Marketing I-Text

Ideological goals Goals based on organization's mission.

Imperfect market is a market in which the assumptions of perfect competition do not hold (see Perfect market ), and the forces which create the conditions of productive and allocate efficiency are hindered as a result.

Implied term Term deemed to form part of a contract even though not expressly mentioned by the parties.

Import-substitution Approach adopted by developing countries whereby local production facilities were set up to avoid imports. As a means of ensuring development and growth it has been less successful than export led growth. Import substitution characterized many Latin American economies. Local producers may not be large enough to produce efficiently, and are not subject to competitive discipline.

INCOTERMS These are standard shipping forms for dividing costs of carriage between buyer and seller. E.g. FOB or Free on board means that the buyer docs not pay the price of transporting the goods from factory/warehouse to the ship.

Generally, the costs of physical movements are as follows :
1. Transport from the manufacturer's premises to the docks; 2. Loading aboard ship; 3. Freight charges; 4. Unloading; 5. Customs duties; 6. Transport from the docks to the customer's warehouse.

EXW: Ex-works. The buyer must take delivery at the exporter's factory and pay all the costs of freight, insurance and other expense items to get the goods transported from the supplier's factory to their destination. This represents the minimum obligations for the seller.

FAS: Free Alongside Ship.
The seller arranges to: 1) deliver the goods alongside the named ship at the port of loading named in the contract; and 2) pay all the charges up to delivery of the goods alongside ship, including freight and insurance charges to that point.
The buyer is responsible for: 1) choosing the carrier to transport the goods abroad and paying the cost of freight from the port of shipment including the cost of loading the goods on board ship (if loading costs are separate from freight charges); 2) arranging insurance and paying insurance from arrival at the dockside onwards; and 3) arranging and paying for any export license or export taxes. The point of delivery of the goods from the seller to the buyer is alongside the ship.

FOB: Free on Board.
FOB means that the buyer does not have to pay for transporting or insuring the goods from the place where they are originally dispatched up to the point when they are taken on board ship. The costs up to this point are borne by the seller/exporter. The place of delivery is the ship's rail.
The seller must: 1) pay for transportation, freight and insurance charges to the named port of shipment (e.g. 'FOB Los Angeles' would mean that an American supplier would be responsible for sending goods for shipment on board at Los Angeles, and to pay costs up to that point); 2) provide and pay for the export license; 3) pay export taxes; 4) deliver the goods on board the ship (or airline flight etc) that the buyer has specified; 5) pay for the cost of loading the goods on board ship (if loading costs arc separate from freight charges).
The buyer must: 1) nominate the carrier to transport the goods (e.g., if the shipping terms for an export consignment from the UK are FOB Stranger, it is the buyer who specifies the shipping company, sailing date and time); 2) give the seller the details of the ship and sailing time; 3) pay for the carriage from this point (i.e. freight from that point, including costs of unloading at the place of destination); 4) arrange and pay for insurance of the goods from this point.

CFR: Cost and Freight. With Cost and Freight, the exporter/seller must nominate the carrier to ship the goods abroad, arrange the contract of carriage and pay freight charges. In these respects, CFR differs from FOB. Though the supplier pays the freight charges to the port of destination, the place of delivery of the goods is the ship's rail when the goods are taken on board. When they are on board, they are the responsibility of the buyer even though the supplier pays freight charges.
The seller must: 1) nominate the carrier and so make the contract of carriage; 2) pay for transportation of the goods to the place of shipment and insure the goods up to this point; 3) provide and pay for the export license; 4) pay export taxes; 5) deliver the goods on board; 6) pay for the cost of loading the goods if the loading charge is separate from the freight charge; 7) provide the buyer with a clean on board bill of lading; 8) pay the cost freight charges to the named port of destination( e.g., 'CFR Rotterdam' would mean that the UK exporter must pay freight charges for delivery to the port of Rotterdam); 9) send to the buyer advice of the carrier and the shipment date.
The buyer must: 1) pay for the insurance of the goods from the time they are taken on board, and so the buyer henceforward bears the risk of loss or damage to the goods; 2) pay for unloading costs at the port of destination if these costs are separate from the freight charges; 3) pay for any import license required; 4) accept delivery of the goods, when the appropriate documents (e.g. bill of lading, invoice) have been presented, an obligation of great practical importance because the supplier does not want the buyer to refuse the goods after they have been shipped to the buyer's country, the seller already having paid freight charges to get them there; 5) arrange and pay for transportation and insurance from the port of destination to their final destination in the buyer's county.

CIF: Cost, Insurance and Freight. Cost, insurance and freight is similar to CFR, with the exception that it is the seller, not the buyer, who must arrange and pay for the insurance of the goods to the port of destination.
The obligations of the seller are therefore the same as for CFR, except that additionally the seller must: 1) arrange for insurance of the goods from the port of shipment to the port of destination (the amount of insurance cover is often the CIF value of the goods plus 10%); 2) pay the insurance premium; 3) provide the buyer with the insurance policy or certificate.
The buyer's obligations are the same as for CFR, with the exception that he does not have to pay for the insurance of the goods between the port of shipment and the port of destination.

DDP: Delivered duly paid.
The seller must pay the costs of delivering the goods to the named destination, having paid import duties on the goods. The seller must therefore pay the import duties or taxes, arrange and pay insurance and provide documents that will enable the buyer to take delivery.
The buyer's responsibility is to take delivery of the goods at the named destination. This represents the maximum obligation for the seller.

Income effect is the effect on the level of consumption of a good of a change in real income caused by a change in its price.

Income elasticity of demand is a measure of the responsiveness of demand to changes in income: the percentage change in the quantity of a good demanded, divided by the percentage change in the income of consumers, with prices held constant.

Incremental cost see Overheads/costs/expenses.

Independents Independent retail traders who own and operate individual outlets.

Indirect cost/overhead see Overheads/costs/expenses.

Indirect distribution is the use of intermediaries, such as wholesalers and retailers, to supply a product to the customer.

Indirect exporting Use of intermediaries such as export houses, specialist export management firms, complementary exporting (i.e. using other companies' products to pull your own into an overseas market); i.e. the outsourcing of the exporting function to a third party.

Indirect taxation Tax on the sale of goods and services, such as value added tax.

Industrial buying is the decision-making process by which formal organizations establish the need for purchased products and services and identify, evaluate and choose among alternative brands and suppliers.

Industrial goods Goods bought by individuals and organizations for further processing or for use in conducting a business. (Philip Kotler)

Industrial marketing
A Distinctive features 1) Sales depended no the fortunes of customer industry, 2) the purchase quantities are usually large, 3) Simple target marketing (small number of customers and readily available SIC codes and trade directories as Kompass), 4) High risk purchase requires long term contracts and good MkIS, 5) Consumer buying decision process of organizations (7 stages), 6) DMU (7 categories);
B Marketing approach 1) Relationship marketing - focus on retaining customers through building trust and commitment, 2) Key account manager (excellent communicator, problem solver and negotiator), 3) Additional services as technical advice and technical specification, 4) New orders - tendering, 5) Price - negotiated, 6) Considering legal and economic constraints, cyclical demand, administered, bid and negotiated price approaches, 7) Direct distribution, 8) JIT for production, transport, storage and inventory holding, 9) Personal selling, 10) Promotion - trade press advertising, exhibitions, trade promotions and publicity.

Decision makers of industrial marketing and buying motivation: 1. Operation Manager - Uses the product in the organization's processes - wants efficiency and effectiveness; 2. Technical Manager - Often has to test and approve the product - wants reliability; 3. The Managing Director - May approve major expenditure or charge of supplier; 4. The Purchasing Manager - Approvers conditions of purchase, monitor supplier performance; 5. Legal Manager - Draws up or approves legal contracts with supplier; 6. Finance Manager - Approvers expenditure and controls debt payment; 7. Health and Safety Manager - May have a role to play with hazardous supplies.

