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1. (a) What are the different market targeting strategies?

Explain them
with appropriate example.
Ans. There are several different target-market strategies that may be followed. Targeting
strategies usually can be categorized as one of the following:
Single-segment strategy - also known as a concentrated strategy. One market segment (not the
entire market) is served with one marketing mix. A single-segment approach often is the strategy
of choice for smaller companies with limited resources.
Selective specialization- this is a multiple-segment strategy, also known as a differentiated
strategy. Different marketing mixes are offered to different segments. The product itself may or
may not be different - in many cases only the promotional message or distribution channels vary.
Product specialization- the firm specializes in a particular product and tailors it to different
market segments.
Market specialization- the firm specializes in serving a particular market segment and offers
that segment an array of different products.
Full market coverage - the firm attempts to serve the entire market. This coverage can be
achieved by means of either a mass market strategy in which a single undifferentiated marketing
mix is offered to the entire market, or by a differentiated strategy in which a separate marketing
mix is offered to each segment.
The following diagrams show examples of the five market selection patterns given three market
segments S1, S2, and S3, and three products P1, P2, and P3.

Single
Segment

Selective
Specialization

Product
Specialization

Market
Specialization

Full Market
Coverage

S1S2S3

S1S2S3

S1S2S3

S1S2S3

S1S2S3
P1

P1

P1

P1

P1

P2

P2

P2

P2

P2

P3

P3

P3

P3

P3

A firm that is seeking to enter a market and grow should first target the most attractive segment
that matches its capabilities. Once it gains a foothold, it can expand by pursuing a product

specialization strategy, tailoring the product for different segments, or by pursuing a market
specialization strategy and offering new products to its existing market segment.
Another strategy whose use is increasing is individual marketing, in which the marketing mix is
tailored on an individual consumer basis. While in the past impractical, individual marketing is
becoming more viable thanks to advances in technology.
(b) Differentiate between joint venture and strategic alliance.
Ans.
Joint Venture:
Contractual
Separate legal entity
Significant matters of operating and financial policy are predetermined
and owned by the JV
Exist for a specific time
Exist for a specific project or purpose
Limited with respect to future expectations

Strategic Alliance:
May or may not be contractual
Generally, not a separate legal entity
Significant matters of operating and financial policy may or may not be
predetermined but are owned by the individual participants.
Indefinite life or a specific time
Fluid and allows for greater amounts of ambiguity

A joint venture is a contractual arrangement whereby a separate entity IS


created to carry on trade or business on its own, separate from the core
business of the participants.
A strategic alliance is generally an arrangement whereby a separate entity IS
NOT created. Participants engage in joint activities but do no create an
entity that would carry on trade or business on its own.
In a joint venture Companies A and B combine to form a new company C,
but in the strategic alliance companies remain independent.

A strategic alliance is usually easier to get in/out of due to due lack of


combined legal structure.
A strategic alliance is generally viewed as being less risky.

2. (a) What do you mean by branding? Explain the importance of


branding.
Ans. The American Marketing Association (AMA) defines a brand as a "name, term, sign,
symbol or design, or a combination of them intended to identify the goods and services of one
seller or group of sellers and to differentiate them from those of other sellers.
Therefore it makes sense to understand that branding is not about getting your target market to
choose you over the competition, but it is about getting your prospects to see you as the only one
that provides a solution to their problem.
The objectives that a good brand will achieve include:

Delivers the message clearly


Confirms your credibility

Connects your target prospects emotionally

Motivates the buyer

Concretes User Loyalty

To succeed in branding you must understand the needs and wants of your customers and
prospects. You do this by integrating your brand strategies through your company at every point
of public contact.
Your brand resides within the hearts and minds of customers, clients, and prospects. It is the sum
total of their experiences and perceptions, some of which you can influence, and some that you
cannot.
A strong brand is invaluable as the battle for customers intensifies day by day. It's important to
spend time investing in researching, defining, and building your brand. After all your brand is the
source of a promise to your consumer. It's a foundational piece in your marketing communication
and one you do not want to be without.
(b) Explain the important methods of pricing in on international market.

