Do you know what international marketing is? If not, follow this article. It will be helpful to guide you through all the different perspectives.
Marketing on a worldwide scale, reconciling or taking global operational differences, similarities, and opportunities in order to reach global objectives is called international marketing. In international marketing, people exchange goods and services across national borders to meet the customers’ requirements. It has various types, including export, licensing, franchising, joint venture, and foreign direct investment.
The preliminary decision that any company takes is to go international or not. The company may not want to globalize because of its vast market share in the domestic market and does not want to discover the new laws and rules of the international market. But some reasons attract the organization to be global. To learn more about international marketing, keep reading this article.
What is international marketing?
International marketing is the application of marketing regulations to satisfy the varied needs and desires of various people residing across national borders. People exchange goods and services across national borders to meet the client’s requirements in international business. International marketing is different from domestic marketing in the exchange and needs of international buyers. Therefore, the knowledge of and the ability to perceive a basic pattern in consumer behavior in different environments is a particularly vital element in the makeup of international marketing.
The marketer carries out marketing activities in more than one nation. He establishes a branch in the foreign market for processing, packaging, or assembling the goods according to the needs of the markets. Sometimes the branch carries out complete manufacturing through direct investments. In addition, international marketing includes establishing joint ventures and collaboration in foreign countries with some foreign firms for manufacturing and the product.
The role of the marketing manager becomes essential in this context. To work successfully in an international environment, the marketing manager must have the ability to seek and understand the environment and way of thinking regarding the consumers, competitors, suppliers, or employees in the new country. You must understand three significant dimensions of the spills of international marketing:
- Ability to perceive patterns of consumer behavior in different countries and the ability to evaluate the fundamental differences and similarities between markets.
- Competence in marketing, with a good grasp of marketing concepts, tools, and techniques.
- Management skills to organize, plan, coordinate, and control an operation of considerably greater complexity, particularly in human relationships, than in the market.
Importance of international marketing
At its most superficial level, the role of international marketing ensures that the marketing mix for a company’s product or service matches international customer needs and seeks opportunities to use a company’s competitive advantages to market other products in new or existing markets. Furthermore, the international market is essential to expanding the target market. The target market of a marketing association will be limited if it just concentrates on the domestic market.
When an organization thinks on a global level, it looks for overseas opportunities to increase its market share and customer base. International marketing may boost a brand’s reputation. A brand that sells internationally is perceived as better than a brand sold locally. People like to purchase widely available products. Hence, international marketing is essential to boost brand reputation.
International business is important in expanding the business in a global market that gives your business an advantage to connect with new customers and new business partners. In addition, the international market plays an important role in opening the door for future opportunities. It increases market shares and customer base, but it also helps the business connect to new vendors, a larger workforce, and new technologies and ways of doing business.
What is an international marketing strategy?
International marketing is the tactics and strategy used to market products and services in multiple countries. It can be in the form of import/export, franchising, licensing, and online sales. Multinational companies like Kia and Walmart have chosen an international strategy to guide their efforts across different countries.
Each strategy involves a different approach to building efficiency across nations while remaining responsive to variations in customer preferences and market conditions. There are three international strategies available listed below:
- Global Strategy
- Multidomestic strategy
- Transnational strategy
A global strategy firm sacrifices responsiveness to local requirements within each of its markets to emphasize efficiency. This strategy is the total opposite of a multi-domestic strategy. Some minor modifications to products and services may be made in different markets. Still, a global strategy stresses the requirement to gain economies of scale by offering essentially the same products or services in each market.
For example, Microsoft provides the same software programs around the world but adjusts the programs to match local languages. Similarly, consumer goods maker Procter & Gamble attempts to achieve efficiency by creating global brands whenever possible. Global strategies also can be very effective for firms whose product or service is largely hidden from the customer’s view, such as silicon chip maker Intel. For such firms, variance in local preferences is not essential.
