international marketing question ban1

7/30/2019 International Marketing Question Ban1

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INTERNATIONAL MARKETING QUESTION BANK

LONG ANSWERS

Q.1 International Business Environment [16]Q.2 Trade Barriers [29]

Q.3 Export Costing methods [104]

Q.4 Incoterms [128]

Q.5 Selecting Potential Markets [181]

BOOKS REFERRED:- INTERNATIONAL MARKETING by Sunny Fernandes RISHABH

PUBLISHING HOUSE(RPH) Second Edition.

CONCEPTS SHORT NOTES

1. International Marketing [2] 1. International v/s Domestic Marketing [11]2. Trading Blocs [38] 2. David Ricardos Theory [14]

3. Principles of GATT [46] 3. GATT v/s WTO [54]

4. MNCs [55] 4. Tariff v/s Non-Tariff Barriers [65]

5. Transport Packaging [71] 5. Specific v/s Ad Valorem Duty [66]

6. Handling Marks [83] 6. Essentials of Good Packaging [77]

7. Turnkey Contracts [169] 7. Role of IIP [79]

8. Counter Trade [170] 8. Role of Overseas Distribution Channel [88]

9. Greenfield Strategy [173] 9. Factors Determining Price [99]10. Export Pricing [100]

11. Break Even Pricing [122]

12. DEPB Scheme [139]

13. APEDA [147]

14. Fiscal Incentives [149]

15. Market Skimming v/s Market Penetration

[155]

16. FOB Price v/s CIF Price Quotation [156]

17. Forms of Direct Exporting [161]

18. Indirect exporting [164]

19. Contract Manufacturing [167]

20. Management Contracting [168]

21. Market Selection Process [186]

22. Direct v/s Indirect exporting [193]


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LIMITATIONS OF INTERNATIONAL MARKETING

1. Unequal sharing of benefits:


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The benefits of international marketing are not shared in a fair manner among the

participating countries. Rich and developed countries get more benefits at the cost of

poor and developing countries.

2. Restrictions on International Marketing:

International marketing will offer all benefits only when free trade is allowed by all

countries. However, the actual position is all together different. Trade restrictions (tariff and

nontariff) are imposed by all countries (developed and developing) on free movement of goods.

This restricts the growth of international trade and actual benefits available to participating

countries are limited. Efforts to remove various restrictions by WTO and other international trade

organizations are not effective.

3. Adverse effects of trade blocs on International Marketing:

Along with trade barriers, trade blocs exist among the countries of the world. EU, LAFTA,

ASEAN are some active trade blocs. They encourage trade among the members of the group but

put

artificial restrictions on the trading activities with nonmembers. As a result, the growth of

international marketing is restricted. Similarly, free trade among nations is not allowed. In

addition, countries which have not joined such trade blocs suffer in regards to their exports and

imports.

4. Domination of MNCs and developed countries on International Marketing:

MNCs from rich and developed countries dominate international trade since long. Their

operations are for profit maximizations. Poor and developing countries suffer due to

virtual monopolistic position of MNCs in international marketing. These corporations sell their

products in many developing countries as per the terms and condition which are profitable to

them. This leads to exploitation of poor and developing countries also dominate international

marketing.


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5. Existence of severe competition in international marketing:

One limitation of present day international marketing is the existence of stiff

competition among participating countries and companies from such countries. Unfortunately,this competition is between unequal competitors. It is between rich and poor or developed and

developing countries. Developing countries lack advance technology, skilled labour,

infrastructure facilities and so on. As a result, they find it difficult to compete with the

developed countries which use updated technology in the production activities. Many poor

countries have to sell their raw materials and other resources at a low price to rich countries.

OBJECTIVES OF INTERNATIONAL MARKETING

To bring countries closer for trading purpose and to encourage large scale free trade among

the countries of the world.

To bring integration of economies of different countries and there by to facilitate the process

of globalization of trade.

To establish trade relations among the nations and thereby to maintain cordial relations

among nations for maintaining world peace.

To facilitates and encourage social and cultural exchange among different countries of the

world.


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To provide better life and welfare to people from different countries of the world. In

addition, to provide assistance to countries facing natural calamities and other emergencies

situations.

To provide assistance to developing countries in their economic and industrial growth andthereby to remove gap between the developed and developing countries.

To ensure optimum utilization of resources (including surplus production) at global level.

To encourage world export trade and to provide benefits of the same to all

participating countries.

To offer the benefits of comparative cost advantage to all countries participating in

international marketing.

To keep international trade free and fair to all countries by avoiding trade barriers.

DIFFERENCE BETWEEN DOMESTIC MARKETING AND INTERNATIONAL

MARKETING

Marketing is the process of focusing the resources and objectives of an organization on

environmental opportunities and needs. It is a universal discipline. However, markets and

customers are different and hence the practice of marketing should be fine tuned and adjusted to

the local conditions of a given country. The marketing man must understand that each person is

different and so also each country which means that both experience and techniques obtained and

successful in one country or countries. Every country has a different set of customers and even

within a country there are different subsets of customers, distribution channels and media are

different. If that is so, for each country there must be a unique marketing plan. For instance,

nestle tried to transfer its successful fourflavour coffee from Europe to the united states lost a

1% market share in the us. It is important in international marketing to recognize the extent towhich marketing plans and programmes can be extended to the world and the extent to which

marketing plans must be adapted. Prof.Theodore Levitt thought that the global village or the

world as a whole was a homogeneous entity from the marketing point of view. He advocated

organisation to develop standardized high quality word products and market them around the

world using standardized advertising, pricing and distribution. The companies who followed

Prof. Levitts prescription had to fail and a notable failure amongst them was Parker pen. Carl


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Spiel Vogel, Chairman and CEO of the Backer Spiel Vogel Bates worldwide advertising agency

expressed his view that Levitts idea of a homogeneous world is nonsensible and the global

success of Coca Cola proved that Prof. Levitt was wrong. The success of Coca Cola was

not based on total standardization of marketing mix. According to Kenichi Ohmae, Coke

succeeded in Japan because the company spent a huge amount of time and money in Japan to

become an insider. Coca Cola build a complete local infrastructure with its sales force and

vending machine operations. According to Ohmae, Cokes success in Japan was due to the

ability of the company to achieve global localisation or Glocalisation i.e. the ability to be an

insider or a local company and still reap the benefits of global operations. Think global and act

local is the meaning of Glocalisation and to be successful in international marketing, companies

must have the ability to think global and act local. International marketing requires

managers to behave both globally and locally simultaneously by responding to

similarities and dissimilarities in international markets. Glocalisation can be a source of

competitive advantage. By adapting sales promotion, distribution and customer service to local

needs, Coke capture 78% of soft drink market share in Japan. Apart from the flagship brandCoca Cola, the company produces 200 other non alcoholic beverages to suit local beverages.

There are other companies who have created strong international brands through international

marketing. For instance, Philip Morris has made Marlboro the number one cigarette brand in the

world. In automobiles, Daimler Chrysler gained global recognition for its Mercedes brand like

his competitor Bayerische. Mc Donalds has designed a restaurant system that can be set up

anywhere in the world. Mc Donalds customizes its menu in accordance with local eating habits

international marketing question ban1

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