Please enable JavaScript.
Coggle requires JavaScript to display documents.
4.7 International Marketing, image - Coggle Diagram
4.7 International Marketing
Method of entry into international market
Direct investment in subsidiaries
A subsidiary is an established firm in which the foreign investor directly or indirectly (through another company) controls more than 50% of the voting power of the shareholders.
Licencing
Licensing refers to the using of a company's property in another country. These property could be referedd to be as intangible assets for people to be able to use for a busniess. This includes trademark, patents, and production techniques.
Joint ventures
A joint venture (JV) is a type of commercial partnership in which two or more parties agree to combine their resources to complete a specific job. Examples of joint venture includes Molson Coors and SABMiller. BMW and Brilliance Auto Group. Microsoft and General Electric. The Walt Disney Company, News Corporation, Comcast's NBC Universal and Providence Equity Partners.
International franchising
A method of expansion for a business that allows new or established franchises to move into a new geographic areas and also new markets. An example of international franchising is McDonalds. It expands overseas through the use of franchises and they pay a certain fee to the franchisee.
Exporting
Refers to the direct sales of goods/ services in a country other than from the parent country. Exporting is one of the most used methods of entry in an international market. Exported good are usually made from the home country which will be then sent to different countries for the product to be sold.
The role of cultural differences in
international marketing
Product
The product should be modifed to meet the taste and cultural requirements of the particular country being targeted. This step is very important as it determines whether or not a business would succeed in a country. Due to different cultures some products may be made difficult to be sold in some countries, such as alchohol, pork, etc.
Price
In many cases businesses may find themselves to obtain less sales than other countries. These may be caused by many factors, but one of the biggest impact would be the price. Some countries may be accustomed to cheap and affordable pricing, wherease international businesses may found their price to be cheap and affordable, the consumers may see it otherwise. This misconception of pricing may lead to consumers straying away from these interantional business, and instead towards local businesses who have adapted to the accustomed price.
Promotion
A worldwide advertising approach must also consider cultural differences. Advertising should target consumers in a global perspective. For instance some cultures are wlecome towards tobacco and alcohol ads, yet others may not allow these types of ads.
Place
Cultural differences affect product distribution. Infrastructure and tradition affect countries' transit, logistics, wholesale, and retail systems. In some countries, internet access is unstable and limited, therefore an e-commerce 'location' strategy may fail. Government regulations make some national distribution networks inaccessible to foreign enterprises. Other countries have strict rules and multinational corporations have a hard time accessing native distribution channels. These differences affect global marketing methods.
