Showing posts with label amity cochin. Show all posts
Showing posts with label amity cochin. Show all posts
Saturday, March 1, 2014
Saturday, November 23, 2013
International marketing planning model
 |
| International marketing planning model |
response to chance orders coming either from customers who are international
players or from other sources such as foreign buyers attending a domestic exhibi-
tion. Such 'passive exporting' is not international marketing, although it contributes
to international trade. It does not associate with the central principle of creating
customer value and market targeting, there i.s little assessment of critical factors
for competitive success, and it is unlikely to build a long-term market position,
Limited domestic growth and/or intense domestic competition is a key
reason why firms enter foreign markets and was a prime motivator behind the
Japanese companies' overseas expansion programme during the 1970s and
1980s. In practice, many firms quickly suspend foreign market activity when the
domestic economy improves or when they fail to make money in the overseas
operation. Finns driven to exporting because of domestic recession often fail to
anticipate the wider external constraints to doing business in a foreign market
and tend to take a short-term orientation to international marketing.3
Furthermore, companies that are struggling to survive at home are highly
unlikely to successfully take on and beat sophisticated competitors in foreign
markets. The domestic market must be secured first before going abroad and it
should be maintained thereafter. Japan's top two car manufacturers, Toyota and
Nissan, are arch rivals at home. They took this rivalry overseas and in the process
have raised the level of competitive activity to new heights in North America and
Europe, while striving to remain strong performers in their home base.
Geographic market diversification to reduce country-specific risk - that is,
the risk of operating in only one country, due to different political-economic
cycles - is a popular reason behind firms' international expansion drive. Firms
must understand that market needs may be strikingly different, even for appar-
ently similar products, and that different management skills and approaches are
needed for different country markets. So, managers must weigh the costs and
barriers to global diversification against the benefits of risk reduction.
Firms spread the costs of production over more units if output is expanded for
overseas markets. While economies of scale give firms a strong incentive to
expand into foreign markets, the firm must also take on board additional adminis-
tration, selling, distribution and marketing co.sts. A 'cost-led' approach or a 'selling
orientation' in international marketing is unlikely to lead to long-term success.
Without H marketing-led orientation, where customers' needs are identified and
satisfied, and die firm's marketing mix adapted for the foreign market, the inter-
national business activity of the firm is unlikely to flourish.
In summary, firms enter overseas markets for profits and/or survival. But
firms must not confuse exporting with international marketing. The latter is
about taking a long-term perspective of foreign market potential and relentlessly
adopting a market-led approach to identifying, anticipating and satisfying the
needs of customers in target international markets. Before going abroad,the firm
must weigh the risks and question its ability to ope rate globally. Can the company
learn to understand the preferences and buying behaviour of customers in other
country markets? Can it offer competitively attractive products? Will it be able to
adapt to other countries' business cultures and to deal effectively with foreign
nationals? Do the company's managers have the requisite international experi-
ence? Has management considered the impact of foreign regulations and political
environments? International marketing is really about exploiting market oppor-
tunities based upon sound environment and specific market analyses.
The Global Marketplace
This Blog discusses the importance of global marketing and explains the key
elements of the planning process: analyzing international market opportunities;
deciding whether or not to go abroad; establishing market entry mode; allocating
resources; developing the marketing plan; organizing for international marketing;
implementing the marketing strategy; and evaluation and control.
Companies pay little attention to international trade when the home market
is big and teeming with opportunities. The home market is also much safer.
Managers do not need to learn other languages, deal with strange and changing
currencies, face political and legal uncertainties or adapt their products to
different customer needs and expectations. This has been the attitude of many
western companies, which saw little need to sell in overseas markets because
their domestic market alone seemed to offer attractive opportunities for growth.
Today, however, die business environment is changing and firms cannot afford to
ignore international markets. The increasing dependency of nations around die
world on each other's goods and services has raised awareness among companies of
die need for a more international outlook in their approach to business. International
markets are important because most firms are geared towards growth and so must
seek new opportunities in foreign countries as their domestic markets mature. As
international trade becomes more liberalized, firms are facing tougher foreign
competition in the domestic market. They must develop the ability to fight off
competitors on tlieir own home ground, or to exploit business opportunities in
foreign markets.
Furthermore, time and distance are shrinking rapidly with the advent of
faster communication, transportation and financial flows. Products developed in
one country are finding enthusiastic acceptance in other countries. Across
western Europe and North America, names such as Toyota, Sony and Toshiba
have become household words in the same way McDonald's, Toys 'fl' Us, Philips
and IKEA are familiar names to most young consumers in Asian countries like
Japan, Singapore find Hong Kong.
