International marketing definitions: levels of involvement in international marketing - Marketing Management

The simple notion that international marketing involves marketing across national boundaries belies the potential complexities of defining precisely what international marketing is and what it involves. On the one hand marketing across national boundaries may simply involve a company passively responding to an unsolicited foreign order received from, say, an independent broker. The company involved in this transaction simply sells its product or service to the broker with little effort, additional considerations or long-term commitment. On the other hand, marketing across national boundaries may involve a company devoting most of its resources to foreign market activities with substantial commitment to markets across the globe and with production or marketing in many countries. Clearly, the term ‘international marketing’ can encompass a wide range of different activities and commitments even though products and services are still essentially being sold across national boundaries. Different levels of involvement allow us to explore and categorize distinct types of activities and commitments encompassed when marketing across national boundaries:

  1. Casual or accidental exporting This type of international business entails the lowest levels of commitment and involvement by a company. It essentially consists of a company responding to largely unsolicited foreign orders and there is not real commitment to international marketing.
  2. Active exporting is where a company makes a positive commitment to its international marketing with an ensuing higher degree of involvement. Not only is there an active recognition that foreign markets exist and represent possible marketing opportunities, but because of this, attempts are made to cultivate sales across national boundaries in a proactive manner. However, even this type of export marketing tends still simply to apply marketing principles to exporting a product which the firm is already selling in its domestic market. Because of this, overall corporate strategy does not really reflect foreign market importance and activities although minor adjustments may be made to the company’s strategy to accommodate these.
  3. Committed international marketing This level of commitment to international marketing entails the greatest degree of involvement on the part of the company. Markets across national boundaries are a key consideration in the marketing strategy of the company. International marketing activities are an integral part of the overall marketing programme. Organizational systems, structures and procedures may be developed specifically for the purpose of enhancing international marketing operations and profitability. A committed international marketer is the Coca-Cola Company. International marketing activities form the centre of the company’s overall marketing programme. All of the company’s organizational systems, structures and procedures are purposely designed to enhance international marketing operations and profitability.

The level of involvement and commitment by a company to ‘marketing across national boundaries’ can vary considerably which means that no single simple definition of what constitutes international marketing can adequately encompass the possible range and scope of activities involved. Related to this notion of different levels of involvement and types of international marketing, is the notion of different types of company perspectives and approaches to organizational structure and systems with regard to its non-domestic marketing. The export marketing company, as suggested in our earlier discussion of levels of involvement, is a company which simply sells its products overseas. This company may or may not have a separate export marketing division, but essentially uses the same marketing strategies in both its domestic and export markets.

The international company is one whose headquarters are located in one country and where ownership is dominated by the nationals of that one country. However, this sort of company views international marketing in a much more positive manner and sees it as being more central to their overall strategy and profits. Marketing strategy tends to emanate from the company headquarters, although they may possess marketing operations in other countries which, in turn, may reflect the particular requirements of each of the foreign markets and customers.

The multinational company (MNC) is generally agreed to have the following characteristics: n They treat the various national markets in which they operate as if they were one. In other words they do not see a distinction between domestic and global marketing opportunities.

  • They have a single management strategy that guides all their various operating companies throughout the world.
  • They think and operate in what Wind et al.3 term a ‘geocentric’ manner. This means that they are essentially world oriented in their approach to their marketing and planning. We return to this notion when we consider alternative organizational systems and structures for international marketing later in this chapter, but essentially the multinational company which will predominantly have a geocentric perspective will be concerned to achieve complete integration of its marketing strategies throughout the world. Lascu4 refers to this as the most extreme type of international involvement. Increasingly, multinational corporations are practising global marketing. A global marketing company views the world as a whole as its market and develops a global marketing strategy.

International Marketing Involvement and Commitment of the Company

Both the level of involvement and commitment by a company to its international markets, and ssociated perspectives regarding these markets, constitute key decisions by a company regarding its international marketing strategy. Simply stated, a company must decide whether it is going to be either a passive exporter or a fully fledged global marketing operator, or of course any number of levels of involvement and commitment in between.However, while this is obviously a crucial determinant of virtually every other aspect of a company’s international marketing operations and strategies, we know that the decision to ‘go international’ is often not a rational ‘searching after business’ opportunity, but rather the result of a series of chance decisions and many companies go through a process of gradually evolving their international marketing operations. For example, in the first stage a company begins by filling unsolicited orders, but does not actively seek to export.

In the next stage the company may actively seek out export markets, but exporting still remains a small part of its business. If the exporting is successful, the company becomes established in one or more export markets and exporting becomes a major activity. The company may then begin to invest in production and other facilities in overseas markets and eventually the company move towards becoming a fully fledged global marketer.

Progression through the stages of involvement to international marketing is by no means an automatic one. Marks & Spencer, for example, despite early forays into overseas expansion including the opening of stores in France, North America and the Far East, have never really developed into a full-blown international retailer. IKEA on the other hand have progressed through successful expansion of their international operations.

Although this gradual evolution of international marketing is how many companies develop their global marketing activities, it is better if the organization plans a systematic development of its activities into the international arena. A firm may enter into marketing across national boundaries passively, due to problems in their domestic market, or actively, by seeking attractive opportunities abroad. We consider some of the reasons for deciding to ‘go international’ shortly, together with some of the factors that should affect this choice if it is to be planned, as suggested, systematically as part of the overall strategic planning process for international marketing. Before we do this, it is useful to consider what, if anything is different or ‘special’ about the management of international marketing compared to pure domestic marketing. We now consider these differences.

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