Definition: International marketing is the process of promoting and selling products or services in

different countries. It involves understanding the needs and preferences of customers in other
nations and adjusting marketing strategies like pricing, advertising, and product features to fit those
markets. The goal is to successfully reach and appeal to global customers, often overcoming
language, cultural, and legal differences.

The scope of international marketing refers to the wide range of activities and opportunities involved
in promoting and selling products or services across different countries. Here's a simple breakdown
of its scope:

1. **Market research**: Understanding the needs, preferences, and behaviors of customers in

various countries.

2. **Product adaptation**: Modifying products or services to meet the tastes, regulations, or

cultural preferences of different regions.
3. **Pricing strategies**: Setting prices based on the local economy, competition, and customer
expectations in each country.
4. **Distribution**: Deciding how to get products into international markets, which may involve
setting up new supply chains or partnerships.

5. **Promotion and advertising**: Creating marketing campaigns that appeal to local customers,
considering language, culture, and media habits.

6. **Dealing with regulations**: Complying with the laws and trade policies of different countries,
such as import/export rules or tariffs.

7. **Cultural differences**: Understanding and respecting the cultural and social norms of each
market to avoid misunderstandings and build positive relationships.

In short, international marketing involves expanding a business across borders and adapting to new
markets to achieve global success.

Features of IM:

The features of international marketing highlight what makes it unique compared to domestic
marketing. Here are the key features explained simply:

1. **Global Reach**: International marketing involves promoting products or services across

different countries and regions, beyond a company's home country.

2. **Cultural Sensitivity**: It requires understanding and respecting different cultures, languages,

customs, and consumer preferences to create marketing strategies that appeal to local audiences.
3. **Market Diversity**: Each country has its own economy, customer behavior, and competition.
International marketing deals with these diverse market conditions.

4. **Adaptation and Flexibility**: Companies often need to modify products, prices, and promotions
to meet the specific needs of each international market.

5. **Complex Distribution**: Getting products into different countries can involve dealing with
various transportation systems, customs regulations, and local distributors.

6. **Legal and Political Factors**: Every country has its own laws and regulations for businesses.
International marketers must navigate trade laws, taxes, tariffs, and political environments.

7. **Currency and Exchange Rates**: In international markets, businesses must deal with different
currencies and fluctuating exchange rates, which can affect pricing and profitability.

8. **Increased Competition**: Companies face both local competitors and other international
brands, making it necessary to differentiate their products to succeed.

These features make international marketing more challenging but also provide opportunities for
growth and expansion.

Differences between domestic and international marketing:

Aspect Domestic Marketing International Marketing

Targets customers within one

Market Area Targets customers in multiple countries.
country.

Deals with a single culture or Requires adapting to various cultures,

Cultural Differences
similar cultural preferences. languages, and customs.

Operates in a familiar economic Faces diverse economic conditions,

Market Conditions
and competitive environment. competition, and consumer preferences.

Legal and Regulatory Follows laws and regulations of Must navigate multiple countries' trade
Environment one country. laws, taxes, and regulations.
Aspect Domestic Marketing International Marketing

Uses one currency, making

Currency and Deals with multiple currencies and
financial transactions
Exchange Rates fluctuating exchange rates.
straightforward.

Products are distributed within the Involves complex logistics and customs
Distribution
same country. for cross-border distribution.

Marketing campaigns are in one Campaigns need to be translated and

Communication and
language and tailored to a similar adapted to different languages and
Promotion
audience. cultural contexts.

Products usually remain the same Products often need to be adapted to

Product Adaptation
across the domestic market. meet local preferences and regulations.

Requires extensive research to

Research focuses on a single
Market Research understand different markets' needs and
market's needs and trends.
trends.

Competes with local businesses Faces both local competitors and other
Competition
and brands. international brands.

Must offer support in multiple languages

Provides support based on local
Customer Service and meet diverse customer service
customer expectations.
expectations.

