Conducting a situation analysis in an international setting is a bit more extensive. For example, you could divide customers into groups and offer one a full-price product and the other a discounted product, then measure which has more uptake. Product adaptation, promotion extension. The product positioning, therefore, must vary in some dimensions. There are many ways to collect it, including face-to-face surveys and interviews, electronic methods like email surveys, via telephone, and more. When dealing with an international market, surveys can be extremely effective as they offer a direct connection with your target customers in your new market. In distributing products globally, many American corporations team with large multinational companies that do not offer competitive products but have the resources and expertise to distribute and market those goods. Dumping (when a firm sells a product in a foreign country below its domestic price or below itsactual costs) is often done to build a companys share of the market by pricing at a competitive level. This makes it harder to distribute your surveys to a significant number of people. For example, Heinz was looking to expand its 9 Lives cat food brand and Morris the Cat logo into Moscow. The same cherries were also domestically sold; however, the best quality cherries were exported as a premium product to buyers from China, because consumers in China viewed them as a delicacy. Having integrated at the function level, we next consider integration of the marketing mix elements. For example, a thawing of political hostilities often leads to the opening of economic channels between countries. The opposite can happen when the dollar appreciates, making some markets less attractive. Just because Brazil sees their ad all the time doesnt mean that it holds any relevance for their situation. Moreover, the decision to distribute products in other countries not only opens new markets, but can also greatly expand a companys business. Before we explore the methods available to researchers, its important to look at the three main types of data you will be aiming to collect: This refers to data that was not collected specifically for the task at hand (in contrast with primary data). Plan Your Market Entry Strategy: U.S. An advertising campaign is one way to deal with this problem. For example, many companies that have successfully built a strong brand in the US have found that their domestic identity has little, if any, impact in markets where they are relatively unknown. Differences in the size and nature of retailers are even more pronounced. Since every marketing message, media advertisement, and media channel is selected based on careful market research, brands are able to demonstrate more intentionality in their marketing decisions. This is where the importance of developing an international marketing plan comes in. Following the integrated approach employed throughout this text, each of the functional elements (e.g. Thus, this stage is primarily concerned with the analysis of international markets. As you could imagine, an international marketing plan is a marketing plan aimed at global expansion of product sales and brand recognition. The best international marketing strategy is doomed to failure if human resources can not find and train the appropriate employees, or research cannot modify the product so that it is acceptable to consumers in another country. A gray market, also called parallel importing, is a situation where products are sold through unauthorized channels of distribution. Having set the objectives for the company, both at the corporate level and the business level, the company can now develop a detailed program of functional activities to achieve the objectives. Now, face-to-face interviews and focus groups can take place entirely digitally, removing the need to send team members abroad or hire people in your target market.

Much of this information is readily available on government websites. Demographic and general economic statistics, such as population size and makeup, per capita income, and production levels by industry, can be important indicators of market potential for your companys products.

While a number of writers have argued that this will be the strategy adopted for many products in the future, in practice only a handful of products might claim to have achieved this already. American businesses have plenty of reasons to market their products in other countries.

A steep depreciation in the value of the dollar can make your product considerably more competitive. In turn, level of commitment and method of entry are influenced by the evaluation of environmental factors as well as resources and capabilities. This strategy is used if a promotional campaign has achieved international appeal, but the product needs to be adapted because of local needs. __ss_noform.push(['form', '71007', '256eed6c-ac75-491a-bfb3-3b0e56870090']); Evaluating the various strategic pricing options and selecting the most appropriate approach. Keep up to date with the latest insights from our research as well as all our company news in our free monthly newsletter. There are many benefits to using this type of research method in international markets. Its worth noting that primary data simply refers to any information collected solely for the task at hand, so survey data and experimental data can be considered primary or secondary depending on the source. International marketing increases a brands focus on a marketing message. You can learn a lot about the business trends, cultural differences, market, laws, and more from the research of other companies. Our newsletter provides great resources, industry trends, and solutions. This all has to do with specialization and market research in each foreign country. Implementing the strategy through the use of a variety of tactics and procedures to set price. Business research is valuable because its an example of another organization that has done some of its work for you. After having a clear understanding of the two and deciding which is best for your business model, you can begin working on your objectives and country of interest. Many small and mid-sized companies that are uncertain whether to open operations in another country investigate the possibility of using an export management