The Content of the Concept and the Essence of International Marketing Essay Example

beliefs regarding business practices. While some countries prefer working with set deadlines, others may perceive this as offensive. Requesting to work within a specific timeframe can be seen as insulting in many countries, as it is perceived as a threat or being cornered. Conversely, some countries attempt to streamline processes by establishing deadlines.

Having knowledge of local customs is essential for achieving success in a foreign market as it is equally vital to understand both the appropriate and inappropriate actions in a foreign country. Failing to comprehend local customs can lead to significant misunderstandings within the business community. Even a seemingly minor action like rejecting a cup of coffee can cause complete confusion, while declining an invitation may be perceived as offensive.

To avoid errors, it's important for individuals to differentiate between acceptable and unacceptable behavior. Ignoring local customs can be offensive and create uncomfortable situations. To succeed as an international marketing manager, one must be able to distinguish appropriate actions from inappropriate ones. Gaining thorough knowledge and understanding of a foreign culture is almost impossible. As stated, culture has a significant impact on the field of international marketing.

Effective communication is vital for understanding culture and avoiding cultural confusion. Companies must establish strong communication channels to connect with customers, suppliers, employees, and government entities in the countries they operate. Inadequate communication can result in various challenges, especially for new companies trying to effectively communicate with potential buyers.

The issue lies in the numerous potential communication barriers that exist. Some of these barriers include inaccurate translation, overlooked regulations, and disregard for economic differences. In other cases, even if a message is successfully delivered, it may prove to be ineffective

and worthless. Occasionally, a buyer may receive the message, but to the disappointment of the company, it was sent incorrectly.

Regular exchange of messages is common in multinational businesses, but inaccurately using titles and names can disable public speech introductions. Communication problems can occur verbally and non-verbally, with serious consequences. Non-verbal communication takes on various forms.

In some nations, a person's messy clothes can send a more powerful message than they intended. The locals are usually more forgiving of tourists' mistakes but less tolerant of business people's errors.

Understanding the various forms of communication in international marketing is crucial. In America, we often overlook product displays in the market, but this is not always the case in other countries. It is vital to recognize that despite affordability, local customers may not necessarily desire a specific product. If they do express interest, it may be contingent upon significant modifications to align with their preferences and taste.

These adaptations exist in the form of product and package. Sometimes, alteration of a material product is necessary to align it with local taste and conditions. Similarly, adaptation of the package is often essential to attract customers to the product. In addition, adaptation is frequently employed to preserve a product's integrity in a unique environment. On occasion, a company may have to modify both the product and the package to develop a suitable product for a new market. It is possible that some products may require more technical adjustments compared to others.

Different countries have different measurement systems, so components often need to be adjusted to meet local standards. The need for adapting products to fit regional requirements has been around for a

long time. For instance, in 1857, the East India Company of England possibly lost control of India because it didn't modify a product it offered. While a product may be popular in markets, it might not sell well if it is packaged in an unsuitable manner. Packaging plays a dual role of promoting and protecting the product. International packaging should be able to withstand the journey.

Some countries have experienced the frustrating phenomenon of their exported products returning in damaged and partially filled containers. Packaging can occasionally cause embarrassment for companies. In the United States, medical containers were noticed for featuring the instructions "Take off top and push in bottom." While this message was innocent in America, it had sexual and humorous connotations for the British.

Finding the appropriate package and product can present difficulties for numerous companies. Inadequate packaging has caused international sales to falter in certain instances. Each company must determine the most fitting market for their product, but this is a challenging endeavor. Regardless of the location, identifying these markets is essential because market testing plays a critical role in global marketing.

Many countries have regulations for their products and packages, with expectations that foreign marketers will comply. Failure to adhere to a country's rules can have significant financial consequences. The legal and political environment varies across borders, with each country having its own policies. Marketers engaging in international marketing must adhere to specific laws and regulations.

Consumer protection and fair competition laws exist in certain countries, which can complicate package design due to varying regulations on wording and colors. While gift-giving is a customary business practice in some nations, it is deemed as bribery or

illegal in the United States. Mistakes can be expensive, but can be rectified through appropriate modifications. The General Agreement on Tariffs and Trade (GATT) mandates that national governments relinquish local laws protecting customers and the environment.

