yogesh- international marketing
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DIFFERENCES BETWEEN DOMESTIC MARKETING
AND INTERNATIONAL MARKETINGThere are various differences between domestic marketing and international
marketing. Due to a language barrier it is more difficult to obtain and interpret
research data in international marketing. Promotional messages needs to consider
numerous cultural differences between different countries. This includes the
differences in languages, expressions, habits, gestures, ideologies and more. For
example, in the United States the round O sign made with thumb and first finger
means "okay" while in Mediterranean countries the same gesture means "zero" or
"the worst". In Tunisia it is understood as "I'll kill you" meanwhile for a Japan
consumer it implies "money".
INCREASEDUNCERTAINTIESASSOCIATED
WITHMARKETINGABROAD
Although firms marketing abroad face many of the same challenges as firms
marketing domestically, international environments present added uncertainties
which must be accurately interpreted. Like domestic marketing, international
marketing requires managers to make decisions that are within the firm's control,
such as which product to market, what price it should command, the optimal
promotion strategy, and the best distribution channels. Furthermore, like firms
marketing domestically, firms marketing internationally must be prepared to react
to factors in the home country which might affect their ability to do business.
Examples include domestic politics, competition, and economic conditions.
International marketers face a host of issues that are out of their direct
control, both at home and abroad. For instance, although domestic policies on
foreign trade cannot be controlled by individual businesses, firms marketing
abroad must be aware of how domestic policies help or hinder foreign trade
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activities. Firms marketing abroad must also be prepared for uncertainties
presented solely by the business environment in the host country as well. Four very
important issues to note in a host country are its laws, politics, economy, and
competition. Other issues are the host country's geography, infrastructure,
currency, distribution channels, state of technological development, and culturaldifferences.
The legal and political environments of the host countries are two of the
most important variables faced by international marketers. First, companies
operating abroad are bound by both the laws of host and home countries;
moreover, legal systems around the world vary in content and interpretation. These
laws can affect many elements of marketing strategies, particularly when they are
in the form of product restrictions or specifications. Also, politics can be a huge
concern for companies operating abroad and is, perhaps, the most volatile aspect of
international marketing. Unstable political situations can expose businesses to
numerous risks that they would rarely face at home. When governments change
regulations, there are usually new opportunities for both profits and losses, and
firms must usually make modifications to existing marketing strategies in response.
For instance, the opening of Central and Eastern Europe presented both high
political risks and huge potential market opportunities for companies willing to
take the risks.
Economic conditions, per capita gross national product (GNP), and levels
of economic development vary widely around the world. Before entering a
market, firms marketing abroad must be aware of the economic situation there; the
economynot to mention individual standards of livinghas a huge impact on the
size and affluence of a particular target market. Furthermore, marketers must
educate themselves on any trade agreements existing between countries as well as
on local and regional economic conditions. Being aware of economic conditions
and the likely direction that those conditions will take can help marketers betterunderstand the profitability of potential markets. For example, many companies
had to reevaluate international marketing strategies as international financial crises
affected the economies of Southeast Asia, Russia, and Latin America in 1997-98.
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Competition overseas can come from a variety of sources as well. Further, it
has the potential to be much fiercer than competition at home. Often, if a market is
ready to accept foreign goods, numerous manufacturersboth indigenous and
foreign basedwill be willing to risk entry into that market. Making the situation
more intense, the governments of many other countries may subsidizemanufacturers to help them enter a particular market.
Obviously, the more foreign markets in which a firm enters, the more of
these uncontrollable events the firm must consider. To make the situation more
interesting, the solutions to problems occurring in one country are often
inapplicable to problems occurring in a second country because of differences in
the political climates, economies, and cultures. The uncertainty of different foreign
business environments creates the need to closely study the environment within
each new market entered.
Companies that are truly global competitors employ a long-term
international marketing strategy to overcome the uncertainties associated with
conducting business abroad. Their long-term strategies enable them to weather
short-term economic or political crises, such as the peso devaluation in Mexico.
Such companies are prepared to make increased investments during downturns,
and as a result they are better prepared when economic conditions improve.
INDIA MARKETING SCENARIO
Currently in India, the national economy and marketplace are undergoingrapid changes and transformation. A large number of reasons could be attributed to
these changes. One of the reasons in these changes in the Indian Market Scenario is
Globalization, and the subsequent and resulting explosive growth of global trade
and the international competition.
