Theories, approaches, issues and motives related to international marketing
International marketing or the global marketing based activities are performed in on an international level. The strategies related to international marketing are developed within the home country and are further implemented in different other areas of market. The process of international marketing is based on the application of different marketing based principles which are helpful in satisfying wants and needs of people who reside across the national borders (Ahi et al., 2017). The marketing activities are performed in multiple nations of the world. The decision of the organization based on entering the new markets is based on international marketing based operations. Different factors which are able to affect the international marketing activities include, high levels of the economies of scale, large share in the market, international market that is untapped in nature (Brouthers, Nakos & Dimitratos, 2015).
The report will be based on the analysis of different theories which are related to different theories which can be implemented in order to analyse different opportunities. The analysis will consider strategies which are used by the organizations in order to research the international market based opportunities.
As discussed by Cavusgil et al. (2014), international marketing based activities which are performed by multinational organizations are related to different theories that are used by them. Different theories which can be implemented in the process of international marketing include, Ansoff matrix, balanced scorecard, marketing mix, SWOT analysis, decision making process of consumers, stakeholder mapping, Porter’s five forces model, PESTEL analysis.
According to Christofi, Leonidou and Vrontis (2017), PESTEL analysis framework can be considered to be an important process which is used by the multinational organizations in order to operate in a successful manner. The framework is mainly used for the purpose of analysing different factors including, political factors which are based on the political condition of the country in which an organization plans to enter. Different factors which are able to affect the international marketing activities are foreign policy, tax policy, environmental law, labour law and trade restrictions. The economic condition of the country based on factors like, interest rates, economic growth, inflation, exchange rates and disposable income of the consumers. Socio-cultural factors are also helpful in analysing age distribution, population growth, career attitudes and health consciousness. The fast technological changes which take place in the environment are analysed by the technological factors in the framework. The legal and environmental framework is also analysed effectively with the help of this framework.
According to Forsgren and Johanson (2014), Porter’s five forces framework is used by the multinational organizations in order to analyse the industry of the country in which it plans to enter. The industry analysis will be able to play a key role in the ways by which the global organization can develop different strategies required for effective operations. The five important forces which are analysed with the help of Porter’s five forces framework include, power of the buyers, power of the suppliers, levels of competitive rivalry, threats based on the new entrants and threats related to substitution.
Researching the international market based opportunities
According to Gillespie and Riddle (2015), the global organizations need to analyse opportunities which are offered by the international markets. The organizations are provided with eight major ways which are based on analysing the opportunities which are present in the international market. Consumer segmentation is considered to be a process which is helpful in the identification of different consumer segments. The analysis of purchase based situation is considered to be another major process is helpful for examining different factors like, payment based methods, distribution channels. The direct competition which can be faced by the organization in a new country needs to be examined in order to develop effective competitive advantage. The levels of indirect competition are also analysed by global organizations in order to understand the customer segments in an effective manner.
As argued by Gürhan-Canli, Sarial-Abi and Hayran (2018), the complementary services and products which can be offered by the organization in new market area are able to play a key role in the effective operations. The global or multinational organizations also need to analyse various industries which are operating in the country. The organizations need to analyse the foreign markets in order to understand the levels of saturation and the opportunities which are provided to them. The external environment of the organization needs to be analysed in an effective manner in order to operate effectively within the industry. The differences which are prevalent in the external environment of the two countries and opportunities which can be used by the organization are considered to be an important part of the analysis.
Globalization has been considered to be an important process which is based on the ways by which an international organization aims at increasing the levels of profitability and revenues by entering a different market. The activities based on globalization are affected by different factors which include, economic issues, social issues, political issues and the cultural issues as well (Kaynak, 2014).
According to Khemchotigoon and Kaenmanee (2015), the economic activities which are performed between different countries are based on technology, cross border based movement of different goods, information. The process of internationalization of the economic activities is considered to be important for the international marketing of organizations. The political factors are also considered to be highly important for the international marketing related opportunities which are used by the global organizations in the industry. The advancement of technologies and complex structure of the society is able to affect the international marketing strategies which have been developed by the organizations in an effective manner. The changes which take place in different factors including, social norms, morality, civic sense are considered to be important for the ways by which the international organizations are able to operate. Cultural factors which are present in the country are able to affect the international strategies and marketing based operations as well (Liu, 2017).
The international marketing related activities which are performed by different organizations are affected and influenced by different factors that are able to reduce the levels of profitability and revenues as well. The organizations can operate in a profitable manner and increase their presence in the industry with the help of expansion of operations. The multinational organizations are able to operate in a profitable manner with the help of different expansion based activities that are performed by them (Ogasavara, Boehe & Barin Cruz, 2016). The international marketing related strategies are further developed by the organization in order to operate profitably in the industry. The organization will be able to develop its position in the industry with the help of proper levels of expansion and presence in the industry as well.
