1) Future of international marketing

International Marketing can be defined as exchange of goods and services

between different national markets involving buyers and sellers.
According to the American Marketing Association, International Marketing is the
multi-national process of planning and executing the conception, prices,
promotion and distribution of ideal goods and services to create exchanges that
satisfy the individual and organizational objectives.
SCOPE OF INTERNATIONAL MARKETING
International Marketing constitutes the following areas of business:Exports and Imports: International trade can be a good beginning to venture
into international marketing. By developing international markets for domestically
produced goods and services a company can reduce the risk of operating
internationally, gain adequate experience and then go on to set up manufacturing
and marketing facilities abroad.
Contractual Agreements: Patent licensing, turn key operations, co production,
technical and managerial know how and licensing agreements are all a part of
international marketing. Licensing includes a number of contractual agreements
whereby intangible assets such as patents, trade secrets, know how, trade
marks and brand names are made available to foreign firms in return for a fee.
Joint Ventures: A form of collaborative association for a considerable period is
known as joint venture. A joint venture comes into existence when a foreign
investor acquires interest in a local company and vice versa or when overseas
and local firms jointly form a new firm. In countries where fully owned firms are
not allowed to operate, joint venture is the alternative.
Wholly owned manufacturing: A company with long term interest in a foreign
market may establish fully owned manufacturing facilities. Factors like trade
barriers, cost differences, government policies etc. encourage the setting up of
production facilities in foreign markets. Manufacturing abroad provides the firm
with total control over quality and production.
Contract manufacturing: When a firm enters into a contract with other firm in
foreign country to manufacture assembles the products and retains product
marketing with itself, it is known as contract manufacturing. Contract
manufacturing has important advantages such as low risk, low cost and easy exit.
Management contracting: Under a management contract the supplier brings a
package of skills that will provide an integrated service to the client without
incurring the risk and benefit of ownership.

Third country location: When there is no commercial transactions between two

countries due to various reasons, firm which wants to enter into the market of
another nation, will have to operate from a third country base. For instance,
Taiwans entry into china through bases in Hong Kong.
Mergers and Acquisitions: Mergers and Acquisitions provide access to
markets, distribution network, new technology and patent rights. It also reduces
the level of competition for firms which either merge or acquires.
Strategicalliances:A firm is able to improve the long term competitive advantage
by forming a strategic alliance with its competitors. The objective of a strategic
alliance is to leverage critical capabilities, increase the flow of innovation and
increase flexibility in responding to market and technological changes. Strategic
alliance differs according to purpose and structure. On the basis of purpose,
strategic alliance can be classified as follows:
i. Technology developed alliances like research consortia, simultaneous
engineering agreements, licensing or joint development agreements.
ii. Marketing, sales and services alliances in which a company makes use of the
marketing infrastructure of another company in the foreign market for its
products.
iii. Multiple activity alliance involves the combining of two or more types of
alliances. For instance technology development and operations alliances are
generally multi- country alliances.
3)

Product Life Cycle

Product Life Cycle Concept

We have a life cycle, we are born, we grow, we mature, and finally we pass away.
Similarly, products also have life cycle, from their introduction to decline they
progresses through a sequence of stages. The major stages of the product life
cycle are - introduction, growth, maturity, and decline. Product life cycle describes
transition of a product from its development to decline.
The time period of product life cycle and the length of each stage varies from
product to product.Life cycle of one product can be over in few months, and of
another product may last for many years. One product reach to maturity in years
and another can reach it in few months. One product stay at the maturity for years
and another just for few months. Hence, it is true to say that length of each stage
varies from product to product.

Product life cycle is associated with variation in the marketing situation, level of
competition, product demand, consumer understanding, etc., thus marketing
managers have to change the marketing strategy and the marketing
mix accordingly.
Product life cycle can be defined as "the change in sales volume of a specific
product offered by an organisation, over the expected life of the product."

Stages of the Product Life Cycle

The

four

major

Introduction,

Growth,

Maturity, and

Decline.

stages

of

the

product

life

cycle

are

as follows :-

Introduction

Stage

At this stage the product is new to the market and few potential customers are
aware with the existence of product. The price is generally high. The sales of the
product is low or may be restricted to early adopters. Profits are often low or losses
are being made, this is because of the high advertising cost and repayment of
developmental

cost.