Prices are set based on local Prices must be adjusted for different
Pricing Strategies market conditions and consumer economies, including considerations of
purchasing power. tariffs and local buying power.

Must navigate trade barriers such as

Generally free from international
Trade Barriers tariffs, import restrictions, and trade
trade barriers.
agreements.

Affects and is affected by the Influenced by global economic factors

Economic Factors
domestic economy. and fluctuations in various economies.

Requires managing an international

Supply Chain Simplified within a single country’s
supply chain with diverse logistics and
Management infrastructure.
potential delays.

This expanded table provides a more comprehensive comparison of domestic and international
marketing.

Why international marketing?

International marketing is important because it helps businesses grow and reach new customers
beyond their home country. Here are some simple reasons why companies choose to market
internationally:
1. **Expand Market Reach**: It allows businesses to sell their products or services in new countries,
increasing their customer base.

2. **Boost Sales and Revenue**: By entering international markets, companies can tap into new
revenue streams and increase overall sales.

3. **Diversify Risk**: Spreading business across multiple countries helps reduce dependence on a
single market, protecting against economic downturns in any one country.

4. **Utilize Global Resources**: Access to different resources, technologies, and talents can improve
products and operations.

5. **Explore New Opportunities**: Different countries offer unique opportunities for growth,
innovation, and partnerships.

6. **Gain Competitive Advantage**: Being present in international markets can help companies stay
ahead of competitors who are only operating domestically.

In summary, international marketing helps businesses grow, reduce risks, and take advantage of new
opportunities around the world.

International Marketing Theories:

International marketing theories help businesses understand and navigate the complexities of
marketing their products or services in different countries. Here are some key theories explained
simply:

1. **Globalization Theory**: This theory suggests that markets around the world are becoming more
similar due to globalization. Companies should adopt a standardized marketing approach to take
advantage of this uniformity.
2. **Adaptation Theory**: According to this theory, companies should adapt their marketing
strategies to fit the unique needs and preferences of each local market. This might involve changing
products, promotions, or packaging to suit different cultures and regulations.

3. **International Product Life Cycle Theory**: This theory explains that products go through
different stages—introduction, growth, maturity, and decline—across international markets. Initially,
a product might be introduced in developed countries, and later, it may be marketed in developing
countries as it matures.

4. **Market Entry Theory**: This theory outlines different ways companies can enter international
markets, such as exporting, franchising, licensing, joint ventures, or setting up wholly-owned
subsidiaries. Each method has its own risks and benefits.

5. **Uppsala Internationalization Model**: This model suggests that companies gradually increase
their international involvement as they gain more experience and knowledge. They start with small,
low-risk entries and slowly move to more significant investments in foreign markets.
6. **Eclectic Paradigm (OLI Model)**: This theory proposes that a company’s decision to enter an
international market is based on three factors: Ownership advantages (unique assets), Location
advantages (benefits of operating in a foreign market), and Internalization advantages (benefits of
controlling operations rather than outsourcing).

7. **Porter’s Diamond Model**: This model explains how certain industries in specific countries
become competitive internationally. It focuses on factors like competitive advantage, demand
conditions, related industries, and government policies.

These theories provide frameworks for understanding how to approach international marketing and
make informed decisions about entering and competing in global markets.

Types of economics and markets:

Here’s a simple overview of different types of economics and markets:

### Types of Economics:

1. **Microeconomics**: Studies individual and business decisions about how resources are used and
how goods and services are priced. It focuses on things like supply and demand, prices, and
consumer behavior.
2. **Macroeconomics**: Looks at the economy as a whole. It examines big-picture issues like
national income, inflation, unemployment, and overall economic growth.

3. **Traditional Economics**: Based on traditional customs and practices, often found in rural or
agricultural societies. Economic decisions are influenced by longstanding customs and community
traditions.

4. **Keynesian Economics**: Suggests that government intervention can help stabilize the economy
during recessions by adjusting spending and taxes. It emphasizes the role of aggregate demand in
influencing economic activity.
5. **Classical Economics**: Focuses on free markets and minimal government intervention. It
believes that markets are self-regulating and that economic forces naturally move towards
equilibrium.

