international marketing and intelligence International Marketing – Nature, comparison with domestic marketing, benefits from international marketing; Major Activities - Market assessment, An overview of product decisions, promotion, decisions, pricing decisions, distribution decisions and product life cycle in international context. Marketing, Research: Information required, sources of information; International Marketing Information System.

1. INTERNATIONAL MARKETING AND INTELLIGENCE
Unit-3
International Marketing – Nature, comparison with domestic marketing, benefits from international marketing;
Major Activities - Market assessment, An overview of product decisions, promotion, decisions, pricing decisions,
distribution decisions and product life cycle in international context. Marketing, Research: Information required,
sources of information; International Marketing Information System.
INTERNATIONAL BUSINESS ENVIRONMENT
1
VIPULKUMAR N M
Assistant Professor,
Department of Commerce,
Kristu Jayanti College, Bengaluru

2. INTRODUCTION
International marketing is the application of marketing principles by industries in one
or more than one country. It is possible for companies to conduct business in almost
any country around the world, thanks to the advances in international marketing.
The word ‘International Marketing’ is defined as the exchange of goods and services
across national borders to meet the requirements of the customers. It includes
customer analysis in foreign countries and identifying the target market.
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3. According to Kotler, "Global marketing is concerned with integrating and
standardizing marketing actions across a number of geographic markets."
According to Cateora, "International marketing is the performance of
business activities that direct the flow of goods and services to consumers
and users in more than one nation."
According to Cateora and Graham, "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 for a profit."
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DEFINITION

4. NATURE OF INTERNATIONAL MARKETING
1. Broader market is available
2. Involves at least two set of uncontrollable variables
3. Requires broader competence
4. Competition is intense
5. Involve high risk and challenges
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5. Scope of International Marketing 5
1. Export – It is a function of international business whereby goods produced in
one country are shipped to another country for further sale or trade.
2. Import – Goods or services brought into one country from another for use or
sale.
3. Re-export – Import of semi-finished goods, further processing, and export of
finished goods.
4. Management of international operations
 Operating marketing and sales facilities abroad,
 Establishing production or assembly facilities in foreign countries, and
 Monitoring the operations and practices of other MNCs and agencies.

6. The major participants in international marketing are as follows –
 Multinational Corporations (MNCs) − A multinational corporation (MNC) is an organization that
ensures the production of goods and services in one or more countries other than its home country.
Such organizations have their offices, help desks or industrial set-up across nations and usually have
a centralized head office where they co-ordinate global management.
 Exporters: They are the overseas sellers who sell products, and provide services across their home
country by following the necessary jurisdiction.
 Importers: They are the overseas buyers who buy products and services from exporters by
complying with the jurisdiction. An import by one nation is an export from the other nation.
 Service companies: A service company generates revenue by trading on services and not on
physical commodities. A public accounting company is the best example of a service company.
Revenue here is generated by preparing returns of income tax, performing audit services, and by
maintaining financial records.
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7. OBJECTIVES OF INTERNATIONAL MARKETING
 To enhance free trade at global level and attempt to bring all the countries together
for the purpose of trading.
 To increase globalization by integrating the economies of different countries.
 To achieve world peace by building trade relations among different nations.
 To promote social and cultural exchange among the nations.
 To assist developing countries in their economic and industrial growth by inviting
them to the international market thus eliminating the gap between the developed and
the developing countries.
 To assure sustainable management of resources globally.
 To propel export and import of goods globally and distribute the profit among all
participating countries.
 To maintain free and fair trade.
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8. 8
BENEFITS FROM INTERNATIONAL MARKETING
 Provides higher standard of living
 Ensures rational & optimum utilization of resources
 Rapid industrial growth
 Benefits of comparative cost
 International cooperation and world peace
 Facilitates cultural exchange
 Better utilization of surplus production
 Availability of foreign exchange
 Expansion of tertiary sector
 Special benefits at times of emergency

9. DOMESTIC MARKETING
Domestic marketing refers to carrying out marketing activities within the national
boundaries means it refers to doing marketing in local market and its scope is
limited. It requires less investment as compared to international marketing. There
is one nation, same language and one culture. In domestic marketing only one
currency is used. In domestic marketing companies can have the same policies and
strategies.
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10. INTERNATIONAL MARKETING
International marketing refers to carrying out marketing activities outside the
national boundaries also and it refers to doing marketing in global market and it’s
scope is wide. It requires more investment as compared to domestic marketing.
There are many nations, many languages and culture. In international marketing
different currencies are used. In international marketing companies needs
different types of policies in the promotion of their product.
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11. 11
Basis Domestic Marketing International Marketing
Definition “It is concerned with the marketing practises
within the researchers or Marketers home
country (domestic market).”
“It 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 for
a profit.”
Role of Politics Political factors are of minor importance. Political factors play a vital role.
Languages &
Cultures
One language and culture. Many languages and differences in cultures.
Financial Climate Uniform financial climate. Variety of financial climate.
Risk Involved Normal risk is involved. Higher risks of different nature are involved.
Control of
Marketing Activities
Control of marketing activities is easy as
compared to international activities.
Control of marketing activities is difficult
because of different factors like – regional,
cultural, political, etc.
Payment Minimum payment and credit risks. Considerable payment and credit risks.

