int marketing
Distribution process: the physical handling, distribution of goods, passage of owner ship, finally the most important, stand point of marketing strategy- the buying and selling negotiations between producers and intermediaries and between intermediaries and customers…Each country has a distribution structure which goods pass from producer to user. Within the structure are a variety of intermediates whose customary functions (activities, existing competition, market characteristics, tradition, and employment)Traditional dist. struc; developing countries evolved from economies with a strong dependence on imports. Importer controls fixed supply, sell it at a high price to a small number of people Distribution Patterns à Service by intermediaries: service attitude vary sharply from one country to another, Line breadth, costs and margins, channel length. Every country differ in distribution patterns Non-existent channels: Common international channel patterns are nearly impossible to track.Blocked channels: international marketer may be blocked from using the channel of their choice due to competitors already established relationships with channel members or because of trade associations or cartels that have contractually closed a channel to outsiders. Stocking: the high cost of credit, danger of loss through inflation, a lack of capital, and other concerns cause foreign intermediaries in many countries to limit inventories. Power and competition: distribution power tends to concentrate in countries where a few large wholesalers distribute to a mass of small intermediaries. Size patterns: the extremes in size in trailing are similar to those that predominate in whole selling. Direct marketing: selling directly to the consumer by mail telephone or door to door is often the approach with insufficient or underdeveloped distribution systems. Resistance to change: efforts to improve the efficiency of the distribution system, new type of intermediaries, the entry of large international organizations we discussed above and other changes to traditional ways are typically viewed as threating and are thus resisted. Merchant intermediaries take title and buy and sell on their own account however agent intermediaries don’t. Export management companies (emc) is an important intermediary for firms with relatively small international volume or for those unwilling to involve their own personnel in the international function. Complementary marketers companies with marketing facilities or contacts in different countries which may have excess marketing capacity or a desire for a broader product line sometimes take an additional line. Buying offices common denominator is to function of seeing and purchasing merchandise on request from principal Selling groups types of arrangements have develpd in which various manufac. or prod. cooperate in a joint attempt to sell their merchan. abroad Foreign sales corp. is a company set up in a foreign county that can obtain a corp. tax exemption a portion of the earnings generated by the sale or lease of export property. Export Merchants are domestic merchants operating in foreign markets and they operate as domestic wholesaler. Prod. retail store an import. channel of distrib. for a large number of manufactures Manufacturers’ representatives are agents that are located in a foreign market that take care of a producers goods in multiple locations from city to multi. locations Distrib. foreign distri. is a merchant intermed. that often has exclusive sales rights in a country or region and works in close cooperation with the prod. Foreign country brokers: like the home based broker discussed above foreign country brokers are agents who deal largely in commodities and food prod. Managing agent and compradors: a managing agent conducts business within a foreign nation under an exclusive contract arrangement with the parent company Dealers anyone who has a continuing relationship with a supplier in buying and selling goods.
