International Marketing

BMU 08105
 Introduction
• Today the corporate world cannot survive with
restricting themselves within the domestic
boundaries. As the consumers across countries
become more universal in nature, the need to
look at the whole world as a market is
growing.
• Whether an organization markets its goods and
services domestically or internationally, the
definition of marketing still applies. However,
the scope of marketing is broadened when the
organization decides to sell across
international boundaries, this being primarily
due to the numerous other dimensions which
the organization has to account for.
 Introduction
• Interest in international marketing can be
explained by changing competitive structures,
coupled with shifts in demand characteristics in
markets throughout the world. With the increasing
globalization of markets, companies find they are
unavoidably enmeshed with foreign customers,
competitors, and suppliers, even within their own
borders. They face competition on all fronts—
from domestic firms and from foreign firms.
 Introduction
• The remarkable growth of the global economy
over the past years has been shaped by the
dynamic interplay of various driving forces.
During most of those decades, companies from
different parts of the world in different
industries achieved great success by pursuing
international, multinational, or global
strategies.
 Driving forces
• Converging market needs and wants,
• Technology advances,
• Pressure to cut costs, pressure to improve quality, competition
• Improvements in communication and transportation technology,
• Global economic growth and the rapid growth of regional free
trade areas such as EU(European Union), NAFTA(The North
American Free Trade Agreement), EAC(East Africa Community)
and APEC(the Asian-Pasific Economic Cooperation).
• and opportunities for leverage all represent important driving
forces; any industry subject to these forces is a candidate for
globalization.
 Introduction
• Since the end of world war 11, a world marketplace has become
reality.
• Many companies have found that global markets offer far greater
potential than their domestic market, especially for products that has
saturate from domestic market eg Coca Cola.
• Interest in International marketing has increased because trade among
nations has exploded since the late 1950s.Nations have ofcourse, been
trading for centuries. Improvement in communication and
transportation since the 1940 and 1950s, however, have allowed
consumer worldwide to learn about goods and services available
beyond their national borders. Consumers have begun to demand
these goods and services, thus creating the opportunities that have
spurred growth.
 Introduction
• The globalization of markets and competition necessitates
all managers to pay attention to the global environment.
• Today, seeing into the future is harder than ever. Any
executive experienced in international business will
verify that things never go as planned in global
commerce. you still have to plan and forecast,
international markets are ultimately unpredictable. The
natural fluctuations in markets are best managed through
building interpersonal and commercial relationship and
broad portifolio of business. Flexibility means survival.
 Define International marketing
• International marketing is 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 coordinated marketing process
undertaken in several countries.

• Cateora and Graham(2005)International Marketing

is the performance of business activities designed
to plan, price , promote and direct the flow of a
company’s goods and services to consumers or user
in more than one nation for a profit..
 Define International marketing
• According
to Terpstra and Sorathy, “international marketing
consists of finding and satisfying global customer
needs better than the competition, both domestic
and international and of coordinating marketing
activities with in the constraints of the global
environment.
• Ghauri and Cateora(2009)International marketing
is the performance of business activities that direct
the flow of company’s goods and services to
consumers or users in more than one nation for a
profit (Ghauri and Cateora,2009)
 The International Marketing Task
• Marketing concepts, processes and principles are universally applicable,
whether doing business in china, Texas or Dar es salaam Tanzania. Even
though marketing principles and concepts are universally applicable, the
environment within which the marketer implement marketing plans can
change dramatically from country to country. The difficulties created by
different environments are the international marketer's primary concern.
• We have seen one definition defined international marketing by just
adding the term 'multinational' to the definition of marketing, Due to this
fact, one may get the impression that international marketing is nothing but
expansion of domestic marketing mix on a large scale. however, that
impression is not true, because international marketing is not a simple
extension of the domestic marketing mix to various countries.
 The International Marketing Task

• The answer lies not with different concepts of marketing

but with the environment within which marketing plans
must be implemented. Competition, legal restraints,
government controls, weather, unpredictable consumers,
and any number of other uncontrollable elements do
affect the profitable outcome of sound marketing plans.
What makes marketing interesting is the challenge of
molding the controllable elements of marketing decisions
(product, price, promotion, and place) within the
framework of the uncontrollable elements of the market
place
 The International Marketing Task