At

the

introductory

The product is unknown,

The price is generally high,

The placement is selective, and

The promotion is informative and personalised.

stage

:-

Growth Stage
At this stage the product is becoming more widely known and acceptable in the
market. Marketing is done to strengthen brand and develop an image for the
product. Prices may start to fall as competitors enters the market. With the increase
in sales, profit may start to be earned, but advertising cost remains high. At the
growth stage :

The product is more widely known and consumed,

The sales volume increases,

The price begin to decline with the entry of new players,

The placement becomes more widely spread, and

The promotion is focused on brand development and product image

formation.
Maturity

Stage

At this stage the product is competing with alternatives. Sales and profits are at
their peak. Product range may be extended, by adding both withe and depth. With
the increases in competition the price reaches to its lowest point. Advertising is
done to reinforce the product image in the consumer's minds to increase repeat
purchases.

At

maturity

The product is competing with alternatives,

The sales are at their peak,

The prices reaches to its lowest point,

The placement is intense, and

The promotion is focused on repeat purchasing.

stage

:-

Decline Stage
At this stage sales start to fall fast as a result product range is reduced. The product
faces reduced competition as many players have left the market and it is expected
that no new competitor will enter the market. Advertising cost is also reduced.
Concentration is on remaining market niches as some price stability is expected
there. Each product sold could be profitable as developmental costs have been paid
at earlier stage. With the reduction in sales volume overall profit will also reduce. At
decline stage :

The product faces reduced competition,

The sales volume reduces,

The price is likely to fall,

The placement is selective, and

The promotion is focused on reminding.

4)PRICING STRATEGY
Pricing Objectives
The firm's pricing objectives must be identified in order to determine the optimal pricing.
Common objectives include the following:

Current profit maximization - seeks to maximize current profit, taking into account
revenue and costs. Current profit maximization may not be the best objective if it
results in lower long-term profits.

Current revenue maximization - seeks to maximize current revenue with no regard

to profit margins. The underlying objective often is to maximize long-term profits by
increasing market share and lowering costs.

Maximize quantity - seeks to maximize the number of units sold or the number of
customers served in order to decrease long-term costs as predicted by the experience
curve.

Maximize profit margin - attempts to maximize the unit profit margin, recognizing
that quantities will be low.

Quality leadership - use price to signal high quality in an attempt to position the
product as the quality leader.

Partial cost recovery - an organization that has other revenue sources may seek only
partial cost recovery.

Survival - in situations such as market decline and overcapacity, the goal may be to
select a price that will cover costs and permit the firm to remain in the market. In this
case, survival may take a priority over profits, so this objective is considered
temporary.

Status quo - the firm may seek price stabilization in order to avoid price wars and
maintain a moderate but stable level of profit.

For new products, the pricing objective often is either to maximize profit margin or to
maximize quantity (market share). To meet these objectives, skim pricing and penetration
pricing strategies often are employed. Joel Dean discussed these pricing policies in his classic
HBR article entitled, Pricing Policies for New Products.
Skim pricing attempts to "skim the cream" off the top of the market by setting a high price
and selling to those customers who are less price sensitive. Skimming is a strategy used to
pursue the objective of profit margin maximization.

Skimming is most appropriate when:

Demand is expected to be relatively inelastic; that is, the customers are not highly
price sensitive.

Large cost savings are not expected at high volumes, or it is difficult to predict the
cost savings that would be achieved at high volume.

The company does not have the resources to finance the large capital expenditures
necessary for high volume production with initially low profit margins.

Penetration pricing pursues the objective of quantity maximization by means of a low price.
It is most appropriate when:

Demand is expected to be highly elastic; that is, customers are price sensitive and the
quantity demanded will increase significantly as price declines.

Large decreases in cost are expected as cumulative volume increases.

The product is of the nature of something that can gain mass appeal fairly quickly.

There is a threat of impending competition.

As the product lifecycle progresses, there likely will be changes in the demand curve and
costs. As such, the pricing policy should be reevaluated over time.
The pricing objective depends on many factors including production cost, existence of
economies of scale, barriers to entry, product differentiation, rate of product diffusion, the
firm's resources, and the product's anticipated price elasticity of demand.
Pricing Methods
To set the specific price level that achieves their pricing objectives, managers may make use
of several pricing methods. These methods include:

Cost-plus pricing - set the price at the production cost plus a certain profit margin.

