Factors Affecting the Success of Business-to-Business International Internet Marketing - Essay Example

International Marketing Table of Contents Introduction 3 Environmental Factors in Developing Strategy 3 Global Resource Allocation 5 Global Resource Allocation Ability Evaluation Model 6 Cultural Strategies in Marketing Success 6 Conclusion 7 Reference List 8 Introduction In International marketing, the organization involves considering more than one marketing mix decisions across the nationalized boundaries. It requires the organization to establish manufacturing facilities worldwide and coordinating the marketing strategies all over the world. In international marketing, the organization focuses on selection and utilizing the global marketing strategies worldwide with the objective of gaining competitive advantage (Steenkamp, 2001). In establishing business, internationally various segments of the market are found such as social, legal, economic, political and cultural. The disparity between international marketing and domestic marketing lies in the global markets complexity and multidimensionality. An international manager requires understanding of such complexities and the allegations they have regarding international marketing. When an organization moves from domestic to global market, different international strategies needs to be approached for getting an idea of the international marketplace. International companies such as Coca Cola, Gillette practices international marketing (Eid and Trueman, 2004). International marketing serves to be a good opportunity for the organizations to expand its business and make profits through overseas business. International competition comes with global cooperation. Organizations in order to establish business in foreign countries make greater efforts to understand cultures of those countries to develop strategies for success. Internationalization is affecting the interdependence of every country and makes attempts to promote global cooperation (Furrer, Liu and Sudharshan, 2000). The aim of the study is to understand the notion of international marketing and the environmental factors that favour the development of various international strategies. The strategies that indicate culture and its appreciation serves as a tool to ensure marketing success, will also be analysed in details. Environmental Factors in Developing Strategy Evaluation of the environmental factors is crucial in developing international marketing strategies. An international manager requires a deep knowledge of the complexities of the environment and its implications in the international marketing environment. International marketing strategies takes into factors such as legal, economic, political and technological for gaining business efficiency (Eid and Trueman, 2004). Legal environment varies in both perspective and in elucidation. An organization besides being bound by its home country laws is also bound by the laws of the host countries in which it operates its business. Acceptability of an organizations product is affected by minor variances and things such as packaging and by key changes such as legislation. For instance, in the USA, the MG sports car was withdrawn when the rising complexity of abiding with safety legislation changes made exporting to that market unprofitable. It is essential for the organizations to recognise the legal environment in each of its markets. The local domestic laws and the international laws are to be abided by the international managers, as it can have a great impact on the organizations capability to operate in particular abroad market (Furrer, Liu and Sudharshan, 2000). Economic factors are essential for the international managers to understand the economic advancements and the way they impinge on marketing strategy. This realization is required at a global level in terms of operating infrastructure like world institutions and trade agreements developed to promote global trade at regional level in consideration to regional trade integration and also at the market level. The economic conditions in various countries are different as per the levels of the economic development and per capita gross national income (Engwall and Jerbrant, 2003). Dissimilarities of income in different countries present challenges for the organizations that are operating in international environment. Challenges can be in terms of searching for potential market opportunities, assessing the differences of possible markets where there is no available capacity of people to pay for products. These factors need to be assessed for efficient international marketing. Political environment in the international marketing consists of any national or international political factor that may affect the organizations operations. Politics is considered to be a relevant factor in ample international decisions, particularly in deciding whether to invest and how to develop markets. Politics is connected to the attitudes of government towards business and the independence within which it can operate its business (Vargo and Lusch, 2004). Unstable political regimes expose international business to a number of uncertainties that they are not likely to face in the domestic market. Various political risks that arise due to the changes of government’s actions are operational restrictions, discriminatory restrictions and physical actions. Investments are common government restrictions faced by the international business. These political restrictions need to be considered in international marketing. Technological factors are the vital driving force for the international marketing of the global organizations to move forward (Vargo and Lusch, 2004) Technologies such as internet, client server technologies, email and World Wide Web have revolted international marketing. British airways operate its global operations from Mumbai. These technologies increases the efficiencies of the business operations and to some extent reduce the complexities of the international business. The impact of the technological advancements can be observed in all aspects of the marketing process of various organizations. FLEXCUBE is the world’s greatest selling banking software product (Engwall and Jerbrant, 2003). Recently, Indians own brand is starting to compete in the international markets. This depicts how information technology is helping the organizations to internationally market their brand and operate successfully. Global Resource Allocation Resource allocation is the major problem faced by the global enterprises. Venture resource distribution in global market is the extension of domestic resource allocation. It includes allocating manpower, material, capital, research and development, marketing and information by using both the international and the domestic markets (Chaudhuri and Holbrook, 2001). Resource allocation in the international context involves realization of the purpose of organization optimized, market competence, market expending and revenue improving. When large organizations face increasing global competition then the international resource integration serves as a key to cultivate the organizations competitive advantage. The organizations way of enhancing the comprehensive ability of resource allocation in a global scope is by achieving optimal response allocation which will result to the success of an organizations international strategy (Steenkamp, 2001). International organizations are required to procure resources and allocate the same in manner such that cost advantages can be created. The corporate social responsibilities require that organizations should not exploit resources. The needs of sustainable productions must be met while allocating