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Familiarity Well familiarity with domestic market. Lack of Familiarity with foreign markets,
research becomes essential.
Knowledge
Requirement
Management knowledge is required. Specific management knowledge and
competence is required.
Product Mix Product mix is decided keeping in view
the satisfaction and more sales.
Product mix is decided according to
foreign market.
Product Planning
and Development
Product planning and development
according to domestic market.
Product planning and development
according to foreign market.
Focus Focus of interest is on general
information.
Focus of interest is on strategic emphasis.
Market Aspect Market is much more homogeneous and
different segments.
Different or diverse markets fragmented
in nature.

13. MODE OF ENTRY TO INTERNATIONAL
MARKET
1. Internet
For some companies, internet is a new mode of marketing while for some it is
the only source of marketing. With the change in recent trends, a large
number of innovative enterprises promote their goods and services on the
internet through E-marketing.
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14. 2. Licensing
Licensing is a process of creating and managing a contract
between the owner of a brand and a company which wants to
use the brand in association with its product. It refers to that
permission as well which is given to an organization to trade in a
particular territory. Licensing further has different channels
namely.
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15. 3. Franchising :
It is that form of business where the owner of a firm or the
franchiser distributes his products and services through affiliated
dealers or the franchisees. Franchising comes with its own
benefits. The franchiser here provides brand name, right to use a
developed business concept, expertise, and also the equipment
and material required for the business.
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16. 4. Turnkey Contracts
It is a type of project which is constructed and sold to buyer as
a complete product. Once the project is established and handed
over to the buyer, the contractor no more holds any ownership
over it.
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17. 5. International Agents and Distributors:
The companies or individuals who handle the business or market representing
their home country in some foreign country are called international agents and
distributors. These agents may work with more than one enterprise at a time.
So, their level of commitment and dedication towards achieving their goals
should be high.
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18. 6. International distributors:
They are like international agents; the only thing that makes them
different is that the distributors claim ownership over the products
and services whereas agents don’t.
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19. 7. Strategic Alliances:
A large number of companies share the international market ground
collaboratively. These companies collaborate while remaining apart
and distinct based on non-equity strategic alliance. The companies
may or may not belong to the same countries.
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20. 8. Joint ventures:
When two parties having distinct identities come together to
establish a new company it is known as a joint venture. The
profit gained and also the loss incurred by the company is shared
or borne by both the parties.
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21. Major activities of International Marketing are as follows
 Export − Trading of goods and services from one country to another by
promoting the same on social media, and abiding by the rules and regulation of
both the home country and the foreign country with respect to the rules and
regulations is known as export.
 Import − Buying of products and services from an external source across
national borders is known as import.
 Re-export − Re-export refers to the export of foreign goods in the same state as
previously imported, from the free circulation area, premises for inward
processing or industrial free zones, directly to the rest of the world and from
premises for customs warehousing or commercial free zones, to the rest of the
world.
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22. 22
Re-export means the export of foreign goods that are already been
imported to the country from that of a foreign country.

23.  Regulation on marketing activities − Re-export refers to the export of
foreign goods in the same state as previously imported, from the free
circulation area, premises for inward processing or industrial free zones,
directly to the rest of the world and from premises for customs warehousing
or commercial free zones, to the rest of the world.
 Formalities and procedures of marketing − There are a number of laws and
policies framed by different countries and these make international marketing
more complex, and a time consuming process. So, it is important to be well
aware of the procedure and formalities and plunge into the vast expanse of
international marketing.
 Trade block and their impact − Active participation of several nations in
marketing activities builds trade block. These blocks involve EU, NAFTA,
ASEAN, SAARC. Measures should be taken to reduce trade blocks as they
are harmful to the growth of free world trade.
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24.  Commercial policies and their impact − Countries participating in the
international marketing design their own commercial policies that suit
their requirements. Different policies of different nations invoke the
commercial environment of international market.
 International marketing research − International market is important,
as it deals with marketing on a larger scale and also paves way for
productive research. Research requires complete knowledge of the in
and out of target market, customers’ needs and requirement, buying
behaviour, prevailing market competition and many more. Market
research at international level provides base for product planning &
development, introduction of sales promotion techniques.
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25. The World Trade Organization is an intergovernmental organization that
regulates and facilitates international trade between nations. It officially
commenced operations on 1 January 1995, pursuant to the 1994 Marrakesh
Agreement, replacing the General Agreement on Tariffs and Trade, which was
established in 1948. The WTO is the world's largest international economic
organization, with 164 member states representing over 96% of global trade
and global GDP
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26. 26

