Overseas Marketeing,Grp 2

8/3/2019 Overseas Marketeing,Grp 2

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OVERSEAS

MARKET


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International marketing involves recognizing that people all

over the world have different needs.

Companies like Gillette, Coca-Cola, United Airlines,

Cadbury and Nissan have brands that are recognized across

the globe.

While many of the products that these businesses sell are

targeted at a global audience using a consistent marketing mix,

it is also necessary to understand regional differences, hencethe importance of international marketing.


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Organizations must accept that differences in values, customs,

languages and currencies will mean that some products will

only suit certain countries and that as well as there beingglobal markets

E.g. for Gillette razors, and for Coca-Cola drinks, there are

important regional differences

For example: Advertising in China and India need to focus on

local languages.


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Just as the marketing environment has to be assessed at home,

the overseas potential of markets has to be carefully

scrutinized.

Finding relevant information takes longer because of the

unfamiliarity of some locations.

The potential market size

Degree and type of competition

Price

Promotional differences Product differences

as well as barriers to trade have to be analyzed alongside the

cost-effectiveness of various types of transport.


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The organisation then has to assess the scale of the investment

and consider both short- and long-term targets for an adequate

return. Before becoming involved in exporting.

An organization must find the answers to two questions:

1.Is there a market for the product?

2.How far will it need to be adapted for overseasmarkets?


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The product must possess characteristics that make it acceptable for the market

These may be features like

Size

Shape

Design

Performance and

Colour.

For example, Red is a popular colour in Chinese-speaking areas. Organizations also

have to consider different languages, customs and health and safety regulations.

If a company offers a product, which is undifferentiated between any ofthe markets to which it is offered, then standardization is taking place.

The great benefit of standardization is the ability to compete with low

costs over a large output.


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It is not difficult to think about the standard marketing mix for

a product and how this might vary from one country to

another.

For example:

* Product- Tastes and habits differ between markets

* Price - Consumers have different incomes* Place - Systems of distribution vary widely

* Promotion - Consumers' media habits vary, as do language

skills and levels of literacy.

With differentiated marketing, on the other hand, an

organization will, segment its overseas markets, and offer a

marketing mix to meet the needs of each of its markets.


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: refers to manufacturing, marketingor employing other processes in a standard way.

: is the process of making products

or aspects of the marketing mix different so as to appeal to

different markets


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Principle of Differentiation:

Dont be different just to be different.

Design and plan for meaningful differences

versus the competitors. Design truly different and unique products

for customers.


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However, it could also be argued that the success of many

products in international markets has come about because

marketers have successfully adapted their marketing mix tomeet local needs.

To a large extent the standardization/adaptation dilemma

depends upon an organization's view of its overseas marketsand the degree to which it is prepared to commit itself to

meeting the needs of overseas customers.

The great benefit of standardization is that costs are lowered,

profitability is increased and the task of supplying different

markets becomes substantially easier.


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There are three main approaches, which can be applied:


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1. Ethnocentrism - Overseas operations are considered to be

of little importance. Plans for overseas

markets are developed at home. There is little research, themarketing mix is standardised and there is no real attention to

different customer needs and requirements in each market.

2. Polycentrism - With this marketing approach, a business

will establish subsidiaries, each with their

own marketing objectives and policies, which are

decentralised from the parent company. Adaptation takes place

in every market using different mixes to satisfy customer

requirements.


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3. Geocentrism - Standardization takes place wherever

possible and adaptation takes place where

necessary. This is a pragmatic approach.

4. Regiocentrism - A regional market orientation with world

market strategies.


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A confectionery and soft drinks manufacturer like Cadbury-Schweppes

typically produces a range of standard items that are sold throughout the

globe using similar marketing mix.

However, differences may occur in such aspects as distribution channels

and pricing as well as advertising in languages that are relevant to

particular cultures.

In addition such a company would produce some products which cater

for particular tastes, and which are relevant to particular cultures. New

products might then be tested in a regional area, before consideration of

which other areas of the globe to roll out that product to.


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Marketing your product or service overseas

To succeed, your marketing strategy will need to be tailored to

each target market.

You'll need to appreciate the traditions, culture and legislation

of the countries you are trading with to exploit your exportingefforts.


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Sales promotion overseas

Customization of your marketing activities is essential if there are

cultural differences affecting the consumption of your product.You should consider:

Using different media. TV viewers in one country may belong to a

particular socio-economic group, while in others TV ownership isfar more widespread.

Changing symbols. For example, you may need to respect different

standards of dress in promotional activities in some countries.

Changing the market proposition. For example, bicycles are

presented as a leisure item in one country, but as essential vehicles

elsewhere.


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Using local agents

Non-specialist research can be conducted in-house but you

will need to be clear about the data you require.

You will also need to set a realistic budget to cover the

necessary costs.

Alternatively you could delegate the research to local

agencies to save money. Local market research agencies have

direct access to your potential customers.

However, you should carefully consider the reputation of the

agency.


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Selling and distribution in overseas markets

There are a number of elements you need to consider to sellsuccessfully overseas. How you organise your sales presence

in export markets is one of the key decisions.

Depending on your product, you may be able to sell directly.

For example, you might be able to sell over the internet or by

exhibiting at local trade shows.


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Many businesses look for a partner who already understands

the local market.

For example:

You can sell to a distributor who then sells your products

locally.

You can use a sales agent who sells products on your behalf,

or puts you into contact with potential customers on a

commission basis.


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You can enter into ajoint venture with a local business. This

gives you a share of the management and profits of the joint

venture, but is a more complicated and expensive option.

If you want complete control over sales, you can set up your

own local office. This is the most expensive option.


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When arranging a sales contract with an agent or distributor,

you need to ensure that responsibility for delivery and

payment is clearly defined.

It's also important to remember that intellectual property (IP)

protection becomes more complicated if you sell goods

overseas.

Patents and trade marks are only recognised and protected in

the country of origin, so you will need to secure IP protection

in each country you intend to sell into.


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Huge Foreign indebtedness

Unstable governments

Foreign-exchange problems

Foreign entry and government bureaucracy

Tariffs and other trade barriers

Corruption

E-commerce---doesnt offer complete solutions

Technological pirating High cost of product and communication

adaptations

CHALLENGES


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OVERSEAS MARKETING

Marketing has become more complex. Increases in new products, product

extensions, high cost of distribution and

shelf space. Expansion of retailer control and power,

changing media habits, overload ofinformation, and array of communication

choices. Ultimate goal of programs

Timing goals


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Major Decisions

Deciding to go abroad

Deciding which markets

Deciding how to enter markets

Deciding on marketing programs

Deciding on marketing organization


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Joint Ventures -- Join with local investors to create

venture. Coca-Cola and Nestlejoined forces in ready to drink coffee and tea.

P&G with rival, Fater, in Italy and Great Britain.

Whirlpool formed venture with Dutch electronicgroup Philips on white-goods business to leapfroginto European market.


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Wrap-up on overseas Marketing Principles

Companies cannot stay domestic and expectto maintain their markets.

Companies need to define their overseaspolicies and objectives.

Companies need to decide on how much toadapt marketing mix.


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Market entry and market control costs can be

high.

Product and communication adaptation costscan be high.

Dominant foreign firms can establish highbarriers of entry.

Which types of markets and countries?


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Anshul Kumar JainRicha Jain

Sanjeev Kumar Chaudhary

Jaya Sachan

Overseas Marketeing,Grp 2

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