Dr B K Mukhopadhyay
(The author is a Professor of Management and Economics, formerly at IIBM (RBI) Guwahati. He can be contacted at m.bibhas@gmail.com)
Dr. Boidurjo Rick Mukhopadhyay
(The author, international award-winning development and management economist, formerly a Gold Medalist in Economics at Gauhati University)
The modern marketer or manager today has to consider global, local, and glocal factors in order to keep up or stay ahead of the curve given evolving market conditions and also new generation bespoke needs.
The complacent approach of static marketing is certainly out of discussion in as much as the IT revolution plus the possibilities that AI, deep and machine learning have to offer. Though it is widely known that internationalization is a process of firm expansion into new markets, yet the importance of marketing and marketing-related topics is often overlooked, thus leaving many international marketing players with an incomplete understanding of the marketing side of this important issue. There are cultural, regional norms, leadership and change, and also cross-cultural branding amongst others that need to be prioritized while planning.
While in the past, trade was undoubtedly conducted internationally, but never before did it have the broad and simultaneous impact on nations, firms and individual households that it has today. Particularly, the scale is of the same. Therefore, the global nature of modern economics influences one's decisions in any case.
What is more, trade growth on a global level has consistently been outperforming the growth of domestic economies in the past few decades, as a result of which many new countries and firms, especially in the emerging economies, have practically located it as highly desirable to become major participants in the international market. Global marketing has thus emerged as number one - more so with continuous and fast replacing technology with 2G to 3G to 4G, and now 5G has further reduced the world to a global village where producers, customers and other stakeholders in the game can all engage collectively.
In the specific sense, international business essentially covers international transaction of economic resources as well as international production of goods and services, and as such the broad forms of business internationalization cover trade, technical collaboration and investment. International marketing is simply the application of marketing principles to more than one country. However, there is a crossover between what is commonly expressed as international marketing and global marketing, which are often used synonymously. That is to say, international marketing is a simple extension of exporting, whereby the marketing mix is simply adapted in some way to take into account differences in consumers and segments.
It then follows that global marketing takes a more standardized approach to world markets and focuses upon sameness, in other words the similarities in consumers and segments. Keegan opined that 'the international market goes beyond the export marketer and becomes more involved in the marketing environment in the countries in which it is doing business.' True - international Marketing is the performance of business activities that direct the flow of a company's goods and services to consumers or users in more than one nation for a profit and international marketing is simply the application of marketing principles to more than one country.
On a broader vision: not in India alone, international marketing has emerged as a targeted area of highest priority among the progressive nations globally. International business expanded at a jet speed in the current decade - reasons mainly being rapid growth in technology, coming up of supportive institutions, openness of the different economies as well as increase in competition.
Examples that can evidence above, Myanmar is now making a foray into the energy sector in particular. Further, a latecomer like Bangladesh has emerged to be our tough competitor in the field of readymade garments (for which sector even Russia also is now interested to learn) making full use of its competitive advantage (a country has a comparative advantage over another if in producing a commodity it can do so at a relatively lower opportunity cost in terms of the foregone alternative commodities that could be produced) in the arena of cheap labour. The EU's internal market is all about removing barriers to free movement of goods and services, people and capital. Organizations are also there to encourage the removal of barriers to free global trade.
It is beyond any shade of doubt that openness of economies has been gaining ground - described as total foreign trade (exports plus imports), as a proportion of GDP, and as such the degree of openness of an economy plays the dominant role. Openness of the goods market refers to free exchange of commodities across national boundaries showing and indicating greater interaction with the global market. Also, openness of the factor market deserves attention - labour and capital have more freedom to choose between domestic and foreign assets. In fact, the MNCs are moving their operations with greater ease around the world in search of lower costs. For example, workers can move freely from one country of EU to another without facing much restrictions.
The fact is that for both the developed as well as the developing world, reaping adequately from modernized, highly fluid, and fast-changing global business/commercial environment does depend on its abundant natural/ human/ technological/ financial resources as well as crucially on the very ability to undertake expanded task of adapting to befitting marketing strategies.
In regards to the very management functions in the sphere of international business differs widely from those engaged in domestic business - mainly visible in areas like accounting and finance, personnel, marketing and production. For example, multinational companies operate in many countries simultaneously and the different units are linked through common ownership responding to common strategy (although the degree of integration varies from case to case). During the last five decades, MNCs have registered a phenomenal growth.
Naturally, the challenge is to create exportable surplus (trade surplus referring to an excess of export receipts over import payments as compared against trade deficit, which means an excess of import expenditures over export receipts measured on the current account and also known as merchandize trade deficit) and at the same time producing goods/ rendering services at the least comparative cost - so as to get a strong foothold on the international market in the face of intense competition.
Finally, the difference between domestic marketing and international marketing should not lose sight of in as much as in the former case the business remains confined to the political region's jurisdiction where rules and regulations as imposed by the government are same, while in the latter case once the trade starts across the border rules and regulation of the host country are replaced by the other government. That is to say a new set of rules come into play, which, in turn, becomes binding and as such the situation becomes more complex.
In domestic marketing, the company can have the same policies and strategies while international marketing requires different strategies in the promotion of their products. As every country has its own laws on business and a company that aims at entering into business in another country must first know about them. Since consumer tastes and preferences may also differ so marketing strategies must be formulated to cater to the needs of different consumers.
Cut to credits, although all these different forms use the basic marketing principles, international marketing is more challenging and requires more commitment from the company because of the uncertainty and differences in laws and regulations in the global market while domestic marketing deals only with the laws and regulations of one country. As markets and nature of businesses evolve with e-tails, AI driven SMEs, green supply chain, the very essence of marketing and its channels needs to realign with company goals and values more than merely flooding inboxes and other innovative ways to busy up our blue screen.