International Marketing: Strategies, Channels, and HR Challenges

Posted on Mar 2, 2025 in Economy

International Marketing: An Overview

International marketing is defined as the performance of business activities designed to plan, price, promote, and direct the flow of a company’s goods and services to consumers or users in more than one nation for a profit. The key difference is the “environment,” encompassing competition, legal restraints, government controls, weather, consumer behavior, economic conditions, technological constraints, infrastructure concerns, culture, and political situations.

The 4Ps of International Marketing

Placement (Distribution)

The distribution process includes:

  • Passage of ownership
  • Buying and selling negotiations between:
    • Producers and middlemen
    • Middlemen and consumers
  • Length of the channels of distribution:
    • Level 0: Direct
    • Level 1: One intermediary (middleman)
    • Level 2: Two or more intermediaries

Middlemen in International Distribution

Definition: A person who buys goods from producers and sells them to retailers or consumers.

  • Types:
    • Domestic middlemen
    • Foreign middlemen
Alternative Middlemen Choices:
  1. Agent Middlemen
    • Manufacturer’s export agent
    • Act on behalf of the manufacturer
    • Payment = fee on sales (commission)
  2. Merchant Middlemen
    • Own the merchandise
    • Act on their own behalf, assuming the entire risk
    • Payment = sales
Factors Affecting the Choice of International Channel:
  • Objectives: Volume, profits, market share, control, etc.
  • Character of the company and market: Nature of the goods; Own sales force vs. distributors.
  • Coverage: Distribution intensity; Main cities…
  • Continuity: Own distributor channel; Long-term relationship…

Price

  • Cost-based price strategy: Set price by calculating product cost, promotion cost, and overhead cost, then adding the desired profit.
  • Value-based price strategy: Set the price after analyzing consumer desires and determining the range of prices acceptable to the target market (willingness to pay).
  • Competition-based price strategy: Set the price in accordance with competitors.

Promotion

  1. Sales Promotions
    • Marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation.
    • Short-term efforts directed to the consumer or retailer to achieve specific objectives.
    • In markets with media limitations, the percentage of the promotional budget allocated to sales promotions may have to be increased.
    • Product sampling.
  2. Public Relations (PR)
    • Creating good relationships with the popular press and other media to help companies communicate messages to customers, the general public, and governmental regulators.
    • Examples: Bridgestone/Firestone Tires safety recall, global workplace standards, corporate sponsorships.
  3. International Advertising
    • Decisions involving advertising are often affected by cultural differences among country markets.
    • Seven steps:
      1. Perform marketing research
      2. Specify the goals of the communication
      3. Develop the most effective message(s) for the market segments selected
      4. Select effective media
      5. Compose and secure a budget
      6. Execute the campaign
      7. Evaluate the campaign relative to the goals specified

Global HR Challenges in International Business

Three broad global HR challenges that have emerged in international business:

  1. Deployment: Getting the right skills to where they are needed in the organization regardless of geographical location.
  2. Knowledge and Innovation Dissemination: Spreading state-of-the-art knowledge and practices throughout the organization regardless of where they originate.
  3. Identifying and Developing Talent on a Global Basis: Identifying who has the ability to function effectively in a global organization and developing these abilities.

Expatriates: Practical Considerations

  1. Candidate Identification, Assessment, and Selection: Cultural sensitivity, interpersonal skills, and flexibility.
  2. Cost Projections: Used to be 3-5 times pre-departure salary.
  3. Assignment Letters: The assignee’s specific job requirements and associated pay will have to be documented and formally communicated in an assignment letter.
  4. Compensation, Benefits, and Tax Programs: Given the vast differences in living expenses around the world.
  5. Relocation Assistance: Maintenance of the person’s home and automobiles, shipment and storage of household goods, and so forth.
  6. Family Support: Cultural orientation, educational assistance, and emergency provisions are just some of the matters to be addressed before the family is sent abroad.