Importance of International Marketing

Importance of International MarketingJump to SWOT analysis foreign Analysis Marketing Mix AnalysisInternational grocery storeing is an important aspect of a businesss planning process if they wish to go international.Today, almost every marketing shaping, large or small, is stirred in some panache by global competition- from the America florist that buys its flowers from Dutch nurseries, to the Melbourne c masshing retailer that sources its merchandise in Asia, to the American electronics manufacturer competing in its home markets with giant Japanese rivals, to the Australian consumer goods designer leading the way with new experiences for international markets. Kotler P, Brown L, Adam S, Burton S, Armstrong G (2007).Before an presidency makes the finality to go global and dish out its ingatherings to a new market they must query their potential markets in terms of the policy-making and legal environs, the economic bodily structure of the market and who the organis ation impart market its products to and how it willing do this.This essay focuses on why international marketing is important and how an organisation can search out opportunities and eliminate threats.BodyKotler P, et al (2007) states Marketing is an organisational function and a set of processes for creating, communicating and delivering value to customers and for managing customer relationships in ways that benefit the organisation and its stakeholders.Managing the consumer relationship as well as the stakeholders requires understanding the various needs and wants of the different parties involved. The consumers want the best character reference product at the cheapest price unless this comes at a cost for the organisation because they in any case incur a duty of c atomic number 18 in managing the relationship with the stakeholders for example the shareholders who want to make a high return on their investment.Businesses abstracted to move their products in the global mark et use International marketing when they gather information closely their rear market. The information gathered would include such(prenominal) things as the demographics of the market, the current political environment, what economic system the hoidenish operates under and the culture of the country.International marketing is subjective for businesses to survive in the global marketplace. Not taking international marketing seriously could lead to the business failure in their overseas markets. However using the right ray of lights the organisation can avoid this.Why is International Marketing important?International marketing is important for businesses wanting to grow in the global market where businesses compete for consumers last dollar. International marketing looks at what it currently does e.g. who they market to, how they do this. However in the global sense, it looks at what it has to change to modernize the new market and what can it keep the same as back home. What other competition exists in the new market, what laws exists that whitethorn affect the businesses operations, how can the product adopt the different culture.Market OpportunityThe business whitethorn use a SWOT analysis to determine what its current position is in the market place is. The SWOT analysis looks at the organisations internal and external factors and quantify what it needs to do to increase the strengths and eliminate the weaknesses and use the opportunities available to decrease either threats.InternalS StrengthsThis includes the businesses capabilities, for example experience and knowledge in the market place, whether the organisation has any competitive advantage, for example the right people working for the organisation, the note of the product and at a price that its competitors cant beat. Another factor to consider is the fault image, whether the brands image is established or not, and whether it is easy to recognise.W WeaknessesThis may include gaps in the c apabilities of the organisation, for example, a lack of cash flow, a lack of knowledge in the certain area or a lack of leadership.ExternalO OpportunitiesAn opportunity can be that the organisations products or service can fill a niche in the market place, the new market possibly closer to the businesses supply chain resulting in a lower cost for the product.T ThreatsThe political structure of the market, the legal barriers, changing customer expectations.Economic environmentThere are four main compositors cases of economic structures Market capitalism, centrally intend socialism, centrally planned capitalism, and market socialism.As described by Keegan potassium (2005) Market capitalism is an economic system in which individuals and firms allocate resources and production resources are privately owned. Therefore consumers decide what goods they desire and firms determine what and how lots to produce the role of the state is to crowd competition and ensure consumer protection .This is currently the most common economic system around the world. Countries operating under Market capitalism are the easiest to get into, but also have the most competition, which means businesses wanting to move into countries with market capitalism will have to put the term into looking at whether the organisation has any sources of competitive advantage, and if it does not, what it can do to be able to gain a competitive advantage.As described by Keegan Green (2005) Centrally Planned Socialism is where the state has the broad power to serve the public interests as it sees fit. State planners make top heap decisions about what goods and services are produced and in what quantities and therefore consumers spend their money on what is available.Organisations wanting to move their products and/or services into countries that operate under centrally planned socialism have to have a clear plan for its entry into the marketplace. There will be less economic freedom in centrally p lanned socialist countries because the state makes the decision on who receives resources. This is the most difficult market to get into due to the controls placed on organisations by the state. If an organisation is wanting to operate in this particular marketplace, it may have to enter into a partnership agreement with the government.Political Risk factorsAs stated by Kotabe and Helsen (2008) the political environment in every country is regularly changing. New social pressures can force governments to make new laws or to enforce old policies differently. Policies that back up international investment may change towards isolationism or nationalism. The environment in each target market should be analysed to determine its train of economic and political attempt and opportunity.Organisations moving into the global market, it must assess the political risk, the organisation must be aware of the history of the political and economic structure of the country as well as the current s ystems which the country operates under.Political risk is the risk of a change in the political environment or the governments policy, which could adversely affect a companys ability to operate effectively and profitability. If the political risk is too high in a country, foreign investment is divergence to be low.Some of the political risks involved for international marketing areThe political structure of the country how rapidly are the government of the country is changed. This factor relates to the governments polices and the level of bureaucracy involved in the system. Other factors include how prevalent corruption is in the normal day to day operations of the