Consumerism has been on the rise, especially in countries with economic growth. Media popularity has also changed people’s preferences and their purchase regularity. As a result, many consumers do not confine themselves to national boundaries for buying national products only. They use brands and goods in the foreign market made in cross-border countries.
Here in this post, you will read about international marketing, its importance, characteristics, types, advantages, and disadvantages.
What is International Marketing?
Global marketing, usually referred to as international marketing, entails the marketing of products or promoting goods to foreign customers around the globe. The aim of international marketing is to satisfy both individual and organizational goals by increasing the market opportunity and creating a versatile customer journey.
Why is International Marketing Important?
To answer this question in one sentence, we would say that because international marketing exposes your company to a wider range of global consumers than domestic marketing. Simple as that.
International marketing offers a chance for a brand to gain more exposure, raise brand awareness, and boost sales. In other terms, it is a way to achieve company goals and increase revenue. Cross-border market opportunities are limitless and reach a much larger audience than they would if a company only operated domestically.
Characteristics of International Marketing
International marketing has specific characteristics. Here are the main ones:
1. Larger Market
You get access to a larger market as a result of an international marketing approach. You won’t be constrained to a small market with a domestic audience in a certain location as now you would be working internationally. Market expansion has a lot of advantages and we will discuss some of them in later paragraphs.
2. Extensive Research
When joining foreign markets, you should double or triple your efforts than when you do regional marketing. You should conduct a vast research market on your marketing research process to know about the different cultures of your target market and find potential customers. If you do not do extensive research, all your marketing efforts can go fruitless.
3. Highly Skilled Team
Needless to say, one of the most obvious characteristics is the collaboration of a team with much higher expertise, especially in the marketing department. The reason is that the team has to be able to tackle more serious issues in a variety of situations. They should also be flexible to adapt to unforeseen incidents through an efficient decision-making process. They should also manage critical matters by changing strategies in no time.
4. Higher Competition
Joining the foreign market means you should compete with more competitors, including both local brands and international ones. To stand out among them and have a competitive advantage, you can:
- define a well-thought-for marketing budget;
- update your marketing plan;
- run an international marketing campaign;
- create social media accounts on more social media platforms;
- organize social media campaigns;
- renew social media strategies;
- offer better deals;
- improve your customer service;
- increase the quality of your products or services;
- spend more time and energy on your website;
- keep your content plan fresh;
- update your advertising methods;
- make creative advertising campaigns;
- improve on your marketing message;
5. More Risks
Naturally, you face more risk factors and obstacles when you sell in a much broader and international market. There are many distinctions in various fields as many countries are involved. It is possible that agreements get canceled with government interventions just like Britain stepping out of the European Union (Brexit) which led to customs pay by the customers. It is also possible that the outbreak of war affects your efforts. Moreover, you will be subject to foreign laws and regulations.
As a result, you should prepare your business for all these unforeseen issues and be able to manage effectively.
6. Long-Term Planning
Such a marketing strategy requires long-term planning. Considering the variety of cultures you should target, you should use a different marketing strategy and be patient with the results.
7. Brand Ambassadors
When promoting your products in the international market, you might need different brand ambassadors. Your marketing strategy will be more effective as a result. However, you should be aware that working with influencers or celebrities is costly at times.
International Marketing Types
There are five international marketing types that international businesses may choose:
- Exporting: The direct shipping of products from a host country to a foreign country is called exporting. This type has shipping costs or transportation costs for customers of foreign countries. There are said to be the lowest risks in this type.
- Licensing: The granting of a license by a company to a cross-border company to use its intellectual property is licensing. Licenses work for a specific duration of time.
- Franchising: Franchising is the same as licensing in that the parent company grants a cross-border company the right to work under its name. However, the difference is that there are much stricter guidelines to follow in franchising
- Joint Venture: As its name suggests, a joint venture happens when two companies from different countries join efforts for their greater good.
- Foreign Direct Investment: A business establishes a fixed asset in a foreign firm to manufacture goods abroad. The difference with a joint venture is that the foreign firm owns the subsidiary.
Advantages of International Marketing
There are important international marketing benefits that we will discuss now.
1. Opportunities for Business Expansion
The very first international marketing benefit that can be noticed is the market expansion and a broader customer base. In fact, you extend your customer base and gain international audiences by making your brand international.
2. Economic Downturn Protection
Unforeseen economic events can seriously harm a company’s financial situation. However, sales to cross-border customers can help counterbalance any potential downturns in income. Your company will be able to make up for losses sustained at home and it is one of the many advantages for firms.
3. Excess Production Effectiveness
You can use surplus production effectively. Exporting extra domestically-produced goods, services, or raw materials to overseas markets is a benefit that this marketing strategy provides for you.
4. Competitive Advantages
You can reach a wider audience in foreign countries and grow your target audience. Doing so can have a remarkable impact on increasing the brand awareness of your business. This is something that cannot be achieved if you do not employ a global marketing strategy. In other words, such a feature would become your competitive advantage; something that your competitors may lack.
5. Increased Employment
As a result of global marketing, opportunities for work would grow significantly. The need for efficient human resources and specialized talent would go on the rise internationally. So, international work environments would be shaped and modern project management software would facilitate the interactions between coworkers who are working from different locations.
Disadvantages of International Marketing
Nothing is perfect and everything comes with a pack of disadvantages. The same rule applies here too. Here are some:
1. Culture Varieties
The concept of culture plays a very important role in customers’ preferences, usage patterns, purchase regularity, etc. You should also consider cultural issues such as the language barrier and implement language versions. If you do not conduct thorough market research about your target market in your market research study, there would be serious impacts on your international marketing activities. For instance, you will be unsuccessful in getting acceptance in host markets and capturing qualified leads as your potential customers.
2. Government Restrictions
Since international trade would involve government restrictions such as taxes, transportation costs, import/export customs, etc. You should keep in mind that these are examples of business challenge on the way and find ways to resolve them.
3. War-Like Circumstances
Selling products internationally can be severely affected by war-like situations or worldwide crises such as what we experienced during the Covid-19 pandemic. The shutdown of operations can change your profitable international marketing activities and you should have critical thinking about that.
4. Intense Competition
Competing with international brands is definitely harder than competing with local brands. Therefore, you should always be updating your business so that you do not drop behind your competitors.
Given all the circumstances regarding global marketing, you now have a more insightful view as a marketing expert. If you want to expand your business to the international market and reach more potential customers in foreign countries, you should remember to review your international marketing methods every once in a while. Wish you the best of luck!