Advanced Marketing

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Advanced Marketing

• Session 1
• INTERNATIONAL MARKETING

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• Agenda
• Review over general marketing
• International marketing definition
• Factors affecting economy in the USA
• International marketing task
• Major obstacles and barriers for international
  marketing
• Stages of international marketing

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Subjects we have discussed before in previous
marketing course

• The evolution of marketing was and sales over
  times starting from the production era till the
  societal marketing.
• Studied the 4ps and their importance in writing
  the marketing plan
• Importance of marketing research and knowledge
  before taking any decision in business
• Positioning, branding and targeting customers,
  segmentation

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let's start a new and more professional level of
marketing
INTERNATIONAL MARKETING
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Foreign markets and trade lines between countries
is know thousands of years ago.

1. Chinese silk has been available in Europe since
   Roman times!
2. Turkish coffee
3. Egyptian cotton

Although a truly global trading system would not
evolve until some 500 years later those people
had the sense of marketing and specially
INTERNATIONAL MARKETING
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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 users in more than
one nation at a profit.
Simply The difference between domestic
"internal" marketing and international market is
that in the latter case, marketing activities
take place in different countries.
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1st we need to know Why companies go
international marketing?

1. More Profit of course it will improve the
   economic state of the country and will bring more
   profit to the company
2. Reputation and More exposure this may be
   important for tourism, etc.
3. Cheaper labor and cost places like china, labor
   costs much less. So some businesses may go open
   factories and establish businesses there.
4. High competition from international companies in
   their local markets so they can compensate losses
   due to foreign competition many companies are
   owned by foreigners.

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As the 1st country to apply international
marketing by its modern concept
The United States Of America became one of the
most economic powerful countries in the world As
a result of that Economically the whole world is
affected by business in America.
As we need to know more about American markets
and economy here are the factors that affected
the American and the global markets as well
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A- The factors that negatively affected the
American markets internationally are mainly

1. The high-tech bust of 2001
2. Enron and WorldCom scandals
3. September 11th attacks on the World Trade Center
   and Pentagon
4. Wars in Afghanistan and Iraq
5. International conflict among China, Taiwan, and
   the United States
6. 2003 SARS outbreak in Asia
7. Global terrorism, e.g., Indonesia, Israel, India,
   and Morocco

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B- The factors that positively affected the
American International markets are
1- Regional free trade E.g. NAFTA USA
increased it exports to Canada and Mexico by
157 Mexico Canada increased their exports to
USA by 250 European Union is the biggest
supporter For the American community 2-
Globalization Impact of the Internet and other
global media on the dissolution of national
borders
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• All these factors give us a proof that wherever
• A business decision is made
• A natural disaster happens
• A scandal or even a rumor is raised
• It doesnt only affect the country it happened in
  but also affect all the international markets.

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• The international marketing task
• The international marketer's task is more
  complicated than that of the domestic marketer
  because the international marketer must deal with
  at least two levels of uncontrollable uncertainty
  instead of one.
• Uncertainty is created by the uncontrollable
  elements of all business environments, but each
  foreign country in which a company operates adds
  its own unique set of uncontrollable factors.

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Controllable environment factors that you can
control or you are the one who are deciding them
according to your own vision and objectives.

• 4Ps of your plan
• 1st of all you should know yourself well, your
  position in the market.
• You should have complete knowledge about you own
  products, prices categories, places of
  distribution and how are you promoting your
  products.
• How you position yourself in the market?
• What is your brand image?
• What are the segments you are working on?

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"Uncontrollable" domestic environment are the
factors you cannot control in your own country.
But it's very important to study them because the
affect your business either in your own country
or internationally.

1. Competition e.g. Kodak in U.S
2. Economy
3. Political regulations

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"Uncontrollable" foreign environment for sure it
is very important to study the foreign
environment to know where you are going and to be
prepared to face differences and adapt to
differences.

1. Structure of distribution
2. Geography
3. Infrastructure
4. Competition
5. Technology
6. Economy
7. Culture
8. Political regulations

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From the previous after we know the international
marketing task we can conclude that
The only constant in international marketing
is DIFFERENCE either in culture, political
regulations, economy, technological status, etc.
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Therefore
ENVIRONMENTAL ADAPTION IS NEEDED

• The most challenging and important one
  confronting international marketers
• Marketers must be able to interpret effectively
  the influence and impact of each of the
  uncontrollable environment element on the
  marketing plan for each foreign market in which
  they hope to do business.

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The major obstacles for adapting to different
cultures are
Self-Reference criterion "SRC It is an
unconscious reference to ones own cultural
values, experiences, and knowledge as a basis for
decisions.
Ethnocentrism It refers to the notion that
ones own culture or company knows best how to do
things.
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To AVOID SRC

• Define goals in your own country and your values.
• Define goals in foreign market and their culture
  and beliefs.
• Isolate the SRC influence study how
• it complicated the problem.
• Redefine the problem without SRC.

