Dr. Elmos Konis
International Marketing
The ‘natural’ way to growth and
internationalisation
A ‘pie’ is made
New
product
The ‘natural’ way to growth and
internationalisation
You enter this market
Competitor
Your share
One way to Growth: You get
a bigger share of this market
Competitor
Your share
Another way to grow:
The market as a WHOLE grows
Competitor
Your share
A third way for company growth: New
products
Another new ‘pie’ is made
A fourth way to company growth
Another way to grow: Internationalisation
Competitor 1
Your share
Competitor 2
The three ways to view markets.
Which is best for SME’s?
• Aggregation
Segments
• Segmentation
gender
income
family
life cycle
age
The three ways to view markets
• Customisation
• And a fourth, mass customisation
Which type of market should SME’s
choose?
• B2B (you need a specific audience to notice
you)
• Retail (you also need a specific audience to
notice you!)
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What should SME’s do to go
international? (The basic principles of
marketing still hold true! Slide 12)
Is there a need for the product abroad?
Is there a niche?
Do we know the TM well? (stay focused!)
Who are the competitors? How powerful are they? Can
there be an advantage? (e.g. personal relations)
Would local collaborations be a better bet? Do we have
a network? Relationship marketing!
What are the difficulties (legal, political, cultural,
technological)
If you can’t beat them join them. Large companies
cooperate with SME’s
Do you have an established brand? If not, find another
way. E.g…
The International Marketing Mix
Foreign environment
(uncontrollable)
1
Political/legal
forces
7
Cultural
forces
Domestic environment
(uncontrollable)
Political/
legal
forces
(controllable)
Price
Promotion
6
Geography
and
Infrastructure
Economic
forces
2
Competitive
structure Competitive
Forces
Product
Channels of
distribution
7
Level of
Technology
Economic climate
5
4
Structure of
distribution
3
Environmental
uncontrollables
country market A
Environmental
uncontrollables
country
market B
Environmental
uncontrollables
country
market C
Consider the perception of your
country in the host country
Seek information and help!
Get help!
• E.g. 09/11/2011 - ‘Small Business, Big World — a
new partnership to help SMEs seize global
opportunities’
The European Commission’s new strategy aimed at
helping SME’s to expand their business outside the
European Union:
• Strengthening and mapping the existing supply of support
services
• Creating a single virtual gateway to information for SMEs
• Making support schemes at EU level more consistent
• Promoting clusters and networks for SME internationalisation
• Rationalising new activities in priority markets
• Leveraging existing EU external policies
How does a small firm ‘fight its war’?
• Attack
• Defend
• Guerilla
The great ‘leveller’
• The internet! (Thanks Sir Tim Berners Lee for the WWW!)
Today you can be ‘born global’ and
succeed even if you are small
How come?
• Access to and affordability of
technology
• The information highway
• ‘Availability’ of innovation
• Ease of travel
• Ease of communication,
building contacts
Today you can be ‘born global’ and
succeed even if you are small
How come?
• Ease of entry in some
industries
• Help from various sources
• Fewer barriers to trade
• Migration of talent
• Today, people do more
research before buying
Inherent strengths of SME’s
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Flexibility and adaptability
Speed of response in developing markets
Niche marketing and ‘unique’ differentiation
Lower overheads
Today, the ‘quirky’ exotic image sells
Deciding Whether to Go Global
• Reasons to consider going global:
– Foreign attacks on domestic markets
– Foreign markets with higher profit opportunities
– Stagnant or shrinking domestic markets
– Need larger customer base to achieve economies
of scale
– Reduce dependency on single market
– Follow customers who are expanding or moving
A quick look at Cyprus
So, what just happened to Cyprus?
It’s a Free Market
We can Learn from the big boys:
e.g. Demonstrate that you can think
globally! (And you understand different
values)
BUT, Avoid the big mistakes of big
companies!
Honda "Fitta" is a slang rather vulgar word used in Sweden, Finland, Denmark and Norway to designate the
vxxxxa. Later, the Honda "Fitta" was renamed "Honda Jazz"
In most Spanish-speaking countries, we associate "Pajero" with "pajear" which is the vulgar version of
"mxxxxxxxxe". It was renamed "Mitsubishi Montero"
In Portuguese-speaking countries, "Pinto" means "pxxxs“.
It speaks for itself!
‘Fly in leather’: "Vuela en cuero," which means simply "Fly naked"
Kekoukela" which means in some dialects "Mare stuffed with wax" or even
"Toad stuffed with wax" . Characters changed to Kokoukole" or "Kekoukele"
which means "Happiness in the mouth"
The traditional "Finger lickin 'good“, in Chinese, the slogan
became: "We will cut your fingers" or "Eat your fingers"
Puff in English slang is ‘gay’
Hhm…
No comment
So, there is room for SME’s too!
Convergence or divergence?
The importance of language
SLEPT
Industrial Structure
• Shapes a country’s product and service needs,
income levels, and employment levels.
Subsistence Economies
Raw Material Exporting Economies
Industrializing Economies
Industrial Economies
Political-Legal Environment
Attitudes Toward International Buying
Government Bureaucracy
Political Stability
Monetary Regulations
Cultural Environment
• Sellers must examine the ways consumers in
different countries think about and use
products before planning a marketing
program.
• Business norms vary from country to country.
• Companies that understand cultural nuances
can use them to advantage when positioning
products internationally.
Cultural Differences
When Nike learned
that this stylized “Air”
logo resembled “Allah”
in Arabic script, it
apologized and pulled
the shoes from
distribution.
Looking at the Global Marketing Environment
The International Trade System:
Restrictions—tariffs, quotas, embargos, exchange controls,
and non-tariff trade barriers.
The World Trade Organization:
Helps Trade—reduces tariffs and other international trade
barriers.
Regional Free Trade Zones:
Groups of nations organized to work toward common goals in
the regulation of international trade.
Summary of Major International Marketing
Decisions
Finally, the Importance of language