Ans. Success in international marketing in the present circumstances depends, among other
things, on right pricing of the product. But it has not to be considered independent of other
elements of international marketing mix such as product, placement and promotion, An
international trade contract cannot be won or lost merely on the basis of pricing. Changes in
various aspects of marketing environment in target market, affecting the
competitiveness of international marketer, have their direct impact on pricing. A marginal or
negligible supplier to a foreign market has to follow the price ruling in the market; Only the
dominant supplier may have the privilege of setting the price in a foreign market. The price in
international marketing is determined by the cost of the product, competition from other
suppliers and demand for the product. Normally, the cost
establishes the floor, the competitive prices are presumed to set price ceiling and the demand for
the product, as determined by the willingness and ability of the customers to buy the product,
mostly' determine the price to be charged by the supplier.
The main objective of pricing in international marketing should be to meet the customer demand
in a competitive situation in such a way that sales and profit are maximized. The pricing
objectives may vary depending upon the stage of product life cycle and a country specific
situation. However the following other objectives of pricing are also pursued in relation to
specific products and specific markets.
Penetration: A new entrant to a foreign market may quote a low price to divert demand from a
regular channel of supply or to generate new demand as low price quotation may bring these
about. The image disadvantage of the new comer and the nature of his product may also
necessitate quoting low price.
Skimming: After an exporter has gained a strong foothold in a foreign market and has built up a
good image for himself and his product, he may charge premium price, to maxirnise and can
continue so long as the highest possible price does not affect adversely the market demand. The
image advantage of the firm and the nature of the product, for example, vanity item may also be
the reasons for quoting high price.
Holding Market Share: The objective is pursued by those companies that want to maintain their
share in the market, usually in relation to single country marketing. They react to price
adjustments by competition and exchange rate fluctuations. They have to take into consideration
their competitive position as, well as the ability and willingness of their customers to pay.
Enhancing Share: This pricing objective is allied to the preceding one with the only difference
that the companies, ill this context, try lo out-price their competitors either by improving their
cost efficiency or by quoting price based on direct costs and not on total costs.
3. (a) Distinguish between direct and indirect selling channel. Discuss the
advantages
and disadvantages of both the channels.

Ans. Indirect selling is employed when a manufacturer in the United States, for example,
markets its product through another U.S. firm that acts as the manufacturer's sales intermediary.
There are several advantages to be gained by employing an indirect domestic channel. The
channel is simple and inexpensive. The manufacturer incurs no start-up cost for the channel and
is relieved of the responsibility of physically moving the goods overseas. Since the intermediary
very likely represents several clients who can help share distribution costs, the costs for moving
the goods are further reduced.
An indirect channel also has limitations. The manufacturer has to give up control over the
marketing of its product to another firm. The channel may not be permanent because the
intermediary can easily discontinue handling a manufacturer's product if there is no profit.
Direct selling is employed when a manufacturer develops an overseas channel so that it deals
directly with a foreign party without going through an intermediary in the home country. One
advantage gained in using the direct selling channel is active market exploitation. Another
advantage is greater control. The channel also improves communication and consistency.
Direct selling, however, is a difficult channel to manage if the manufacturer is unfamiliar with
the foreign market. It is time consuming and expensive.

(b) Discuss the merits and demerits of direct mail as a promotional tool. How
does it
different from other form of advertising.
Ans.: Direct Email marketing, a very cost effective and easy way of reaching customers, has its
share of demerits. Let us see what are the merits and demerits of this type of marketing
campaign:
Merits:
1. Cost effective way to reach a wide the range of receivers.
2. The emails are the most inexpensive way of communication in todays world.
3. Consumption of time is very low as compared to other forms of communication.
4. The bounce backs, unsubscribe mails, read-receipts, click-throughs etc. help in
measuring the responses.
5. Emails can be tailored keeping in mind the target audiences and dividing them in
subgroups. This helps the marketers to send information which is relevant to a
particular group.
Demerits:

6. Some organizations send bulk emails which are discarded by customers as spam.
7. Legitimate commercial emails and spam emails cant be easily differentiated.
8. People worldwide use spam filters which often filter the legitimate emails.
9. Though email is relatively a newer concept and is more cost effective, the chances
of the email ending in a target customers junk folder is more than ninety percent.

