Lesson 3 International Marketing Lesson 3 International Marketing

Lesson 3: International Marketing

Lesson 3 International Marketing Objectives: Understand foreign markets and consumer behavior Recognize market research methods Identify product development strategies Understand proper packaging, pricing, and promotion for international markets

Market & Marketing Market A market refers to the likely customers for a product in a certain geographic location. International Marketing International marketing is how a company sells a product to a likely customer across different countries.

Market Categories Two types of market categories: Consumer market The individuals and households that will purchase a product. Organizational market Buyers who purchase items for resale or additional production.

Check Your Understanding Why is it important to understand what a market is and how they are categorized? It is important to understand what a market is and how it is categorized in order to create specific, effective marketing messages.

4 Steps of the International Marketing Process 1. Market Research 2. Product Development 3. Packaging and pricing 4. Promotion

Step 1 - Market Research Before selling a product, companies must first determine what customers need, want and are willing to buy. Market research gathers the data necessary to making those determinations. Two major categories for market research: Secondary data Primary data Information that has already been collected and published Marketers collect primary data to solve a specific research problem

Research Evaluation Once all market data has been collected, the data must be evaluated and a decision made that supports a sound business strategy.

Check Your Understanding Why is market research necessary? To understand what customers want, need, and are willing to pay for.

Check Your Understanding What are the two types of market research? Secondary & Primary

Step 2 - Product Development Target market – particular market segment that a company plans to serve. Companies must also determine if the brand needs adjusting for international customers. Brand- A name, symbol, and/or design that defines a product.

Product Development Two types of products: Global products- a standardized item offered in the same form in all of the countries in which it is sold. International products- a customized product adapted to the culture, tastes, and social trends of a country.

Check Your Understanding Why does a company need to research branding for their target market? To ensure the product brand is enticing and not offensive to the target market.

Check Your Understanding Explain the difference between a global product and an international product. A global product does not change based on the international market. An international product is customized based on the specific market.

Step 3 - Packaging & Pricing Color, design, and the shape of the packaging can be important to the success of a product.

Check Your Understanding Can you recognize these famous products based on their packaging? Coca-Cola ® Pringles ® Levi’s ® Heinz ® Campbell’s ®

Pricing What should be considered when setting a product’s price? Operation costs Exportation costs Product modification costs Taxes and fees Customer demand Competition

Pricing 3 pricing strategies for new products: Competitive pricing- pricing a product closely to that of a competitor Skim pricing- pricing a product as high as possible Penetration pricing- pricing a product as low as possible

Check Your Understanding If a company will have heavy competition for a product, what do you think the best pricing strategy would be? In most cases, competitive pricing would be the best strategy.

Step 4 - Promotion There are 4 steps to the promotion process: 1. Analyze the target market • • • Geographic area Demographic Characteristics Customer needs • • Buying habits Media usage 2. Create an advertising message • • • Get the customer’s attention Increase interest Improve the company’s image • • Boost buying potential Motivate customers into action 3. Select media • • Newspaper Television Radio Magazine • • • Direct mail Outdoor Internet 4. Execute and evaluate • • Be conscious of timing and campaigns Evaluate for effectiveness using surveys and sales figures

Check Your Understanding What are the four steps in the International Marketing Process? 1. 2. 3. 4. Market Research Product Development Packaging and Pricing Promotion

Check Your Understanding What are the four steps in promotion of an international product? 1. 2. 3. 4. Analyzing the target market Creating an advertising message Selecting media Execution and evaluation

Summary Understand foreign markets and consumer behavior Recognize market research methods Identify product development strategies Understand proper packaging, pricing, and promotion for international markets