Major differences between Industrial Marketing (IM) and Consumer Marketing (CM) of Powers:
1. Purchase motivation: IM - Multiple buying influence and Support company operations, CM - Individual or family need.
2. Nature of demand: IM - Derived or joint demand, CM - Primary demand.
3. Emphasis of seller: IM - Economic needs, CM - Immediate satisfaction.
4. Customer needs: IM - Each customer has different needs, CM - Groups with similar needs.
5. Nature of buyer: IM - Group decisions, CM - Purchase by individual or family unit.
6. Time effect: IM - Long term relationship, CM - Short term relationship.
7. Product details: IM - Technically sophisticated, CM - Lower technical content.
8. Promotion decisions: IM - Emphasis on personal selling, CM - Emphasis on mass media advertising.
9. Price decisions: IM - Price determined before and Terms are important, CM - Price substantially fixed and Discounts important.
10. Place decisions: IM - Limited number of large buyers and Short channels, CM - Large number of small buyers and Complex channels.
11. Customer service: IM - Critical to success, CM - Less important.
12. Legal factors: IM - Contractual arrangements, CM - Contracts only on major purchases.
13. Environmental factors: IM - Impact sales both directly and indirectly, CM - Impact demand directly.
14. Importance of different promotional mix components: IM - (i) Personal selling, (ii) Direct marketing, (iii) Advertising and Public relations; CM - (i) Advertising, (ii) Direct marketing, (iii) Personal selling and Public relations.

The industrial communications mix: 1. Personal selling, 2. Internal selling
, 3.Advertising: 3.1 Trade journals, 3.2 Business press, 3.3 Directories; 4. Direct marketing: 4.1Telemarketing, 4.2 Direct mailing; 5. Public relations, 6. Sales promotions: 6.1 Literature, 6.2 Videos, 6.3 Events, 6.4 Trade shows, 6.5 Exhibitions, 6.6 Discounting, 6.7 Business gifts.

Principles of industrial marketing communications strategy and their strategic implications: 1. Purpose of industrial promotion - Build up the company's image in the mind of the purchaser; 2. Communication objectives - Must be geared to specific business objectives; Communication methods - Different balance than for consumers markets. Personal selling more important; 4. Choice of media - Important to determine the best media to reach the complex decision-making process; 5. Measuring effectiveness - Essential to measure the contribution of communications in achieving business objectives.

Industrial market All the individuals and organizations acquiring goods and services which enter into the production of other products and services that are sold, rented, or supplied to others. (Philip Kotler)

Characteristics of industrial markets : 1) Goods for organizations; 2) Few buyers, 3) Several decision makers, 4) Huge purchasing volume, 5) Close supplier-customer relationship.
See also Consumer markets.

Industry The set of all sellers of a product. A group of firms which offer a product or class of products that are close substitutes for each other. (Philip Kotler)

Industry structure is the organizational and competitive characteristics of an industry including the number and size distribution of buyers and sellers, the nature of the product and the size of any barriers to entry.

Fragmented industry is populated by a large number of small and medium sized companies. (Porter) Industries become fragmented for the following reasons: (i) Barriers to entry are low; (ii) There are few economies of scale to be had by a large firm; (iii) Transport cost are high; (iv) Being too large might lead to higher overhead costs; (v) Local image and reputation are important; (vi) The market itself might be fragmented; (vii) Government can forbid concentration; (vii) Standards can be enforced locally.

Concentrated industries differ from fragmented industries in that are dominated by a small number of large firms, which are able to exercise a significant influence over the market as a whole. Industries become fragmented for the following reasons: (i) There are economies of scale; (ii) The amounts of money needed to stay in the business are large; (iii) Entry barriers are high; (iv) A large firm can benefit from an integrated distribution network; (v) Customers' needs are fairly standard in the market; (vi) The company has proprietary product technology.

Emerged industry is a new, or re-formed, industry. It can be created by any environment change.

Inelastic demand Total demand for a product that is not much affected by price changes, especially in the short run. Influencer A person whose views or advice carries some weight in making a final buying decision. (Philip Kotler)

Inept set See Buyer Behavior Theory.

Inert set See Buyer Behavior Theory.

Inferior good is a good for which demand falls as consumers' incomes rise.

Inflation is a sustained rise in the general level of prices.

Influencers see Decision Making Unit.

Infomercials A 15-60 minute television commercial typically presented in a casual talk show format that is designed to look like an ordinary television program. (Responsive Database Services, Inc)

Information Data processed in such a way as to be of some meaning to the person who receives it.

Criteria of good information : 1) Information should be relevant for its purpose, 2) Information should be complete for its purpose, 3) Information should be accurate for its purpose, 4) Information should be clear to the user, 5) The user should be have confidence in it, 6) Information should be communicated to the right person, 6) Information should not be excessive - its volume should be manageable, 7) It should be timely, 8) Information should be communicated by an appropriate channel of communication, 9) It should be provided at a cost which is less than the value of the benefits it provides.

Hard information Data collected for a specific purpose in an organized way or scientific manner.

Soft information Data acquired in an unstructured and unplanned manner, with no specific purpose in mind (conversation with suppliers, customers and colleagues).

See also Data and Intelligence.

Information needs refer to areas of knowledge required in order to make an informed and effective decision.

Information processing is the organization, manipulating, and distribution information. As there activities are central to almost every use of the computer, the term is in common use to mean almost the same as 'computing'. (British Computer Society)

Categories of information processing : 1) Transaction processing systems, 2) Management information systems.

Information sources refer to the locations or holders of the knowledge required for a particular purpose. They may be secondary (published) or primary (research) sources.

Internal information sources (use) : 1. Sales invoices, 2. Debtor lists (better payers' and more financially reliable customers); 3. Sales records (effectiveness and efficiency of sales, trends in sales by customer and by market); 4. Client databases (current and historic); 5. Customer complaints (areas to improve, etc.); 6. Internal management reports; 7. Sales personnel (potential customers and growth areas); 8. Management accounts - Budget/Actual/Variances (segments with highest contribution, accordance to the plans); 9. Enquiries; 10. Personnel details; 11. Job costing and constancy projects; 12. Details of unsuccessful quotations; 13. Responses to direct mail or previous advertising.