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Culture is not the only obstacle in international
marketing but also we face

1. Historical events between nations influence
   business
2. Geography
3. Natural Resources
4. Protectionism
5. The Impact of Tariff (Tax) Barriers
6. Non-Tariff Barriers

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• Historical events between nations influence
  business
• The impact of specific events in history can be
  seen reflected in technology, social
  institutions, cultural values, and even consumer
  behavior.
• The military conflicts in the Middle East in new
  cola brands, Mecca Cola, Muslim Up, and Arab
  Cola.
• Geography Natural resources
• Countries with hostile climates associated with
  economic stagnation.
• Countries that suffer the most from major
  calamities disasters are among the poorest in
  the world.
• USA consumes 17 million barrels of petroleum, so
  they export 54 from Middle East
• Influences ability to market products.

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Protectionism Countries use protectionist
measures to shield a countrys markets from
intrusion by foreign competition and imports.

• Maintain employment and reduce unemployment.
• Increase of business size.
• Protection of the home market.
• Encouragement of capital accumulation.
• Maintenance of the standard of living and real
  wages.
• Conservation of natural resources.
• Protection of an infant industry.
• Industrialization of a low-wage nation.
• National defense.

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• The Impact of Tariff (Tax) Barriers
• Increase Inflationary pressures, Government
  control and political considerations in economic
  matters and Special interests privileges.
• Weaken Balance-of-payments positions,
• Supply-and-demand patterns,
• International relations (they can start trade
  wars).
• Restrict Manufacturer supply sources,
• Choices available to consumers, Competition.
• Non-Tariff Barriers
• Specific Limitations on Trade
• Customs and Administrative Entry Procedures
• Standards
• Government Participation in Trade

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• To be globally aware is to have
• Tolerant of Cultural Differences
• Knowledgeable of
• (a) Culture
• (b) History
• (c) World Market Potential,
• (d) Global Economic
• (e) Social and Political Trends

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Stages of international marketing involvement

1. No Direct Foreign Marketing
2. Infrequent Foreign Marketing
3. Regular Foreign Marketing
4. International Marketing
5. Global Marketing

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• No Direct Foreign Marketing
• In this stage company does not cultivate
  customers in other countries
• their product may be available there as some
  retailer bought it from abroad and reselling them
  inside his home country
• This also can be known from inquiries or orders
  for the product from a country where the product
  doesn't present and this will be through the
  website of the company.

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• Infrequent Foreign Marketing
• In this stage temporary surplus caused by
  variation in production level or demand may
  result in infrequent marketing overseas.
• i.e. this year I have a huge surplus so I will
  provide my products in foreign markets but last
  year I had no enough surplus so I didnt.

• Regular Foreign Marketing
• The firm has a permanent productive capacity
  devoted to the production of goods to be marketed
  in foreign markets.
• The firm may have overseas intermediaries or may
  be it has its own sales force there. E.g. "Red
  Bull" in Egypt

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• International Marketing
• Companies in this stage are fully committed to
  and involved in international marketing
  activities.
• Such companies seek markets allover the world and
  sell products that are a result of planned
  production for markets in various countries.
• This planning entails not only the marketing but
  also the production of goods outside the home
  market.
• E.g. when "Nestle" first entered Egypt for the
  market of ice-cream then they bought "Kimo
  ice-cream"

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• Global Marketing
• The transition from international marketing to
  global marketing is often catalyzed by a
  company's crossing the threshold "limit or roof"
  at which more than one half its sales revenues
  come from abroad.
• At global marketing level the most profound
  change is the orientation of the company towards
  the markets including their domestic market as
  well.
• At this stage the company treats the whole world
  as one market.
• e.g. McDonald's

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Strategic orientation of international
marketing EPRG Schema

1. Ethnocentric or Domestic Marketing Extension
   Concept
2. Polycentric or Multi-Domestic Marketing Concept
3. Regiocentric
4. Geocentric

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• Ethnocentric or Domestic Marketing Extension
  Concept
• Home country marketing practices will succeed
  elsewhere without adaptation
• International marketing is viewed as secondary to
  domestic operations.
• e.g. TGI Fridays

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• 2.Polycentric or Multi-Domestic Marketing
  Concept
• Opposite of ethnocentrism .
• Management of these multinational firms place
  importance
• on international operations as a source for
  profits.
• Management believes that each country is unique
• and allows each to develop own marketing
  strategies locally.
• E.g. Gerber Pepsi

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• 3. Regiocentric and Geocentric
• Regiocentric and Geocentric are synonymous with a
  Global Marketing Orientation where a uniform.
• Standardized marketing strategy is used for
  several countries, countries in a region, or the
  entire world.
• Sees the world as one market and develops a
  standardized marketing strategy for the entire
  world
• E.g. Carrefour

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Questions
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