27. Regulations of WTO in International Marketing
World trade is defined as an agreement between two or more nations that may operate their
business in different parts of the world. This business is done by importing and exporting
goods and services. In short, buying and selling of products and services irrespective of
national boundaries.
Given below are five elements that make international trades possible −
 The agreement over sale of items.
 The agreement over carriage of items.
 The agreement over insurance of the items.
 The consent from the exports and imports authorities to fulfil legal formalities.
 The mode of payment as agreed by the buyer and the seller.
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28. MARKET ASSESSMENT
This is a basic but major decision because of the impact on resources and
effort included, mainly in the case of small and medium-sized enterprises.
For a company to expand its business into another country. it is suggested
that the global market should be analysed properly. The initial selection for
analysing the global market can be conducted with the help of the following
criteria –
1. Environment and market analysis ( PEST, PESTLE, SWOT)
2. Distribution channels
3. Demand analysis
4. Marketing Mix
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29. Environment and Market analysis
PEST
PESTLE
SWOT
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30. 30

31. 31

32. 32

33. DISTRIBUTION CHANNEL 33

34. 34

35. 35

36. Marketing Mix
 1. Product – What the company is manufacturing?
 2. Price – What is the pricing strategy used by the company?
 3. Place – Where is the company selling?
 4. Promotions – How is the company promoting the product?
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37. The Variables of Marketing mix are as follows
I. Product in the Marketing mix
Important product decisions in international marketing management are:
A. Market segment decision.
B. Product mix decisions.
C. Product specifications.
D. Positioning and communication decisions.
 What product are you selling?
 What would be the quality of your product?
 Which features are different from the market?
 What is the USP of the product?
 Whether the product will be branded as sub brand or completely new?
 What are the secondary products which can be sold along with primary (Warranty, services)
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38. The Variables of Marketing mix are as follows
II. Promotion in the Marketing mix
Important promotion decisions in international marketing management are:
 Advertising
 Personal Selling
 Sales Promotion
 Public Relations
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39. The Variables of Marketing mix are as follows
III. Pricing in the Marketing mix
The 7 C’s of International Pricing Strategy
Primary Factors ( 3C’s)
1. Costs:
2. Competitors
3. Customers
Secondary Factors ( 4C’s)
4. Cultural Differences
5. Channels of Distribution:
6. Currency Rates
7. Control by Government
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40. The Variables of Marketing mix are as follows
IV. Place/ Distribution in the Marketing mix
 International departments
 Working with distributors
 Online
 Setting up your own sales force
 International distribution channels
 Export distribution strategy
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41. International Product Cycle
The international product cycle concerns the stages of product
development in the international market. It is best explained by
the Product Life Cycle theory, developed by researcher Raymond
Vernon. According to Vernon, products go through five stages of
production:
 Introduction
 Growth,
 Maturity,
 Saturation,
 Decline
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42. A product can be characterized based upon its stage in the lifecycle as
well as the nature or effects of the product in the market. Vernon
identified 3 product categories:
 New Product
 Maturing Product
 Standardized Product
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43. New Product
 As per the Product Lifecycle theory, new products are comprised of local parts
and labor. Often this are custom-manufactured parts and the efforts of the
inventor.
 Once established and entering the growth phase, product parts and labor are
sourced more broadly - outside of the immediate location (outsourced). Also,
the product may be offered for sale in the international market.
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44. Mature Product
A mature product that sells in high volume generally requires parts and labour
from even broader sources. This may include outsourcing various aspects of the
product (manufacture of parts, assembly, shipping, etc.). The requirements for
production increase and there is increased demand from non-local (often global)
markets.
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45. Standardized Product
A Standardized Product eventually, the product will become obsolete. That
is, it will succumb to competitive products or replacement goods. This may
happen at different rates based upon the characteristics of the market in
which it is being sold. product life cycle the product becomes completely
standardized.
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46. The Important Phases of International Product Life
Cycle are:
1. Introduction and growth
2. Maturity
3. Decline
4. Import
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47. 47

48. 1. Introduction and Growth:
The first phase of international product life cycle is introduction and growth
during which innovative (exporting) country’s export strength is evident.
Product innovation is likely to be related to the needs of the home market.
The firm usually serves its home market first.
The new product is produced in the home market because, as the firm moves
down the production learning curve, it needs to communicate with both
suppliers and customers. After meeting the demand of the home country, the
manufacturers start exporting foreign market and exporting goods to them.
Thus, export strength is evident by innovator country.
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49. 2. Maturity
The next phase of international product life cycle shows the stage where the
production activities start shifting from innovating country to other countries, i.e.,
foreign production starts. The importing firms in the middle income country realize
the demand potential of the product on the home market. The manufacturers also
become familiar in producing the goods.
The growing demand of the products attracts the attention of many firms. They are
tempted to start production in their country and gradually start exporting to the low
income country. The large production in the middle income country reduces the
export from the innovating country.
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50. 3. Decline
Decline is the third phase in which foreign production becomes
competitive in the export market. The firms in low income country also
realize the demand potential in the domestic market. They start producing
the products in their home country by exploiting cheap labor.
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51. 4. Import
 In the last phase of international product life cycle, import competition
begins. The producers in the low income importing country gain sufficient
experience in producing and marketing the products. They attain the
economies of scale and gradually become more efficient than the innovator
country.
 At this stage, the innovator country finds the import from this country
advantageous. Hence, the innovator country finally becomes the importer
of that product. In this fourth stage of product life cycle the product
becomes completely standardized.
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