International Business

International Market Segmentation, Target Market, & Positioning Marketing philosophy has passed through different phases such as
1)

Mass Marketing Marketing

2) Product Differentiation Marketing

3)Target

Mass Marketing: This involves mass production, mass promotions, mass distribution of goods & services Product Differentiation Marketing: In this case marketer two or more products that exhibits different features, styles, qualities etc., they offer variety to the buyer, Target Marketing: Here the marketer distinguishes among the many market segments, selects two or more of these segments & develops products & marketing mix tailored for each segment. This involves three steps, 1)Market Segmentation 2)Market Targeting 3)Product Positioning Market Segmentation: It is act of dividing market in to distinct groups of buyers, which might require the products or market mix .eg. Beer drinkers. These sets of buyers represent different segments of market, segmented or differentiated based on their preferences & taste. Market Targeting: It is an act of evaluating & selecting one or more market segments to enter. Product Positioning: This an act of designing the companys products & market mix to fit a given place in the consumer mind. Basis of Market Segmentation: The market is segmented or divided on the basis of a)Geographic segmentation c)Psychographic segmentation b) Demographic segmentation d) Behavioral segmentation

a)Geographic Segmentation: In this case, the market is differentiated on basis of cities, towns, villages. One such differentiation based on zones. Eg. Eastern, Western, Southern etc.

b)Demographic Segmentation: This means that dividing the market based on demographic variables such as, age sex, family size, income, occupation, education religion, and race. c)Psychographic Segmentation: This means dividing buyers in different groups based on different groups such as Social class, lifestyle, personality. d)Behavioral Segmentation: This includes factors like occasions, benefit sought, users status, usage rate, loyalty status. What is product? Product is something tangible that could described in terms of physical attributes such as dimension, components, form, and colour so on. However, this misleading as people thinks that only tangible products can be exported.

Product is defined as the sum of all the physical & psychological satisfaction that the buyer or user receives because of the purchase or use of a product. Product Planning & Development Major forms of product planning in international marketing are New product development or addition Change in existing products Finding new uses for existing products Product elimination Just because a product is successful in one country there is no guarantee that it will be successful in other markets.

 A marketer must determine the local needs & taste & take them into account. Some products have universal appeal &little or no change is necessary when the products are placed in various markets.

New Products Development A company may add products to its product mix for marketing in foreign markets by exporting in many ways. The most obvious is to export the existing domestic product is a relatively easy & cost effective. Another relatively easy but not economical is to acquire a firm or some operations of a firm that has products for which there are potential or existing overseas area. The acquired firm may be a foreign firm whose products are designed for its home market & perhaps third markets or it may be accompany in the same country as the firm doing acquiring eg. McDonnell Doughlas with States Department of Defense. Boeings for its biggest customer United

Ciba & Geigy merged to form largest chemical pharmaceutical company. Many acquiring companies consider that it is cheaper to in long run to pay high prices for established brands than to invest in building new ones. Eg Ford Motor Co. expanded its operations by acquiring Europes Jaguar, Land-Rover Aston Martin & Volvo. A company can add to its offerings by copying products developed successfully by others. Many companies follow this approach with varying degree of success, but market leader does not use this approach. Finally, a company can obtain its new product by the process of new product development. There are six distinct steps in new product development First step-Generation of new product ideas. These ideas come from number of sources such as sales person employees, competitors marketing research firms, Customers.eg.3M Companys chemist-Scotch guard fabric protector. Second step- Screening of ideas. Ideas generated are reviewed to determine its feasibility

Principles of new product development New product should be useful to society. It should make use of own creativity, technology or skills. New product should be superior to competitors in terms of cost & performance. It should able to withstand exhaustive test before it is commercialized It should be able to deliver its own message at every level of distribution. Third step Business analysis, This involves the estimation of product features, cost, demand & profit eg. Xerox. Fourth step Product development, Which involves technical tests as well as manufacturing pilot models in small quantities. g, GoldstarCo. Kimchi fresh & odorless for long time gained its position from Samsung Fifth step.-Test marketing. To determine the potential marketing problems optimal marketing mix.eg.Budweiser was pulled out of German market after six months. This brand failed in France because of taste.

Sixth step-Full scale commercialization This means actually going through full-scale production & marketing.Eg Coca Cola Ambasa whitewater, a lactic based drink removed after 18 months from market Changes in Existing Product Often a product that is in trouble or is in maturity or declining stage of its life cycle can have its life extended by making modifications .These modifications can be in the physical product or auxiliary services; it may involve standardization or adaptation.eg. Automobiles exported to India, must have right hand drive. Similarly cars exported to Western Europe, UK, Australia, New Zealand must have left hand drive. Often a company requires change & improvements in its products to maintain & hopefully increase the market share/positions compared to its competitors. .eg. Sony Walkman continually introduces new features to meet changing taste.

New Uses for Existing Products Guidelines: Is there a related application? A product sold to women may be sold to men & vice versa. Can a product be used differently when used with another product? Consumer product may have industrial market &vice versa.

Product Elimination: Weak products add substantially to overhead costs. While primary attention is given to other forms of product planning & developments, less emphasis is usually placed on deleting the old or weak products. The existing product mix should be continually evaluated or monitored this should be done in relevancy &light of changing customer needs, competitive products, & environment conditions. A company can withdraw this product from weaker market, but should continue in markets that are favorable or giving good results.