International Marketing Environment

International marketing environment is a set of controllable

(internal) and uncontrollable (external) forces or factors that affect
international marketing. International marketing mix is prepared in
light of this environment.
Global Marketing Environment
 Economic Environment
 Cultural Environment

 Technological Environment
 Legal/Political Environment
 Competitive Environment

Domestic Marketing Environment

 Domestic political climate,

 Government approach towards international trade,
 Legal system and business ethics,
 Availability and quality of infrastructural facilities,
 Availability and quality of raw-material,

Organisational Internal Environment

 Goals and objectives of organisation,

 Managerial philosophy of organisation,
 Personal factors related to management,
 Managerial attitudes toward other nations, customers, social welfare, etc.,
 Organisational policies and rules,

IDENTIFYING AND SELECTING INTERNATIONAL MARKETS.

There are several bases of classification, principal among them are:

1) Classification on the Basis of Stages of Demand:
i) Existing Markets:
In the existing markets, consumer needs are known and are already being serviced by

some products. The market opportunities can be assessed by estimating the

consumption rate and the share of imports in current consumption.

ii) Latent Markets:

Latent markets have potential customers, but because no one has offered a product
to fill the latent need there is no existing market.
iii) Incipient Markets:

Incipient markets do not exist in the present. However, conditions and trends can be

identified that point towards the emergence of future needs and preferences for

products and services that will create a latent market, which if supplied will become
an existing market.

2) Classification on the Basis of Stages of Development:

The world markets can be divided into four distinct segments which are

as follows:
i) Industrially Developed Economies:

Industrially developed countries provide a large market as they have no or little

import restrictions. These countries lay more emphasis on the production of more

sophisticated products and therefore insist more and more on research and

development. Therefore, they like to import goods of simpler technology and simpler
manufactures.

They provide ample opportunities for the marketing of the following

types of products:

a) Labour intensive products like electronics and light engineering goods because
these countries have an acute shortage of la.

b) Spares and components and raw materials to field their industries as they are not
rich in agricultural raw materials.

c) Decorative articles and craft articles because of their affluence.

d) Anti-pollution equipment and those articles whose production has been banned
for risks of pollution because they are very particular about preventing pollution.

As these countries have modern technology they are willing to provide technology to
set up production and processing facilities in developing countries.
ii) More Developed Developing Countries:

This category would include countries like Brazil, Mexico, Hong Kong, India, etc.

They would like to update technology for current range of manufactures and would

like to import machinery and equipment to set up new manufacturing facilities. They
are also interested in setting up joint ventures in other less developed countries.

iii) Raw Material Exporting Economies:

This category includes countries like those in the Gulf area and many countries ir.

Africa and Latin America. They are generally faced with large changes in foreign

exchange earnings because of fluctuations in their export prices. For example, Gulf

countries were having a good time because of the increase in oil prices. They have

inadequate infrastructure and therefore they need various types of goods, almost

anything – consumer durables, food products, transport equipment, services

facilities, etc.

iv) Subsistence Economies:

This type of economy is found in the least developed countries. They almost produce
nothing and depend very much on the imports. They need:

a) Equipment to exploit their untapped resources

b) Infrastructural facilities like railways, roads, building, transport equipments,

power generation equipments, transmission line tower etc.

c) Turnkey projects like housing, schools, hospitals etc.

As these countries lack infrastructures, the most developed countries do not offer

latest technology and therefore there is much scope for the developing countries like

India to export their products in these countries. New industries can be set up in
these countries.
3) Other Basis of Division of World Markets:
i) On the Basis of Population:

Population could be another criterion for division of markets. The higher the

population of a country, the bigger is the market provided by it. Of course, when

analyzing population, it is necessary to look at (i) age groups and sex, (ii) social class,

(iii) educational background, (iv) Number of households, (v) geographic

concentration and differences, and (vi) the rates of change in each of the above
characteristics.

ii) On the Basis of Gross National Products:

Gross National Product (GNP) ant its rate of growth as also the standard of living of

its population could provide another basis for classification of countries. In fact, the

large industrialized nations like the United States, West European countries, Japan,

Australia and Canada are the best markets for consumer goods and consumer

durables even though these countries manufacture these products themselves,

because the people are wealthy enough to be able to buy imported products and in
many cases prefer to do so.

However, before a firm determines whether a particular segmentation

strategy is worthwhile, it must consider the following three points:

a) The size of each segment under consideration must be measurable which means

that the sufficient data are available about the segment in question. In case the

necessary information is not available or it is too costly to collect then it is not

worthwhile to adopt such strategy as optimization of resources is lost.

b) The segment selected must be such that it can yield* adequate returns. In other
words, it must be substantial enough to be profitable.

c) Lastly, the firm must make sure that the segment selected must be accessible in an

effective manner. In other words, marketing institutions like channels of distribution

and promotional media must exist in the proposed segment so that the consumer
may be contacted with least efforts.