4.7. International Marketing (HL Only)


 * International marketing


 * Sale and marketing of a business’ products on an international scale.
 * Globalization: increasing worldwide competition, the process by which businesses start operating on an international scale.
 * Methods of entry into foreign markets


 * Exporting


 * Direct selling to overseas buyers
 * Direct investment


 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Where business set up additional production and distribution facilities in foreign markets
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Costly
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#222222;font-weight:700;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">The Internet: <span style="font-size:11pt;font-family:Arial;color:#222222;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">businesses use internet to market their products because of its global reach. <span style="font-size:11pt;font-family:Arial;color:#222222;font-weight:700;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">E-commerce: <span style="font-size:11pt;font-family:Arial;color:#222222;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">trading over the internet.


 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Lower costs and risks
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:700;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Joint ventures


 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Two or more companies investing in a new project overseas
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Spreads risk while sharing benefits, resources, and knowledge
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:700;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Franchising/licensing


 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">A firm paying for an established business’ name, products and image, and will be allowed to operate under that name (ex. McDonald's).
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:700;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Opportunities and threats of entry into foreign markets


 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:700;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Opportunities


 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Expand marketing operations into growing and emerging markets
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Spreading overall risk between more markets
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Taking advantage of marketing and production economies of scale
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:700;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Threats


 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">High-barriers of entry
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Strong competition from the well-established local industry
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Differing consumer demands
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:700;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Approaches to selling goods internationally


 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:700;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Pan-global


 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Standardized product across the globe
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Treats the whole world as a single market
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:700;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Advantages


 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Capitalize on existing strong brand
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Economies of scale (advertising/promotion)
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">More consistency and standardization
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:700;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Disadvantages


 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">May offend local tastes and culture
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Risky if not tailored to the local market
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:700;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Global localization/glocalization


 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Adopting a differentiated marketing mix that meets national and regional tastes and cultures
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Thinking global, acting local
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:700;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Advantages


 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Caters to local tastes
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">More products (diversification)
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Spreads risks
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Cater to wider market
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Avoid any issues of cultural insensitivity
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:700;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Disadvantages


 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">May lose identity of brand
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">More costly (research implications)
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:700;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Branding in the global market


 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Strong brand adds to competitive strength of a business and allows it to penetrate overseas markets more easily
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Successful global brands enjoy marketing economies of scale, thus achieving consistency in branding, cost savings, and brand loyalty
 * <p dir="ltr" style="line-height:1.38;margin-top:0pt;margin-bottom:0pt;"><span style="font-size:11pt;font-family:Arial;color:#000000;font-weight:400;font-variant:normal;text-decoration:none;vertical-align:baseline;white-space:pre-wrap;">Global brands can focus on local needs by modifying or glocalizing their products but keeping core elements intact – local language and culture must be considered