International marketing mix strategy
|International marketing mix strategy|
International marketing mix strategy involves use of different marketing instruments to achieve positive financial results by company operating on international or global markets. These instruments include: product, price, distribution and promotion. International marketing mix strategy should take into account legal and socio-cultural circumstances in every country to which it is directed.
Main types of international marketing strategy
- Global marketing mix strategy - is based on the assumption that on the international market there is so called global consumer with similar needs and preferences. Using this approach, on foreign markets companies apply identical marketing instruments and their combinations, there is no different instruments adapted for social and cultural environment in those countries,
- National marketing mix strategy or multinational strategy - for each country company applies a separate marketing strategy adapted to specific needs and preferences of customers, their customs and traditions,
- Hybrid marketing mix strategy - involves standardization of one or more marketing instruments and at the same time adjusting others to the characteristics and conditions prevailing on the particular national market (customs, traditions, regulations, etc.,).
Different product strategies used in international markets
- Product standardization - company introduces unchanged product on the foreign market. Such action makes sense when the product due to its nature, has similar utility for customers on various markets. The use of this strategy is comfortable and not very expensive. Example of companies using this strategy is IKEA.
- Product adaptation - involves adjustment of the product and its properties to the conditions prevailing on the particular market. This includes packaging, size, symbols (depending on the culture prevailing in the country concerned), colour. Adaptation of the product requires large amount of capital and experience.
- Gradual changes in the product - used in situation where there is no danger of the emergence of competition.
Pricing policies in international marketing mix
- usually, company introduce separate pricing policies on foreign markets (due to differences of wealth, competition, etc.),
- development of modern communication technology makes distant markets more similar to each other, which makes it harder to lead a separate pricing policy at home and abroad. In this case, the company carries out a global pricing strategy, when the processes of internationalization blur the differences between the various markets.
Distribution policy in international markets
On the international market distribution activities are related to the offering on the market of products in an appropriate form, place and time. The activities must, however, be adapted to other instruments of the marketing mix and change along with them. The main goal of distribution policy is to overcome spatial, temporary and ownership barriers to distribution separating manufacturer and the final customer. International logistics plays major role in international sales and production activities.
Promotion policy as a marketing mix instrument abroad
Promotion policy involves transferring information to new potential buyers about the company, its products in order to make them to buy these products. Selection and use of the instruments needed to achieve these objectives depends on factors such as:
- objective of promotion on the international market,
- financial resources and experience in foreign markets,
- provisions of the law which regulate promotional activities in each country,
- cultural factors - e.g. language, habits, religion, symbols, associations related to the colour,
- attitude to foreign products,
- competition on the foreign market,
- the company may take similar actions as experienced competitors or, if it is lacking in resources, cooperate with the participants in the distribution channel and jointly carry out promotion,
- the nature and quality of the product,
- type of the customer.
Examples of International marketing mix strategy
- Product: Companies may employ multiple strategies to accommodate different preferences in different countries. For example, McDonald’s offers a range of Halal meals in countries with a predominantly Muslim population.
- Price: Different countries have different currencies and different economic situations. Companies may adjust prices to accommodate local economic conditions. For example, a company may charge a lower price in a developing country than they would in a more developed country.
- Distribution: Companies may need to adjust their distribution strategies to accommodate different cultures and infrastructure. For example, a company may choose to market its products through small, independent retailers in one country and through large, national chains in another.
- Promotion: Companies need to be mindful of local norms and customs when designing promotional campaigns. For example, a company may choose to use TV and radio ads in one country and social media campaigns in another.
Advantages of International marketing mix strategy
An international marketing mix strategy has many advantages, including:
- The ability to tailor each element of the marketing mix (product, price, distribution and promotion) to the different international markets and their respective cultural and legal contexts. This helps to create a strategy that is both effective and culturally appropriate, ensuring that the message and product are well-received by the target audience.
- International marketing mix strategy allows for economies of scale, as costs can be shared across multiple markets.
- It allows the company to better understand their international customers, which helps them to create more effective marketing campaigns and tailor their products to meet their customers’ needs.
- It can also help a company to respond quickly to changes in international markets, as they are better informed of the needs and wants of their target markets.
- Finally, it can help a company to build strong relationships with international partners, as they are better able to understand each other’s needs and work together more effectively.
Limitations of International marketing mix strategy
International marketing mix strategy has some limitations which can hinder its effectiveness. These include:
- Cost: Implementing a marketing mix strategy on an international scale is expensive and resource-intensive. Companies must account for the cost of research, advertising, and production in different countries.
- Language barriers: Language barriers can prevent effective communication of the marketing message to the international audience.
- Cultural differences: Different cultures interpret messages differently, so the same marketing message may not be effective in various countries.
- Political and legal factors: Political instability and legal regulations can affect the implementation of a marketing mix strategy.
- Lack of market information: Companies lack information about the international market, which can lead to ineffective strategy implementation.
- International marketing mix strategy should also consider other approaches such as segmentation, targeting and positioning.
- Segmentation is the process of dividing the market into smaller groups of consumers who have similar needs, characteristics and behaviour patterns. This allows companies to target their products and services towards specific consumer groups.
- Targeting is the process of selecting the most promising segments and designing marketing strategies for each of them. Positioning involves creating a unique value proposition for each target segment and communicating it through an effective marketing mix.
- Finally, International marketing mix strategy should include a strong focus on global brand building. Companies should invest in developing a unified brand identity that resonates with consumers across all markets. This includes creating a consistent brand message, using the same visual identity, and delivering a consistent customer experience.
In summary, International marketing mix strategy requires careful planning and consideration of multiple approaches, including segmentation, targeting, positioning, and global brand building. By taking these steps, companies can ensure they are well-positioned to reach their international markets.
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