INTERNATIONAL MARKETING - Meaning, domestic and international marketing, Factor affecting International markets and domestic market, Intermediaries in international marketing , merit and demerit of it .

MEANING 

     International Marketing is becoming largely popular and it's potential is increasing day by day as it is applicable universally. However , the difference between marketing at home country and abroad has been identified by learned people at large.

      " Marketing is an organisational function and a set of processes for creating communication and delivering value to the customer's relationship in way that benefit the organisation and it's stake holders " . 

        Thus , in this emerging global scenario , developing a thorough understanding of international marketing has become a pre- condition of success for the firms operating in domestic as well as in international markets. The two types of marketing differ in their scope of implementation.

DOMESTIC MARKETING 

     Domestic markets are those markets which are operated within the national boundaries of the country where local competitors compete and deals with buying and selling of products and services is called domestic markets. The company has to face two types of factors which operate in a market. They are : controllable and uncontrollable factors. 

      Controllable variable such as price, advertising  and distribution of product and uncontrollable like economic structure , cultural values and legal infrastructure within specific political or geographic boundaries of a country.

INTERNATIONAL MARKETING

     International marketing are those markets which are operating across the national boundaries of the home country is called International marketing. " Performance of business activity designed to plan, price , promote and direct the flow of company's goods and services to consumers or users in more than one nation for profit" .

     The main difference between international and domestic marketing arises due to the challenge faced by firms in both the market environment , which are obviously much complex in international markets than what a firm faces while operating exclusively in domestic markets.

FACTORS AFFECTING INTERNATIONAL MARKETS AND DOMESTIC MARKET

  A marketer has to keep changing his business strategies due to economic , political, social cultural and other factors that influence both the international and domestic markets. These are generally uncontrollable.

 (a) ECONOMIC FACTORS :  The international marketing decisions are greatly influence by the economy  and it's variables like Economic growth, GNP, industrial sector, Role of foreign trade in the economy . The domestic tariff structure and exemption regarding import duty affect the final cost of production and therefore affect the competitiveness of the product in term of cost. The exchange rate and the foreign exchange regulations of a country influence the cost of imported inputs and also the payment making and receiving options available in the international market. 

(b) POLITICAL AND LEGAL FACTORS : Political and legal laws of a country affect the decision of international marketing. The government of a particular country may impose restrictions on international business transactions for the sake of issues of national concern like security ,integrity, culture , moral ethics and values.  The procedure of getting legal sanction to do business sometimes can take years .

Mostly , political turmoil creates uncertainties in operation. Coca-Cola was made to leave the country in 1970's because coca-cola incurred the wrath of politicians, most particularly George Fernandes who was singularly responsible for throwing out the "Real thing". An international firm should be very careful of its operations throughout the globe and bad publicity can affect it where it least expects the damage to happen.

(c) CULTURAL FACTORS : It is important to understand the cultural trends , local traditions and manners of the country while selecting product company names, policies , logo , punch lines, brand names etc. The local traditions affect consumption patterns and buying habits in international markets. Wrong selection of such thing may go against the culture of the people of that country. 

(d) SOCIAL FACTORS : The trade environment in the host country may be different from home country of the marketer mainly due to different policies , rules and regulations, standard of living , earning , expenditure and consumption patterns etc. The marketer has to adapt to these changes for maximising hus profits.

(e) GOVERNMENT POLICIES : Government imposes regulations to restrict imports so that the domestic industries can develop . Tariffs protect domestic producers from foreign competition and such policies and tariffs make marketing mix decision complex in international markets.

(f) RISKS : There is more risk factors in international market than in domestic market   Thus a firm has to be cautious in an international market on various risks like Exchange rate risk; political risk and inadequate compensation . In a floating rate system , exchange rate change frequently causing profits or loss that give rise to financial risk.

INTERMEDIARIES IN INTERNATIONAL MARKETING

" A channel of distribution comprises a set of institution which perform all of the activities utilised to move a product and it's title from production to consumption " .

There are two types of intermediaries :

1. Direct intermediaries

2. Indirect intermediaries

ADVANTAGES OF USING AN INTERMEDIARY

  Following is the list of advantages a firm gets from intermediary : 

Market coverage, customer contacts, lower costs, systematic cash flow  and logistic support etc. Market specialization , marketing knowledge, segmentation and selling skills are indispensable for effective marketing strategies.

DISADVANTAGES OF USING AN INTERMEDIARY

    Along with advantages intermediary also brings following disadvantage for the firm: 

Fear of losing control , losing customer contact, fear of losing customer ownership , fear of opportunity behavior , fear of inadequate communication , fear that the objectives of the intermediary will conflict with loss of the producer and  fear of poor market management.

REFERENCES

1. International marketing - Rakesh Joshi, third edition 2005

2. International business management - N Venkateshwar, first edition ,2009.