External information sources : 1. Exhibitions, industry contacts, 2. Sales representative reports, 3. Government statistics and reports (e.g. Office for National Statistics, Annual Abstract, BOTB Country Profiles, DTI's reports, Chamber of Commerce's reports, Industrial Outlook, Marketing Information Guide, etc.), 4. Market research publishers: 4.1 Mintel reports, 4.2 Keynote, and 4.3 Front & Sullivan - monthly reports on profile of different markets (customers and competitors). 4.4 Also publishes special reports on individual markets (e.g. fresh fish, hamburgers, carbonated drinks) which are commercially available and much used, 5. Professional bodies (e.g. CIM library), 6. Reports from distributors, agents and middlemen, 7. 'Off-the peg' research company (e.g. AGB Superpanel), 8. Key statistical data from: 8.1 Central Statistical Office (for UK), 8.2 CENDATA (for USA) and 8.3 Eurostat (for the EU), 9. Trade magazines (e.g. Computer Weekly, Advertising Age, Chain Store Age, Progressive Grocer, Stores, Marketing Week, Campaign), 10. Quality press (e.g. Financial Times), 11. Business periodicals (e.g. Management Today, Business Week, Fortune, Forbes, The Economist, Harvard Business Review), 12. Marketing journals (e.g. European Journal of Marketing, Journal of Marketing Research, Journal of Consumer Research), 13. Data from some of the providers of continuous market research such as BMRB's TGI (Target Group Index) - annual profile of most product markets in terms of who buys what; 34 volumes each year. 14. On-line databases: 14.1 On Line Business and Company Databases by Helen Parkinson, 14.2 On Line Management and Marketing Databases by Nick Parker. 15. Directories: 15.1 Kompass (names and addresses of companies (e.g. possible competitors) by company and product category), 15.2 Dunn & Bradstreet, 15.3 Infocheck, 15.4 Extel, 15.5 Kellys - guide lists industrial, commercial and professional organizations in the UK, giving a description of their main activities and addresses, 15.5. Key British Enterprises - a register of 25,000 UK companies. Includes basic financial data, including sales, number of employees and Standard Industrial Code (SIC), 15.6. Who Owns Whom - lists firms and their parent organizations, 15.7 Business Monitor: gives statistics for different products, e.g. number of manufacturers, industry sales and import levels, 15.8 Henley Center for Forecasting- projects future social attitudes, life-styles, income and expenditure, 15.9 Retail Business: monthly reports on the profiles of different retailing markets, 15.10 The Retail Directory: details of trade associations and retail companies according to type and geography, 15.11 National Readership Survey: profile of readers of newspapers and magazines (for advertising readership selection), 15.12 BRAD (British Rate and Data): costs of advertising in various mass media, 15.13 Local Chambers of Trade: statistics on companies in their trading area and information on trading conditions, 15.14 Report of Companies registration Office; 16. Handbooks (e.g. Marketing Retail Handbook); 17. External consultants; 18. Commercial information databases and reports: 18.1 A.C.Nielsen reports, 18.2 IMS International, 18.3 Information Resources, Inc., 18.4 MRB Group (Simmons Market Research Bureau), 18.5 NFO Research.

The use of external information sources : 1. Mailing lists, The Internet, Newspapers and magazines, Trade directories and Trade associations - possible new customers; 2. Information on competitors - Competitor intelligence system, SWOT analysis, etc.; 3. Government reports and statistics - market changes, environment changes etc.

Also see Sources of information about competitors, Competitor intelligence system and Secondary data.

Information and communication technologies (ICT): 1. The Loyalty Cards, 2. Electronic Funds Transfer at Point of Sale (EFTPOS); 3. The Internet; 4. E-mail; 5. Web sites; 6. Data warehousing; 7. Electronic Point of Sale (EPOS); 8. EDI.

Limitations of the application of ICT : 1. High costs of setting up the systems in terms of hardware, software and training; 2. Possible lack of skilled staff to operate the system; 3. Resistance from management, employees and customers; 4. Some of the ICTs (Internet) are limited to certain customers; 5. Unemployment may rise as machines replace staff; 6. Customers may wish to visit shops for social contacts, etc.; 7. The employees' task become mundane and lacking initiative.

Information technology (IT) is the science applied to the generation, processing and dissemination of data.

Reasons justifying the case for a strategy for information systems and information technology : 1. IT involves high cost; 2. IC is critical to the success of many organization; 3. IT is now used as part of commercial strategy as a weapon in the battle for competitive advantage ; 4. IT required by the economic context; 5. IT affects all levels of management; 6. IT may mean a resolution in the way information created; and presented to management; 7. IT involves many stakeholders, not just management, and not just within the organization: 7.1 Other business, 7.2 Government, 7.3 Customers, 7.4 Employees; 8. The detailed technical issues in IT are important; 9. IT requires effective management as this can make a real difference to successful IT use.

Issues of developing strategic plan for IT : 1) Identifying business needs, 2) The organization current use of IT, 3) The potential opportunities that IT can bring.

Initiators see Decision Making Unit.

Informative advertising Advertising used to inform consumers about a new product or feature and to build primary demand. (Philip Kotler)

Innovation
Definition #1. Innovation is the process by which new products are brought to market.
Definition #2. Innovation is doing something new.

Industries that have not had significant cost-saving innovation over last years : 1) Pharmaceuticals, 2) Chemicals, 3) Car design, 4) Financial services, etc.

Innovative technologies are radically new methodologies, processes or machines which are developed into commercial use.

Examples of Innovative technologies : 1) Pentium, 2) Microsoft Windows, 3) Laser scanners, 4) Bar-codes, 5) EPOS, 6) Computerized stock control, 7) Virtual reality (interactive armchair shopping, transformation in leisure activities and life-style).

Implications of innovative technologies : 1) Critical factor to increasing the productive potential of the global economy, 2) Continuous innovation is one means of earning long run profitability, 3) Innovative technologies work to the interests of consumers (reducing costs, improving design and quality).

Insider groups Interest group regularly consulted by government.

Inspection review Inspection of products after manufacture is held to be wasteful. Defective production is a waste of materials, time, working capital. Also see TQM.

Institutional markets see Organizational markets.

In-store surveys takes place in a shop or just outside.

Advantages of in-store surveys: 1. They are more targeted than mall intercept surveys (appropriate retailers can be selected) and hence lead to increase in quality of responses, 2. Recruitment can be pre- or post-tested by interviewing people entering or leaving the store.
Disadvantage: The permission of the retailer need to be gained.

In-house (or in-home or doorstep) interviews and business interview are part of those surveys where respondent recruitment is door to door. The former would be more appropriate for consumer research - interviewers may be given a list of names and addresses or be limited to certain areas. Interviews can be pre-arranged but can be time-consuming. Longer interviews are possible.
See also Interview.

Intangible asset is an asset which does not have a physical identity, e.g. trade marks and patents.

Integrated marketing communications (IMC) focuses on consistency within the communication strategy of an organization. Its ultimate aim is to achieve synergy between its component parts in order to generate a more effective approach to communications.

Integrated marketing communications involve: 1. The strategic choice of elements of marketing communications which effectively and economically influence transactions between an organization and its existing and potential customers, clients and consumers. 2. The management and control of all marketing communication elements. 3. Ensuring that the brand positioning, proposition, personality and messages are delivered synergistically across every element of communication and are derived from a single consistent strategy.

Possible driving or favoring forces of a move toward greater integration in marketing communication: 1. Pressure on communication budgets, 2. Fragmentation of the media, 3. Growing international communications, 4. Increasing power of computers databases and electronic storage, 5. Development of Internet, 6. More sophisticated client. 7. Move from mass advertising (which is expensive) to selected media. 8. Advantages of promotional combinations. 9. Increasing understanding of the Integrated marketing communications process. 10. Sophisticated planning. 11. Market segmentation, 12. The power of computers in storing and processing information, 13. Proof of the benefits of Integrated marketing communications.

Possible barriers or restraining forces of a move toward greater integration in marketing communication: 1. Resistance to change. 2. Old planning system downgrade promotional decisions to tactical level. 3. Traditional (functional) organization structures with responsibility for only one element of communications. 4. Centralized control. 5. External agencies organized in limited specialist areas.

Methods of overcoming the barriers and methods of integration: 1. Top management commitment and top management policy decision, 2. Marketing organization development, 3. Training and development, 4. Communications as a competitive advantage, 5. Achieving the results, 6. Hierarchy of objectives and control, 7. Functional integration, 8. Appoint a single communication agency.

There are major advantages from the integration process: 1) Strategies should reinforce each other, 2) Messages are given which are consistent, 3) Integrated strategies may be synergic, 4) Intention procedures cost savings, 5) Above all integration achieves business results, 6) Consistent creative approach, 7) Better use of all media, 8) Greater marketing precision, 9) Easier working relationship, 10) Sustainable competitive advantage.

