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International Marketing Management And Admittance Strategy

When an organisation decides to enter into a overseas market, it is vital for the business to adopt a strategy to type in to the market. The first couple of months are very important to attain the goals and purpose of the company. There are numerous ways to enter the market. This will depend upon the price, risk and the control of the company on the investment. The simplest and commonly used admittance strategy is exporting by using either immediate approach as an agent or indirect methodology as counter trade.

Market Entry Strategy:

There are extensive ways to enter in to a international market. The mostly used ways are as follows



Joint Ventures

Joint Ownership

Direct Investment


Exporting is the most customarily used and more developed way of getting into a foreign market. it can be defined as the marketing of goods stated in one country into another. It's very easy because the company can use the home labour to create goods and then sell it into another country. The success of the strategy requires the knowledge of need and needs of the locals, and then effectively market the merchandise.

The main benefit of exporting is the fact that the company does not require of the services of the neighborhood people, thus the procedure is more standardised. If the business can't find enough consumers for the merchandise, than they look into other markets, to boost the profitabilty of the organisation.

(http://www. answers. com/topic/exporting)


Licensing is defined as "the method of foreign procedure whereby a firm in a single country agrees to permit a company in another country to make use of the manufacturing, producing, trademark, know-how or various other skill provided by the licensor".

(kotler Armstrong, (2004) Rules of Marketing 10th release, Pearson Education)

It is quite similar to the franchise operation. Coca Cola is a great exemplory case of licensing, since it has given licenses to different companies on earth to make coca cola. Licensing requires very little cost and engagement, thus it is a very common business practice.

Joint projects:

Joint ventures can be defined as "an enterprise where two or more investors talk about ownership and control over property rights and operation". Joint endeavors are a far more comprehensive form of involvement than either exporting or licensing.

(kotler Armstrong, (2004) Rules of Marketing 10th model, Pearson Education)

It is a very commonly used method of getting into a overseas market. In this technique, the parent company join forces with another company from the variety country to create goods and services.

Joint Ownership:

"A jv in which a company joins investors in a foreign market to make a local business where the company stocks joint ownership and control"

(kotler Armstrong, (2004) Guidelines of Marketing 10th edition, Pearson Education)

Direct Investment:

"Coming into a international market by developing foreign-based assembly or manufacturing facilities is called immediate investment".

(kotler Armstrong, (2004) Rules of Marketing 10th model, Pearson Education)

Direct investment is commonly used by large companies. Those companies which have gained significant local market try to increase their profitability by investing into the foreign market. Company which have ample financial resources can also open production and making crops in the host country. There are several advantages of beginning a manufacturing unit in the host country which are the following:

It can decrease the cost by purchasing cheap raw material and labour.

Companies tend to be given foreign authorities investment bonuses by the coordinator countries.

The company can have a good reputation in the country but it creates jobs.

The company builds up a good marriage with the consumers, suppliers, vendors and federal government.

The company may easily identify the needs and wants of the local people and thus change its product accordingly

The company can have full control the investment. Thus it can change its insurance policies that can provide it long-term international targets.

Types of Firms:

The different kinds of companies are the following:

Large companies:

The companies that have a large number of human tool and development facikty comes under the group of large company. These businesses can be local structured or multinational organisations or MNC. MNC's carry out their activities in the overseas countries to generate revenue. Normally MNC's have their hq in one country, but their activities are across the border.

In large companies, all the admittance strategies can be utilized. Because large companies have adequate human and money, they can certainly adjust themselves to the market condition.

Small and mid-sized enterprise (SME):

SME's are the companies where the range of employees falls below a certain limit. The definition of SME differs far away. E. g. in EU, the definition of SME is the fact that the companies where the variety of employees is significantly less than 10 are called "micro", those with significantly less than 50 employees as called "small", and the ones with less than 250 as "medium".

But in the United States, the firms with significantly less than 100 employees are called small enterprises and those with significantly less than 500 employees are called mid-sized enterprises.

SME is going for joint venture into the foreign market because they don't have sufficient resources and local knowledge. The best way to enter is to have services from a local company.

(www. answers. com)

Manufacturing firms:

Those companies which produces physical goods are called developing companies. These businesses are production structured which utilise the machines, tools and individuals resource to produce products. Usually developing firms require a huge space to handle their activities.

If the Manufacturing firm is a sizable organisation then it can choose any strategy for as long it is affordable.

Service based firms:

The companies which sell services as opposed to the physical goods are called service established companies. The service based companies are as important as the manufacturing companies. Service structured businesses include telecom companies, call centres, insurance companies, bank sector etc.

These companies usually go for joint venture with the local firm. They use the local knowledge of the local firms to increase the profitability.

Risks encountered by the Company:

When a firm try's to purchase the market, it is faced by different types of risks, which can be as follows:

Financial risk:

The risk that is associated with the funds of the organisation is called financial risk. All the organisations are faced with risk in one form or another. In finacial sector, the financial risk can be explained as the risk to getting actual return less than the expected go back.

Companies invest in several portfolio to reduce the financial risk from the investment. However the return on investment depends upon the risk associated with it. If an has risky associated with it, than return may also be very high.

Political risk:

Political risk is the kind of risk that happen to be encountered by organisations when they aim to invest in to the market. This type of risk is usually associated by the political decisions made by the governments.

Any company that wishes to increase and preserve the growth, the government stability is vital. if the political environment of the united states is not steady, than the firms are faced by a whole lot of hurdles.

Economic risk:

This kind of risk handles the market of the united states. Whenever a company invests in the international market, its goal could severely be strike by the economical conditions of the neighborhood market, specially with the change in the currency rate. If the country comes with an unstable economy, it might influence the buying power of folks. Thus it might impact the demand for product.

Factors that have an impact on the Consumer Behaviour:

Cultural factors:

Cultural factors have a great impact on the buying behaviour of the consumers. Thus the marketer must understand the role enjoyed by the buyer's culture, subculture and interpersonal class.

Culture: culture of your country is the most crucial factor that affect the buying decision of the consumer. It is very important for an organisation to comprehend the culture of the country before making an investment there. Every group or society has a distinctive culture and it can influence the overall belief of the contemporary society. E. g different countries assign different meanings to the colors. White colous is assosiated with purity and cleanliness in traditional western countries while it is assosiated with death in certain Asian countries.

Subculture: it is a group of folks with shared value systems predicated on common life activities and situations. Subcultures include nationalities, religions, racial teams and geographic parts.

Social class: it is relatively everlasting and purchased divisions in a world whose members talk about similar values, interests and behaviours. It is dependant on factors such as income, profession, education, wealth and other parameters.

(kotler Armstrong, (2004) Rules of Marketing 10th model, Pearson Education)

Working and business routines:

If an organization wants to invest in a international country than its very important to comprehend the business procedures in the worried country. the business practices accompanied by the asian companies is just a little different than the companies in the western world. Specially in the banking industry, some of the Muslim countries choose the Islamic banking system. Thus while investing in this sector, the investor must understand communal and religious ideals of the populace.

Cultural distance:

In order to invest in a overseas market, the researcher must understand the social difference between your market and the foreign market. culture of the country plays an integral part in the buying design of the consumers. In clothes industry, the european cloths is probably not that much suitable in other asian and African countries because of the religious and interpersonal differences.

Geographic distance:

The geographic distance also takes on an important part in choosing the international market for investment. If the prospective market is closer to the home market, the profits can be increased by minimizing the transportation cost. Thus the same capital can be utilised to market the merchandise to the masses.

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