Emerging Trends in International Business and Management

Growth driversManagement tips

Background • To earn more or to expand market, all manufacturers

want to sell abroad• In particular, Selling products in Unites States (USA) is

dream of every manufacturers in the world• Then where does USA based manufacturer sell their

products?• However, the Unites States only represents 4 percent of

the world’s population. • Hence opportunities for USA manufacturers to sell

products and services worldwide become clearly evident• International marketing is no longer an option, but a

strategic imperative

Growth Drivers1. Internet Population : The growth of the Internet has increased

competition tremendously and opened up the doors to international business.

• Companies have developed a web presence to keep themselves ahead or in line with their competitors internationally.

2. E-commerce Growth - According to International Data Corporation (IDC), the U.S. accounts for approximately 40 percent of all money spent online.

• The percentage is expected to decrease as Western Europe and Asia increased their online spending.

• According to Aberdeen Group, 66 percent of E-commerce spending today originates outside the United States.

Growth Drivers3. Online Payment - A barrier that blocked E-commerce

growth throughout the world, particularly in Europe, was different currencies. However, since adoption of Euro, better price comparisons and increased competition have improved deals for online buyers. It has become easier to conduct business in the European online market

4. Marketing and Advertising - Online marketing is a popular method to gain international audiences. For example, Email has become one of the most successful channels for marketers , which means that companies interested in selling through online market have taken advantage of this popular medium.

Challenges in IB1. Language and Culture - Neither technical accuracy nor

perfect translation is sufficient when considering the language the marketer will communicate through. It is important to really understand how a language is used by the people in the target market.

• Many multinational corporations , no matter how large, have made mistakes in the global environment just because they have not done their research

• Example: Pepsi have a popular slogan: "Come alive with the Pepsi Generation" . When, in Taiwan, this was translated in Taiwanese, it came out as "Pepsi will bring your ancestors back from the grave."

Issues• While choosing new markets, the marketers need to

consider several macro and micro factors. • Macro issues:

• Political/regulatory environment, • Financial/economic environment, • Socio cultural issues and technological

infrastructure ( skilled manpower / out sourcing). • Micro issues:

• Competitive considerations • Local infrastructure such as transportation &

logistics network • Availability of mass media for advertising .

 

Challenges 2. Pre and Post Sales Support - Communication with customers

as well as business partners is an important consideration when marketing and selling internationally.

• When a customer in an international market has a problem or would like to communicate with the manufacturer company, they will most likely want to speak in their own language.

• They will also be interested in attaining a level of customer service that is in-line with their culture and expectations.

• Many manufacturers are able to meet customer expectations through strategic alliances or foreign distributors who deal with the local customers on their behalf.

Challenges3. Regional Laws - All phases of product development are

affected by regulations. • For example, the product itself, such as its physical and

chemical aspects, is subject to laws designed to protect consumers with respect to purity, safety or performance.

• Local laws also affect product features such as branding, packaging and warranties.

• Advertising regulations also takes various forms.• In some regions, advertising for pharmaceuticals must have

prior approval from Health Ministries. • Sales promotion techniques in some countries put

constraints on contests.

Management Tips for effective International Business

1. Conduct Research: One of the first steps should be to plan a trip to conduct research and evaluate the resources and knowledge based on the information gathered

2. Set Objectives: there must be reasons why you want to go to this particular location. While the situation analysis outlines where you currently are, your objectives identify where you want to be

3. Identify Strategy and Tactics: Once you have identified your reasons behind the trip, you will outline your strategy for attaining each one with appropriate tactics

Management Tips for effective International Business

4.Localization : While marketing internationally, it is important to consider the language and culture of the regions in which you like to expand your presence

5.Budget and Time Availability - Translation services can be very expensive, particularly when localizing an entire site

6.Email Campaigns and Newsgroups - Email campaigns and discussion groups in the countries you are targeting are probably the most effective online marketing techniques.