I NTERNAT I ONAL MARKET I NG

1. INTERNATIONAL MARKETING Hamed jamshidi 2007503074 1

2. international marketingis the multinational process of planning and executing the conception, pricing, promotion and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives. International marketing involves recognising that people all over the world have different needs. Companies like Gillette, Coca-Cola, BIC, and Cadbury Schweppes have brands that are recognised across the globe. 2

3. THE WORLD’S FIVE EXPORTING COUNTRIES: 1-THE UNITED STATES ($700 BILLION) 2-GERMANY ($560 BILLION) 3-JAPAN ($390 BILLION) 4-FRANCE ($320 BILLION) 5-BRITAIN ($260 BILLION) Collectivelyaccountingfor 42 percent of global trade. 3

4. many u.s. companies have made the world their market 4

5. The Complete Process Market Segmentation Market Targeting Market Positioning Design a product or service to meet a segment’s needs and develop a marketing mix that will create a competitive advantage in the minds of the selected target market Identify and describe market segments Evaluate segments and decide which to go after 5

6. Market Segmentation • Identifying distinct groups of consumers whose purchasing behavior differs from other in important ways. • Marketing mix adjusted to reflect differing purchasing patterns in segments. • Geography • Demographics • Socio-cultural factors • Psychological factors 6

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8. Market Segmentation • Two main issues in the differences between countries • The structure of market segments • The existence of segments that transcend national borders 8

9. Marketing Mix (4 Ps) • Product • Promotion • Pricing • Place (Distribution) – the most important for international business entry 9

10. Marketing Mix: Product 10

11. Product Attributes • A product is a bundle of attributes. If consumer needs were the same all over, a firm could simply sell the same product worldwide. Unfortunately, differences in the three following areas often necessitate adaptations • Cultural differences • Economic differences • Product and technical standards 11

12. Cultural Differences • Range of dimensions: • Social structure • Language • Religion • Education • Most important - the impact of tradition • Some tastes and preferences becoming cosmopolitan 12

13. Economic Differences • Consumer behavior is influenced by economic development • Consumers in highly developed countries tend to have extra performance attributes in their products • Consumers in less developed countries tend not to demand these extra performance attributes 13

14. Product and Technical Standards • Government standards can prevent the introduction of global products • Different technical standards impede global markets, as well • Come from idiosyncratic decisions made long ago 14

15. In India, McDonald’s serves chicken, fish, and vegetable burgers, and the Maharaja Mac—two all-mutton patties, special sauce, lettuce, cheese, pickles, onions, on a sesame-seed bun. 15

16. Marketing Mix:Place 16

17. Distribution Strategy • Three different distribution systems: • Retail concentration: number of retailers • Cost/benefit of each alternative vary from country to country • Channel length: levels of channel members • Longer the channel in a country, the higher the price • Shorter channel in a country, lower price • Channel exclusivity: access • Match to positioning of product in country 17

18. A Typical Distribution System Manufacturer Inside the Country Manufacturer Outside the Country Import Agent Wholesale Distributor Retail Distributor Final Customer 18

19. Marketing Mix: Price 19

20. International Pricing Twelve European Union countries have adopted the euro as a common currency, creating “pricing transparency” and forcing companies to harmonize their prices throughout Europe 20

21. Pricing Strategy • Price discrimination • Strategic pricing • Regulatory factors 21

22. Pricing Strategy • Price discrimination: Different prices, different countries, same product • Charging what the market will bear • Two factors: • Must keep national markets separate • Different price elasticities • Arbitrage:Charging different prices in different countries for same product • Doesn’t always work • Sometimes it does • Income level and competitive conditions determine elasticity • Elasticity (price) tends to be greater in countries with low income levels • Elasticity (demand) tends to be greater in countries where there are many competitors 22

23. Strategic Pricing • Predatory pricing: • Using price as a competitive weapon • Multipoint pricing strategy: • When two or more international firms compete against each other in two or more national markets • A firm’s pricing strategy in one market may impact a rival in another market • Experience curve pricing: • Firms price low worldwide to build market share. Incurred losses are made up as company moves down experience curve 23

24. Marketing Mix: Promotion 24

25. Communications Strategy • Effectiveness of international communications can be impacted by: • Cultural barriers. • Need to develop cross-cultural literacy • Source and country of origin effects • Receiver of the message evaluates it based upon the status of the sender • Country of origin effects: • Emphasize/de-emphasize foreign origin • Noise levels • Tends to reduce the effectiveness of a message • Developed countries - high • Less developed countries - low • Push versus Pull: • Push emphasizes personal selling • Pull depends on mass media advertising 25

26. Deciding on the Global Marketing Organization • Organize an export department • Create international divisions • Geographical organizations • World product groups • International subsidiaries • Become a global organization 26

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28. Thank you for your listening 28