company. These cookies do not store any personal information. Conducting primary market research involves collecting data directly from the foreign marketplacethrough interviews, surveys, and other direct contact with representatives and potential buyers. Youll also need to consider linguistic differences, which means hiring interpreters or locally-based staff. For example, some Middle Eastern cultures treat interviews with suspicion and it may be difficult to gather a meaningful sample group. The opposite can happen when the dollar appreciates, making some markets less attractive.. Non-governmental organizations like charities can be excellent sources of data due to their work in research. In the USA, you can find that tickets are a lot cheaper because soccer is not the major sport in the United States. Online surveys are one of the cheapest and easiest ways to gather information and can be done from anywhere in the world with no need to hire additional staff or deal with logistics in your target market. International marketing, as opposed to global marketing, is incredibly important to boost your companys international imagefor a few reasons. Another discovery: while Americans tend to treat their kitties with tuna, Russian cat lovers prefer to serve beef-flavored food. All Rights Reserved. Karen Rogers, manager of key customer marketing at FedEx, added that sponsoring eventsdomestically or internationally also gives a company the opportunity to meet with prospective customers in a social setting and affords a series of spin-offs, such as promotions and product giveaways. There are still limitations, of course it relies on your audience having access to electronic devices which can lead to skewed results (for example, you end up interviewing only younger and more affluent people). The most recent statistics for some countries may be more than a few years old, or the data may be too broad to be of much value to your company.. Once youve decided that your company is able to export and is committed to it, populate your export plan with data and insights gleaned from available sources. Attaching your corporate identity to a known, respected entity in your target market is another. Figure 2.1 The decision sequence in international marketing. For effective market research, youll have to do your own work too. Get weekly insights into the world of logistics. According to consulting firm Deloitte and Touche, about 95 per cent of the worlds population and two-thirds of its total purchasing power are currently located outside the US. If you are interested in learning more or are seeking help in the industry, give one of our team members a call and we would be excited to contribute! Because of the expense of primary market research, most companies rely on secondary data sources. The age of the global brand is at hand. Anything involving the internet is dependent on internet access in your target market, which may be very low in some parts of the world. In recent years, weve all seen an explosion in the use of video chat software like Zoom and Microsoft Teams. While the product stays the same this strategy allows for the adaptation of the promotional effort either to target new customer segments or to appeal to the particular tastes of individual countries. By committing to the specifics of a written plan you can help ensure that your company will finish what it begins, and that the hopes that prompted your export efforts will be fulfilled. What distribution channels are available? This strategy is consistent with the low income levels of many foreign countries, andthe lower price helps to build market share. It may have been collected by businesses based in your target market or some other location. This last advantage is especially important. Keegan (11) has highlighted the key aspect of marketing strategy as a combination of standardization or adaptation of product and promotion elements of the mix and offers five alternative and more specific approaches to product policy: Another critical element that is closely aligned with the product and promotion is the brand. Pricing products in foreign nations is complicated by exchange rate fluctuations, tariffs, governmental intervention, and shipping requirements. An increased understanding of a culture, customized message, and a detailed country-specific marketing plan all work together to create stronger brand authority. Perhaps the most critical factor to be considered when developing a pricing strategy in international markets, however, is how the customers and competitors will respond. You also have the option to opt-out of these cookies. Simply, how can prices be coordinated by the company across the various markets and still make the necessary profit? It was my job as a sales/marketing intern to show the best quality cherries to the export buyers and target the certain qualities they desired in order to acquire the premium prices they were ready to pay. Decisions here will be dependent on matching the results of that analysis with the companys objectives. However, implementing a global strategy requires a great deal of coordination. The research conducted by other businesses can be an extremely useful starting point for your market research. FedEx sponsors one of Benettons formula racing cars in Europe. However, the collection of such data on your own is time consumingand expensive and may not be comprehensive.. Managing prices and financing international transactions. Managing product inventories requires consideration of the availability of suitable warehousing, as well as the costs of shipping in small quantities. But opting out of some of these cookies may have an effect on your browsing experience. Secondary sources are less expensive and helps your company focus its marketing efforts. By clicking Accept, you consent to the use of all cookies. A customized export plan is a valuable strategic and operational tool for growing the export side of your business. Some cultures, such as Japan, may be unwilling to give strong responses, leading to many neutral answers and no meaningful takeaway. Attitude scales like the Likert scale allow respondents to give a score on how they feel about a question or statement, usually on a scale of Strongly Disagree to Strongly Agree. It should be apparent by now that companies and organizations planning to