Target return pricing - set the price to achieve a target return-on-investment.

Value-based pricing - base the price on the effective value to the customer relative to
alternative products.

Psychological pricing - base the price on factors such as signals of product quality,
popular price points, and what the consumer perceives to be fair.

In addition to setting the price level, managers have the opportunity to design innovative
pricing models that better meet the needs of both the firm and its customers. For example,
software traditionally was purchased as a product in which customers made a one-time

payment and then owned a perpetual license to the software. Many software suppliers have
changed their pricing to a subscription model in which the customer subscribes for a set
period of time, such as one year. Afterwards, the subscription must be renewed or the
software no longer will function. This model offers stability to both the supplier and the
customer since it reduces the large swings in software investment cycles.
Price Discounts
The normally quoted price to end users is known as the list price. This price usually is
discounted for distribution channel members and some end users. There are several types of
discounts, as outlined below.

Quantity discount - offered to customers who purchase in large quantities.

Cumulative quantity discount - a discount that increases as the cumulative quantity

increases. Cumulative discounts may be offered to resellers who purchase large
quantities over time but who do not wish to place large individual orders.

Seasonal discount - based on the time that the purchase is made and designed to
reduce seasonal variation in sales. For example, the travel industry offers much lower
off-season rates. Such discounts do not have to be based on time of the year; they also
can be based on day of the week or time of the day, such as pricing offered by long
distance and wireless service providers.

Cash discount - extended to customers who pay their bill before a specified date.

Trade discount - a functional discount offered to channel members for performing

their roles. For example, a trade discount may be offered to a small retailer who may
not purchase in quantity but nonetheless performs the important retail function.

Promotional discount - a short-term discounted price offered to stimulate sales.

7) foreign trade development regulation act

Foreign Trade, as all of you must be aware is one of the most important factor in the overall
economic development of the country. For an ordinary person it is a very complex area which
involves a whole gamut of policies, procedures etc. laid down by different Departments of the
Government, which are responsible for this activity. Therefore, it is not easy to understand
this complex maze of policies/procedures and an exporter or prospective exporter in a
country like India who wants to enter into this area, does not know where to start. In this
chapter, we will be trying to understand this complex scenario and we would have an
overview of foreign trade, its policies, procedures and some of the important schemes for the
exporters/ importers, being run by the Government Departments. The basic idea of this
exercise would be to aquaint ourselves with all aspects of foreign trade so that we are able to

know how the foreign trade is regulated in the country and how one can maximize the
benefits being given by the Government to the exporters/ importers under its various schemes
executed by different departments
SALIENT FEATURES OF FOREIGN TRADE DEVELOPMENT AND REGULATION
(FTDR) ACT 1992
(i) This Act replaced the earlier Act which used to be called as Import and Export (Control)
Act 1947.
(ii) The basic objective of FTDR 1992 is to provide a frame work for development and
regulation of foreign trade by facilitating imports into the country, as well as, taking measures
to increase exports from India and any other related matters.
(iii) The Act empowers the Central Government to make any provision in order to fulfill
these objectives.
(iv) In terms of these powers contained in FTDR Act 1992, the government makes provisions
to fulfill the objectives by way of formulation of the Export and Import Policy.
(v) Earlier this policy used to be called as Export and Import Policy i.e. Exim Policy,
however, of late the Policy is being termed as Foreign Trade Policy (FTP) of the country as it
covers areas beyond export and import in the country. This Policy, in terms of the Act is
formulated by the office of the Directorate General of Foreign Trade (DGFT), an attached
office of the Ministry of Commerce & Industry, Government of India. 7 FTDR Act, 1992 and
Foreign Trade Policy (
vi) The Act lays down that no person can enter into import or export business in India unless
he is issued an Importer Exporter Code No. (IEC No.) by the office of the DGFT.
(vii) In case any exporter or importer in the country violates any provision of the Foreign
Trade Policy or for that matter any other law inforce, like Central Excise or Customs or
Foreign Exchange, his IEC number can be cancelled by the office of DGFT and thereupon
that exporter or importer would not be able to transact any business in export or import.
(viii) The Act also provides for issuance of a permission called licence or authorization for
import or export, wherever it is required in terms of the policy. Similarly, powers to suspend
and cancel the licence for import or export are also provided for in the Act.
(ix) The powers related to search and seizure etc. of the premises, where any violation of
Export Import Policy has taken place or is expected to take place are also provided for in the
Act.
(x) What constitutes a violation of the provision of this Act is also contained in the Act itself.
Violations would cover situations when import or export has been made by unauthorized
persons who are not legally allowed to carry out import or export or when any person carries
out or admits to carry out any import or export in contravention of the basic Export Import
Policy.

