land up with wrong price.

3.6 Promotions and Communication Mix

3.=.1 #ntroduction:

romotion plays a very important role in mar(eting both domestic as well as

international. 5ven if product is very good it may not achieve success unless the

promotion is appropriate and ade@uate. ccording to Simon Ma'aro "promotion in

mar(eting simply means the transaction of message to the buyer or the consumer

or the channel of distribution in which the supplying company aims to tell each oneof these receivers why they should buy or handle the product.$ #n other word,

promotion mi) creates the desirability of the product among foreign potential

buyers by providing them ade@uate information about the foreign customers.

/verseas mar(eting communication means (eeping close contact or dialogue with

those concerned with the mar(eting of company$s product or products different

foreign mar(ets. This includes consumers, dealers, distributors and other

middlemen connected with mar(eting and sales promotion. Such communication

has special importance in overseas mar(eting as the buyers and dealers are inforeign countries and the seller i.e. e)porter would not be able to meet them

personally. 8aturally, the entire transaction needs to be completed through

communication. &or such communication letters, tele), fa) or advertising, etc. are

re@uired to be used as tools or techni@ues.


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2ontinuous communication is useful for selling the products effectively to

consumerspresent and prospective. 2ommunication provides information and

creates awareness, interest and desire to purchase the product in domestic and

international mar(et. long with the superior @uality products, regular supply,

reasonable price, satisfactory after sale service, continuous and purposefulcommunication in e)isting and potential overseas mar(et are essential for sales

promotion. Therefore from the above we can see that both communication and

sale promotion are complementary to each other and are integral part of

international mar(eting.

3.=.% &actor affecting product promotions in international mar(ets:

Darious factors that affect the promotion mi) in international mar(et are:

1* roduct related factor

8ature and mount of product information: dvertising in international

media is very costly. Therefore information presented to the consumers

regarding the product must be concise, clear and simple to understand. To

demonstrate comple) product and ideas, methods such as personal selling,

trade fairs and e)hibitions can be used.

roduct$s stage in life cycle: during the introductory stage e)tensive

advertising and sales promotion are re@uired in order to reach potentialcustomers. 6uring the growth stage competition grows and therefore, a

manufacturer must concentrate on product differentiation. 6uring the

maturity stage, the promotional efforts are reduced.

8ature of the product: consumer goods should be promoted through

advertising in media of mass communication as there are large numbers of

consumers and they are spread over a large geographical area. owever, in

the case of industrial goods more emphasis is placed on personal selling,

trade fair and e)hibitions, as the buyers of such goods are concentrated.

-nit price of the product:


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%* 2onsumer ?elated factors:

Si7e and characteristic of the target mar(et: if the si7e of the target mar(et is

large, then the mar(eter may ma(e use of advertising, publicity and sales

promotion techni@ue. #f the target mar(et is of limited si7e then personalselling may be resorted to. gain, the consumer characteristics need to be

considered while selecting appropriate promotion media.

Types of buying decisions: romotion efforts may turn futile if buying

decisions of consumers are programmed. #n such cases they may not be

receptive to the information transmitted by advertising. #n the case of non

programmed buying decisions, advertising and personal selling play an

important role in including the consumers to buy the products so advertised.

3* 2ompany related factors:

romotion Strategy: push strategy involve the mar(eting efforts directed at

the channel intermediaries to induce them to stoc( and promote the product

while a pull strategy is directed at consumers to induce them to demand the

product. ush strategy resorts to personal selling and trade promotions while

pull strategy ma(es use of advertising.

randing strategy: firm may adopt either individual or family branding

strategy. #n the case of individual branding strategy, each brand is promoted

separately and hence re@uires massive advertising and sales promotion

efforts. #n the case of family branding strategy all brands are 'ointly

promoted and hence it re@uires less promotion efforts.

ricing Strategy: #t plays a significant role in international mar(eting. #n the

case of high price goods li(e diamond or industrial machines personal

selling is effective as buyers need a good deal of information. owever, in

the case of low price convenience goods such as soaps, toiletries, etc. the

e)porter may resort to advertising mass media.

dvertising udget: dvertising budget of a firm is a ma'or determinant ofits promotion mi). The e)porter may resort to heavy advertising if its

advertising budget is large and vice versa. gain, a ma'or part of

advertising budget is used for promotion in mass media and remaining on

trade fairs, e)hibitions and publicity.