Seven-level systematic approach to analyzing integration issues developed by Alan Pulford: 1. Vertical integration - Linking together of business, marketing and marketing communication objectives. 2. Horizontal integration - Between the business function of marketing and manufacturing, human resources and finance. 3. Marketing integration - Of all elements of the marketing mix. 4. Communication integration - Of the total promotional mix. 5. Creative integration - Unifying creative themes across all communications. 6. Internal/External integration - Linking together all internal and external resources, ensuring agencies work together. 7. Financial integration - Ensuring that economies of scale are obtained and that investment in any promotional element is optimized.

See also Marketing communications and SOSTAC.

Intelligence is defined as being information that has been further analyzed.
See also Data and Information.

Intention to create legal relations Element necessary for an agreement to become a legally binding contract.

Interactive television shopping provides the marketer with a two-way cable or computer link with the customer, allowing purchases to be made in the convenience of the home.

Interactive marketing Marketing by a service firm which recognizes that perceived service quality depends heavily on the quality of buyer-seller interaction. (Philip Kotler)

The advantages that interactive systems will provide to customers: 1. Saving time spend in shopping visit; 2. Saving use of cars and cars parking; 3. Reduction in congestion and pollution; 4. Ability to watch demonstration from the comfort of one's home; 5. Ability to browse and greater variety of products to chose from; 6. Ability to interrogate, get technical advice; 7. Getting bank balances immediately; 8. Transferring funds between accounts; 9. Paying bankers orders; 10. Access to directories of suppliers; 11. The specific needs of individual customers could be met; 12. The cost of stockholding could be reduced.

The advantages that interactive systems will provide to retailers: 1. Close markets segmentation; 2. The ability to target specialist groups; 3. Access to global markets; 4. Development of relationship markets; 5. Building up of databases; 6. One-to-one marketing.

Limitations of interactive systems: 1. There are inevitable high set up costs. 2. There is a lack of knowledge of the system; 3. Some people suffer from technophobe; 4. There is a lack of personal contact; 5. Expectations of quality may not be released; 6. It is necessary to touch, feel, smell or taste some products; 7. Shopping for some people has social benefits; 8. Existing shopping centers may be destabilized.

Interest group Pressure group, or defensive group (e.g. trade union) promoting the interests of a group in society.

Interest rate is the percentage of a sum lent which the borrower pays to the lender: in other words, the price of money.

Intermediaries include any organization in the supply chain between the business and its final customers.

Internal communications is the process through which organization (1) share information, (2) build commitment to achieve objectives and (3) assist in the management and acceptance of change. The organization's marketing strategy needs to be sold to those within organization.

Internal marketing Marketing by a service firm to effectively train and motivate its customer-contact employees and all the supporting service people to work as a team to provide customer satisfaction. (Philip Kotler)
Internal marketing aims to ensure that everybody within an organization is working towards the achievement of common objectives. It is recognition that people who work together stand in exactly the same relationships to each other as do customers and suppliers. Internal marketing is the practice of treating employees as valued customers. The rationale is that anticipating, identifying and satisfying employee needs will lead to greater commitment. This in turn will allow the organization to improve the quality of service to its external customers. IM is combination of marketing, human resources, training and behavioral science. Internal marketing: 1) Customer satisfaction(internal customers), 2) External marketing (informing all staff of forthcoming promotions), 3) TQM (grown of the popularity of subj.), 4) Communication (enthusiasm, understanding and involvement), 5) Staff information (company magazines, newsletters and other services - promotion company, its mission, its culture, and any changes), 6) Company objectives.

Reasons for Marketing Department responsibility for Internal Marketing: 1) knowledge of organization's overall strategy, 2) appreciation of external customer's needs, 3) the expertise to deploy these tools etc. towards internal customers, 4) budgets and financial resources to do the job.

Internal markets are established by government within public sector organizations to encourage efficient and effective resource management in the absence of external competition.

Internal records information Information gathered from sources within the company to evaluate marketing performance and to detect marketing problems and opportunities. (Philip Kotler)

Internal secondary data See Secondary data

Internal selling Increasingly it is recognized that a salesperson has an internal role to play in representing his customer needs to the company.

International advertising agencies
The advantages of using an international agency: 1. Consistency of presentation, 2. Less duplication and dilution of effort on the part of agency and client, 3. Centralized control and all advertising effort, 4. Speedily response across markets, 5. Pooling of talent and ideas from the entire agency network, 6. Specialized resources available, 7. Standardized working methods of the agency, 8. Reduced costs due to economies of scale, 9. Specialist resources can be made available.

The drawbacks of using an international agency (Bennett): 1. Uneven quality of service in their different branches, 2. They produce bland campaign, 3. Quality control suffers due to handling hundreds of campaign simultaneously, 4. Clients have to tailor their campaigns to suit the conventions of the agency, 5. Small or medium sized clients suffer a lack of attention from senior staff, 6. High staff turnover rates amongst creative employees, 7. Antagonism is caused at a local level, 8. Possible loss of local knowledge, 9. Local cultures and styles may be unconsidered, 10. Quality control can suffer because of complex logistics.

The changing International advertising agencies: 1. International client companies are likely to grow, placing even more demands on their multinational agencies; 2. Forms of transnational media such as satellite television and the Internet, will pose challenges in terms of media status; 3. Media buying and selling power is becoming more concentrated. This has lead to the continuing growth of international media independents; 4. Advertisers are likely to become more sophisticated and more demanding of their agencies; 5. Agencies will need to become more accountable. There is some movement to payment by results systems; 6. There is likely to be a continuing concentration of ownership of agencies with fewer larger global organizations; 7. There will be a growth of agency branches in developing countries such as Russia, Eastern Europe and China.

International institutions are organizations designed to maintain global trade and payments stability and encourage the development of Third World countries, e.g. International Monetary Fund, IBRD.

International institutions : 1) The Organization for Economic and Development(OECD), 2) International Monetary Fund (IMF), 3) The World Bank(IBRD), 4) General Agreement on Tariffs and Trade (GATT), 5) United Conference on Trade and Development (UNCTAD).

International logistics decision areas are: (a) traffic/transportation management; (b) inventory control; (c) order processing; (d) materials handling and warehousing; (e) fixed facilities location management.

International marketing The marketing of goods and services in two or more countries. International marketing presents a new set of challenges for the marketer: 1) Growth, 2) Economies of scale, 3) Competition, 4) National necessity, 5) Reduce dependence, 6) Variable quality, 7) Finance.

Major motivations to Internationalize small and medium-sized firms: 1. Proactive: 1.1 Profit advantage, 1.2 Unique products, 1.3 Technological advantage, 1.4 Exclusive information, Managerial urge, 1.5 Tax benefit, 1.6 Economies of scale; 2. Reactive: 2.1 Competitive pressures, 2.2 Overproduction, 2.3 Declining domestic sales, 2.4 Excess capacity, 2.5 Saturated domestic markets, 2.6 Proximity to customers and ports.

Standards for local marketing activities (Marketing objectives) : (a) Market research (number and types of studies); (b) Sales volume (by product line/quarter/year etc.); (c) Market share (by product/quarter/year); (d) Product (quality control standards); (e) Distribution (market coverage, dealer support); (f) Pricing (levels, margins and rigidity or flexibility, especially in countries with high inflation); (g) Branch (volume and nature of local advertising/sales promotion); (h) Selling (local sales force standards); (i) Customer returns; (j) Number of complaints; (k) 'Share of voice' in international promotions; (1) Consumer awareness.

Regional trading groups : 1) Free trade areas (e.g. EFTA and LAFTA), 2) Customs unions (e.g. EU), 3) Economic unions (e.g. USSR, COMECON).

See below IM planning, IM organization, IM pricing, IM research and IM strategies.

