Some Challenges That Firms Face for International Marketing
American companies have identified huge markets internationally for their products and services.
The markets are huge in terms of population, in countries such as China and India. The
purchasing power of consumers and businesses in many countries is also significant enough for
American firms to want to compete in these markets. However, international marketing is not
without pitfalls, and U.S. companies have made costly mistakes by not adequately researching
international markets before they commit resources there.
Identifying a True Market Need- A key to success in business is offering products and services
for which customers have a compelling need. The customer has a problem that needs to be
solved, and the product or service provides the solution in such an effective way that its benefits
are not difficult to communicate. Identifying the true needs of large numbers of people in a
foreign country is not easy. Not having lived in their culture experiencing their day-to-day lives,
American marketing executives can err by assuming that what people in other countries want or
need exactly matches the wants and needs of American consumers.
Dilution of Brand-Name Power- Due to the Internet, movies and other forms of entertainment,
American culture and the corporate symbols of that culture--brand names--are well known across
the globe. This does not mean the American companies & quo; products will be popular when
introduced in other countries. Being aware of a brand name is the same as preferring it. It can be
a long and expensive process to gain the trust of consumers who have used their own local
products for years or even generations. The American companies can be perceived as attempting
to take over the position long held by local companies, causing resentment.
Cultural Nuance- Consumers are influenced to purchase products by marketing messages
delivered through the media, including print media such as magazines. Humor is often used in
commercial messages to get the consumer to pay attention. But what is considered extremely
funny in one culture can be perceived as confusing or insulting in another. To produce effective
advertising requires more than accurate translation of the message from one language to another.
It requires a deep understanding of the culture, customs, morals and even religious views that
predominate in that country. What motivates consumers to buy products varies from country to
country.
Communication Style- Business executives from different countries can encounter several
barriers to effective communication besides obvious language differences. The traditional pace
of business negotiations can be different. Americans sometimes want to hurry negotiations along,
whereas in some other countries emphasis is placed on building relationships before a business
deal is seriously considered. Executives from other countries may place a higher value on things
such as facial expression instead of just the words that are being said.
Distance and Time- Even with technologies such as video conferencing, executives in other
countries may prefer to establish relationships on a personal level. For a smaller American
company, this can mean a significant investment in travel costs and having key executives out of
the office for extended periods. Time zone differences can make it difficult to coordinate projects
where collaboration is required. Executives on the West Coast of the U.S. are just getting to
work in the morning when their European counterparts are winding down for the day.
Finding Reliable Partners- American firms often establish relationships with distributors
located in the countries whose markets they are seeking to enter. They hire sales reps based in
those countries. They may engage local marketing and public relations firms to assist them.
Because the American firm might have no prior experience in that country, finding people who
are trustworthy and competent can be a challenge.
