2. International Marketing
ATM Semester 2
Lecture 10
By Sanemkhan Nurillaeva
International Marketing

3. Agenda Definition Good and Bad Examples
Deciding which markets to enter
Market Entry Mode and Risk
3 Strategic Market Orientation

4. Definition: International Marketing
“Multinational process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services and to create exchanges that satisfy individual and organizational objectives” (John Shaw, 2008)

5. Good Example: at&t

6. Bad Example: KFC
In Chinese, the Kentucky Fried Chicken slogan “finger-lickin’ good” came out as “eat your fingers off.”

7. Barriers Deciding whether to go international Reasons
Saturated domestic markets
Small domestic markets
Low growth domestic markets
Customer drivers
Competitive forces
Cost factor
Portfolio balance
Barriers
Insufficient Knowledge
Lack of Capital
Market Uncertainty
Commercial & Political Risks

8. Deciding which markets to enter
Macroenvironmental issues
Socio-cultural
Technological
Economic
Political/legal
Foreign
Market
selection
Microenvironmental issues
Market attractiveness
Company capability profile

9. Microenvironmental issues
Market attractiveness
Microenvironmental issues
Market size and growth rate
Competition
Cost of serving the market
Profit potential
Market access

10. Microenvironmental issues
Company capability profile
Microenvironmental issues
Skills
Resources
Product adaptation
Competitive advantage

11. Market Entry Mode and Risk

12. Deciding how to enter the market
Indirect
exporting
Direct
exporting
Joint
ventures
Direct
investment
Licensing
Commitment, Risk, Control, and Profit Potential

13. Foreign market entry strategies
Direct investment
New facilities
Acquisitions
Cooperative
Licensing
Joint ventures
Exporting
Indirect
Domestic-based export merchants
Domestic based export agents
Piggybacking
Cooperative organisation
Direct
Foreign-based agents or
distributors
Domestic-based sales
representatives
Overseas sales/marketing office
or subsidiary

14. Which strategy should be used?
It depends on:
Vision
Attitude toward risk
How much investment capital is available
How much control is desired

15. 3 Strategic Orientation
Domestic market extension orientation
Multidomestic market orientation
Global market orientation

16. Domestic Market Orientation
International operations viewed as secondary
Prime motive is to market excess domestic production
Firm’s orientation remains basically domestic
Minimal efforts are made to adapt product or marketing mix to foreign markets
Firms with this approach are classified as ethnocentric

17. Multidomestic Market Orientation
Companies have a strong sense that foreign country markets are vastly different
Market success requires an almost independent program for each country
Separate marketing strategies (mostly polycentric)
Subsidiaries operate independently of one another in establishing marketing objectives and plans
Products are adapted for each market
Control is decentralized

18. Global Market Orientation
Company guided by global marketing orientation
Marketing activity is global
Market coverage is the world
Firm develops a standardized marketing mix applicable across national boundaries
Markets are still segmented
Each country or region is considered side by side with a variety of other segmentation variables
Fits the regiocentric or geocentric classifications

19. Global Market Orientation: Example
McDonald’s:
Process is standardized in every country
Logo is same
Most of the advertisements are similar
Store decoration and layout almost alike
BUT
Wine in France and Beer in Germany
A Filipino Style spicy burger in Manila
Pork burgers in Thailand
P&G pursue a global strategy for disposable diapers, but a multidomestic strategy in Asian markets for detergents. (The strategy differs product to product)

20. Reading
P. Kotler, K.Keller, 2006, Marketing Management, 12 ed, Prentice Hall
D.Jobber, Principles and Practice of Marketing, 3ed, 2001, McGrawHill
Isobele and Lowe, (2008). International Marketing Strategy [Online]. Available from: ter01.pdf
International Marketing Strategy and Theory (2008) by John Shaw