Also see Economic development, Globalization, International institutions, Marketing environment, Market entry, and Trade blocks.

International marketing organization : 1) Who does what in an organization (division of labor), 2) The allocation of responsibilities, 3) Delegation, power, authority, 4) Centralized/Decentralized decision making.

The factors affecting international marketing organization :
1. The size of the firm and its business; 2. The number of foreign countries in which it operates; 3. The level of involvement and mode of operation in its overseas markets; 4. The firm's overseas objectives for its foreign business; 5. The firm's experience in international business; 6. The value and variety of its products; 7. The nature of its marketing task.

Low involvement organization structures: 1. Export department, 2. International division where international business is dealt with differently from domestic business, 3. Integrated international business with domestic business.

Elaborate organizational structures organize stuff along (i) regional, (ii) product, (iii) functional or (iv) project lines.

Factors affecting the extent of decentralization : 1. Organization type chosen: 1.1 Regional structures are frequently decentralized, 1.2 Product structures are usually decentralized, 1.3 Function and Matrix structures are may be either centralized or decentralized, 1.4 Project structures are almost always centralized; 2. The nature of management function; 3. The size of subsidiaries.

Advantages of centralization: 1. Better planning; 2. Better coordination in achieving overall corporate objectives; 3. Optimum use of resources.

Disadvantages of centralization: 1. Motivation of senior staff at subsidiary level suffering from low control over decisions or resources which affect their targets; 2. Possible misunderstanding and delays in management communications.

Factors affecting changes in organization evolves from a domestic to a global operator: 1. Size of firm and business Number of foreign countries in which it operates, 2. Level of involvement, 3. Company's objectives, 4. Experience in international business, 5. Value and variety of products, 6. Nature of the marketing task.

Possible evolution of organization evolves from a domestic to a global operator: 1. Export department, 2. Divisions, 3. Subsidiaries, 4. Overall operation.

Internal factors of organization evolves from a domestic to a global operator: 1. Brand image (awareness, etc.) 2. Corporate standing (ethics, moral values, attitude) 3. Distribution network 4. Effectiveness of processes 5. Efficiency of logistics operation 6. Financial status 7. Internal communication structure 8. Management ability 9. Motivation of workforce 10. Pricing structure / cost base 11. Product stoked 12. Promotional ability 13. Suppliers 14. Understanding of customers

International marketing planning (three levels): 1. Operational plans (short range, 1-3 year); 2. Strategic plans; 3. Corporate plans.

Model of the marketing planning process and information derived:
1. Preliminary analysis and screening: matching company/country needs - Environmental uncontrollable, company character and screening criteria: 1.1 Host country(s) constraints: 1.1.1 SLEPT, 1.1.2 Competition, 1.1.3 Distribution; 1.2 Company character: 1.2.1 Mission, 1.2.2 Objectives, 1.2.3 Resources, 1.2.4 Management style, 1.2.5 Organization, etc.
2. Adapting the marketing mix to target markets: 2.1 Product: 2.1.1 Adaptation, 2.1.2 Brand name, 2.1.3 Features, 2.1.4 Packaging, 2.1.5 Enhancements; 2.2 Price: 2.2.1 Credit, 2.2.2 Discounts; 2.3 Promotion: 2.3.1 Advertising, 2.3.2 Media, 2.3.3 Personal selling, 2.3.4 Message, 2.3.5 Sales promotions; 2.4 Distribution/place: 2.4.1 Channels, 2.4.2 Logistics.
3. Developing the marketing plan: 3.1 Situation analysis; 3.2 Objectives; 3.3 Strategic options; 3.4 Tactics; 3.5 Budgets; 3.6 Actions programs.
4. Implementation and control: 4.1 Objectives and standards; 4.2 Assign responsibility; Measure performance; 4.4 Corrective actions.

Possible drawbacks of standard international planning methods :
1. Time consuming process; 2. Too many activities and people involved in process; 3. Unnecessary collection of all rather than essential data; 3. Poor quality of implementation of planning; 4. Unresponsive or inadequate feedback mechanism; 5. Generic planning system.

Recent developments in international planning and control :
1. Emergent planning system; 2. Incremental or evolutionary planning systems; 3. Decision support system; 4. Best practice and Benchmarking; 5. Environmental planning system.

International marketing pricing
Factors of pricing decisions in the international marketing :
1. The company's marketing pricing objectives: 1.1 Financial (Cash generation, Profit, Return on investment); 1.2 Marketing (Maintain/Improve market share, Skim/Penetrate), 1.3 Competitive (Prevent new entry, Follow competition, Market stabilisation);
2. Cost: full cost of supply goods to consumers. Relevant costs could include administrative costs, a proportion of group overheads, manufacturing costs, distribution and retailing costs;
3. Inflation, particularly in the target market and in raw material sup-pliers;
4. Demand, which is a product of local taste, price, disposable income and competition. As a consequence, demand curves will be distinct for each individual market. Only the selling price is under the influence of the firm. Important information here is the demand curve and the price elasticity of demand. Profits will be maximized when product reaches a point when MC = MR;
5. Official regulations. Governments may well intervene to prevent the implementation uniform pricing policies. This may involve accept-able measures such as import du-ties and tariffs, and generally unacceptable measures such as non-tariff barriers, import quotas and price freezes. Price controls may also be used, and this will affect the ability of marketers to plan prices effectively; 6. Competition. 'Price leaders' may well be undercut by competitors. The effectiveness of this policy will vary according to the significance of other marketing activities, and the capacity of competitors to match these;
6. Regional meetings of foreign distributors create related markets, which in turn lead to uniformity in prices;
7. The diversity of markets within a country is important. If markets are unrelated the seller can successfully charge different prices.
8. Pressures for price uniformity often come from large groupings such as free trade areas or the EU. Pressure for price uniformity also comes from increases in international business activity. Control over prices which may be operated by the company would include: (a) direct distribution to customers, (b) resale price maintenance; (c) recommended prices; (d) agreed margins between parent and subsidiary companies; (e) centralized control over prices within several subsidiary companies.

Integrated pricing guidelines :
1. Set consistent objectives: 1.1 Make sure that objectives are dearly stated, operational and mutually consistent. 1.2 When there are several objectives, develop priorities, or otherwise clarify the relationships between the objectives. 1.3 Make sure that everyone concerned with a pricing decision, at any level in the firm, understands the relevant objectives.
2. Identify alternatives: 2.1 Identify enough alternatives to permit a sensible choice between courses of action. 2.2 Avoid traditional thinking, encourage creativity.
3. Acquire relevant information: 3.1 Be sure that information about buyers and competitors is current and reflects their current and future situations. 3.2 Make sure information is for the future, not just a report of the past. 3.3 Involve market research people in the pricing problem. 3.4 Make sure cost information identifies which costs will be affected by a particular pricing alternative. 3.5 Communicate with and involve accounting people with the cost aspects of a pricing decision. 3.6 Analyze the effect a particular alternative will have on scarce resources, inventories, production, cash flows, market share, volume and profits.
4. Making the pricing decision: 4.1 Make full use of the information available. 4.2 Correctly relate all the relevant variables in the problem. 4.3 Use sensitivity analysis to determine which elements in the decision are not important. 4.4 Consider all human and organizational problems which could occur with a given pricing decision. 4.5 Consider the long-run effects of the pricing decision. 4.6 Base the pricing decision on the life cycle of each product. 4.7 Consider the effect of experience in reducing costs as the cumulative production volume increases.
5. Maintain feedback and control: 5.1 Develop procedures to ensure that pricing decisions fit into the firm's overall marketing strategy. 5.2 Provide for a feedback mechanism to ensure that all who should know the results of individual price decisions are fully informed.