Developing a marketing strategy to compete effectively in the world

market is one of the most critical challenges facing the firms today.
Firms that market their products only in their home countries are
influenced by the environmental forces operating in the domestic
market only. However, in today's global economy, most corporations
must anticipate and respond to opportunities and threats presented by
forces in both the domestic environment and foreign environment.
Weather the firm concentrates on a few markets close to home or target
many markets throughout the world, a long run dynamic
strategy must be formulated to provide the firm with a sustainable
competitive advantage. This strategy should, at the same time, enable
the firm to ' anticipate, respond and adapt to the complexity and rapid
pace of various environmental changes taking place in' the global
market. Since no business firm can by itself, control the forces in
international marketing environment, it must take the environmental
factors as and adapt its business strategy to suit the environmental
factors. Example the new normal of COVID 19
• Environment adjustment is needed. To adjust and
adapt a marketing programs to foreign markets ,
marketers must be able to interpret effectively the
influence and the impact of each of uncontrollable
environmental elements on the marketing plan for
each foreign market in which they hope to do
business. In broad sense, the uncontrollable element
constitute the culture, the difficulty facing marketers
in adjusting to the culture lies in recognizing their
impact.
• When marketers operate in other cultures, marketing
attempts may fail because of unconscious responses
based on frames of reference acceptable in one’s
own culture but unacceptable in different
surroundings. To avoid such errors, the foreign
marketer should be aware of the principle of
marketing relativism means marketing strategies
and judgments are based on experience, and
experience is interpreted by each marketer in term
of his or her own culture and experience.
• The key to successful international marketing is adaptation
to the environmental differences from one market to
another. Adaptation is conscious efforts on the part of the
international marketer to anticipate the influence of both
the foreign and domestic uncontrollable environment on
marketing mix, and then to adjust marketing mix to
minimize the effects. And the primary obstacle to success
in international marketing is a person’s self reference
criterion(SRC) in making decisions, that is an unconscious
reference to one’s own culture value, experience and
knowledge as a basis for decision making.
 International marketing concept .
• Domestic Marketing: Marketing that is targeted exclusively at the home-
country market is called domestic marketing. A purely domestic company
operate only domestically, When it reaches growth limits, it diversifies into
new markets, products and technologies within the country instead of
entering foreign markets.

• Export Marketing: This is the first stage when the firm steps out of the
domestic market and explore market opportunities outside the country. In
export marketing, the main aim of the firm is to expand the market size.
Firm produces all its goods in the home country and exports the surplus
production to other countries. It makes full marketing efforts in the
domestic country, but do not undertake any marketing activity in the
foreign countries, It makes no effort to plan and execute marketing mix lo
the needs and requirements of the foreign markets, Thus, in export
marketing the emphasis is on expanding the market size by exporting to
other countries.
• International Marketing: marketing focus changes from just exporting to
marketing in foreign countries, Company establishes subsidiaries in the foreign
countries to undertake marketing operations.

•
• Multinational Marketing: Is the adaptation of the domestic marketing mix suitable
to the market differences in market environment in each country of operation. The
guiding philosophy of multinational marketing is that markets and ways of doing
business around the world are so unique that the only way to succeed internationally
is to adapt to the different aspects of each national market. Activities of
multinationals generally follow the principle of comparative advantage. Hamilton
A(1791) said ‘Rather than treating the foreign investor as rival, we should consider
him a valuable helper, for he increases our production and efficiency of our business
, that was true then when Hamilton said it, and it is still true now.

• Global marketing means operating as if all the country markets in company's

scope of operations (including the domestic market) are approachable as a single
global market and standardizing the marketing m& where culturally feasible and
cost effective.
 Importance of international marketing:

Importance from the consumer's point of view:

• Consumption of goods at a low price
• Enjoying benefits of competition
• Consumption of new products
• Importance from the producer's point of view:
• Export of surplus production
• Expansion of market in foreign countries
• Production of goods at a low cost
• Increase in production
• More profitable
• Reduce business risk
• Reduce cost
Importance from economic point of view:
• Increases total production
• Increases export earnings
• knowledge and cultural progress
• Increases international peace and assistantship
• Extension of industry
• Export of unusual goods
• Optimum utilization of natural resources
• Progress in technological knowledge
• Image development.
• Increase in consumption
 Reasons for a business firm to go international

• Domestic market constraints

• Domestic demand constraints drive many companies to expand the
market beyond the national boundaries. such as If the size of the domestic
market is very small, companies look forward to foreign markets to
achieve the economies of scale, recession of domestic market, The
market for a number of products tend to saturate or decline in the
advanced countries. Growth in international markets causes the growth in
demand for some products, attracting the manufacturers of these products
to internationalise. Sometimes, excess production capacity arises because
of changing demand in the domestic market.
• Government policies and regulations
• Government policies and regulations also 'motivate the firms to
internationalize. Government may impose certain restrictions on further
growth and capacity expansion of some firms within the domestic market
in order to achieve certain social objectives.
• ' 3) Growth of overseas markets
• The enormous growth potential of many foreign
markets is a very strong attraction for companies
to enter into foreign markets
• 4) Increased productivity
• Increased productivity is necessary for the
ultimate survival of a firm. This itself may lead
company to increase production and then seek
export
• 5) Relative profitability
• One of the most important objectives of internationalization’s is the profit advantage.
International business could be more profitable than the domestic. The price realized
in export markets may be relatively higher than that realized in the, home market.