Thus, as global competition intensifies, local companies that never thought
about foreign competitors suddenly find these competitors in their own back-
yards. The firm that stays at home to play it safe not only misses the opportunity
to enter other markets, but also risks losing its home market.
Consider, for example, Japanese victories over western producers in ninny
sectors - motorcycles, cars, cameras, consumer electronics, machine tools,photocopiers. These markets used to be the stronghold of US, German and British
companies in the 1970s, but are now dominated by .lapanese manufacturers. The
latter are not insulated from foreign competitors either. Increasing competition
from lower-cost newly industrializing countries (NIGs) in the Far East, notably
South Korea and Taiwan, are posing a big threat to established Japanese firms in
traditional industries like steel, chemicals and heavy machinery.
In the United States, American firms are fighting off aggressive assaults by
international European companies: Die's successful attacks on Gillette and
Nestle's gains in the coffee and confectionery markets are a reflection of the
growing level of international competition in 'safe' home markets. In the
European Union(Ell), foreign firms'direct investment is on the increase and
ititra-Union flows of investment in all kinds of business sectors - cars, clothing,
retailing, financial services - are particularly active. Many sophisticated and
aggressive foreign companies also see the emerging eastern European economies
as longer-term opportunities. So, more than ever, firms must learn how to enter
foreign markets and increase their global competitiveness.
Although some companies would like to stem the tide of foreign imports
through protectionism, this response would be only a temporary solution.
Suppressing a free flow of foreign imports would lead to fewer choices for the
consumer and higher prices for indigenously produced goods. In the long run, it
would raise the cost of living and protect inefficient domestic firms. It also means
that consumers' needs and wants would not be met effectively and efficiently. A
better solution is to encourage more firms to learn to make the world their
market.
The importance of internationalization is also reflected by the fact that most
governments run an export promotion programme, which tries to persuade local
companies to export. Denmark pays more than half the salary of marketing
consultants who help small and medium-size Danish companies get into exports.
Many countries go even further and subsidize their companies by granting prefer-
ential land and energy costs - they even supply cash outright so that their com-
panies can charge lower prices than do their foreign competitors.
Today the pressure on firms operating in global industries is not just to export
to other countries, but to strive to be a global firm. A global industry is one in
which the strategic positions of competitors in given geographic or national
markets are affected by their overall global positions, A global firm, therefore, is
one that, by operating in more than one country, gains research and develop-
ment, production, marketing and financial advantages in its costs and reputation
that are not available to purely domestic competitors,2 The global company sees
the world as one market. It minimizes the importance of national boundaries, and
raises capital, sources materials and components, and manufactures and markets
its goods wherever it can do the best job. For example, Ford's 'world truck' sports
a cab made in Europe and a chassis built in North America. It is assembled in
Brax.il and imported to the United States for sale. Thus global firms gain advan-
tages by planning, operating and co-ordinating their activities on a worldwide
basis. These gains are a key reason behind recent global restructuring
programmes undertaken by leading German car producers, BMW and Mercedes-
Benz. Global marketing is concerned with integrating or standardizing marketing
actions across a number of geographic markets. This does not rule out forceful
adaptation of the marketing mix to individual countries, but suggests that firms,
where possible, ignore traditional market boundaries and capitalize on similari-
ties between markets to build competitive advantage.
Because firms around the world are globalizing at a rapid rate, domestic firms
in global industries must act quickly before the window closes on them. This does
not mean that small and medium-size firms must operate in a dozen countries to succeed. These firms can practise global nichernanship. The world, however, is
becoming smaller and every company operating in a global industry - whether
large or small - must assess and establish its place in world markets.
Firms that confront international competitors in their existing markets must
ask some basic questions; What market position should we try to establish in our
country, in the geographic region (e.g. Europe. North America, Asia, Australasia)
and globally? Who will our global competitors he and what are their strategies and
resources? Where should we produce or source our products? What strategic
alliances should we form with other firms around the world V.
elements of the planning process: analyzing international market opportunities;
deciding whether or not to go abroad; establishing market entry mode; allocating
resources; developing the marketing plan; organizing for international marketing;
implementing the marketing strategy; and evaluation and control.
Companies pay little attention to international trade when the home market
is big and teeming with opportunities. The home market is also much safer.
Managers do not need to learn other languages, deal with strange and changing
currencies, face political and legal uncertainties or adapt their products to
different customer needs and expectations. This has been the attitude of many
western companies, which saw little need to sell in overseas markets because
their domestic market alone seemed to offer attractive opportunities for growth.