Contingency planning :
1. Ongoing monitoring of market; 2. Forward buying of currency whilst it is at an advantageous rate; 3. Factoring invoices through organizations who pay invoices immediately for a commission fee; 4. Use countertrade agreements; 5. Leasing; 6. Trading in a third currency; 7. Quotations and invoices in own currency, fixed rate; 8. Offsets; 9. Spot trading; 10. Provision of payment insurance.

International marketing promotion
International promotional mix :
1. Trade and professional journals; 2. Consumer media (magazines, newspapers, TV, radio, posters etc.); 3. Direct mail; 4. Trade fairs and missions; 5. Personal selling; 6. Telemarketing; 7. Sales promotion; 8. Public relations.

Consumer media characteristics : 1. Extent of target market coverage; 2. Image carried by the medium; 3. Literacy levels; 4. Ownership/readership; 5. Ability to convey the message; 6. The cost of contact (usually expressed as cost per 1.000 audience).

Factors driving the move to international direct mailing : 1. The growth in sophistication of computer and database technology 2. The increasing availability' of suitable consumer or business listings 3. The growth of international media which can be used for direct response advertising 4. The perceived accountability- of direct marketing campaigns compared to other communications campaigns 5. The ease with which direct marketing campaigns can be pre tested in order to maximize their effectiveness 6. The improving skills of direct marketing agencies 7. The increasing willingness of the consumer to purchase items directly 8. The increasing use of internationally accepted credit cards

Factors restarting the move to international direct marketing : 1. Lack of telephone and postal infrastructure. 2. Lack of road and rail penetration to facilitate distribution. 3. Lack of suitable media to use to target consumers. 4. Lack of consumer and business lists in some countries. 5. The threat of increasingly strict legislation concerning the use of consumer information. 6. Consumer backlash against what is seen as junk mail

Support of international salespersons : 1. Generation of enquiries. 2. Product literature and samples where relevant. 3. Information on price, delivery and terms.

Attributes of international salespersons : 1. Knowledge of the product and market. 2. Language and cultural knowledge specific to the country. 3. Technical knowledge where necessary. 4. Contacts, preferably from experience in the market. 5. Suitable personality. 6. Selling skills. 7. Motivation to succeed.

International promotional campaign decisions : 1. Professional assurance; 2. The message; 3. The media; 4. The promotional budget; 5. Monitoring and control; 6. Organization; 7. Independent or Co-operative promotion.

International marketing research
Specific objectives of international marketing research: (i) Identify attractive new markets; (ii) Enhance profitability by pinpointing opportunities and threads; (iii) Facilitate awareness of general market trends; (iv) Monitor changes in customer needs and preferences; (v) Ensure that the company can maintain its competitive position by knowledge of competitor plans and strategies; (vi) Identify new product opportunities in the marketplace; (vii) Monitor political, legal, economic, social and technological trends and subsequent customer reactions; (viii) Enhance the level and quality of information available for tactical and strategic planning in international markets.

The International marketing research process: 1. Monitoring international markets (passive information gathering); 2. Investigation (low cost informal methods of research); 3. Research (general background analysis, market access analysis, market structure, competitor analysis, market practices analysis).

Marketing information system for intentional markets should contain the following information (12 C's of Phillips, Doole and Lowe): 1) Contracts - business practices; 2) Communication - media; 3) Caveats - beware; 4) Country (SLEPT factors); 5) Commitment - access, incentives, regulation; 6) Choices - supply, competitors; 7) Channels of distribution; 8) Concentration, Segmentation, Geography; 9) Currency; 10) Culture - buyer behavior; 11) Capacity to pay - pricing, payment terms; 12) Consumption.

Problems of conducting research on an international basis: 1. Lack of secondary data, 2. Reliability of secondary data, 3. Incomparability of data across countries, 4. Incomparability of research techniques and reporting methods, 5. Language differences and the need to interpret data in relation to the culture of origin, 6. Lack infrastructure for data collection, 7. Co-ordination of home and foreign research agents with home and foreign country clients.

Most critical international information: 1. Government Data: 1.1 Tariff information Original country export/import data, 1.2 Nontariff measures, 1.3 Foreign export/import data, 1.4 Data on government trade policy; 2. Corporate Data, 2.1 Local laws and regulations, 2.2 Size of market, 2.3 Local standards and specifications, 2.4 Distribution system, 2.5 Competitive activity.

International marketing questions determining information requirements
1. Broad strategic issues: 1.1 What objectives should be pursued in the foreign market? 1.2 Which foreign-market segments should the firm strive to satisfy? 1.3 Which are the best product, place-distribution, pricing, and promotion strategies for the foreign market? 1.4 What should be the product-market-company mix to take advantage of the available foreign-marketing opportunities?
2. Foreign market assessment and selection: 2.1 Do opportunities exist in a foreign market for the firm's products and services? 2.2 What is the market potential abroad? 2.3 What new markets are likely to open up abroad? 2.4 What are the major economic, political, legal, social, technological, and other environmental facts and trends in a foreign country? 2.5 What impact do these environmental dimensions have on the specific foreign market for the firm's products and services? 2.6 Who are the firm's present and potential customers abroad? 2.7 What are their needs and desires? 2.8 What are their demographic and psychographic characteristics-disposable income, occupation, age. sex, opinions, interests, activities, tastes, values, etc.? 2.9 What is their life-style? 2.10 Who makes the purchase decisions? 2.11 Who influences the purchase decisions? 2.12 How are the purchase decisions made? 2.13 Where are the products purchased? 2.14 How are the products used? 2.15 What are the purchase and consumption patterns and behaviors? 2.16 What is the nature of competition in the foreign market? 2.17 Who are major direct and indirect competitors? 2.18 What are the major characteristics of the competitors? 2.19 What are me firm's competitive strengths and weaknesses in reference to such factors as product quality, product lines warranties, services, brands, packaging, distribution, sales force, advertising, prices, experience, technology, capital and human resources, and market share? 2.20 What attitudes do different governments (domestic and foreign) have toward foreign trade? 2.21 Are there any foreign trade incentives and harriers? 2.22 Is there any prejudice against imports or exports? 2.23 What are different governments doing specifically to encourage or discourage international trade? 2.24 What specific requirements-for example, import or export licenses-have to be met to conduct international trade? 2.25 How difficult are certain government regulations for the firm? 2.26 How well developed are the foreign mass communication media? 2.27 Are the print and electronics media abroad efficient and effective? 2.28 Are there adequate transportation and storage or warehouse facilities in the foreign market? 2.29 Does the foreign market offer efficient channels of distribution for the firm's products? 2.30 What are the characteristics of the existing domestic and foreign distributors? 2.31 How effectively can the distributors perform specific marketing functions? 2.32 What is the state of the retailing institutions?
3. Marketing mix assessment and selection: 3.1 Product: 3.1.1 Which product should the firm offer abroad? 3.1.2 What specific features-design, color, size. packaging, brand, warranty, etc.-should the product have? 3.1.3 What foreign needs does the product satisfy? 3.1.4 Should the firm adapt or modify its domestic market product and sell it abroad? 3.1.5 Should it develop a new product for the foreign market? 3.1.6 Should the firm make or buy the product for the foreign market? 3.1.7 How competitive is or will be the product abroad? 3.1.8 Is there a need to withdraw the product from the foreign market? 3.1.9 At which stage in its life cycle is the product in the foreign market? 3.1.10 What specific services are necessary abroad at the presale and postsale stages? 3.1.11 Are the firm's service and repair facilities adequate? 3.1.12 What is the firm's product and service image abroad? 3.1.13 What patents or trademarks does the firm have that can benefit it abroad? 3.1.14 How much legal protection does the firm have concerning patents, trademarks, etc.? 3.1.15 What should be the firm's product mission philosophy in the foreign market? 3.1.16 Are the firm's products socially responsible? 3.1.17 Do the products create a good corporate image? 3.1.18 What effect does the product have on the environment?
3.2 Price 3.2.1 At what price should the firm sell its product in the foreign market? 3.2.2 Does the foreign price reflect the product quality? 3.2.3 Is the price competitive? 3.2.4 Should the firm pursue market penetration or market-skimming pricing objectives abroad? 3.2.5 What type of discounts (trade, cash, quantity) and allowances (advertising, trade-off) should the firm offer its foreign customers? 3.2.6 Should prices differ according to market segment? 3.2.7 What should the firm do about product line pricing? 3.2.8 What pricing options are available if costs increase or decrease? 3.2.9 Is the demand in the foreign market elastic or inelastic? 3.2.10 How are prices going to be viewed by the foreign government-reasonable, exploitative? 3.2.11 Can differentiated pricing lead to the emergence of a gray market?
3.3 Place-Distribution 3.3.1 Which channels of distribution should the firm use to market its products abroad? 3.3.2 Where should the firm produce its products, and how should it distribute them in the foreign market? 3.3.3 What types of agents, brokers, wholesalers, dealers, distributors, retailers, etc. should the firm use? 3.3.4 What are the characteristics and capabilities of the available intermediaries? 3.3.5 Should the assistance of ElVICs (export management companies) be acquired? 3.3.6 What forms of transportation should the firm use? 3.3.7 Where should the product he stored? 3.3.8 What is the cost of distribution by channel? 3.3.9 What are the costs of physical distribution? 3.3.10 What type of incentives and assistance should the firm provide its intermediaries to achieve its foreign distribution objectives? 3.3.11 Which channels of distribution are used by the firm's competitors, and how effective are these channels? 3.3.12 Is there a need to develop a reverse distribution system, e.g., recycling?
3.4 Promotion-Nonpersonal (Advertising and Sales Promotion) 3.4.1 How should the firm promote its products in the foreign market? Should it advertise? Should it participate in international trade fairs and exhibits? 3.4.2 What are the communication needs of the foreign market? 3.4.3 What communication or promotion objectives should the firm pursue abroad? 3.4.4 What should be the total foreign promotion budget? 3.4.5 What advertising media are available to promote in the foreign market? What are their strengths and limitations? How effective are different domestic and foreign advertising media? 3.4.6 Should the firm use an advertising agency? 3.4.7 How should it be selected? 3.4.8 How effective and competitive are the firm's existing advertising and promotion programs concerning the foreign market? 3.4.9 What are the legal requirements? 3.4.10 Are there foreign laws against competitive advertising?
3.5 Promotion-Personal Selling 3.5.1 Is there a need for personal selling to promote the product abroad? 3.5.2 What assistance or services do foreign customers need from the sales force? 3.5.3 What should be the nature of personal selling abroad? 3.5.4 How many salespeople should the firm have? 3.5.5 How should the sales personnel he trained, motivated, compensated, assigned sales goals and quotas, and a foreign territories? 3.5.6 What should the nature of the foreign sales effort he? 3.5.7 How does the firm's sales force compare with its competitors? 3.5.8 What criteria should the firm use to evaluate sales performance? 3.5.9 How should the firm perform sales analysis?