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2ompany ersonnel: #f a company has good and well trained sales force

then the company may resort to personal selling as the ma'or tool of

promotion mi). owever, the company faces shortage of s(illed sales force

it may either hire outside personnel or may resort to other medium such as

publicity and advertising.

4* 5nvironment related factors:

Disibility of the firm: Some firms are more visible to the public because of

their name, product and services or relative position in the industry. Such

firms may have to spend a good deal in maintaining their image through

public relations and advertising.

2ompetitors ction: romotional programmes of rivals in the industry have

a varying of companies promotion mi). &irms often have to match orcounter the promotional activities of the competitors to maintain and

increase their mar(et share.

*ercise: &.,

State +-et-er t-e (ollo+ing is true or (alse2 i( (alse give

correct statement

a* Promotion and communication are complementar,

to eac- ot-er in t-eir use and application.$* isi$ilit, o( t-e rm is consumer related (actor

aecting t-e promotion and communication mix.c* dvertising $udget relates to product (actor aecting

t-e communication mix.d* 2ommunication provides information, creates awareness, interest

and desire to purchase the product in domestic and internationalmar(et.

e* !nder compan, personnel management a compan,

ma, -ave personal selling as its promotion tool.


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3.=.3 Techni@ues of product promotion in international mar(et:

romotion mi) consists of different techni@ues of mar(eting communication such

as advertising, sales promotion, public relations, personal selling, publicity,

pac(aging, trade fairs and e)hibitions. This factors must be blended together inorder to accomplish the firms ob'ectives. Darious elements of promotion mi) are as

under:

1* dvertising:

dvertising is any paid form of non personal presentation and promotion of ideas,

goods and services by an identified sponsor. The different advertising media are

newspapers, maga7ines, radio, televisions and so on. owever their relative

effectiveness varies from country to country and so do their availability and

efficiency. dvertising plays a significant role in informing persuading and

educating the present and potential consumers.

%* Sales promotion:

Sales promotion is defined as short term incentives offered to consumers or dealers

encourage sell of a product or service. Sales promotion activities includes trade

fairs and e)hibitions, samples, gifts, contests, games, lotteries, discounts, etc.

regulations regarding sales promotion differ from country to country. Sales

promotion efforts of a firm must be supported or complimented by other elements

in the promotion mi).

3* ublic ?elations:

Modern business houses are becoming more and more consumer oriented. They

believe in maintaining good and cordial relations with their consumers, creditors,

dealers as well as intermediaries. Through public relations, the firm intends to

create a positive impression on the government agencies, employees, shareholders,

consumerists, environmentalist, suppliers and others which is necessary in theinternational mar(ets.

4* ersonal Selling:

ersonal Selling is defined as oral presentations in a conversation with one more

perspective consumers for the purpose of effective sales. ersonal selling may be


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preferable when the product is technically nature, is of high unit value and the

number of customers is limited. #t is generally preferred in the case of industrial

good s and consumer durables. 5ffective communication and s(illful salesmanship

is needed to convince and induce the target customers to buy such products.

9* ublicity:

#t is an unpaid form of advertising where by news item is carried in mass media

about a firm and its products, policies, personnel or actions. &or instance a

newspaper may publish articles on the company or its products or activities. #t may

be favorable or unfavorable. The publicity unit or public relation$s department may

influence the international media owners to write a positive story about the

company and its products.

=* ac(aging:

ttractive and durable pac(aging not only protects the product but also acts as a

silence salesman. n attractively designed pac(aging can attract the attention of

prospects and can induce them to act upon their buying decisions. +hile designing

the pac(ages, factors such as the si7e and shape of the pac(age, their colors,

language use, international pac(aging standards, must be ta(en into consideration

if needed assistance can be sought from the #ndian institute of pac(aging ##*.