business. This will affect the businesses estimable and social responsibility and may have a negative on its brand image.An example of how the political situation can change rapidly and have a negative impact on organisations is Cuba. Under the Batista dictatorship foreign investment, mostly from the United States of Am erica flowed in, eventually reaching around 2 one thousand million dollars. However communist revolutionaries commanded by Fidel Castro seized Havana and overthrew Batista in 1959, and proceeded to nationalise much of the assets owned by foreign investors.Market segmentationMarkets consist of buyers, and buyers differ in one or much ways. They may differ in their wants, resources, location, buying attitudes and buying practices. Because buyers have unique needs and wants, each buyer is potentially a separate market.Organisations have to choose parts of the market which they want to target rather than competing for the entire market this is what market segmentation is, breaking the market into different groups of people, based on their needs and wants, as well as what makes them want to buy a product. This all allows the organisation to determine who their products are aimed at.Demographic segmentationThis involves dividing the market into groups based on each demographic variable , for example, the age, gender, family size, family life-cycle, income, occupation, education, religion and nationality of individuals who buy the businesses products.For example Chinas population is 300 times larger of New Zealands. Therefore the organisation must break these groups of the potential buyer of the product.Behavioural segmentationBehaviour segmentation focuses on whether or not people buy and use a product, as well as how often and what quantity consumers use or consume. Researching this information about the new market, the business may find opportunities such as there is a niche in the market that consumers look for in a product. Behavioural segmentation is about the potential benefits people look for in a product.Psychographic segmentationPsychographic segmentation involves grouping people in terms of their attitudes, value, and lifestyles. This information is usually obtained through surveys and questionnaires and other types of studies.Marketing MixProductIntrodu cing your product in the international market comes with a whole new marketing mix analysis. When opening an organisations product to a new market the organisation has to assess what the product is, what it stands for and how the organisation is going to market this product. If there are already similar products in this market, how is the business going to different the product from its competition?The brand image of the product may be a source of competitive advantage to the organisation. Whether the product is locally made or made in another(prenominal) country, is all part of the brand image. This plays out in the perception that if a product is made in Asia, it might not be of the same quality as it would be if it was made in New Zealand. personnel casualty into a new market, the organisation has to take into account the religion and the culture of the country. For example selling NZ pork in Indonesia Indonesia is the largest Muslim country in the world. How does an organisatio n market this product?Through the market segmentation, the organisation should be able to break down different groups of people in that country for example how many non-Muslims live in that country, which can help the organisation market its product. The organisation must also figure out how it can do this without upsetting the main religion of the country.PriceSelling the product at the right price that best suits the product. Going to a new market the organisation may have to change its pricing strategies to match the country. This all depends on several factors, such as how much competition there is in the market, whether the product the organisation is selling is in a low income area, which would have the result of many people not universe able to afford to buy the product if it is too expensive.PromotionWhen an organisation is promoting their product and/or service in the international marketplace, it has to consider factor such as, what the organisation does currently to prom ote its product/service and how or if they can change this form of promotion to reach a new target market. The type of promotion that the organisation used domestically may not work the same in the foreign marketplace due to different demographics, culture and so forthWhen Fisher Paykel launched its product line in China earlier this year, they launched it at the biggest appliance show in China, knowing that there would be a lot of viewers and potential buyers of their products at this show.PlacementPlacement is the distribution of an organisations product and is an important aspect of entering a foreign marketplace. In order to sell their products an organisation has to have an effective distribution network, and establishing one can often be a very expensive and time consuming job. One way to gain a distribution network is to acquire wholely an existing business that sells a competing product.ConclusionInternational Marketing is important for businesses that are thinking of going global or already have. How the organisation reached its target market domestically may not work the same in the new marketplace. There are different tools that the businesses can use to find opportunities, and also many strategies to use in the new marketplace which will improve the chances of a return on the time and money the organisation invested in its new marketplaceBefore entering the new marketplace the organisation may carry out research to find out which countries will provide the best return for the organisation, this can be done by analysing the countrys economic system and the level of political risk present.An organisation may use a SWOT analysis to look at its current internal and external environment. A SWOT analysis will outline the organisations strengths, whether it has any competitive advantages and if so how can they use this to their benefit. The SWOT analysis also highlights the organisations weakness and any opportunities threats that may arise for the organ isation.The organisation may use market segmentation as another tool to analyse who its target market is through demographic, psychographic and behavioural segmentation, as well as who may use their product/service, when they may use the product/service, how this product could be used and why and how it can reach all of its target market.Another tool that the organisation may use is a marketing mix analysis, this analyses what its products are, what pricing strategy it will use in the new market, how the organisation can promote the product, whether it will keep the same promotion method as it does domestically or promote it differently and how will they get the products to the consumers.International marketing is more than just selling your products in a new marketplace, it is about building relationships with the consumers, for the organisation to do this it must understand what the needs and wants of their consumers are, and at price will they pay to get this.ReferenceKeegan, W.J ., Green, M.C. (2005). Global Marketing. (4TH ed.). Upper Saddle River, N, J Prentice Hall. p. 151, 154,155,228,235,237,49Kotabem M., Helsen, K. (2008). Global Marketing Management. (4TH ed.). Hoboken, N, J John Wiley Sons, Inc.Kotler, P, Brown, L, Adam, S, Burton, S, Armstrong G. (2007). (7TH ed.). Frenchs Forest, NSW Pearson Education Australia. p.25, 7