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What Is International Marketing? Concept And Strategies


International marketing is a business management technique, through which the company intends to make a profit, taking advantage of the opportunities offered by foreign markets and facing international competition. It is a systematic, circular, and periodic management technique. It is systematic in the sense that it obeys a method, circulating the results of its application to serve as experience for the re-elaboration of the international marketing plan, and, in addition, it is elaborated periodically, with different frequencies according to the company.


International marketing, like any business strategy, has a series of controllable variables and others beyond the control of the company. Among the first are its own infrastructure and capabilities: production capacity, R&D level, experience and knowledge of marketing, financial capacity, attitudes and predisposition of managers towards the internationalization of the company, etc. Uncontrolled variables make up the external environment (economic, cultural, legal, and political) and international competition. The characteristics and development of foreign markets as well as international competition are variables over which the company has no influence, but it can know its situation and predict future trends.


International marketing management includes a series of strategic decisions that the company must take on a scheduled basis. These are the decision to internationalize itself, the choice of target markets, the entry strategy, and the adaptation of the international marketing-mix policies in the different markets in which it is present.


THE DECISION TO GO INTERNATIONALIZED

The first international marketing decision is to analyze whether or not the company should embark on international marketing activities, that is, the conquest of foreign markets. It seems evident that in the new international environment, more and more companies are opting for the internationalization alternative, there are even the so-called born global that are born already focused on international markets; In most cases, these are innovative companies linked to the digital economy sector.


The advantages that justify internationalization are many, among them:

  • Use all or a large part of the productive capacity: there are products whose sales are concentrated in certain seasons of the year. Selling these seasonal products in countries with opposite weather seasons (northern and southern hemispheres) will take advantage of productive capacity and achieve greater stability in sales. An example is mountain bikes whose sales are concentrated in the period May-August in the northern hemisphere (EU, United States) and in November-January in the southern hemisphere (Australia, Latin America).

  • Access to a broader market: internationalization implies accessing specific market segments for each product. If it is possible to be present in a large number of countries, the life cycle of the product can be extended since when it is in a phase of maturity or decline in developed markets, with the export it will be possible to access other markets where the product is not yet acquainted.

  • Image improvement (internal and external): from the communication perspective, the presence in several countries reinforces the image of the company both in front of its national and international clients. Having customers in several countries transmits an idea of ​​solvency and guarantee in the products and services offered.

  • Risk diversification: the company's presence in several markets is also a means of diversifying risk since at a given moment the negative results of countries or areas in recession will be offset by those of countries that obtain positive growth rates.

  • Continuous learning: Finally, the directors of companies that go abroad are in contact with very different markets and, therefore, in the development of their work they learn in terms of innovative products, management techniques, marketing methods, actions, communication, digital marketing strategies, etc. Many of these experiences and actions can be applied in the local market.

THE CHOICE OF TARGET MARKETS

Once internationalization has been chosen as a growth path, the second strategic decision is the selection of the markets that offer the greatest potential. There are more than 200 countries in the world, of which approximately 80 have high purchasing potential. The exporting company, regardless of its size and resources, must have a marketing information system that makes it easier for it to select target markets.


In this process, three stages can be distinguished through which the company must make decisions:

  • A number of countries: the double alternative of concentration (choosing a small number of countries to focus your commercial efforts on them) or diversification (choosing a larger number of countries even if you obtain a lower volume of sales in each of them) are proposed here. they).

  • Most favorable geographical areas: focus your efforts on certain geographical areas that cover homogeneous countries in terms of the criteria for choosing the most favorable ones. In this election, criteria such as geographical or cultural proximity, the level of development, or the growth prospects of the countries in the area will prevail.

  • Selection of target countries: once the most favorable areas have been chosen, the company must choose within them those countries that offer greater accessibility and business potential, also evaluating the risks involved in penetrating them.

THE CHOICE OF THE FORM OF ENTRY IN THE CHOSEN MARKETS

Once the countries have been chosen, the next decision is the way to enter each of them. It happens that foreign markets, unlike the national market, present barriers and access difficulties (geographical, legal, language, cultural) that make it necessary to seek help to reach the end customer. Thus, there are ways to reach foreign customers that are more numerous and different than those that exist to reach local customers. These forms can be classified into four groups:

  • Direct export: the company's own export department addresses the end customer.

  • Indirect export: intermediaries (agents, distributors, trading companies) are used to reach the end customer.

  • Cooperation agreements: the company seeks partners in foreign markets with the idea of ​​establishing long-term business relationships that materialize in license, franchise, or joint venture agreements.

  • Establishment abroad: Finally, the company can choose to establish itself in the target market through the creation of delegations, commercial subsidiaries, or production subsidiaries.

THE ADAPTATION OF THE MARKETING-MIX TO DIFFERENCES IN WORLD MARKETS

Once the target market and the form of entry have been chosen, the last strategic decision has to do with the adaptation of the commercial offer that is going to be launched on the market, that is to say, the marketing mix (marketing-mix), in terms of product, price, distribution, and communication.

  • Product: first of all, adaptation to the legal regulations on the product that is required in the country of destination and, above all, to the tastes and demands of customers.

  • Price: the pricing policy takes into account certain differentiating variables (purchasing power, logistics costs, product positioning, etc.).

  • Distribution: the choice of the most favorable channel for the commercialization of the exported product which, depending on the distribution structure, may differ from one country to another.

  • Communication: the choice between offline and online communication techniques, as well as the adaptation of texts, messages, and images to the particularities of each market.

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