>* Trade &airs A 5)hibitions:

Trade fairs and e)hibitions play a leading role in publici7ing the product of the

e)porters. Trade &airs and e)hibitions by bring potential buyers and suppliers in

contact with each other in imparting information about the relevant development

around the worldB play an important role in international mar(eting. #n #ndia,

#ndian Trade romotion /rgani7ation #T/* organi7es trade fairs and e)hibitions

of #ndian products.

E* 8ew #nformation Technologies:

There have been dramatic changes in the information and communication

technologies over the last few years. 8ew information technology modes include

electronic mail, corporate and public data bases, application systems, fa), video

and computer conferencing which are widely used in the field of international


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mar(eting. These modes have brought the world closer and are considered to be the

driving forces of internationali7ation.

3.=.4 ?ole of promotion mi) in international mar(et:

5)port mar(eting communication performs the following functions:

1* roduct wareness:

The main ob'ective of the promotion mi) is to ma(e consumers aware of the

products available in the mar(et. n effective promotion mi) ma(es the

prospective consumers aware of the availability of a product, its features,

advantages, usage, price, etc. This information helps them in ma(ing their purchase

decisions.

%* 5ducation:

romotion mi) educates the prospective consumers about different uses of the

advertised product, its advantages over other substitutes, its contents, availability,

technical aspects, etc. romotion can also be used to warn consumers of imitation

of brands, duplicate and fa(e products, etc.

3* Motivation:

Services such as home delivery, educating, consumers on the uses and maintenanceof the product, warranties and guaranties, availability of product on installment

basisB special discounts and attractive gift s(ims influence the buyer$s decision of

the consumers. These services must be given a due consideration while devising a

promotional strategy.

4* ersuasion:

The e)porter should ma(e proper use of selling points in the advertising message

in order to persuade consumer to buy the product. e can also ma(e effective useof -ni@ue Selling roposition -S* while drafting advertising message. ence,

the role of promotion is not only to inform but also to persuade the prospective

buyers to buy the products.


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9* #nforming #ntermediaries:

romotion mi) can also be used to inform intermediaries, namely wholesaler,

retailer and commission agents above the range of products provided by the

e)porter, terms and condition of the sale and delivery, incentive offered, etc. , andto persuade them to stoc( and sale the products in overseas mar(et.

=* 2reation of 0oodwill:

romotion mi) can also be used as a tool for the promotion of corporate image not

only of the product and the company but also of the country as a whole in the

overseas mar(et. 0ood @uality products and timely services can go a long way in

enhancing the goodwill. This helps in increase the mar(et share of the products.

>* ?etaining the 5)isting Mar(et Share:

6ue to increase in competition and ever improvement in technology, consumer

turnover has become common phenomenon. #n order to retain e)isting mar(et

share, the e)porter must (eep consumers updated on availability of brand, its

features and uni@ueness and modification and improvement in the product, etc.

E* /vercoming 8egative ttitudes:

0enerally foreign buyers have some apprehension about the @uality of product

originating from developing and under developed countries. 5ffective and positive

promotion mi) strategy can help to change such negative apprehension of the

consumer and can be used to persuade consumer to go for a trial purchase.

3.=.9 roduct romotion rocess in #nternational Mar(et:

The main steps in developing and effective communication mi) are as under.

1* #dentifying Target udience:

The mar(eter must have a clear idea of the target audience. The target audience

influences the mar(eters decision on what to say, to whom, when, why and how to

say. Target audiences of different demographics differ in their perceptions.

Therefore it is always advisable to identify the target audience so as to design the

proper communication mi).


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%* 6etermining 2ommunication /b'ective:

romotion ob'ectives must be specific and realistic. The communication ob'ective

can be any or many of the following.

To ma(e the audience aware of the firm$s products.

To influence the dealers to stoc( and push the products.

To maintain enhanced brand loyalty.

To correct erroneous impression of the company.

To counter competitors$ claim.

To develop company and brand images and so on.

3* 6esigning the message:

The mar(eter should design an effective message to reach the target audience in

order to achieve the promotion ob'ectives. hilip !otler has identified, following

essentials in an ideal message:

The message content should be brief, yet effective.

The message must be structured (eeping in mind #6 model.

The contents of message such headline, copy te)t, illustration, slogans, etc.,

must be formatted properly.