During the mid-1980s, plans were made to enhance GATT's jurisdiction by granting it the capacity to oversee foreign investment and trade in services. If these modifications are implemented, GATT will have the authority to remove barriers to foreign investment and nullify domestic laws protecting a nation's insurance, brokerage, and banking sectors. This elimination of local legislation can undoubtedly streamline the legal aspects of the global business environment. From a marketing perspective, promoting a product can be extremely difficult.

Timing is crucial when launching a new product, as different people have different perceptions of time. Some nationalities are more time-conscious than others, so extra time is often needed to ensure that everything is completed on schedule. An international marketer can consider various strategies for their product and promotion.

Marketing a product globally with a single promotional message can be successful for products with universal appeal. This strategy is often the most cost-effective option. However, when it is challenging to translate or adapt promotions to local customs, companies opt to market a single product while tailoring its promotions.

Some products are widely recognized and require minimal advertising as they have already gained popularity nationwide. One effective advertising strategy is to focus on American influence in China. When a particular theme is successful in one country, it becomes tempting for a company to use it in another country. However, there is a significant risk involved in this approach as themes that are well received are often

culturally specific. An example of this is the highly popular Marlboro advertisements.

In America and Europe, the Marlboro man symbolizes a powerful masculine image. However, this advertisement did not resonate with the urban population in Hong Kong due to their lack of identification with countryside horseback riding. In certain countries, companies have made unsuccessful attempts to utilize traditional promotional techniques that have proven successful elsewhere. While billboard advertisements are legally allowed in most parts of the Middle East, it does not guarantee their effectiveness.

In certain situations, companies have been known to mistakenly advertise in the incorrect language, which can result in significant issues. These mistakes often stem from the promotional strategy, as the perception of product characteristics is crucial in international marketing. It is necessary to acknowledge that the significance of specific product traits differs across countries.

Multinational corporations, therefore, must consider different promotional tactics to cater to diverse markets. One approach is modifying the product while maintaining the same promotional mix, which is employed when a product may not resonate with local preferences. For instance, an American cheese company might need to alter the ingredients when producing cream cheese for different countries' markets. The most costly strategy is adapting both the product and its promotion. This approach becomes necessary when neither the existing product nor its promotion would appeal to foreign markets. Occasionally, the international firm may create an entirely new product specifically for a foreign market.

Creating a new product line for a foreign market can be expensive. The distribution strategy employed often depends on the firm's international organization, whether it involves licensing, exporting, or manufacturing in the host country. Generally, international marketers utilize existing

distribution channels to connect the product producer with the consumer or industrial user.

The flow of products in international marketing is facilitated by a sequence of marketing organizations in different countries. Shorter channels are used for most industrial products. Licensing is a fundamental level of international marketing, where one firm grants another firm permission to produce and market its product and use its brand name in exchange for a royalty or other compensation.

This grant can take the form of directly selling rights or have a limited time frame. International licensing can be connected to joint ventures between a parent company and its subsidiary. For instance, an American candy maker might engage in a licensing agreement with a British company. The British company would then have the right to utilize the American company's candy recipe and packaging to promote the candy as its own. Licensing offers the advantage of enabling expansion into a foreign market without any investment. However, if the licensee fails to maintain the quality standards of the licensor, it may harm the product's reputation.

Another drawback of licensing arrangements is that they typically do not offer the original producer any foreign marketing experience. However, technology licensing can serve as a viable alternative to exporting finished products through intermediaries or engaging in various forms of international investment. Many companies utilize intercompany licenses to safeguard the intellectual property of the parent company, which is held by its subsidiary, and also enable the subsidiary to make certain license fee payments to the parent. The suitability of licensing also depends on the characteristics of the product. Products that undergo rapid technological advancements make for favorable candidates for licensing. Additionally,

licensing serves as a gateway for large companies to enter secondary markets.

The potential licensor must consider legal and financial factors. Often, the decision to license is made when a company has no other options due to government restrictions on foreign ownership or barriers to developing a marketing network through tariffs. Licensing provides the opportunity for the licensor to enter foreign markets with minimal financial risk. The decision to license is intricate.

Joint ventures can prevent the problems encountered by companies when going overseas, as many licensing relationships fail due to a lack of understanding between parties. By combining the expertise and efforts of local and foreign firms, joint ventures can eliminate many of these problems. A joint venture is a partnership formed for a specific goal or period of time, often entered into by international corporations. These partnerships are often created to share the expensive costs associated with exploring for offshore products.