6. **Behavioral Economics**: Examines how psychological factors and cognitive biases affect
economic decisions, challenging the idea that people always make rational choices.

7. **Development Economics**: Studies how economies grow and develop, especially in low-income
countries. It looks at ways to improve economic conditions and reduce poverty.

### Types of Markets:

1. **Perfect Competition**: A market where there are many buyers and sellers, all of whom have
perfect information. Products are identical, and no single buyer or seller can influence the market
price.
2. **Monopolistic Competition**: A market with many sellers offering similar but not identical
products. Each seller has some control over their prices due to product differentiation.

3. **Oligopoly**: A market dominated by a few large firms. These firms have significant control over
prices and often compete with each other, but their actions can influence the market significantly.

4. **Monopoly**: A market where there is only one seller or provider of a product or service. The
monopolist controls the market price and supply.

5. **Duopoly**: A special case of an oligopoly where only two firms dominate the market. These
firms often have significant influence over prices and market conditions.

6. **Black Market**: An unofficial market where goods and services are bought and sold illegally,
often to avoid regulations or taxes.

7. **Free Market**: A market where prices and production are determined by unrestricted
competition and consumer demand, with little to no government intervention.

8. **Mixed Economy**: Combines elements of both market economies and planned economies. It
includes a mix of free market practices and government intervention to regulate or support certain
sectors.

These categories help us understand how economies function and how different market structures
impact business and consumer behavior.

UNIT -2
Environment of global markets: types: political, economical, social , legal and technological
environment, Exim policy , international trade and its barriers trade in goods and services.

### **Environment of Global Markets**

1. **Political Environment**:

- **Definition**: Refers to how government policies and political stability affect business
operations in different countries.

- **Examples**: Trade agreements, political stability, government regulations, and international

relations.

2. **Economic Environment**:
- **Definition**: Involves the economic conditions that influence a country's market and
businesses.

- **Examples**: Economic growth, inflation rates, exchange rates, and employment levels.

3. **Social Environment**:

- **Definition**: Includes the cultural and social factors that impact how businesses operate and
how products are received.

- **Examples**: Cultural norms, social attitudes, lifestyle trends, and demographic changes.
4. **Legal Environment**:

- **Definition**: Refers to the laws and regulations that govern business operations in different
countries.

- **Examples**: Trade laws, labor laws, intellectual property rights, and environmental regulations.

5. **Technological Environment**:

- **Definition**: Involves the impact of technology on businesses and how advancements

influence global markets.

- **Examples**: Innovations, digital communication, automation, and technological infrastructure.

### **Exim Policy**

- **Definition**: Short for Export-Import policy, it refers to the regulations and guidelines set by a
government to control and promote international trade.

- **Purpose**: To manage the flow of goods and services between countries, support domestic
industries, and balance trade deficits.

### **International Trade**

- **Definition**: The exchange of goods and services between countries. It allows countries to
obtain products they don’t produce locally and sell what they have in excess.
- **Components**: Includes both exports (goods/services sold to other countries) and imports
(goods/services purchased from other countries).

### **Trade Barriers**

- **Definition**: Obstacles that countries use to restrict or regulate international trade.

- **Types**:

- **Tariffs**: Taxes on imported goods that make them more expensive.

- **Quotas**: Limits on the number of goods that can be imported.

- **Embargoes**: Complete bans on trade with certain countries.

- **Subsidies**: Financial support to local businesses to make their products cheaper compared to
foreign goods.

- **Regulations**: Rules and standards that products must meet to enter a market.

### **Trade in Goods and Services**

- **Goods**: Physical products like electronics, clothing, or food that are traded between countries.

- **Services**: Intangible products like financial services, consulting, or tourism that are exchanged
across borders.

Understanding these elements helps businesses navigate the complexities of international markets
and make informed decisions about global trade and investment.