(xi) The penalties which can be imposed by the authorities, competent to do so, in case of any
contravention or violation of the Foreign Trade Policy are also described in the Act.
(xii) As is the norm in any Act of the Government, in order to fulfill the basic dictum of
natural justice, detailed provisions for appeal and revision of orders are also provided for in
the Act. In terms of these provisions, any person who is aggrieved by any decision taken by
an authority under the Act can make an appeal to the superior Authority for appeal and
revision of the orders issued by the subordinate Authority.
(xiii) In terms of the Act an order has also been issued which lists down the categories which
are exempted from the application of provisions of the Foreign Trade Policy. This order is
called Foreign Trade (Exemption from Application of Rules in Certain Cases) Order, 1993.
This order separately lists the institutions and entities for export, as well as, imports on which
the rules framed under FTDR Act, 1992 are not applicable.
(xiv) To operationalize the provisions of any Act, Rules are required. For the FTDR Act, the
rules framed and issued by the Government are called Foreign Trade (Regulation) Rules,
1993 which lay down the various operational provisions such as fee requirements for
issuance of licenses, conditions of licenses, refusal, suspension and cancellation of licenses
etc

8) Marketing research
"the process or set of processes that links the producers, customers, and end users to the
marketer through information information used to identify and define marketing
opportunities and problems; generate, refine, and evaluate marketing actions; monitor
marketing performance; and improve understanding of marketing as a process. Marketing
research specifies the information required to address these issues, designs the method for
collecting information, manages and implements the data collection process, analyzes the
results, and communicates the findings and their implications."

The Characteristics of Good Marketing Research

Scientific Method careful observation, generate hypothesis, prediction, testing

Research creativity innovative ways to solve problems

Multiple Methods shy away from any one method

Interdependence of models & data data interpreted from underlying models

Value & cost of information value/cost considerations

Healthy skepticism skepticism of assumptions

Ethical Marketing learn about customers needs to better serve them

Overcoming barriers to the Use of Marketing Research:

Narrow conception many managers see it as only a fact finding mission

Uneven caliber of marketing researchers perceived as clerical activity

Late & erroneous findings

Personality & presentational differences

Marketing Decision Support System (MDSS) is a coordinated collection of data,

system, tools, & techniques with supporting software & hardware by which an
organization gathers and interprets relevant information from business &
environment & turns it into a basis for marketing action.

Models for managers to simulate marketing situations

A variety of analysis tools (see pg. 128 for list)

Neural Networks Artificial intelligence system imitates human mind

The Marketing Research Process

Step 1: Define the problem & agree on research objectives

Required level of detail, how specific? Order of magnitude?

Competitive issues: how easily copied by competitors, etc.

Step 2: Develop research plan

What is most efficient plan to obtain information.

Step 3: Data sources

Secondary data collected for other purpose & already exist

Primary data collected for specific purpose or project

o

Marketing Database collection of data about customers, prospects, leads,

etc. that is actionable for marketing purposes

Research approaches:
o

Observational Research: watch relevant actors & settings

Focus group: people invited to discuss/try product

Surveys: questionnaire

Experimental Research: controlled environment; subjecting groups to a

variety of treatments

Research Instruments:
o

Questionnaires: closed end & open-end questions

Mechanical Testing Instruments

Sampling plan:
o

Who is to be surveyed?

Sample size, how many people?

Procedure, how to choose people?

Contact Methods:
o

Mail questionnaire

Telephone interviewing

Personal interviewing arranged or intercept people (i.e. the mall)

Step 4: Collect the Information

Scanners, computers, data entry

Step 5: Analyze the Information averages, measures of dispersion

Step 6: Present the Findings to relevant parties