A firm using a multidomestic strategy sacrifices efficiency to emphasize responsiveness to local requirements within each of its markets. Rather than forcing all of its American-made shows on viewers around the globe, MTV customizes the programming shown on its channels in dozens of countries, including New Zealand, Portugal, Pakistan, and India.
Similarly, food company H. J. Heinz adapts its products to meet local preferences. For example, some Indians do not eat garlic and onion, so Heinz offers them a version of its signature ketchup that does not include these two ingredients.
A firm using a transnational strategy seeks a center ground between a multidomestic strategy and a global strategy. Such a firm tries to balance the desire for efficiency with the requirement to adjust to local preferences within various countries. For example, large fast-food chains such as McDonald’s and KFC rely on the same brand names and the same core menu items across the globe. These firms make some concessions to local tastes too for a better experience.
In France, wine can be purchased at McDonald’s. This approach makes sense for McDonald’s because wine is the main element of French diets.
Types of international marketing
Export or licensing are usually the first steps for international enterprises to offer their products or services in a new country. Contract manufacturing, joint ventures, and foreign direct investments are some more types of international marketing. Meanwhile, these types of international marketing can also serve as an option to penetrate the international market. To have a closer look, check out the following types:
Exporting is the process of transporting goods directly to a foreign country. Manufacturers who want to expand their firms into new markets typically start by exporting. This is not surprising. Exporting has the minimal risk of any international marketing type on this list. It also has the most negligible impact on the organization’s human resource management.
Licensing is a contract in which a corporation, known as the licensor, permits a foreign company to use its intellectual property. It’s usually for a set period, and the licensor is compensated with royalties. Throughout the United States, there are many examples of intellectual property licensing. Patents, copyrights, industrial methods, and business names are examples of this type of international marketing. Some of the largest global licensors, as per statistics, include; Disney, Iconix Brand Group, and Warner Bros.
Franchising entails a parent company endowing foreign firm permission to conduct business in its name. On the other hand, franchises typically must follow more challenging operating requirements than licensed businesses. Service businesses, such as hotels, rental services, and restaurants, use this type of international marketing more often.
A joint venture is a partnership between two companies from different nations to gain mutual benefit. It is an equal involvement of two or more companies in a business venture in which each company:
- Contributes financial resources
- To some extent, they own the entity.
- Risk is shared.
Sony-Ericsson is probably the most well-known worldwide joint venture to date. It’s a partnership between Sony, a Japanese electronics manufacturer, and Ericsson, a Swedish telecom corporation.
Foreign direct investment
An enterprise uses FID to deploy a fixed asset in a foreign country to manufacture a product there. In contrast to joint ventures, the foreign business owns the subsidiary completely. As a result, it achieves effective control or significant influence over the decision-making process.
Mergers and acquisitions, retail, services, and logistics are examples of foreign direct investment. Several American businesses employ these worldwide marketing techniques to present their goods and services worldwide.
What are the activities involved in international marketing?
International marketing involves tasks like observing and acknowledging customers’ buying behavior, adapting to the changes in marketing trends, identifying competitors, acquiring the required information about them, and acquiring knowledge about products. Here are a few activities that are involved in international marketing mentioned below:
- Product localization
- Marketing localization
- Inbound marketing
- Outbound marketing
It doesn’t require an extensive explanation, but there is a long list of points to check. You have to check:
- Are “cookies” allowed?
- Can you make direct competitor comparisons?
- Are there labeling or disclaimer requirements?
- How will the personas of your target demographic conflict in a new market?
- What bandwidth cost and availability restrictions limit access by your target market?
- Is email penetration satisfactory, or will SMS be more effective?
- How “viral” is the civilization and your target group?
- On which local language keywords must you optimize?
- Which social media tools do your target personas lean upon?
Keep in mind just because you are keen on maintaining anonymity like many other international man readers, and find “tweeting” inane, doesn’t mean your customers do too.
