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International Marketing Summary 3MAR
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1: Global marketingInternational marketing
→ The application of marketing principles to more than one country
5 decisions in international marketing
1. Whether to internationalize
2. What markets to enter
3. Market entry strategies
4. Designing commercial plan
5. Implementing & coördinating
Views on doing international business
Internationalization vs globalization
Globalization Internationalization
The change in the world economy to a more The activity of firms on an international scale
interdependent system. and the resulting impact of their activities.
The trend of firms buying, developing, International, means between or among
producing & selling products/services in most nations.
countries and regions of the world.
Global economic integration of many formerly International can be limited to a region or a few
national economies into one global economy. countries.
A response to globalization.
How does the company management look at internationalization?
→ Goal: find and satisfy global customer needs
→ Will have to coordinate marketing activities
→ Different management orientations
EPRG Framework
→ Different management views/orientations
,Ethnocentric companies
Etnos = nation, people
• Home country is ‘superior’
• Needs of domestic market are most relevant
• Highly centralized decision-making (HQ power)
• Product is a copy-paste of home
• Organization & technology same as in home country
Advantages Disadvantages
Cheaper: no cost & efforts needed for No full exploitation of opportunities worldwide
adaptation
High degree of control Inefficient: decision makers need to travel a lot
One-way communication No opportunity to learn from other cultures
Example: Nissan
→ Aan iemand vragen
Example Harley Davidson
→ Is by most definitions an ethnocentric company
→ Understandably with respect to its positioning
→ An “all-American” brand
→ Holding a multinational appeal
Polycentric companies
Poly = a lot, multiple
• ‘Each country is unique’
• Decision-making: host country orientation, highly decentralized
• Products & marketing: country-by-country: different conditions for production and
marketing in different locations
• Marketing strategy: localization & adaptation
• Companies’ basic objective: ‘public acceptance within the host country’
Advantages Disadvantages
Better understanding of local needs No economies of scale
Better exploitation of local market potential High cost of local responsive marketing mix
Easier targeting with local terms Lack of coordinations & control
Maximize profits in each location with specific No knowledge transfer between locations
targets (market research)
Example: McDonalds
• McDonald’s strategy to serve non-beef burgers to its Indian customers can be defined as a
polycentric orientation
• Each subsidiary has it own price and promotion policy
→ Note: Where possible McDonald’s will try to standardize (reduce costs), but always keep an eye
on the local market needs
Example: Unilever
• Unilever’s deodorant REXONA has more than 39 different packages and even different brand
names
,Regio centric companies
• The world consists of regions
• These regions will be based on similarities (e.g.: Benelux market, EU, Nafta)
• Strategies formulated on the entire region rather than individual countries
• Reasons
o Saves cost
o Some sensitivity towards local
o Transitional step towards polycentric
Example: Coca Cola
• Distributes its communication across the different continents
Geocentric companies
• The world is one common market
• Develop global product concepts without adaptions to the product, but depends on the
industry
• HQ & subsidiaries collaborate
• Not possible in FMCG, while easier in technology sector (Apple, Google, Boeing)
Globalization vs Localization
Globalization Localization
= global integration = market responsiveness
= recognizing the similarities between = responding to each market’s needs and wants
international markets and integrating them into
the overall global strategy
Example: Henkel Persil Black
→ In Saudi Arabia
• Abaya: black overgarment worn by Arab women
• Market need: Abaya needs to remain black
→ In Western Europe
• Via Abaya, detected a need for a detergent for black clothing in Western markets
• Jumping onto the black fashion wave
Which view of the ERPG framework do you recognize?
→ Globalization + localization = GLOCALIZATION
→ Think global, act local
→ Other example like this: McDonalds
Reasons for globalization Reasons for localization
Removal of trade barriers Cultural differences
Relationship management
Standardized technology Protectionism
Worldwide markets
Cultural homogenisation Deglobalization trend
Worldwide communication
Global cost drivers
, Glocalization
2: Internal: decision to internationalize
Global marketing & management style
Large scale enterprises Small medium
enterprises
Resources Many resources Limited resources
Internal resources External of resources
Coordination of personnel, (outsourcing)
finance, market knowledge
Formation of strategy / Deliberate strategy formation Emergent strategy formation
decision making processes Adaptive decision making model Entrepreneurial decision-making
in small incremental steps model
Owner is directly involved,
dominating decision making
throughout the company
Organization Formal/hierarchical Informal
Independent from one person Owner has power to control total
organization
Risk-taking Mainly risks averse Sometimes risk-taking/sometimes
Focus on long term opportunities risk-averse
Focus on short-term
opportunities
Flexibility Low High
Economies of scale & Yes Only limited
scope
Use of information Advanced techniques Informal, inexpensive info
resources Databases gathering
External consultancy Internal resources
Internet Face-to-face communication
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