Today, however, die business environment is changing and firms cannot afford to
ignore international markets. The increasing dependency of nations around die
world on each other's goods and services has raised awareness among companies of
die need for a more international outlook in their approach to business. International
markets are important because most firms are geared towards growth and so must
seek new opportunities in foreign countries as their domestic markets mature. As
international trade becomes more liberalized, firms are facing tougher foreign
competition in the domestic market. They must develop the ability to fight off
competitors on tlieir own home ground, or to exploit business opportunities in
foreign markets.
Furthermore, time and distance are shrinking rapidly with the advent of
faster communication, transportation and financial flows. Products developed in
one country are finding enthusiastic acceptance in other countries. Across
western Europe and North America, names such as Toyota, Sony and Toshiba
have become household words in the same way McDonald's, Toys 'fl' Us, Philips
and IKEA are familiar names to most young consumers in Asian countries like
Japan, Singapore find Hong Kong.
Thus, as global competition intensifies, local companies that never thought
about foreign competitors suddenly find these competitors in their own back-
yards. The firm that stays at home to play it safe not only misses the opportunity
to enter other markets, but also risks losing its home market.
Consider, for example, Japanese victories over western producers in ninny
sectors - motorcycles, cars, cameras, consumer electronics, machine tools,photocopiers. These markets used to be the stronghold of US, German and British
companies in the 1970s, but are now dominated by .lapanese manufacturers. The
latter are not insulated from foreign competitors either. Increasing competition
from lower-cost newly industrializing countries (NIGs) in the Far East, notably
South Korea and Taiwan, are posing a big threat to established Japanese firms in
traditional industries like steel, chemicals and heavy machinery.
In the United States, American firms are fighting off aggressive assaults by
international European companies: Die's successful attacks on Gillette and
Nestle's gains in the coffee and confectionery markets are a reflection of the
growing level of international competition in 'safe' home markets. In the
European Union(Ell), foreign firms'direct investment is on the increase and
ititra-Union flows of investment in all kinds of business sectors - cars, clothing,
retailing, financial services - are particularly active. Many sophisticated and
aggressive foreign companies also see the emerging eastern European economies
as longer-term opportunities. So, more than ever, firms must learn how to enter
foreign markets and increase their global competitiveness.
Although some companies would like to stem the tide of foreign imports
through protectionism, this response would be only a temporary solution.
Suppressing a free flow of foreign imports would lead to fewer choices for the
consumer and higher prices for indigenously produced goods. In the long run, it
would raise the cost of living and protect inefficient domestic firms. It also means
that consumers' needs and wants would not be met effectively and efficiently. A
better solution is to encourage more firms to learn to make the world their
market.
The importance of internationalization is also reflected by the fact that most
governments run an export promotion programme, which tries to persuade local
companies to export. Denmark pays more than half the salary of marketing
consultants who help small and medium-size Danish companies get into exports.
Many countries go even further and subsidize their companies by granting prefer-
ential land and energy costs - they even supply cash outright so that their com-
panies can charge lower prices than do their foreign competitors.
Today the pressure on firms operating in global industries is not just to export
to other countries, but to strive to be a global firm. A global industry is one in
which the strategic positions of competitors in given geographic or national
markets are affected by their overall global positions, A global firm, therefore, is
one that, by operating in more than one country, gains research and develop-
ment, production, marketing and financial advantages in its costs and reputation
that are not available to purely domestic competitors,2 The global company sees
the world as one market. It minimizes the importance of national boundaries, and
raises capital, sources materials and components, and manufactures and markets
its goods wherever it can do the best job. For example, Ford's 'world truck' sports
a cab made in Europe and a chassis built in North America. It is assembled in
Brax.il and imported to the United States for sale. Thus global firms gain advan-
tages by planning, operating and co-ordinating their activities on a worldwide
basis. These gains are a key reason behind recent global restructuring
programmes undertaken by leading German car producers, BMW and Mercedes-
Benz. Global marketing is concerned with integrating or standardizing marketing
actions across a number of geographic markets. This does not rule out forceful
adaptation of the marketing mix to individual countries, but suggests that firms,
where possible, ignore traditional market boundaries and capitalize on similari-
ties between markets to build competitive advantage.
Because firms around the world are globalizing at a rapid rate, domestic firms
in global industries must act quickly before the window closes on them. This does
not mean that small and medium-size firms must operate in a dozen countries to succeed. These firms can practise global nichernanship. The world, however, is
becoming smaller and every company operating in a global industry - whether
large or small - must assess and establish its place in world markets.
Firms that confront international competitors in their existing markets must
ask some basic questions; What market position should we try to establish in our
country, in the geographic region (e.g. Europe. North America, Asia, Australasia)
and globally? Who will our global competitors he and what are their strategies and
resources? Where should we produce or source our products? What strategic
alliances should we form with other firms around the world V.
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