Knowing and understanding as much as possible about the international marketplace will improve a company’s ability to achieve success in that market.

Such knowledge will provide valuable insight into the steps that must be taken to meet the demands and specific requirements of that market as well as help companies avoid critical mistakes.

Market research in itself serves no purpose. It must be directed towards some practical objective. Its principal value lies in facilitating the decision-making process. Market research should be closely coordinated with the company’s strategic plan.

The research plan must identify the issues that need to be addressed and the sources of information shown so that the marketing plan can be validated and subsequently updated through reference to the initial sources of information.

Researchers need to have terms of reference to ensure that the information gathered is focused and cost effective.

Exporters want to know what specific market opportunities are available for their product before developing an international marketing strategy. In developing that opportunity, the researcher should gather information on these topics:

1. What does the market structure look like?

Knowledge of the composition, profile or structure of a foreign market enables an exporter to plan for market entry, promotion and development of customized products or services, and address the many other issues important in entering a new market.

2. How is the market share split up?

Market share is an important consideration, but in the long term, achieving sustainable profitability in each market is the ultimate goal. Knowing how the market is currently served is important.

For example, are there any dominant competitors in the market or does each participant have only a small part of the market? Entering into a highly competitive new market means that for every product sold by the company, a competitor loses a sale.

With market share information generated through research, the marketing function can design a specific market entry strategy.

3. What are the current market trends?

Trends in international markets can indicate what products are being phased out or what new products are entering the market. With this information, the marketing function can decide if any modifications are required to its marketing strategies and plans.

Attention should be given to any trends in the economic and political environments within the target markets.

4. What size of market are you looking at?

Market size is often a major determinant when deciding to enter foreign markets. For markets of a certain size, niche marketing may be warranted.

In the case of larger markets, the emphasis may be on taking advantage of economies of scale.

5. What challenges will your product or service face?

A number of questions relating to the nature of the product or service must be considered. What is the consumption rate of the product? Is standardization an issue? Based on the information provided from the research, the marketing function would determine if any product modifications are necessary.

6. How will you price your products or services competitively?

One of the most important elements of information to be generated by market research is a sense of what the foreign customer is willing to pay for the product. Another related factor is the price of competitors’ products.

7. How will you promote your business?

Research can identify promotional channels such as radio, television, newspapers, Internet sites, bulletin boards or high-profile events. Many of these outlets have demographic information about their audiences. With this information, the marketing function can design an effective promotional program.

The existence of product-related trade shows can be determined through research—usually by referring to Global Affairs Canada (GAC) or the Federation of International Trade Associations (FITA).

Additional research can yield information about the nature of promising trade shows and the characteristics of attendees. This enables the marketing function to consider the most appropriate show for a product/audience fit.

8. What kind of competition will you face?

Knowing who the competition is and what it is doing is as important in a foreign market as it is in a domestic one. Increasingly however, the pool of potential competitors is far broader, partly owing to the Internet, and partly to the fact that competition can come from outside a particular industry sector.

9. What kinds of logistics challenges will you face?

Logistics research can yield information on the availability and nature of the various channels of distribution and storage capabilities in the target market. This enables the marketing function to develop a logistics plan to get the product to the customer as quickly and as cost effectively as possible.

10. Are there any cultural issues in your target market?

Significant cultural issues may not always be covered in the standard secondary sources of information.

There are however, many sources especially focused on intercultural effectiveness or cross-cultural interaction, that can offer very practical insight. Additionally, the researcher may consult with business people who have worked in the target market or with travelers who have spent a significant amount of time there.

The objective is to identify significant cultural issues that might pose a barrier to successful entry. Such barriers might require adjustments either to the market entry strategy, the sales approach, product positioning, labeling or even the product itself.

The foregoing research topics can be effectively organized by using various techniques such as PEST analysis, SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis, as well as Porter’s “Five Forces” analysis.

Each of the techniques or models suggested can be readily applied to international markets, and can be valuable in analysis conducted in the context of international marketing activities.

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The nuances of languages and culture can lead to misunderstandings. It is therefore paramount for an exporter to understand the importance of the communication process and how it relates to the company’s promotional activities in mass markets abroad.

When marketers factor in the various legal, cultural and linguistic factors that could prevent them communicating their message to new markets with the same clarity as their existing customers, their efforts can serve to build a strong brand relationship and win over a whole new group of customers to their products.

Don’t make assumptions about cultural and linguistic considerations

Linguistic and cultural diversity has a direct influence on the form and content of the promotional message.

Some confusion may be overcome by creating advertisements that use pantomime or voice-overs, as in some television commercials. However, this is more than just a matter of translation.

In some cases, underlying symbols have completely different meanings.

For example, we associate lemons with cleanliness and freshness, whereas in the Philippines, lemons connote illness.

Other cultural considerations must be reviewed and taken into account when considering promotional strategies and marketing campaigns.

A simple method of understanding the cultural norms for advertising and promotion is to review magazines, television commercials or other mass marketing tools from the local market, such as billboards or newspaper advertisements.

In some cultures, what is socially acceptable is immediately apparent.

Get a competitive advantage with your packaging and labelling

Transferring a brand image to global markets can pose many challenges because of cultural differences and buyer preferences.

Logos, packaging and advertising that some countries find acceptable—and indeed sometimes appealing—can unwittingly cause offence in other countries. It is not uncommon that an agent or distributor recommends packaging changes.

A foreign-made product can enjoy a certain advantage in many countries but there is rarely much sympathy for poorly thought-out marketing efforts.

Keep control of your trademarks, patents and copyrights

The product logo should be tested and then registered in the target country. This is done through a trademark or patent agent. The logo or trademark will be used on all correspondence, advertising and public relations material.

The agent can provide information about the uses and limitations of the company’s symbol.

Copyrights, patents, trademarks and registrations do not automatically leap across national borders.

What belongs to a company in Sweden may belong to someone else in another country. In some countries, such as Japan, foreign trademarks can be registered even if the product is not in use.

McDonald’s corporation found this out when a Japanese food company registered its golden arches trademark under its own name before McDonald’s had a chance to do so.

Several companies have made decisions not to enter certain markets with their products largely due to the inability to protect their branding or enforce their patents or trademarks.

While many countries, such as China, have taken drastic steps to co-operate with international companies and authorities to counteract this practice, the international marketer must take into account the possibility of piracy depending upon the nature of their product and the target market.

Shaping the promotional message to meet your customers

In conducting international mass marketing or promotional campaigns, companies know that the promotional message in each market may be different.

For example, IBM is promoted as American in Japan and European in Europe. The Japanese still perceive American goods and services as being of high quality, whereas Europeans do not.

Conversely, some companies want to promote the same image in each market: this is the approach taken by BMW and Levi Strauss.

The promotional message may differ depending on the product being promoted and nature of the target foreign market.

What steps are you taking to tailor your marketing strategies to fit in new markets?

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