The extent of involvement and commitment to international markets - Marketing Management

International Marketing Involvement and Commitment of the Company

The involvement and commitment to international markets. It was suggested that although this is often the result of a process of evolution, in many companies it is a well planned, systematic and considered decision area and indeed the first one in planning international marketing strategies.

Many factors influence and determine the extent to which a company wishes to become involved and committed to international markets. It is therefore not possible to be specific about what constitutes an appropriate degree of involvement as it varies from company to company and even within a company. A company should decide in a rational manner the extent of its current and planned future involvement and commitment to international markets, and where this commitment is planned to increase over time, this should be done in a systematic and ordered manner. Amongst factors that will affect these decisions are:

  • situation in domestic market regarding sales and profits;
  • opportunities afforded through international expansion;
  • corporate objectives and plans;
  • company resources and skills;
  • attitudes towards risk;
  • outside influences e.g. government incentives and changes in trading blocks.

What is most important is that international marketing plans should be developed from, and be consistent with overall corporate objectives and plans.

Foreign market selection

Having determined how committed and involved a company is to be to international markets, the company must then select specific foreign markets it intends to target. In many ways this is an issue of market segmentation and targeting which were considered in Chapter 3. Overall, it is a question of matching company strengths and resources against potential market opportunities after considering aspects such as competition, market size and growth. Of particular importance, especially for inexperienced international marketing companies, is the need to resist the temptation to attack too many markets, thereby spreading effort and resources too thinly to be successful. Often, initial efforts should be directed at a single market and this can be later extended to other markets.

Market selection can be based on a number of criteria:

  1. Market potential: e.g. market size and trends, location of competition and their marketing mixes, customer profiles, needs and wants and channels of distribution.
  2. Market similarity: often a company will select markets which are similar to their own domestic markets. ‘Psychological’ proximity is often more important than geographical proximity in international markets. While it is understandable that companies would prefer markets similar to their own domestic markets in which they have experience, there is a danger that a company may be tempted to take too much for granted and ignore subtle but critical environmental differences.
  3. Accessibility: encompasses both geographical distance and logistics, but also for example, political distance which involves legal and technical import controls, political constraints on business and exchange controls.

The selection of which markets to enter, and how many (i.e. coverage) is a crucial strategic decision. Overall we are looking for those markets which offer the greatest potential for the company to achieve its overall objectives for its international markets.


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