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The other reason for these changes in the Indian Market Scenario is the
technological change. This is an important factor because the technological
competitiveness is making, not only the Indian market, but also the global
marketplace cutthroat.
In the Indian Marketing Scenario, the market success goes to those companies that
are best matched to the current environmental imperatives. Those companies that
can deliver what the people want and can delight the Indian customers are the
market leaders.
Today the companies are operating in such a marketplace where survival of the
fittest is the law. In order to win, the companies are coming out with various new
and evolving strategies because the Indian market is also changing very fast. It is to
capture the Indian market, that the Indian and the Multi National Companies areusing all of their resources.
The Indian market is no longer a sellers market. The winner is the one who
provides value for money. A large number of companies have huge idle capacities,
as they have wrongly calculated the market size and installed huge capacities. This
has further contributed to converting the Indian market into a buyers market.
The Indian Marketing Scenario is one of the biggest consumer markets and that is
precisely the reason why India has attracted several MNCs. These large MultiNational Companies have realized that to succeed in the Indian market-place they
need to hire Indian representative who are much more aware of the Indian
economic, political, legal and social realities. In the Indian Marketing Scenario, it
is the MADE FOR INDIA marketing strategies that work
SEPARATINGCULTURALVALUES
Culture is a very important aspect of international marketing because the elements
that compose it affect the way consumers think. The language a population speaks,
the average level of education, the prevailing religion, and other social conditions
affect the priorities the inhabitants have and the way they react to different events.
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With this in mind, it is easy to see that managers of firms operating only in the
domestic market are often able to react to many market uncertainties correctly and
automatically because they intuitively understand the culture and the impact of
changing conditions. In foreign markets, however, this is not the case. Because
they were not raised in the country in which they are trying establish a market,managers abroad often do not fully understand the culture and lack the proper
frame of reference. Thus, decisions that they would make automatically at home
could be dramatically incorrect when operating abroad. Unless special efforts are
made to understand the cultural meanings for activities in each foreign market,
managers will likely misinterpret the events taking place and risk making the
wrong decisions.
This problem is so real that some authorities in international marketing
believe that unconscious references to a firm's domestic cultural values contribute
to most international business problems. To overcome these potential disastrous
decisions, firms must understand the cultural factors existing in both their domestic
country and the host country. Business problems and goals must be defined in
terms of the host country's culture. Being able to separate home-country norms
from those in the host country can be a very challenging task. Often, the influence
of one's own culture is underrated.
American multinational corporations have been in the forefront ofdeveloping international brands that cut across local cultural differences.
Companies such as Coca-Cola, IBM, and McDonald's have created international
brands to sell their products to large market segments worldwide. Other American
examples of global icons include Intel, MTV, CNN, and Disney. The advertising
and marketing campaigns that built these international brands took a universalist
approach, building on the American tradition of assimilation. However, as
culturally diverse emerging markets become more important to international
marketing, campaigns targeted to specific cultures will appear more frequently.
CONCLUSION
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International marketing occurs when a business directs its products and services
toward consumers in more than one country. While the overall concept of
marketing is the same worldwide, the environment within which the marketing
plan is implemented can be drastically different. Common marketing concerns
such as input costs, price, advertising, and distributionare likely to differdramatically in the countries in which a firm elects to market. Furthermore, many
elements outside the control of managers, both at home and abroad, are likely to
have a large impact on business decisions. The key to successful international
marketing is the ability to adapt, manage, and coordinate a marketing plan in an
unfamiliar and often unstable foreign environment.
Businesses choose to explore foreign markets for a host of sound reasons.
Commonly, firms initially explore foreign markets in response to unsolicited
orders from consumers in those markets. In the absence of these orders, companies
often begin to export to: establish a business that will absorb overhead costs at
home; seek new markets when the domestic market is saturated; and to make quick
profits. Marketing abroad can also spread corporate risk and minimize the impact
of undesirable domestic situations, such as recessions.
While companies choosing to market internationally do not share an overall
profile, they seem to have two specific characteristics in common. First, the
products that they market abroad, usually patented, have high earnings potential inforeign markets; in other words, the international sale of these products should
eventually generate a substantial percentage of the products' total revenue. Also,
these products usually have a price or cost advantage over similar products or have
some other attribute making them novel and more desirable to end users abroad.
Second, the
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