Social, political, economic and cultural issues related to international marketing
According to Samiee, Chabowski and Hult (2015), market selection is able to play a major role in the ways by which the international organizations are able to expand the operations effectively. The process of market selection is based on the following steps,
- International marketing based objectives – This is considered to be the first step in market selection based process which helps in determining the objectives related to export marketing. The selected market is able to serve different objectives which are based on international marketing and is suitable for the operations of different international organizations as well (Skarmeas, Zeriti & Baltas, 2016).
- Parameters based on selection – The proper selection and evaluation of markets is able to play a major role in the development of effective parameters. The parameters which are thereby used by the organizations in order to operate in the industry include, international environment, resources of the firm, nature based on competition, situation in the market and nature of the levels of competition (Skarmeas, Zeriti & Baltas, 2016).
- Preliminary screening – The major objective which is related to preliminary screening is based on the ways markets with least potential are eliminated. The parameters which are used for screening are different for the organizations.
- Short listing of the markets – After the elimination of different markets, the areas in which the organization can aim at expanding the operations can be shortlisted. This process of shortlisting is based on the information which is gathered based on the markets (Sun, Paswan & Tieslau, 2016).
- Evaluation and selection – The markets which have already been shortlisted are thereby evaluated with the help of cost-benefit based analysis. The markets are provided with ranks based on evaluation which has been made related to the market.
- Test marketing – The selected market can be tested effectively with the help of different products which are launched by the organization. This process is also helpful in providing feedback to producers based on the market (Winit et al., 2014).
- Commercial production – This is considered to be the last step in the process of proper market selection process. The last step thereby requires the minor levels of changes which can be made on the product mix offered by the organization (Sun, Paswan & Tieslau, 2016).
According to Skarmeas, Zeriti and Baltas (2016), the process which is used by an organization in order to enter the foreign market is able to help in the development of effective strategies which can help in proper and sustainable operations. The results and revenue levels of the organizations are based on the modes of entry which have been used by the international firms. Different types of strategies which can be used by the organizations in order to enter the international markets are as follows,
Exporting – This is considered to be a process which is based on the marketing and direct sales based activities of the goods which are produced on a domestic level and offered to the customers in the foreign markets.
Licensing – This process mainly permits the organization which operates in the target country in order to use the property of licensor. The fees are paid by the licensee for the rights which are provided to them (Gürhan-Canli, Sarial-Abi & Hayran, 2018).
Joint venture – The joint venture based activities are related to different factors which include, reward or risk sharing, market entry, development of products and sharing of the technologies. The organizations are provided by distribution based channels and political connections in the new area of operations (Liu, 2017).
Foreign direct investment – The process of foreign direct investment or FDI is based on direct ownership of different facilities which are provided in the target country. The direct ownership based process is thereby based on the high degrees of control which are available in the operations and ability based on understanding the consumers and competitive environment as well (Sun, Paswan & Tieslau, 2016).
The mode of market entry is selected by the organization with respect to the needs and demands of the consumers and the operational capabilities as well. The international organizations thereby need to be decide the mode of market entry with respect to the ways by which profitability and revenues can be increased (Papadopoulos & Heslop, 2014).
Planning is considered to be a major step which is based on the activities that are performed by the international organizations which include, advertising, promotional activities and marketing. The needs of customers need to be analysed with the help of proper marketing based plans. The marketing plans which have been developed by the organization are thereby related to the culture which have been implemented in different processes (Papadopoulos & Heslop, 2014).
The international marketing related strategy which is implemented by the multinational or global organizations is an important part of the operations in foreign countries. The strategy which has been developed by the organization is based on the external environment related factors.
Segmentation, targeting and positioning is considered to be a major strategic approach which is used by the international organizations in order to operate profitably in the industry. The STP model can be implemented in order to develop the market or customer segments which can be targeted effectively with the help of the products or services that are offered to them. The positioning based strategy which is used by the multinational organizations is based on the position which is developed by the organization in comparison to the others (Brouthers, Nakos & Dimitratos, 2015).
Conclusion
The report can be concluded by stating that the international organizations can implement effective strategies in order to operate effectively in other foreign markets. The different organizations however need to develop strategies with respect to their specific needs and demands in the country. The increase of presence and profitability is considered to be an important factor which is able to affect the international marketing related activities.
References
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Brouthers, K. D., Nakos, G., & Dimitratos, P. (2015). SME entrepreneurial orientation, international performance, and the moderating role of strategic alliances. Entrepreneurship Theory and Practice, 39(5), 1161-1187.
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Kaynak, E. (2014). Internationalization of companies from developing countries. Routledge.
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Skarmeas, D., Zeriti, A., & Baltas, G. (2016). Relationship value: Drivers and outcomes in international marketing channels. Journal of international marketing, 24(1), 22-40.
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