2. Introduction to International Marketing Benefits of International Markets Market A market can be defined simply or rather complexly. In the simplest terms, a market is a system of institutions, rules and procedures relating to the exchange of goods and services between persons or organizations.

3. Benefits of International Markets Markets can be defined in different ways, including by geography, customer, product or even the behavioral characteristics of consumers.

4. Benefits of International Markets An international market is defined geographically as a market outside the international borders of a company's country of citizenship. A company, to the extent that it is a legally distinct entity from its owners like a corporation, is usually a citizen of the country where it is organized. IBM, for example, was formed in the United States. Thus, any geographic area outside the territorial boundaries of the United States where IBM conducts business is IBM's international market.

5. Benefits of International Markets The conceptual opposite of an international market is the company's domestic market, which is the geographic region within the national boundaries of company's home country.

6. Benefits of International Markets International marketing is the performance of business activities to plan, price, promote and direct the flow of a company’s good and services to consumers or users in more than one nation for a profit. Marketing concepts, processes and principles are universally applicable and the marketer’s task is the same whether doing business in Pakistan or United Kingdom.

7. Benefits of International Markets We all know business goal is to make profit by promoting, price, and distributing products for which there is a market. The answer lie not with different concepts of marketing but with the environment with in which marketing plans must be implemented. The uniqueness of foreign marketing comes from the range of unfamiliar problems and the variety of strategies necessary to cope with different levels of uncertainty encountered in foreign markets.

8. Benefits of International Markets Competition, legal restraints, government controls, weather, fickle consumers and any number of other uncontrollable elements can and frequently do affect the profitable outcome of good, sound marketing plans. The marketer cannot control or influence these uncontrollable elements but instead must adjust or adapt to them in a manner consistent with a successful outcome.

9. Benefits of International Markets What makes marketing interesting is the challenge of molding the controllable elements of marketing decisions (product, price, promotion, distribution, and research) with in framework of uncontrollable elements of the market place(competition, politics, laws, consumer behavior, level of technology, etc) Marketing plans changes or need to change dramatically from country to country or region to region.

10. Benefits of International Markets The difficulties created by different environments are the international marketer’s primary concern.

11. The International Marketing Task The international marketer’s task is more complicated than that of the domestic marketer. The international marketer deal different levels of uncertainty, uncertainty is created by the uncontrollable elements of all business environments,(domestic and foreign) but each foreign country in which a company operated adds its own unique set of uncontrollable factors.

12. The International Marketing Task Marketing Decision Factors The successful manager constructs a marketing program designed for optimal adjustment to the uncertainty of the business climate. In the figure the inner circle represents the area under control of the marketing manager. Assuming the necessary over all corporate resources, structures and competencies that can limit or promote strategic choice, marketer blends price, product, promotion etc to capitalize on anticipated demand.

13. The International Marketing Task The second circle represents the aspects of the domestic environment uncontrollable. These include home country elements that can have a direct effect on the success of a foreign venture. They are political, legal, economic and competition. For example a political decision involving domestic foreign policy can have a direct effect on a firm’s international marketing success. The domestic economic climate is another important home based un-controllable variable with far

14. The International Marketing Task Reaching effects on a company’s competitive position in foreign market The capacity to invest in plants and facilities, either in domestic or foreign market is to large extent a function of domestic vitality. Competition with in the home country affects a company’s domestic as well as international plans.

15. The International Marketing Task In addition to uncontrollable domestic elements, a significant source of uncertainty is foreign environment uncontrollable. [outer circle] A business operating in its home country feels comfortable in forecasting the business climate and adjusting business decisions to these elements. The process of evaluating the uncontrollable elements in an international marketing program often involves substantial doses of cultural, political, economic shock.

16. The International Marketing Task Political and legal forces and the level of technology are only two of the uncontrollable aspects of the foreign environment. The uncertainty of different foreign businesses environment creates the need for a close study of the uncontrollable elements with in each new country.

17. Environmental Adaptation Needed To adjust and adapt a marketing program to foreign markets, marketer must be able to interpret effectively the influence and impact of each of the uncontrollable environmental elements on the marketing plan for each foreign market in which they hope to do business. In broad sense the uncontrollable elements constitute the culture; the difficulty facing the marketer in adjusting to the culture lies in recognizing its impact.

18. Environmental Adaptation Needed The task of cultural adjustment, is the most challenging and important one confronting international marketer. In dealing with unfamiliar markets, marketers must be aware of the frame of reference they are using in making their decisions or evaluating the potential of market. Frame of reference is a set of criteria in relation to which judgments can be made. "the observer interprets what he sees in terms of his own cultural frame of reference"

19. Environmental Adaptation Needed Cross cultural misunderstanding can also occur. Cultural conditioning is very important in any study of the market system of different people, their political and economic structures, religion, and other elements of culture. foreign markets must constantly guard against measuring and assessing the markets against the fixed values and assumptions of their own culture..

20. The self-Reference Criterion and ethnocentrism Adaptation is a conscious effort on the part of the international marketer. It is to anticipate the influences of both foreign and domestic uncontrollable factors on a marketing mix and then to adjust them. The primary obstacle to success is self criterion reference and an associated ethnocentrism. The SRC is an unconscious reference to one’s own cultural values, experiences and knowledge as a basis for decision.

21. The self-Reference Criterion and ethnocentrism Closely connected is ethnocentrism that is notion that people in one’s own company, culture or country know best to do things. Ethnocentrism is generally problem when managers from affluent countries work with managers and markets with less affluent countries. Mostly reactions are based on meaning, values, symbols, and behavior, relevant to own culture and usually different from those of the foreign culture.

22. The self-Reference Criterion and ethnocentrism SRC can prevent you from being aware of cultural differences or from recognizing the importance of those differences. For example In US a polite refusal is certainly acceptable but in Asia a host is offended if you refuse hospitality. Learning ever yculture in depth and being aware of every important difference is almost humanly impossible.

23. The self-Reference Criterion and ethnocentrism To avoid errors in business decisions, the knowledgeable marketer will conduct a cross cultural analysis This will help in isolates the SRC that influences and maintain vigilance regarding ethnocentrism. The following steps are suggested as a framework for such an analysis. Define the business problem or goal in home- country cultural traits, habits or norms.

24. The self-Reference Criterion and ethnocentrism Define the business problem or goal in foreign- country cultural traits, habits or norms through consultation with natives of the target country. Make no value judgments. Isolate SRC influence in the problem and examine it carefully to see how it complicates the problem. Redefine the problem without SRC influence and solve for optimum business goal judgment.

25. Developing Global Awareness Opportunities in global business abound for those who are prepared to confront numerous obstacles with optimism and willingness to continue new ways. To be globally aware is to have Tolerance of cultural differences. Knowledge of cultures History World market potential Global, economic, social and political trends.

26. Developing Global Awareness Example can be the former republics of the Soviet Union, along with Russia, Eastern Europe, China, India, Africa and Latin America are undergoing economic, social and political changes that have already altered the course of trade and redefined new economic powers.

27. Developing Global Awareness Global awareness can and should be built in to organizations using several approaches. Select managers specifically for their demonstrated global awareness. Global awareness can also be obtained through personal relationships in other countries