resources. This means that organizations are required to keep in mind the needs of all the stakeholders, of present as well as the future before resources are utilized. Managers are therefore required to balance the needs of stakeholders when the decisions regarding resource allocation are made. Additionally it becomes essential for companies to alter their strategic resource allocation plans from period to period. Allocating the same resources to the same business units year after year, make organizational goals to become stagnated. Strategic plans are required to be altered so that resource allocation patterns can also be altered so as to create competitive advantages, along with changes in the external environment (Engwall and Jerbrant, 2003). When the top management of the organization decides the intended strategic position in international markets and when it decides the basic rules of behaviour which requires to be followed in implementing that position, the decision makers needs to determine the adequate level of resource required (Conway and Swift, 2000). Global Resource Allocation Ability Evaluation Model For evaluating the differences of global resource distribution abilities between various multinational organizations, an evaluation index system can be built from the investment decision making, organizational control and core resources operation (Rugman and Collinson, 2012). These act as indicators to analyse the resource allocation ability systematically. Investment decision making skill indexes include few secondary indexes. At the macro level, for a business to get success internationally, the investment decision making plays a vital role. In the speculation decision making influence factors, the organizations international strategy research level, success rate of overseas project investment and the percentage of decisions that the managers make, directly constitute the indicators of resource allocation (Rugman and Collinson, 2012). Organizational control ability includes a few secondary indexes. This ability is related to the international business organizations ordinary operations which serve as a key to regain allocation. Specific selections are control system optimum degree of global business, the time length from high level decision making to project execution and global operations management information system exposure, are the indexes to measure organizations resource control capability. Core resources allocation ability indexes comprise some secondary indexes. This indexes selects global business investment profit level, various types of business coordination development level, worldwide project development and supervision level are the various business operations ability assessment indexes. Global companies like Coke use efficient resource allocation strategies for performing their business effectively all over the world. When the problem of resource allocation comes into action, the Coke Company has provided greater authority to its managers to use every resource of the organization wherever and whenever they are needed to use. Resources such as capital, labour and machinery are utilises systematically in their international business. Cultural Strategies in Marketing Success Cultural differences are generally language differences that have a noteworthy impact on the manner a product can be utilised in the market, its brand name and marketing campaign. Initially, Coca Cola had numerous issues in China as Coca Cola sounded like “Kookie Koula” which is translated into Chinese language as “A dry mouthful of candle wax” (Terpstra, 2000). They had to discover new pronunciation of it “Kee Kou Lee” which meant “Joyful tastes and cheerfulness” (Czinkota, Ronkainen and Zvobgo, 2013). Operating business profitably in different countries requires an understanding that there may be numerous considerable differences in various regions. At the initial stages of globalization of business it may not seem unusual for the western organizations to experience the cultural gaps when operating business in foreign countries as well as various regions of those countries. An advertising campaign can be perceived differently in different countries because of the existence of cultural divergences. A marketing campaign can succeed in one country and fail in other countries because of the differences in beliefs and values of the people in different countries (Czinkota, Ronkainen and Zvobgo, 2013). Analysis of the cultural environment is an important criterion for international marketing managers for developing effective marketing strategies to position the the brand and generate revenues. Conclusion Organizations operating globally attain success in their business by perceiving the changes in the global environment. Strategies need to be initiated that will make them enable to respond accordingly. The organizations that perform well will base their victory mostly on recognition of changes in the boundaries of markets in their evaluation of the international marketing surroundings. The increased rate of globalisation of organizations is due to the information technology driven businesses. It has enabled many international firms to re examine the factors contributing to gain a global advantage. It is so far emphasised the requirement of careful, detailed and through applications of international marketing strategies. Continuous evaluation and supervision of the organizations marketing activity is essential to gain global competitive advantage. Through an in depth study of the relevance of international marketing, it can be concluded that there is an increased requirement to develop efficient international marketing strategies for the global organizations to perform its business efficiently. Resource allocation is needed to be done strategically for managing the scare resources effectively and to ensure that the allocations are beneficial in bringing organizational success. Also, the relevance of possessing strong culture in an international organization and the culture of the country in which the organization has set up its business needs to be understood by the global firms for gaining marketing success. Reference List Chaudhuri, A. and Holbrook, M. B., 2001. The chain of effects from brand trust and brand affect to brand performance: the role of brand loyalty. Journal of marketing, 65(2), pp. 81-93. Conway, T. and Swift, J. S., 2000. International relationship marketing-The importance of psychic distance. European Journal of Marketing, 34(11), pp. 1391-1414. Czinkota, M., Ronkainen, I. and Zvobgo, G., 2013. International Marketing. Singapore: Cengage Learning. Eid, R. and Trueman, M., 2004. Factors affecting the success of business-to-business international Internet marketing (B-to-B IIM): an empirical study of UK companies. Industrial Management & Data Systems, 104(1), pp. 16-30. Engwall, M. and Jerbrant, A., 2003. The resource allocation syndrome: the prime challenge of multi-project management?. International journal of project management, 21(6), pp. 403-409. Furrer, O., Liu, B. S. C. and Sudharshan, D., 2000. The relationships between culture and service quality perceptions basis for cross-cultural market segmentation and resource allocation. Journal of service research, 2(4), pp. 355-371. Rugman, A. M. and Collinson, S., 2012. International Business. New York: Pearson. Steenkamp, J. B. E., 2001. The role of national culture in international marketing research. International Marketing Review, 18(1), pp. 30-44. Terpstra, V., 2000. The millennium and international marketing. International Marketing Review, 17(1), pp. 15-18. Vargo, S. L. and Lusch, R. F., 2004. Evolving to a new dominant logic for marketing. Journal of marketing, 68(1), pp. 1-17. Read More