The message must be presented through the right source and to the right

audience.4* Selecting the communication channels:

The mar(eter has to select the appropriate communication channel. e may select

either non personal channel such as television, radio, etc. or direct channel such as

personal selling, trade fairs and e)hibition. The choice of direct and indirect

channel depends upon the communication ob'ective.

9* 5stimating the promotion budget:

promotion budget put minimum and ma)imum on promotion e)penditure for aspecific period. #t is influenced by the factor such as promotion ob'ectives,

availability of fund, competitors$ budget, Si7e of mar(et coverage, etc.

=* 6eciding on romotion Mi):


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The Mar(eter has to consider the right promotion mi) by appropriately blending

the different elements of promotion mi). There are basic four factors formulating a

promotion strategy namely product related factors, consumer related factors,

company related factors and environment related factors.

>* #mplementing the romotion Mi):

/nce, the promotion mi)es decided, the mar(eter has to allocate funds for each of

the promotion mi). fter allocating the funds the mar(eting manager ta(es

necessary arrangement to implement the promotion mi). &or implementation

purpose the mar(eter has to select the various channels or media to carry the

promotion messages.

E* 5valuating the performance:

The mar(eter has to constantly monitor the performance of promotion mi) in order

to ensure that the promotion strategy reali7es the promotion ob'ectives. #f

necessary, corrective measure should be ta(en.

3.=.= arriers to romotion in #nternational Mar(et:

6evelopment of appropriate international mar(eting promotion mi) is a difficult

tas( because of several comple)ities and intricacies. These comple)ities and

intricacies act as barrier to the effective promotion. Some of these barriers are

1* 6ifferences in ?egulations:

?egulation governing promotion activities differ from country to country. +hile

underta(ing promotion abroad, the e)porter should understand this regulation

thoroughly and should ensure that his promotion programmes are in conformity

with the regulation of country concerned.

%* 2ultural 6ifferences:

6ue consideration must be given to culture factures while designing a promotion

mi) for international mar(et. +hat ma(e appeal well to the people of one country

may be distasteful or even offending to people of some other country. The


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differences in belief or attitude associated with colors, numbers, symbols etc., must

be considered.

3* Media &actors:

The availability of various media, their relative effectiveness, coverage, media

consumption habits, cost of media, etc. differ in different countries. +hile

formulating a promotion mi) for overseas mar(ets, all these factors must be ta(en

into consideration or else an overseas agency can be hired for the purpose.

4* #nfrastructure:

esides the availability and efficiency of promotion media, there are several other

infrastructural factors which affect international promotion mi). These

infrastructural factors are availability of advertising agencies, mar(eting researchfirms, database, mar(eting intermediaries, mar(eting intelligence system, etc.

9*


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overseas mar(et should normally be large enough to create a positive and strong

impact on consumer psychology.

3.7 Lets um !"

#nternational mar(eting of services refers to the mar(eting mi) and strategies

adopted to mar(et the services. ?aising trend of service sector especially #T based

sector, including /, an(ing, oteling, Tourism, etc. signifies its importance in

international mar(et.

rice is the value of e)change for any product or service. #t is an important factor

both in domestic and international mar(et as it helps to earn more profit, create a

mar(et share, brand recognition and s(im the cream, etc. The pricing decision in

international mar(et is based on many determinant factors li(e cost of product,

elasticity of demand, government policies, incentives, mar(eting policies, trade

policies, etc.

romotion and 2ommunication Mi) is yet another type of mar(eting mi) that

helps in attaining a distinctive place in the #nternational mar(et. There are various

promotion mi)$s li(e advertising, personal selling, sales promotions, publicity,

public relations, customer satisfaction, etc. which are well planned before its

implication in the host country as they are affected by factors li(e product,

customers, company and environment.

3.# !nit $nd $xercises

%* -at are t-e (actors t-at aect t-e International pricing

decision8

9* 0xplain t-e term Price and descri$e its importance in

International Market.

3* -at do ,ou mean $, International Promotion andCommunication Mix8 State and 0xplain t-e :ools and :ec-ni;ues

o( International Communication Mix.

4* 0numerate t-e (actors aecting t-e International Promotion

Mix.


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5* State t-e Signicance o( International Service Marketing in

context o( India as t-e


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international business module.docx

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