1.0 THE MARKETING CONCEPT

Marketing is:-

Satisfying the needs and desires of customers more effectively and efficiently than your competitors and at an acceptable profit.

1.1 Marketing as a Philosophy
The reason for the existence of any firm is:-

CUSTOMERS!

The firm is in the business of creating:-

CUSTOMER SATISFACTION!

Everyone in the organisation has a role to play in:-

DELIVERY OF CUSTOMER SATISFACTION!

1.2 The Marketing Approach
· The key task of the firm is to determine the needs, wants and values of a target market;
· Then adapt the firm to delivering the desired satisfactions more efficiently and effectively than the other competitors.

1.3 International Marketing Defined...

International marketing is the performance of business activities that direct the flow of the company's goods and services to consumers or users in more than one nation for a profit.

1.4 Phases of International Involvement
Normally, a firm seeking to develop it's offshore opportunities, moves through a number of phases in achieving the desired goals for international trading:-

Phase 1 - Domestic Marketing Phase
Phase 2 - Infrequent Foreign Marketing Phase
Phase 3 - Regular Foreign Marketing Phase
Phase 4 - International Marketing Phase
Phase 5 - Global Marketing Phase
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2.0 MARKETING PLANNING

2.1 The Benefits of Formal Planning
· It encourages systematic forward thinking.
· Better co-ordination of company efforts.
· Establishes performance standards and measures progress.
· Sharpens the company's focus on what it wants to achieve.
· Interaction between people is bought into sharp focus.
· Specifies what resources are required to achieve stated objectives.

2.2 The Strategic Plan
· Forecasting in a timeframe appropriate to the firm but generally up to five years.
· Provides the firm with the broad direction for growth and the future of the company.
· Deals with issues that will impact on the future of the firm.
· Sets long term objectives in such areas as:-

(a) return on investment (ROI)
(b) market position
(c) sales growth
(d) new products
(e) markets and technology

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3.0 THE MARKETING MIX (The controllable factors within an organisation)

Internationally, these are known as the 5 P's. An organisation needs to develop an effective mix of :-
1. Product / Service
2. Price
3. Promotion
4. Place / Distribution
5. People

3.1 The Product

3.2 Price

3.3 Promotion


3.4 Place / Distribution

4.0 EXTERNAL ENVIRONMENT

4.1 The Marketing Environment (The Uncontrollable Factors)

4.2 Critical Success Factors for Export marketing
* Do your homework
* Avoid generalisations
* Be prepared to spend alot of time and hard work
* Flexibility and adaptivity
* Commitment
* Planning is vital

4.3 Culture and Business Practices Characteristics of Culture
* Culture satisfies needs
* Culture is learned
* Culture is shared
* Culture is dynamic
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5.0 MARKETING STRATEGIES

* The means by which the firm will seek to achieve objectives and goals.
* A set of co-ordinated decisions on - target markets - the marketing mix - marketing expenditure
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6.0 BASIS OF OVERSEAS MARKET ENTRY SELECTION

* Speed of market entry required
* Cost associated with each strategy
* Flexibility required
* Risk associated with each strategy
* Investment payback period
* Long-term profit objectives
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7.0 MARKET ENTRY STRATEGIES

* Direct Exporting
* Licensing
* Franchising
* Joint Ventures
* Consortia
* Direct Foreign Acquisition / Investment

7.1 Direct Exporting
Exporting involves the physical movement of goods from the home country to another.

Advantages:
- Minimal commitment of resources
- Low risk involvement
- Easiest and most common method

Disadvantages:
- Controlling distribution channels
- Paperwork associated with exporting
- Selecting a reliable distributor/s
- Understanding the needs and communicating with another language or culture
- Distance from end markets / customers

Agents/Distributors - are usually paid on a commission basis with exclusivity of a sales territory but handle more than one company / product.

Advantages:
- Ease of entry into offshore markets
- Low-cost investment and low-risk alternative
- Use of agent's expertise and experience in dealing with local conditions
- Ease of contact with local markets

Disadvantages:
- Problems in choosing the "right" quality agent
- Lack of control of the agent, especially if they take title to the goods
- Conflict of interest by agent carrying (selling) other Company's products

7.2 Licensing
Licensing is the purchase or sale of product or process technology, design and marketing expertise.

Advantages:
- Provides access to difficult markets
- Ideal for small firms with little capital to enter offshore markets
- Low-risk market entry strategy
- Minimal commitment of resources
- Low development costs required
- Allows for improved delivery and servicing of markets
- Can service a wider geographical area more easily

Disadvantages:
- Disclosure of competitive information and experience
- Creates possible future competitors
- Lack of control over licensee
- Passive interaction with markets
- Exclusion of some export markets (due to nature of "sole rights")
- Cost of organising and servicing licensing operations

7.3 Franchising
Is a form of marketing and distribution where rights are granted for specific product, time, areas.

Advantages:
- Flexibility in dealing with local market conditions
- Maintenance of control by franchisor
- Use of market knowledge, capital and expertise of franchisee in offshore markets
- Can expand market coverage with low level of capital

Disadvantages:
- Success dependent on franchisee effort
- Risk that the franchisee, if performing poorly, will have a negative effect on the brand name(s)
- Problems of ensuring consistency in quality standards across all franchise outlets

7.4 Joint Ventures
Is an arrangement between parties to share and form a new enterprise for mutual benefit.

Advantages:
- Reduction of political and economic risk
- Use specialised skills of local partner/s
- Gains access to distribution channels
- Deals with any restrictions
- Deals with any lack of resources (capital, people ..)
- Attractive where the firm does not have the resources to expand its international activities
- By-pass trade barriers
- Facilitates technology transfer
- Provides opportunity to learn and gain experience of conducting business in the local marketplace

7.5 Direct Foreign Investment
Can involve the firm manufacturing or acquiring operations offshore through direct investment.

Advantages:
- Access to raw materials
- Control over marketing, production and distribution
- Perception of commitment
- Ability to capitalise on lower cost labour
- Reduced costs (eg. distribution etc.)

Disadvantages:
- Problems with government restrictions
- Maximum investment required (high risk)
- Risk of appropriation of assets
- Perception of being a foreigner with no local interest

7.6 Consortia
Involves a number of participating firms pooling their resources and skills towards a common objective.

Advantages:
- Pooling of resources
- Reduction of risk
- Ability to negotiate through joint representation
- Benefit from government schemes and support

8.0 EXPORT PLANNING PROCESS

Need to cover the following issues
* Business definition
* Strategy
* Market opportunities
* Export objectives
* Market coverage objectives
* Marketing mix strategies
* Implementation and control