What is international marketing?

International marketing is defined as the performance of business activities including

pricing, promotion, and product and distribution decisions across borders.
International marketing is the performance of business activities designed to plan, price,
promote and direct the flow of a companys goods and services to consumers or users in
more than one nation for a profit.
Vern Terpstra and Ravi Sarathy defined as international marketing consists of finding and
satisfying global customer needs better than the competition, both domestic and
international and of coordinating marketing activities within the constraints of the global
environment.
The American Marketing Association defined as International Marketing is the
multinational process of planning and executing the conception, pricing, promotion and
distribution of ideas, goods and services to create exchange that satisfy individual and
organizational objectives.
Here marketing activities take place in more than one country. Complexity and diversity
are found in international marketing operations.

Importance of International Marketing:

Today international marketing is very important for the development of the country. This
is the age of globalization and open market economy, so the importance of international
marketing has become more affluent.
It is most important not only for the producers but also for consumers and buyers.
Importance from the consumers point of view: i)
Consumption of unproduced goods
ii)
Consumption of goods at a low price
iii)
Enjoying benefits of competition
iv)
Consumption of new products
v)
Increase in consumption.
Importance from the producers point of view:
i)
Export of surplus production.
ii)
Expansion of market in foreign countries.
iii)
Production of goods at a low cost.
iv)
Increase in production.
v)
More profitable
vi)
Reduce business risk.
vii)
Reduce cost
Importance from economic point of view:
i)
Increases total production.
ii)
Increases export earnings
iii)
Challenging natural calamities
iv)
Knowledge and cultural progress

v)
Increases international peace and assistantship
vi)
Extension of industry
vii)
Export of unusual goods.
viii) Optimum utilization of natural resources.
ix)
Progress in technological knowledge
x)
Import of essential goods
xi)
Image development
xii)
Employment opportunity
xiii) Improving standard of living.
xiv) Economic development
International marketing task is not only to earn foreign currency by exporting goods but
also to involve in developing the production, consumption and socio-economic
development of a particular country.

Difference between international marketing and domestic marketing:

The only difference between the definition of domestic marketing and

international marketing is that in the international marketing, marketing activities
take place in more than one country.
More complexity and diversity are found in international market than the
domestic market.
The uniqueness of foreign marketing comes from the range of unfamiliar
problems and the variety of strategies necessary to cope with different levels of
uncertainty encountered in foreign markets.
Even though marketing principles and concepts are universally applicable, the
environment within which the marketer must implement marketing plans can
change dramatically from country to country or region to region.
Area of business: The area of domestic business within the boundary of the
country but in international marketing, the area of business is across the border or
boundary.
Rules and regulation: The rules and regulation of international marketing are
more complex than the domestic marketing.
Control: The producers, middlemen and government any time regulate domestic
market but a particular producers or a middleman cannot control international
marketing.
Buyer and seller: - In domestic market, Buyer and seller both are the citizen of
the same country. But international marketing, buyer and seller are from different
country.
Scale of business: Domestic market is typically small size, so it may be sole
proprietorship. But the dimension of international marketing is large, so the public
limited company or partnership company owns it.
Nature of buying and selling:- In domestic marketing, goods and services are
bought and sold by retailing and wholesaling, but in international marketing,
goods and services are bought and sold by the wholesaling.
Influence of terms of trade: - in domestic marketing, the marketers do not need
to determine the terms of trade. The exchange rate do not influence on the
domestic marketing But in international marketing, imports and exports are
influenced and affected by the rate of exchange and terms of trade or balance of
payment.
Mobility of factors of production:- In domestic marketing, the mobility of
factors of production can move from one place to another within the country
without any restriction, in international marketing, the mobility of factors of
production is restricted.
Nature of transaction: in international marketing, the bank, insurance and
financial institutions influence more greatly on international marketing than the
domestic marketing.
Capital: international marketing requires more capital than the domestic
marketing.

