Session I-International Marketing

By: Ruturaj Baber

Unit-ISession-I

Session plan

• Introduction to International Marketing

• Definitions of International Marketing

• Motivation for International Marketing

• Domestic Vs. International Marketing

• Importance of International Marketing

• International Dimensions of Marketing

• Benefits of International Marketing

MBA-III (International Marketing) 2Session I

Definitions of International Marketing

“The performance of business activities that direct the flow of goods and services to consumer and user in more than one nation”

Hass & Cateora

“The multinational process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services that satisfy individual and organizational objectives”

American Marketing Association

“The process that allocates company’s resources without regard to national boundaries”


Motivation for international marketing (General)

• Competitive edge

• World wide integration of economies

• Technology edge and infrastructural development

• Growth in purchasing power

• Emergence of demanding customers


Motivation for international marketing (Firm Specific)

• Capacity utilization and economic advantages

• Product life cycle extension

• Experience transfer and benchmarking


Towards internationalization

• What is internationalization?

In economics, internationalization is the process of increasinginvolvement of enterprises in international markets, althoughthere is no agreed definition of internationalization.


Why firms are looking forward to internationalization?

• There are three macro factors tend to underlie the trend towards greater internationalization. They are:• The decline in trade barriers

• Removal of restrictions on foreign investment

• The dramatic change in technology


Strategies for internationalization

• International Cost Leadership Strategies

• International Differentiation Strategies

Session I MBA-III (International Marketing) 10


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Product differentiation


Factors forcing companies to go global

• Domestic competition

• To avoid dependence on domestic market

• Economies of scale


Difference between International and Domestic Marketing

1. Meaning It refers to those activities which results into transfers of goods and services from one country to another.

It refers to those activities which results into transfers of goods and services inside the country itself.

International Marketing Domestic Marketing


2. Barriers International trade is characteristics by tariff and non tariff barriers.

Domestic marketing has no such restrictions.

3. Currencies It involves exchange on the basis of different currencies.

It involves exchange in the basis of same currencies.

4.GovernmentInterference

Exchange takes place under government rules and regulations. There is high degree of government interference.

Government in interference is zero or minimum only incase of essential commodities.

5. Culture Trade should be done taking diverse into consideration. Even things like colour combination can be affect the trade.

Culture does not affect in domestic marketing.


6.Mode of Payment

Letter of credit is normally as mode of payment.

Cash, Cheques, DD’s are the most common.

7.Mobility of Factors of Production

Factors of Production are relatively immobile as compared to domestic marketing.

Domestic Trade enjoys greater mobility in factors of production.

8. Competition International Trade is subject to intense competition.

Competition is not as intense as it is in international marketing.

9. Documentation International Marketing is subject to complex documentation

Domestic trade does not involve much of documentation.


10. Risk International Marketing is subject to high risk. Political, foreign exchange risk, bad debt risk are few of them.

Domestic Marketing is also subject to risk but not as high as international marketing


Importance of International Marketing

• Now follows the importance of international marketing:• Importance from customer point of view

• Importance from producer’s point of view

• Importance from economic point of view


Importance from customer point of view

• Consumption of goods at a low price

• Enjoying benefits of competition

• Consumption of new products

• Increase in consumption


Importance from 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 cost


Importance from economic point of view

• Increases total production

• Increases export earnings

• knowledge and cultural progress

• Increases international cooperation

• Extension of industry

• Export of unusual goods

• Progress in technological knowledge

• Image development of country


International Dimensions of Marketing

• It becomes comparative marketing

• Usually part of international trade.

• It is concerned with micro level of market in the country.

• International, multinational and global marketing are used interchangeably


Benefits of International Marketing

• Survival

• Growth of overseas markets

• Sales and profits

• Diversification

• Inflation and price moderation

• Employment

• Standard of living


Thank You


Session I-International Marketing

Marketing

Transcript of Session I-International Marketing