compete effectively in world markets need a clear and well-focused international marketing plan that is based on a thorough understanding of the markets in which the company is introducing its products. Questions to consider are: What currency should a company price its products? In the case of international marketing, it is particularly important to address the concerns of the stakeholders in the host company. So, too, does the quality of service provided. Many countries have inadequate docking facilities, limited highways, various railroad track gauges, too few vehicles, and too few warehouses. There are some challenges involved, however. But with more markets come more obstacles and hurdles to manage. It tends to transcend language and questions can be easily translated. Soon, you will narrow the selection to the best foreign export markets and develop a market entry strategy. difference between global and international marketing, Marketing Your Company in Foreign Countries - Land, Sea, & Air Shipping Services - InterlogUSA Blog, Small Global Companies - Land, Sea, & Air Shipping Services - InterlogUSA Blog, Rail Strikes? This is particularly important in international markets; for example, customer brand loyalty may be much stronger in certain markets than others, and products may be at the end of their life in the domestic market but may be ideal for less sophisticated markets. A gray market comes about when individuals buy products in a lower-priced country from a manufacturers authorized retailer, ship them to higher-priced countries,and then sell them below the manufacturers suggested price through unauthorized retailers. Is your price point appealing within the market? One product, one message, worldwide. They afford you a direct insight into what your customers think, what they want, what they worry about, what their pain points are, and how they feel about your competitors, among many other things. Do your products (or their labeling or packaging) need to be modified foroneormore markets? Market research is an essential but often challenging process, and it becomes harder when you try to do it in a completely new market far from home. if costs are shared with other parties; NGOs may provide more accurate and up-to-date data than governments in developing regions of the world, which can lack the infrastructure to collect information properly. Talk with successful exporters of similar products, including members of District Export Councils in your local area. They are responsible for getting products to overseas markets and payment in return. Contact experts at the U.S. Department of Commerce and other government agencies by visiting export.gov, the U.S. governments export portal. If not, what can you dotomakeit more appealing? Watch for announcements of specific projects, or simply visit potential markets. This category only includes cookies that ensures basic functionalities and security features of the website. This method works well in areas like North America and Europe but is poorly suited to countries like Eritrea, where only 14% of the population uses the internet. Anthony OReilly, Chairman of H J Heinz, believes that the communications revolution and the convergence of cultures have now set the stage for truly global marketing. This servicecosts, on average, several hundred dollars for each market analyzed and does not require you totravel there. This article will look at some of the most effective methods for international market research, the things youll need to consider compared to domestic research, and some tips on how to make each one work. __ss_noform.push(['submitType', 'manual']); 9380 Central Ave NE #350, Building an international business takes time. The results lead to a realistic set of objectives. Fortunately, market researchers today have access to a wealth of methods and tools, many of which did not exist even in the recent past.Get in touch to learn how Kadence can help you conduct international market research as effectively as possible, allowing you to mount a confident and informed market entry. Home Knowledge hub 9 Most Effective Methods for International Market Research. By adapting both products and promotion for each market, the firm is adopting a totally differentiated approach. In essence, international marketing is aimed at customizing or tailoring products, marketing, and sales tactics at the international market they are expanding into. Another reason is that the products being sold may be surplus or cannot be sold domestically and are therefore already a burden to the company. It not only includes the normal assessment of external environmental factors and resources /capabilities, it also includes a determination of the level of commitment exhibited by the business, as well as possible methods of entry. Ultimately, this coordination between business functions is contingent on the market entry strategy employed as well as the degree of standardization or customization deemed. Often companies find it difficult to coordinate and control prices across their activities in order to enable them to achieve effective financial performance and their desired price positioning. In confirming the positioning of a product or service in a specific market or region, it is therefore necessary to establish in the consumer perception exactly what the product stands for and how it differs from existing and potential competition by designing an identity that confirms the value of the product. How should a company approach selling to countries that have a shortage of hard currency? However, this is always just a starting point. __ss_noform.push(['baseURI', 'https://app-3QNHWHFHF6.marketingautomation.services/webforms/receivePostback/MzawMDE3tjAwBgA/']); Finally, the third link is the channel structure (logistics) within countries, which distributes the products from their point of entry to the final consumer. The objectives of this section is to help students . In a recent job of mine, my role in my position was to show freshly picked US-grown Cherries to Export buyers from China. Suppose a well-established American company begins broadcasting their messages to multiple coun19tries. Necessary cookies are absolutely essential for the website to function properly. However, in countries at different stages of economic development, the customer segments that are likely to be able to purchase the product and the occasions on which it is bought may be significantly different. Now, lets explore some of the most effective methods available to market researchers when getting started in a new, overseas market. The below recommendations will help you obtain useful secondary information: 1. if the product is used in association with a product bought previously; Unlike global marketing where all decisions are made from personnel at the companys headquarters, international marketing generally calls for more marketing employees and research teams. Nagle (12) has suggested nine factors that influence the sensitivity of customers to prices, and all have implications for the international marketer. Another challenge here is cultural differences. 