Principles of Marketing L11

International marketing

Principles of Marketing

Dr. Norman Peng Sr. Lecturer in Marketing



Last week

• Last week, we discussed service marketing, marketing for non-profit organisation, and the ethical issues…

• Finally, we will discuss international marketing


Why market internationally?

• Saturated domestic market • Smaller domestic markets• Low growth domestic markets • Customer drivers• Competitive forces• Cost factors• Portfolio balance


Mobile phone for example

• Domestic market, customers, competition, cost – UK #of phone/population= 122.95% – UK number of phones= 75,750, 000– China #of phone/population= 55.97% – China number of phones= 747,380,000– India #of phone/population= 44.73% – India number of phones= 525,147,922


Which international market to explore?

• PEST– Political and legal • copy right, bribery, political structure

– Economic • GDP, saving habit, # of rich and poor people … etc.

– US per capita= $46,443; Japan per capita= $ 39,573; South Korea= $16,450; China= $ 3,566



Which international market to explore?- Macro

• Social– Family structure• Birth rate (France: 2.36; Hong Kong: 0.97)

– Age structure • Baby-boomer (Japan: 82.6; Russia: 65.5)

• Technology – TV per household, internet access



• Culture – Culture, geographic, language • Examples

Individual

culture

Universal


Cultural dimensions


Culture

• Shared knowledge, beliefs, art, morals, law, customs…

• Culture can be expressed through: – Symbols- McDonalds, Nike – Hero- Harry Potter, Micky Mouse – Rituals- ways of conduct business and political meetings– Values- good/bad, lucky/unlucky… etc



Culture dimensions

• High context vs low context• Conflicts situation • Decision making and thinking pattern • Risk taking• Time (Monochronic vs polychronic-time)


Culture dimensions

• Hofstede’s IBM study – High vs Low power distance – Individualist vs collectivist – Masculinity vs feminity – High vs Low uncertainty avoidance – Long vs short-term oriented


International Marketing Strategy and Marketing Mix



• Market attractiveness – Size, competition, cost of serving this market,

profit potential, market access • Company capability – Skill, resources, products, competitive advantages


Entry strategy

• Indirect exporting – Agent, merchant, cooperative • Zara and H&M

• Direct exporting – Foreign agent or domestic sales rep.?– Overseas subsidiary – Internet


Entry strategy

• Licensing – Licensing • TV programmes

– Franchising • McDonalds

– http://www.the-franchise-shop.com/list/524/McDonalds-Franchise.html

• Joint venture/strategic alliance – Two companies create a new company • Sony Ericsson




Entry strategy

• Direct investment / direct subsidiaries – New facilities – Acquisitions

• Things to consider – Risk of losing proprietary information – Resource required – Level of control


International setting- Product and Promotion

• Product– Ikea

• Promotion – Globalisation and Localisation


International setting- Promotion

• Toward a global advertising culture?– TV, international advertising firm, mobility and

education– US count for 75% of the television export

• Basic assumption – Similar needs, emotion and frame of mind in

evaluating information– Different in the product/service to satisfy that need,

how emotions are expressed, ways of evaluating information



• Advantage for globalised campaign – Cost control, simplified planning– Uniform brand image– Maximise the use of good ideas– Quality control – Knowledge sharing



• How dog barks in different countries– Woof-woof in Italy and Britain – Wuff-wulff for Austrian– Vov-vov for Norwegian – And Ham-ham for Romanian

• Regulation – Advertising targeting at children (Sweden) – Alcohol advertising (France) – Blue jeans appear in ad (Malaysia)



• Advantage for localised campaign – Culture, mentality and product usage– Country of origin – Local regulation and competition

• Strategic choice– Global consumer culture positioning – Foreign consumer culture positioning – Domestic consumer culture positioning




• Think global act local• HQ and local office relationship– Strategic versus tactic

• Type of product is most important – Industrial versus consumer


International setting- distribution

• Place/distribution– Retail environment – maturity of consumer• Refund policy

– infrastructure • motorway, airport, seaport

– Middlemen



International setting- pricing

• Pricing – Uniform or price

discriminating strategy


Ultimately…

• Centralisation or decentralisation?– Level of control required – The cost


Thank you

Any Questions?

Principles of Marketing L11

Documents

exampledomestic market

service marketing

china number of phones

macro culture culture

uk number of phones

india number of phones

domestic sales

customs culture