Infrastructure is the dry set of administrative details you’ll seriously not regret attending to. Securing the top-level domains before enterprising squatters for your company and brands allows you to create local language microsites later, optimized for prevalent search engines in focus markets and the local Google engine. Ensure that trademarks are registered in your company name to avoid the nightmare of having your genuine product seized in customs counterfeit.
The product must be localized
Your product must be localized in the packaging; label language no gimongous’ club-store packs are sold in typical emerging markets. Distribution infrastructure is often primitive, formulation, labeling, and even suggested use.
Marketing localization is where the black magic of international marketing is involved. Here, you will leverage or squander your opportunity to accommodate local cultural expectations and capitalize on the cachet that “Made in America” still carries in many markets.
A colloquially appropriate translation that is not direct but rather an adapted message combined with proper imagery, color selection, fonts, and even output size are all localization considerations. Regarding your brand names, they should be vetted for explicit concerns and ‘sounds like’ conflicts in local languages to avoid the Nova and mist mistakes.
Communication requires that the message and marketing communications be appropriately tailored for the local market, almost as a localization element.
International inbound marketing
International inbound marketing is essentially SEO on steroids. Several factors predict the methodology:
- Buyers are increasingly savvy. They are attacked with marketing messages and practice selective consumption, rarely acknowledging marketing invitations when they want info. However, they use the internet not to visit an online brochure but rather to search for a solution.
- Google is increasingly savvy. The ranking of sites presenting solutions is based on relevance and authority. Many factors determine those, but increasingly, ‘content’ is the key. Content is fresh, high-quality material such as blog posts, eBooks, videos, whitepapers, etc., which is valuable to clients and speaks directly to long-tail keywords—for example, General liability for insurance vs. general commercial liability.
- Traffic should be excellent. You must constantly increase traffic. SEO, social media, and blogging contribute a lot to this. But traffic must convert to opportunities before it has any functional value. Chances are not ready to be assaulted by a sales rep but have some interest. That interest and the relationship with your company must be promoted. This can and should be done automatically with more content which moves them along a sales funnel.
The goal of your website is to convert traffic to prospects and capture some basic info to begin to build a relationship. And the purpose of your inbound marketing program is to have a metrics-rich tool that lets you relentlessly tweak the process. Inbound marketing has a lot of virtues, not least of which are significantly low relative cost and its unique fit to the way the world now reaches products and services.
In its international form, inbound marketing involves localizing the approach, such as keywords, content, inbound links, and other refinements, so that buyers in potential markets, searching in their language on their local search engines, will find you accessible.
Outbound marketing is the set of tools, including email, SMS, infomercial, etc., that you will use to broadcast your message as you build a following in a target market. There are many steps and layers of nuance. It’s not intuitive, and the most challenging requirement is to iterate in one market after another. The payoff is a substantially higher return on your investment in internationalizing your business. Consider it as “juicing” the returns while simultaneously reducing risk.
Advantages of international marketing
Before stepping on the ground of international business, learn the advantages of international marketing. A few of them are discussed below:
Rapid industrial growth
Demand for new goods is formed through the international market. It leads to growth in the industrial economy. The industrial development of a nation is guided by international marketing. For example, new job opportunities, entire utilization of natural resources, etc.
International cooperation and world peace
Trade relations established through international marketing bring all the nations closer to one another and give them the chance to sort out their differences through mutual understanding. It also encourages the countries to work collaboratively with one another. This thereby designs a cycle wherein developed countries help developing countries in their developmental activities, removing economic disparities and technological gaps between the countries.
Facilities cultural exchange
International marketing makes social and cultural interaction possible between different countries of the world. Along with the goods, the current trends and fashions followed in one nation pass to another, developing cultural relations among nations. Thus, cultural integration is achieved at the global level.
Provides a higher standard of living
International marketing ensures a high standard lifestyle and wealth to citizens of nations participating in international marketing. Goods and products that cannot be produced in your home country due to particular geographical restrictions prevailing in the country are made by countries with abundant raw materials required for production and no restrictions imposed on production.