When a company considers forming a joint venture, it must carefully evaluate its options. Neglecting to thoroughly investigate potential partners often leads to problems. Analyzing licensing decisions is just as challenging as deciding to create a joint venture. Making incorrect decisions at the appropriate time can lead to the loss of significant future business opportunities and profits. Alternatively, a company can produce its goods in its home country and export them for sale in international markets.

Similar to licensing, exporting is a comparatively low-risk strategy for entering foreign markets. However, unlike licensing, it is a challenging endeavor. Exporting offers various degrees of involvement for the exporting company. At the most basic level, the company can sell its products to an export/import merchant. This merchant takes on

all the risks associated with product ownership, distribution, and sales. They may acquire the goods in the producer's home country and take charge of exporting the product.

The exporting firm has the option to send its products to an export/import agent, who will handle the sale of the products from foreign intermediaries for a fee. This agent functions as an independent firm, selling and potentially performing additional marketing tasks for the exporter. The exporter maintains ownership of the products throughout the shipment and until they are sold. Additionally, the exporter has the possibility of establishing its own sales offices in foreign nations.

These installations serve as an expansion of the company's distribution system on a global scale. The exporting company retains control over sales and acquires valuable experience and understanding of foreign markets. Eventually, the company might establish its own sales team to collaborate with overseas sales offices or branches. Pricing plays a critical role in international trade.

The pricing system commonly used in international marketing is known as cost-based pricing. This method is not as widely used in domestic marketing as it is in international marketing. The process involves the seller calculating the total cost of producing or purchasing one unit of the product, and then adding an amount for additional costs and profit. This added cost is referred to as the markup, and it determines the selling price of the product.

Markup pricing, commonly used by most businesses, involves calculating the markup as a percentage of the total cost. Despite its ease of application, this approach possesses two significant drawbacks. The first challenge lies in determining an optimal markup percentage. Should this percentage be excessively high, it

risks pricing the product beyond its market value. Conversely, should the markup percentage be too low, the seller effectively forfeits potential profit that could have been earned by setting a higher price.

To put it differently, setting the markup percentage to accommodate market operations is a challenging task. Additionally, markup pricing creates a division between pricing and other business functions. The pricing of a product takes place after determining production quantities and incurring costs, often without considering the market or the marketing mix. For optimum results, it is crucial to integrate various business functions.

Different types of pricing in international marketing have various variations. Geographic pricing strategies focus on the cost of delivery. The seller can bear the entire cost of delivery, regardless of the buyer's location. Alternatively, the seller and buyer can share transportation costs, with the seller covering most of the delivery expenses. Additionally, when a foreign product is imported into a country, it incurs a tax on its cost.

Import duties aim to safeguard particular domestic industries by increasing the prices of competing imported products. Initially, the importer bears the majority of the import duties. Subsequently, these costs are shifted onto customers in the form of higher prices, which are typically less competitive. Additionally, expenses associated with shipping and adhering to various regulations contribute to the pricing structure. Exchange rates, particularly fluctuations in these rates, also impact prices.

Financial limitations typically arise from exchange rates, which require converting local currency into foreign currency at government-imposed rates. Due to the additional expenses and uncertainties caused by exchange rates, prices in foreign markets usually exceed those in domestic markets. Income distribution is a significant economic factor to consider.

Income

distribution, particularly discretionary income, can vary significantly across countries. Discretionary income is of great importance to marketers as consumers have more control over its spending. Income affords purchasing power, making higher income countries the focus for international marketers in terms of personal, disposable, or discretionary income. However, certain producers have discovered that their products are more likely to be successful in low-income countries.

Similar to domestic marketing, the success of a product in international marketing depends on its ability to meet the needs of the target market. International marketing encompasses all business activities that involve transactions across national borders. There are various reasons why a company might choose to enter the international market, but regardless of the reason, international marketing offers an effective means of market entry. To account for variations in the business environment and target markets from one country to another, a company's marketing program must be tailored to foreign markets. This may involve adjusting elements of the marketing mix to accommodate cultural, social, economic, and legal differences.

Foreign marketing involves the comprehension of different extra expenses that have a tendency to raise the costs of goods being exported. The marketing program of an international enterprise must adjust to the requirements of a foreign market, with the primary focus on implementing strategies that help achieve the company's marketing objectives. It is crucial to avoid making false assumptions as they often lead to costly mistakes in the marketplace.