4. (a) Discuss some of the important social, ethical, and environmental item
in
International business.
Ans.: Social and cultural factors shape patterns of market demand and underlie emergence of new tastes and
interests aswell as growth of new market segments, At the same time, socio-cultural trends often reflect the
impact of changing economic and technological conditions. An international marketing mix can only be
effective as long as it is relevant to a given culture. It may call for modification of the product, introduction of
a new entering foreign markets without due regard for local customs and traditions, commit serious blunders.
Being a major force as a culture of a country or region is, it should be thoroughly understood specially in terms
of the particular values and social practices followed.
In the context of marketing, the word culture does not refer to classical music, art and literature, but to social
institutions, values, beliefs and behaviors. Culture includes everything a person learns to know as a member of
a society but does not include the basic drives with which one is born. Culture is also the total way of life and
thinking , pattern that are passed from generation to generation

(b) What is marketing communication? Outline the element of a simple


communication
process.
Ans. Marketing communication-one of the 4 Ps of the marketing mix-refers to all forms of
communications that organizations use to influence buying behavior of present and potential
customers, Marketing communication should be designed to inform customers about the benefits
and values that a product or service offers. The principal forms of marketing communication are
advertising, personal selling, publicity and sales promotion. All these elements can be utilized in
global marketing also. However, the environment in which marketing communication
programmes are implemented can vary from country to country. In this unit, we shall discuss the

meaning, objectives, role and key decisions common issues and major communication tools in
international marketing communication.
Elements of Communication Process
Communication has been described as "who says what to whom through which channels with
what effect". We notice that the two major parties involved in the process are the sender (who)
and the receiver (whom). The tools that senders use to reach their entered receivers are called
messages and channels (or media). Thus communication occurs when: 1) a sender transmits a
message, 2) a receiver receives that message, and 3) the sender (and the receiver have a shared
meaning. The communication process itself involves the functions of encoding, decoding,
response and feedback. Let us understand each of these elements in the communication process.
Sender, also called the source, is the party who sends the message to another party called the
receiver or destination. The sender is engaged in the mental process of putting thought into a
form in which it can be communicated.
Receiver is a person for whom the message is intended aid takes an active part in the
communication process. How meaning is assigned to a message by the receiver depends upon
the receiver' is attitudes, values, previous experience, needs and the timing of the message.
Encoding is the process of translating the idea to be communicated into a symbolic message
consisting of words, pictures, numbers, gestures, etc. This step is necessary because there is no
way of sending an idea from one person to another in its raw or pure form.
Message is a combination of symbols representing objects or experiences that a sender transmits
in order to induce a change in the receiver's behavior. Since most symbols (words, 'pictures,
numbers, etc,) have more than one meaning, h e symbols selected for the message should be
simple and familiar to receivers.
Medium is the means by which the sender conveys the message to the receiver. Broad) there are
two types of media: 1) inter personal media, and 2) mass media. In inter, personal medium there
is a direct contact between the sender and receiver.
Decoding is the process by which the receiver attempts to convert symbols conveyed by the
sender into a message. Just as the sender encodes the message, the receiver must decode it.
Receivers may decode or interpret the message in different ways because of their individual
characteristics, experiences and backgrounds.
Response is a set of reactions a receiver has after being exposed to the message. Receiver
responds to sender's message by reacting in different ways such as asking questions, buying or
not buying the product or seeking more information, etc.

Feedback is the communication from a receiver to the sender about how he/ she understood the
message and reacted to it. In this reverse flow of communication, receivers encode their message
and send them to the decode, The sender must then decode the feedback message.
Noise refers to anything that interferes with the communication process so that the receiver gets
a message, which is different from the one the sender sen1 or gets no message at all. Noise can
affect any or all elements of the communication process. For example, if there are too many
advertisements of the same product (different brands) in a single newspaper or magazine, it can
create distraction. Our earlier example of the airline slogan is a case of noise.
5. Write short notes.
a) International Advertising :
International advertising entails dissemination of a commercial message to target audiences in
more than one country. Target audiences differ from country to country in terms of how they
perceive or interpret symbols or stimuli, respond to humor or emotional appeals, as well as in
levels of literacy and languages spoken. How the advertising function is organized also varies. In
some cases, multinational firms centralize advertising decisions and budgets and use the same or
a limited number of agencies worldwide. In other cases, budgets are decentralized and placed in
the hands of local subsidiaries, resulting in greater use of local advertising agencies.
International advertising can, therefore, be viewed as a communication process that takes place
in multiple cultures that differ in terms of values, communication styles, and consumption
patterns. International advertising is also a business activity involving advertisers and the
advertising agencies that create ads and buy media in different countries. The sum total of these
activities constitutes a worldwide industry that is growing in importance. International
advertising is also a major force that both reflects social values, and propagates certain values
worldwide.
In international markets the process of communicating to a target audience is more complex
because communication takes place across multiple contexts, which differ in terms of language,
literacy, and other cultural factors. In addition, media differ in their effectiveness in carrying
different appeals. A message may, therefore, not get through to the audience because of people's
inability to understand it (due to literacy problems), because they misinterpret the message by
attaching different meanings to the words or symbols used, or because they do not respond to the
message due to a lack of income to purchase the advertised product. Media limitations also play
a role in the failure of a communication to reach its intended audience.
The process of communication in international markets involves a number of steps. First, the
advertiser determines the appropriate message for the target audience. Next, the message is
encoded so that it will be clearly understood in different cultural contexts. The message is then
sent through media channels to the audience who then decodes and reacts to the message. At