International marketing strategy
International marketing strategies of Warren Keegan: 1. Standardize product / Standardize communications (e.g. Coca-Cola); 2. Standardize product / Adapt communications (Horlicks is promoted as a relaxing bedtime drink in UK and as high protein energy booster in India); 3. Adapt product / Standardize communication (Washing powder ingredients may vary from country to country depending on water conditions and washing machine technology. However, the communication message of clean clothes is the same); 4. Adapt product / adapt communications; 5. Invent a new product to meet the needs of the market.

Factors contributing to an effective global strategy: 1. Staff and company structure; 2. Motivation; 3. Standards; 4. Centralization; 6. Communication; 7. Adapted marketing mix.

The arguments for standardizing communications : 1. Economies of scale in production and media; 2. A consistent and strong brand image will be presented to the consumer; 3. Easier implementation and control; 4. Good communications ideas are rare and should be exploited creatively across the markets; 5. Greater buying power; 6. Suits international customers; 7. Used in international media; 8. There is a convergence of tastes internationally; 8. Faster communication between countries; 9. Use of the information superhighway.

The arguments against standardizing communications: 1. Any standardization policy assumes consumer needs and wants are identical across market; 2. Communications concepts may prove to be inappropriate for specific culture of the local market (language, Aesthetic etc.); 3. Media channels availability and infrastructure varies widely from country to country; 4. A country's level of educational development may prevent a standardized approach; 5. Legal restriction may prove to be a stumbling block; 6. Standardization may encourage the 'not invented here' syndrome in local management; 7. Different countries have economies which more or much less developed than others, 8. Each country has its own distribution channels which will affect the standard advertising strategy.
See also Marketing environment differences.

Factors encouraging product standardization : 1. Economies of scale in: 1.1 production, 1.2 marketing/communications; 1.3 research and development, 1.4 stock holding; 2. Easier management and control, i.e. 'familiarity'; 3. Homogeneity of markets, in other words world markets available without adaptation (e.g. denim jeans); 4. Cultural insensitivity, e.g. industrial and agricultural products; 5. Consumer mobility for travelers/tourists; 6. Where 'made in' image is important to a product's perceived value (e.g. France for perfume, Sheffield for stainless steel); 7. For a firm selling a small proportion of its output overseas, the incremental adaptation costs may exceed the incremental sales value.

Factors encouraging adaptation/modification : 1. Mandatory modification. Mandatory product modification normally involves either adaptation to comply with government requirements or unavoidable technical changes.
2. Discretionary modification: (a) Discretionary modification is called for only to make the product more appealing in different markets. It results from differing customer needs, preferences and tastes. These differences become apparent from market research and analysis, intermediary and customer feedback etc. (b) Levels of customer purchasing power. Low incomes may make a cheap version of the product more attractive in some less developed economies. (c) Levels of education and technical sophistication. Ease of use may be a crucial factor in decision-making. (d) Standards of maintenance/repair facilities. Simpler, more robust versions may be needed.

International Monetary Fund (IMF) deals primary with member governments and their central banks. The IMF's original membership of 38 has grown to 168 (at 1997). Its main role has been to supervise and maintain the stability of globalize world financial system by providing temporary lending to members suffering balance of payment deficits.

International markets include any target customers located outside domestic or trade bloc frontiers. Domestic sellers will Seek exchange transactions with these potential buyers.

Basic data about the country (possible source - Hutchinson Encyclopedia):, (a) Area, (b) Capital city, (c) Other major towns (d) Environment, (e.g. mountainous, desert, wet, dry etc), (e) Physical infrastructure, (f) Communications infrastructure (g) Political system, (e.g. liberal democracy, military republic) and political parties, (h) Main exports, (i) Currency ()') Population: this gives the potential size of the consumer market, (k) Life expectancy (1) Gross national product, and gross domestic product, (m) Religion, (n) Level of literacy (o) Media, (independent? state controlled? Number of newspapers, TV stations), (p) Recent political developments.

International trade is the exchange of goods and services between countries and arises out of comparative cost advantages.

Benefits of international trade for the countries : 1) Choice and diversity of product, 2) Advantages of specialization.

Benefits of international trade for the companies : 1) Providing a wider market for specialist niche producers, 2) Additional volume to reduce the cost base and secure economies, 3) Escape from saturated or threatened domestic market, 4) One possible means of extending the product life cycle, 5) As a source of volume growth to support expensive R&D, 6) To counter a depressed home market and maintain capacity, 7) As a competitive strategy to counter and deter foreign rival entry into the home market, 8) As a means of spreading risks.