Factors encouraging standardization: • Economies of scale • Economies of scope • Control & coordination • Global market integration • Intuitive appeal Factors encouraging adaptation: • Different buyer behaviour patterns • Different use conditions • Government and related influences • Subsidiary/agent interests • Adherence to marketing concept (customer orientation) .Reasons to globalize Flee recessions Counter impact of demographic changes Exploit new technologies Obtain political clout Escape competition at home (by domestic and foreign firms) Keep up with competition abroad levels of competition Generic ,Product Form ,Product Type ,Brand MAIN STRATEGIES Differentiation vs. Cost positioning stratigies Leader (Defense) Prince (Offense) Follower (Flank) Niche (Guerilla). ndp(Strategy, idea, screening, business analysis, development, testing, launch) Export process Prompt, Feasibility, Profit Potential ,Launch. Product/mkt Strategy mix existing existing (Market penetration) existing new ((market development) new existing ( product development) new new (product diversification) developing strategies for global expansion know thy self, know thy product, target, package lightly, be thoughtful, build value proposition.sprinkler strategy suggests spreading the company’s resources in order to gain even small footholds across as many markets as possible.A waterfall strategy, as the term implies, is one where the firm pours all of its available resources into one or a select few markets .expansion strategy expand or not, Intl Mkting evolution, mode of entery, overall strategy, adapting mkting mix.1. Indirect exporting usually means that the company sells to a buyer in its own home country who in turn exports the product (common approach for companies taking first steps in international scene)2. Direct exporting the company sells to a customer in another country, be it an intermediary or an end customer. – Licensing is a means of establishing a foothold in foreign markets without large (if any) capital outlays. Internation mkting can be 2 of the following info come through cultural boundaries and second different rsch tool in foreign mkt. breadth and scope of intl marketing; general info of country, forecast future by pestl, marketing info to make 4ps, able unable. STEP is created through; economic and demographic, cultural and social political, over view of mkt condition, summary of technological eviro competition situation. Research Processàresearch problem, determine source of info objectivity, establish research, cost & benefit of research gather relevant data, analyze interpret and summarize. Quantitative research; feeling, ideas, attitudes, opinions used in internatl mkting to define problem. Qualitative verbally or writing yes/no questions can give us percentage or avg. research intl formed of’ online surveys, online focus groups, web visitors, custom identification, email mkting embedded research observation research. . Ethnocentrism: Use everywhere the same strategy as home . Polycentrism: Develop a separate and distinct strategy for each foreign market 3. Regiocentrism: Because polycentrism will likely be cost-prohibitive at least develop a separate and distinct strategy for each region 4. Geocentrism: Develop one strategy for all countries worldwide. Companies that adapt suffer from lack of vision.There are six steps for a firm to reach the foreign end user Foreign Retailer, Foreign wholesaler, Foreign import agent, International broker, Domestic export agent, Domestic intermediary Export distribution Domestic Intermediaries• Trading Houses– Full vs. Limited service firm – Product vs. Market focus – Agents vs. Merchants – Misc. types – buying houses, procurement agents, export managers…• Freight forwarders, brokers, agents..2. International Intermediaries• Brokers, Agents, Trading Houses, ..3. Foreign (Local) Intermediaries• Difficult to identify/sign-up good distributors• Government assistance• Must be done in-field based on pre-determined criteria. Trading house services include the following Market identification & selection, Buyer identification, evaluation, and selection, Sourcing, Research on product and packaging specifications, Price negotiations, Arrangements of terms of sale, Financial arrangements Shipping & forwarding arrangements, Export documentation, Export risk protection, Arrangements for payment, Handling claims, After-sales service, Promotional support The 5C’s of Distribution Of the five “Cs” of distribution, in international marketing cost (to the exporter, rather than to the consumer) is given the greatest amount of attention by most exporters, usually followed by coverage. Control often needs to be ceded (or so it is thought) to be able to sell.Character is viewed with reference to domestic criteria rather than those which may be relevant to the foreign market. (Remember: Bundle of Benefits!)Continuity is given the least attention (since it pre-supposes long-term thinking).Insufficient attention to the last three C’s can cause both immediate (character) and longer-term (control, continuity) problems. Factors affecting choice of channels The following should be clear before selecting channel intermediaries. Identify specific end markets within and across countries, Specify marketing gaols in terms of volume market share and profit margin, Specify financial and personnel commitments for developing international distribution, Identify control, length of channels, terms of sale, and channel ownership.1. Analytical Considerations• Company (profitability, transportation & distribution costs, tariffs & taxes)• Market (income, competition, channel margins)• Environment (foreign exchange risks, inflation, price controls, regulation)2. Strategic Considerations• Standardized vs. adapted prices• Penetration vs. skimming price • Marginal vs. full-cost pricin 3. Managerial Considerations• Transfer prices, export price escalation, quotations, grey markets. Trade terms ex works, Free on truck or trail, free alongside ship, free on board, costand freight insurance, duty paid or buyers account