Use of document: various kinds of documents are used in international

marketing, such as letter of credit, bill of exchange, bill of lading, import and
export license etc.
Management and direction: the management and direction of international
marketing are more complex than the domestic marketing.
Different marketing program: in international marketing, the marketers must
take the adapted and different marketing programs according to the needs,
interests and demands of that country.
Influence of international relationship: the nature of international relationship
among the countries in influence on international marketing.
Tariff barriers: in international marketing, there are some tariffs and non-tariff
barriers faced by the international marketers.
Business risks: - it is very difficult to pre-specify the problems and risks in
international marketing.
International events: domestic marketing is not influenced by the international
events but international marketing greatly influenced by the international events
such as 11th September 2007.
Monetary system: in domestic marketing, the banking and insurance policy,
financial policy, loan policy and tax policy are the same within the country. In
international marketing, there are differences among the banking and insurance
policy, financial policy, loan policy and tax policy in the international marketing.
Communication and control: in international marketing, the communication is
more complex than the domestic marketing.

The international Marketing task:The international marketing task is made more daunting because environmental factors
such as laws, customs and cultures vary from country to country. These environmental
differences must be taken into account if firms are to market products and services in
other countries.
The international marketers task is more complicated than that of the domestic
marketer because the international marketer must deal with at least two levels of
uncontrollable uncertainty instead one.
Uncertainty is created by the uncontrollable elements of all business environments, but
each foreign country in which a company operates adds its own unique set of
uncontrollable factors.
The total environment of international market consist of domestic controllable, domestic
uncontrollable and foreign uncontrollable factors.
The controllable factors are product, price, place and promotion.
The domestic uncontrollable factors consists of political and legal, economic climate and
competitive structures.
The foreign uncontrollable factors consists of political and legal forces, economic forces,
competitive structure, level of technology, structure of distribution, geography and
infrastructures and cultural forces etc.
Marketing decision factors:
The successful managers constructs a marketing program designed for optimal
adjustment to the uncertainty of the business climate. The marketing manager blends
product, price, promotion and channels of distribution activities to capitalize on
anticipated demand.
The controllable elements can be altered in the long run and usually in the short run to
adjust to changing market conditions, consumer tastes or corporate objectives.
Aspects of the domestic environment:- the domestic uncontrollable environment that
are often beyond the control of companies. These home country elements that can have a
direct effect on the success of a foreign venture: political and legal forces, economic
climate and competition.
A political decision involving domestic foreign policy can have a direct effect on a firms
international marketing success. For example, the U.S. government placed a total ban on
trade with libya, imposed restrictions on trade with south Africa, placed a total trade
with Iraq. In each case, the international marketing programs of U.S companies were
restricted by these political decisions.
Conversely positive effects occur when there are changes in foreign policy and countries
are given favored treatment.

The domestic economic climate is another important home-based uncontrollable variable

with far reaching effects on a companys competitive position in foreign markets. If
internal economic condition deteriorates, restriction against foreign investment and
purchasing may be imposed to strengthen the domestic economy.
Competition within the home country can also have a profound effect on the international
marketers task. Competition within its home country affects a companys domestic as
well as international plans.

Aspects of the foreign environment:A significance source of uncertainty is the number of factors in the foreign environment
that are often uncontrollable.
The more significant elements in the international marketing environment include
political/legal, economic forces, competitive forces, level of technology, structure of
distribution, geography and infrastructure and cultural forces.
These constitute the principal elements of uncertainty an international marketer must
cope with in designing a marketing program.
The level of technology is an uncontrollable element that can often be misread because of
the vast differences that may exist between developed and undeveloped countries. A
marketer cannot assume that the understanding of concept of preventive maintenance for
machinery is the same in other countries as in the United States. In such situation, a
marketer will have to take extra steps to make sure that the importance of routine
maintenance is understood and carried out.
Political and legal issues face a business whether it operates at home or in a foreign
country.
In a domestic situation political details and the ramifications of political and legal events
are often more transparent than they are in some foreign countries. In many foreign
countries corruption may prevail, foreigner may receive unfair treatment , or the laws
may be so different from those in the home country that they are misinterpreted. The
point is that a foreign company is foreign that thus always subject to the political whims
of the local government to a greater degree than a domestic firm.