International marketing is the application of marketing principles in more than one country, by companies overseas or across national borders. International marketing is based on an extension of a company’s local marketing strategy, with special attention paid to marketing identification, targeting, and decisions internationally (See also Local Marketing).
According to the American Marketing Association (AMA) “international marketing is the multinational process of planning and executing the conception, pricing, promotion and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives.”
- Contract manufacturing
- Joint venture
- Direct investment
*Market entry modes are listed from lowest risk/reward to highest risk/reward
Rapid technological advances mean that geographical and cultural communication barriers are disappearing, and even smaller businesses without a physical presence in other countries can market and sell their products internationally (See also Diversity Marketing). This means that almost anyone with the desire can market internationally, but will do so with varying levels of success, depending on the thought and research that is put into the international marketing strategy.
Companies selling goods that have customs restrictions, like food and live plants, must contend with a more rigorous regulatory process before marketing their products internationally. While they may have a more difficult time setting up their international export business, they also have the opportunity to expose other countries to native products they couldn’t access otherwise.
Other types of companies that often perform well internationally include those involved in export, joint ventures, and direct investment.
Exporting is the practice of shipping goods directly to a foreign country. Prominent companies that do an excellent job of marketing their foreign exports to the United States include Fanta soft drinks, Honda, and retail giant H&M. In fact, H&M paid $3.5 million for a 30-second commercial during the 2012 Super Bowl, a marketing bonanza that has long been dominated by American brands.
Joint venture companies refer to the combined efforts of two or more businesses to their mutual benefit. One of the most famous international joint venture success stories is Sony-Ericsson, a partnership between a Japanese electronics company and a Swedish telecommunications company. Their international marketing strategy, comprised of bright colors and modern shapes, has helped make the joint venture known the world over. (See also Cooperative Marketing)
A direct investment company places a fixed asset in a foreign country with the aim of manufacturing a product, or part of a product, abroad. Dell computers, for example, is an American company with factories in many other countries that assemble personal computers from parts made all around the world. Dell then markets their computers with an exceptional emphasis on customer needs and customization – unlike other companies that sell pre-manufactured products; Dell computers are custom-assembled after customers place their orders.