each stage in the process, cultural barriers may hamper effective transmission of the message and
result in miscommunication.
b) Data collection & Data Analysis
Data Collection: Data collection is the most important and crucial step in the marketing
research process. This step is preceded by definition of research objectives, clear determination
of the type of
data and information required to be collected and determination of methodologies to be used in
collecting the requisite data and information. Without the above pre-research activities, there is a
possible danger that critical data and information may not be obtained and for that what is
obtained may turn out to be not very relevant or suitable, The validity and accuracy of the final
judgment is most crucial and depends heavily on how well the data were gathered in the first
place. Thus, data awe considered the backbone of any research project as it helps the marketing
manager to take the right decision, In the absence of reliable and updated data the entire
marketing research process may bederailed.
Data Analysis: Data collection though very important, is not an end in itself. Having
collected the
relevant data either from the primary source or secondary some or from both, the next important
step in the marketing research process is to analyse it properly' and interpret it intelligently, so
that relevant inferences call be drawn and the marketing executive can initiate appropriate action.
Analysis can be viewed as the ordering, the breaking down into constituent puts, and the
manipulating of data to obtain answers to the research question or questions underlying the
research project. Tightly interwoven with analysis is interpretation: it is so closely related to
analysis that it may be considered as a special aspect of analysis rather than a separate activity.
The process of interpretation involves appreciating the results of analysis, making inferences
relevant to the research relationships studies, and drawing conclusions about these relationships.
Since analysis represents the end of he research process (short of writing the report), everything
done prior to this stage must be construed as having been done for the sole purpose of analysis.
From a decisional context, all conclusions, recommendations, and decisions ate based on the
analysis of the raw data obtained from the research project. This points to the need for keeping in
consideration analysis or potential analysis, even at the beginning stage or planning and
designing the project.
c) Joint Venture
In the context of international business, an international joint venture is an
enterprise formed by the international business company sharing ownership
and control with a local company in the foreign country. International joint
venture is another alternative strategy you may consider to enter in
overseas market.

A union of two or more parties who contractually agree to contribute to a


specific venture which is usually limited to a specific task for a specific period
of time. A joint venture is a separate legal entity generally governed under
partnership lawwhich varies from state to state. The JV parties can be
individuals, partnerships or corporations that continue to operate
independently from the other except for activities related to the Joint
Venture.
Basic Components of Joint Venture:
The Union

The contract can be viewed as a pre-nuptial agreement


The alliance is the union

The new legal entity can be viewed as the child.

The Separation

Separation is inevitable because JVs generally have a limited life


and purpose.

d) Strategic Alliance
A more recent phenomenon is the development of a range of strategic alliances. Alliances are
different from traditional joint ventures in which two partners contribute a fixed amount of
resources and the venture develops on its own. In an alliance, two firms pool their resources
directly in a collaboration that goes beyond the limits of a joint venture. although a new entity
may be formed, it is not a requirement. Sometimes, the alliance is Supported by some equity
acquisition of one or both the partners.. In an alliance, partners bring a particular skill or
resource, usually one that is complementary to each other. By joining forces, both are expected to
profit from each other's experience. Typically, alliances involve either distribution access or
technology transfers or production technology, with each partner contributing a different aspect
to the venture.
This strategy seeks to enhance the long term competitive advantage of the firm by forming
alliance with its competitors (existing or potential in critical areas), instead of competing with
each other. The goals are to leverage critical capabilities, increase the flow of innovation and
increase flexibility in responding to market and technological changes. Strategic alliance is also
sometimes used as a market entry strategy. For example, a firm may enter a foreign market by
forming an alliance with a firm in that foreign market for marketing or
distributing the farmer's product.

Strategic alliance, more than an entry strategy, is a competitive strategy. Strategic alliances which
enable companies to increase resource productivity and profitability by avoiding unnecessary
fragmentation of resources and duplication of investment and effort. Alliances are growing in
popularity and are very conspicuous in such industries as pharmaceuticals, computer, nuclear,
telematics, etc., which are characterized by high fixed costs in R & D and manufacturing, high
technology and fast changing technology.