Benefits of comparative cost
International marketing provides comparative cost benefits to all the participating countries. These countries benefit from the division of labor and specialization at the international level through global marketing.
Ensures rational and optimum utilization of resources
Logical allocation of resources and ensuring their best use at the international level is one of the international marketing. It invites all the nations to export whatever is available as excess. For example, raw materials, crude oil, consumer goods, and even machinery and services.
Better utilization of surplus production
Google produced in surplus in one country is shipped to other countries that require the goods in international marketing. Thus, the foreign exchange of products between exporting countries and importing countries meets the needs of each other. It is possible only when the participating countries effectively use surplus goods, services, raw materials, etc.
The significant advantages of international marketing include effective utilization of surplus domestic production, the introduction of new varieties of goods, improvements in the quality of production, and the promotion of cooperation among countries.
Availability of foreign exchange
International marketing soothes the availability of foreign exchange required for importing capital goods, modern technology, and m any more. Fundamental imports of items can be sponsored by the foreign exchange earned due to exports.
Special benefits in the event of an emergency
Whenever a country faces natural mishaps like floods & famines, it is supported by other countries in the international market. The international market provides an emergency supply of goods and services to meet the urgent requirements of the country facing calamity. This distribution can only be facilitated by a country that has surplus imports. A company exporting goods to other foreign countries earns substantial profit through export operations as domestic marketing is less profitable than international marketing.
The loss a company suffers in domestic marketing can be reimbursed from the profit earned through exports in international marketing. Foreign exchange can be acquired by exporting goods to foreign countries. Thus, the profit gained can be used to import essential goods, new machinery, technology, etc. This would further boost large-scale export in the future.
Example of international marketing
International marketing provides the best examples of marketing strategies by brands dominating their respective industry. You can see a few examples of powerful and brilliant international marketing strategies to help paint a picture of great international marketing.
Nike can evolve its global presence by carefully selecting international sponsorships, such as its previous long-standing relationship with Manchester United. Although sponsorship spending can be pretty unpredictable, these partnerships have certainly helped the brand capture the attention of an international audience.
Nike’s NikeID co-creation platform performs as another strategy that the company is using to appeal to international markets. By placing the power of design into the hands of the customer, Nike is able to deliver customized products that align with different cultural preferences and styles. People love the quality, and it is the most well-reputed brand.
Apple’s global marketing strategy is another excellent example of a great global marketing strategy. Though Apple took a massive risk with the size fit strategy for its iPhone design. The brand’s customer service protocol didn’t follow the exact strategy. Apple tailored its customer service protocol to serve the local taste of each market.
With a standardized design, the brand was able to make its product easily identifiable all around the world. But with its customer service protocol, they were able to precisely meet each market’s needs. These two contrasts worked perfectly for the brand.
Everybody knows McDonald’s is a successful global brand. Keeping its overarching branding invariant, McDonald’s practices “glocal” marketing efforts. McDonald’s conveys a local flavor to different countries with region-specific menu items. For instance, McDonald’s offers McArabia, a flatbread sandwich, in its restaurants in the Middle East.
McDonald’s has introduced macaroons to its French menu and added McSpaghetti to its menu in the Philippines.
Coca-Cola is an excellent example of a well-known brand for its international marketing efforts. The large corporation Coca-Cola focuses on small community programs and invests a lot of time and money in small-scale charity efforts. For example, in Egypt, Coca-Cola has built 650 clean water installations in the rustic village of Beni Suef and sponsors Ramadan meals for children across the Middle East.
In India, the brand sponsors the ‘Support My School’ initiative to enhance facilities at local schools. The brand sticks with selling an emotion that can’t get lost in translation, like happiness.
International marketing is the application of marketing regulations to satisfy the varied needs and desires of various people residing across national borders. If you want to go for international marketing, you must know its strategies and advantages that will help you more in making a decision. There are many reasons discussed here that show the importance of international marketing. International marketing is important in expanding the business in a global market, giving your business an advantage to connect with new customers and new business partners.