2.2 The International Marketing Plan Copyright 2017 by Babu John Mariadoss. if the price of a product represents a small proportion of total expenditure of the customer; Essentially there are three channel links between the seller and buyer. It should be combined with other methods for best results. Rather than broadcasting the same media advertisements to multiple countries, each country/market segment receives different marketing messages to appeal to that particular community. Additionally, a foreign product often can command a higher price simply because consumers around the world expect foreign items to cost more. The latter audits not only the weaknesses of the company, but also the strengths of the company, which are often taken for granted. Afterwards, youll have greater insight into the basic steps of the market research process. Difficulty answering this question has led to two serious problems. Business-level considerations begin with the assessment of the stakeholders involved in the business. The Country Commercial Guides, which provide latest market intelligence for more than 140 countries, are an excellent research tool. Contract Disputes? Attend seminars, workshops, and international trade shows in your industry. Firms, usually from advanced nations, that are supplying products to less well-developed countries adopt product invention. It is important to clearly identify the different stakeholder groups, understand their expectations, and evaluate their power, because the stakeholders provide the broad guidelines within which the firm operates. Experimental data is gathered through an experiment. However, doing face-to-face research in an international market comes with a unique set of challenges. Product extension, promotion adaptation. In other countries, however, very few people own smartphones. Hire an international trade and marketing consultant. When companies price their products very high in some countries but competitively in others, they engage in a gray market strategy. Trend watching experts from across our global boutique identify four key trends that we believe will define the next 12 months, inspiring innovation across Asia, the US and Europe. Cultural, climate, class, ethnicity, politics they are a few of many elements that differ from country to country and have a great deal of leverage over consumer buying behavior. Congestion? Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. We begin at the corporate level, where firms decide whether to become involved in international markets and determine the resources they are willing to commit. Blaine, MN 55434. If I were to go to Europe for a Futbol match, the tickets prices would be more expensive because of the size of the target audience, than if I were to attend an MLS soccer game in the US. Importance of Developing an International Marketing Plan. This technology applies to market research and is ideally suited to researching foreign markets. Primary market research has the advantage of being tailored to your companys needs and providesanswers to specific questions. This is a blanket term for all the data you gather through speaking to real people in your target market. Thus, while the companys brand awareness may soar, their brand authority remains low in Brazil and high only in America. Whats Currently Happening in the Rail Industry, Strike at German Ports May Have Long-Lasting Implications, Prices for Wheat Have Dropped, but the Pressure on Supply Still Remains. When conducting secondary market research, your company collects data from various sources, such as trade statistics for a country or a product. For example, if a US bicycle manufacturer focuses only on the US market, it loses the opportunity to increase revenues in countries where bicycles are a primary mode of transportation. Dual adaptation. Required fields are marked *. An example of international pricing I could use would be for a sporting event. What are the required standards, testing, and certifications? Out of these cookies, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. The U.S. Commercial Service can also help you find intermediaries with specific marketexpertise. A steep depreciation in the value of the dollar can make your product considerably more competitive. Keep abreast of world events that influence theglobal marketplace.. All the various challenges and obstacles of market entry are compounded when you enter a market with different cultures, customs, languages, laws, and infrastructure to what youre used to dealing with in your domestic market. The drawbacks are that its dependent on mobile access. How should a company deal with fluctuating exchange rates? Keep in mind, there is a difference between global and international marketing. The difference between good and bad market research can make the difference between the success and failure of your product, and this is even more true when launching in foreign markets. In market research, this can take many forms. Once again, experimental data is a useful tool when researching an international market, since it yields real-world findings and allows you to draw concrete insights about how your product will be received. Global marketing can also breathe life into a foundering product, and may even extend its lifespan. Its quick, easy, cheap, and allows you to reach a large number of people. It is important, too, to evaluate the capacity of the firm to be flexible, adaptable, and proactive, as these are the attributes necessary, for success in a highly competitive and rapidly changing world.