• 6) Diversification to reduce business risk-A diversified export business may help in

mitigating sharp fluctuations in the overall activity of a firm

• 7) Control inflation and price rise - On several occasions, Governments permit

imports to increase the supply and control prices, thus control the inflationary
pressures on the economy. Whenever domestic prices increase, normally imports are
allowed to increase the supply and control the prices, When imported products are
available at lower price, domestic producers also reduce their prices. Without imports,
there is no pressure on domestic producers to reduce their prices, The lack of
imported product alternatives forces consumers to pay more, resulting in inflation and
excessive profits for local firms.
• This development usually acts as a prelude to workers' demand for higher wages,
further exaggerating the problems of inflation.
• 8) Counter- competition
• Many companies also take an offensive international competitive strategy
by way, of counter-competition. The strategy of counter-competition is to
penetrate the home market of the potential foreign competitor so as to
diminish its competitive strength and to protect the domestic market share
from foreign penetration. Effective counter-competition has a
destabilizing impact on the foreign company's cash .flows, product
related competitiveness and decision making about integration,
• 9) Strategic vision-The systematic and growing internationalization of
many companies is essentially part of their business policy or strategic
management. The stimulus for international come from the urge to grow,
the need to become more competitive, the need to diversify and to get
strategic advantages 'of internationalization.
 Growing Importance of International
Marketing.
• Today most business activities are global in scope, Finance, technology, research,
capital and investment flows,' production facilities, and marketing and distribution
networks all have global dimensions, Every business must be-prepared to compete
in an increasingly interdependent global economic environment and all business
people must be aware of the effects of these trends on their business. Of all the
trends affecting global business today, three stand out as the most dynamic, the
ones that will influence the shape of ‘ international business in the future:
• (1) the rapid growth of regional economic groupings areas such as North American
Free Trade Area (NAFTA), European Union (EU) and East Africa Community
• (2) the trend toward the acceptance of the free market system among developing
countries in Latin America, Asia and Eastern Europe; and,
• (3) from these two, the evolution of large and emerging markets.
• Developing countries will see the highest economic growth as they come closer to
the standards of living of the develop world. Language, financial stability,
economic system and local cultural factors can influence which markets you should
favor. China, Brazil, Singapore
• Communication
• More intense and more rapid communication allow customer everywhere to purchase
products made anywhere around the globe and to access the information about what to
buy

• Demographic shifts
• The population of industrialized world is aging while many developing countries still
have very youthful population.
• Innovation
• The pace of innovation is increasing as many companies develop new products and
improve new version of traditional products.

• Increased Competition
• As more business enter international markets, Western companies will see increased
competition.
• Today, global marketing is essential not only for the realization of the full
potential of a business, but even for the survival of the businesses, A
company that fails to go global is in danger of losing its domestic business to
international competitors with lower costs, greater experience, better
products, and in a nut shell, more value for the consumer.
•  
• The challenge of international marketing is to develop strategic plans that are
competitive in the intensifying global markets. These and other issues
affecting the world economy, trade, markets, and competition.
• In most industries it is clear that the companies that will survive and prosper
in the 21st century will be global enterprises. Companies that do not face the
challenges and opportunities of going to global will be absorbed by more
dynamic enterprises; the others will simply disappear in the wake of the more
dynamic competitors.
• With vivid examples, differentiate between
domestic and international marketing.
• Submission date: Monday 27/november/2019
• Time 14hrs
• Business goal is to make a profit by
promoting, pricing, and distributing the
product for which there is a market. If this is
the case, what is the difference between
domestic and international marketing
• Individual Assignment One. Submission Date: 5th
January, 2021 9hrs
• With Vivid examples differentiate domestic and
international marketing. Describe the contribution of
each in business operations. (Not more than two pages)
• GROUP ASSIGNMENT Submission date:6thJanuary,2021
• Identify and describe commercial documentations in
international marketing. With vivid examples describe
the documents required when importing a motor
vehicle to Tanzania.