Limitations to the growth of international trade : 1) Resource are mobile between different uses, 2) No resources are left unemployed or underutilized as a result of the increased specialization, 3) There is a demand for any increased production made possible, 4) There is no movement of productive factors between countries.

Sources of turbulence in the international trade : 1. Political: 1.1 War, 1.2 Terrorism, 1.3 Breakdown in relationships; 2. Economic: 2.1 Coordinated recessions, 2.2 Multiplier - accelerator effect, 2.3 Major trade disputes, 2.4 Movement toward protectionism, 2.5 Failure to coordinate economic polices; 3. Confidence; 4. Technological factor; 5. Natural factor.

Controls on international trade : 1) Tariff, 2) Quota, 3) Embargo, 4) Non-tariff barrier, 5) Terms of Trade, 6) Customs duty.

Also see International institutions, Trade blocs.

International trade life cycle Adaptation of product life cycle model to international conditions: a product may be at a different stage in the PLC depending on the market.

Internet, (Information Superhighway) refers to the global information networks linking personal computer users world-wide: 1) Developed by the US military in the 1970s, 2) Designed to improve communication and intelligence, 3) Mid 1990s has Seen significant commercial activity, 4) The World Wide Web.

The attributes of the Internet: 1. High speed of interaction; 2. Low cost provision and maintenance; 3. Ability to provide mass customization; 4. Global reach and wide search facilities; 5. Instant dialogue; 6. Multy-directional communications, (e.g. to suppliers, to customers etc.); 7. High level of user control; 8. Customer, (Visitor) driven - interactivity; 9. Moderate level of credibility.

Advertising advantages of Internet: 1) Target auditory - 18-35, 2) Tailor-made sites, 3) Sites can be quickly changed and updated, 4) Automatic information transmission, 5) Freebies, (screen savers, wallpapers), 6) Entertainment experience, 7) 24 hour access.

Services of relevance to the marketer provided by Internet : 1) Interactive TV, 2) On-line shopping, 3) Video conferencing, 4) Database access.

Extranet is company's secure site that can be accessed with a password. The Extranet provides a link with the company customers.

Intranet is network of company computers linked together by LAN/WAN systems. It is secure site that can be accessed by company employees, usually with a password.

Internet research See Interview.

Interview may be either face-to-face or at a distance, (via postal questionnaire or on the telephone) and may be fully structured, semi-structured, unstructured or in-depth.

Types of date collection using questionnaires:
1. Face-to-face in the person's home or office, (In-house interviews): 1.1 Advantages: 1.1.1 Respondent at ease, 1.1.2 Body language visible, 1.1.3 Home/office can be observed, 1.1.4 Interviewer can explain/probe, 1.1.5 Long interview possible, (up to 1 hour), 1.1.6 Visual aids can be used, 1.1.7 Computer Assisted Personal Interviewing, (CAPI) can be used; 1.2 Disadvantages: 1.2.1 Growing resistance to letting strangers into one's home, 1.2.2 Expensive, 1.2.3 Difficult to monitor interviews, 1.2.4 May be many interruptions.
2. Face-to-face in the street or shopping, (Mall intercept survey): 2.1 Advantage - Interviewer can show, probe and explain; 2.2 Disadvantages: 2.2.1 People often in a hurry, 2.2.2 Many potential interruptions, 2.2.3 Can be uncomfortable, (weather, nowhere to sit etc.), 2.2.4 Sample = people who shop in that locality at that time of day.
3. Over the telephone, (with the interviewers either working from home or from a central location), (Telephone research): 3.1 Advantages: 3.1.1 Sample can be chosen randomly, 3.1.2 Interviewer can probe and explain, 3.1.3 Computer Assisted Telephone Interviewing, (CATI), 3.1.4 Supervisors can listen in, (central location of interviewers); 3.2 Disadvantages: 3.2.1 Difficult to use visual aids unless sent in advance, 3.2.2 Long interviews not possible, 3.2.3 Supervisor cannot listen in, (if interview from home), 3.2.4 Respondent may be distracted.
4. By post, (Postal research): 4.1 Advantages: 4.1.1 Potentially the lowers cost per interview if there is an adequate return rate, 4.1.2 Increased postage rates are raising cost, 4.1.3 Questionnaire easy for respondents to complete; 4.1.4 Interviewers bias eliminated; 4.2 Disadvantages: 4.2.1 Increased postage rates are raising cost, 4.2.2 Inflexible, 4.2.3 Questionnaire must be short, 4.2.4 No proving questions, 4.2.5 May take more time than other surveys method, 4.2.6 Questionnaires can be returned anonymously, (although often they are coded, 4.2.7 Obtaining a complete mailing list is difficult, non-response is major disadvantaged;
5. By fax: 5.1 Advantages: 5.1.1 Similar to postal, 5.1.2 May be treated as more urgent, (until junk faxes start to annoy); 5.2 Disadvantages: 5.2.1 Similar to postal, 5.2.2 Confidentiality could be a problem, 5.2.3 Only owners of fax machines would be sampled; 6. Other self-administered, (e.g. in a restaurant, in a hotel room or in a magazine): 6.1 Advantages: 6.1.1 Similar to postal, 6.1.2 Specialist magazines and journals are good way of reaching certain segments, 6.2 Disadvantages: 6.2.1 Similar to postal, 6.2.2 Sample self selecting and only users.
7. Via the Internet, (E-mail): 7.1 Advantages: 7.1.1 Fast and easy to use, 7.1.2 Delivery is certain, 7.1.3 Reasonable cost, 7.1.4 Flexibility in response, (E-mail, Mail or Fax), 7.1.5 Less paper wasted; 7.2 Disadvantages: 7.2.1 Only reach e-mail subscribers, 7.2.2 Size of questionnaire may be limited, (form configuration), 7.2.3 Fear of computers.

Interview surveys can be classified as: 1) Mall intercept survey, 2) In-house, (or in-home or doorstep) interviews, 3) Hall tests, 4) In-store surveys, 5) Business interview.

Advantages of interview survey : 1) Ability to check the respondent before interview, 2) Capacity to gather answers on all questions, 3) Ability to check understanding the question and to encourage respondents to answer as fully as possible, 4) High response rates.

Features of different methods of survey :
1. Economy: 1.1 Postal interview - Potentially the lowers cost per interview if there is an adequate return rate; increased postage rates are raising cost; 1.2 Telephone - Avoid interviewer's travel expenses; less expensive than in-home interviews; most common surveys method; 1.3 Personal interview - In-home interviewing is the most expensive interviewing method; shopping mall test and "focus group" may lower cost.
2. Flexibility: 2.1 Postal interview - Inflexible; questionnaire must be short, easy for respondents to complete; no proving questions; may take more time than other surveys method; 2.2 Telephone - Flexible because interviewers can ask probing questions, en-courage respondents to answer questions, rapport may be gained, but observations are impossible; 2.3 Personal interview - Most flexible method. 3. Interviewer bias: 3.1 Postal interview - Interviewers bias eliminated; questionnaires can be returned anonymously, (although often they are coded); 3.2 Telephone - Some anonymity; may be hard to develop trust among respondents; 3.3 Personal interview - Refusals may be decreased by interviewers' rappartibuilding effort, interviewers personal attributes may bias respondents. 4. Sampling and respondents' co-operation: 4.1 Postal interview - Obtaining a complete mailing list is difficult non-response is major disadvantaged; 4.2 Telephone - Sample must be limited to respond with telephones and listed numbers; engaged signals, no answers and non-response including refusals - are the problems; 4.3 Personal interview - Not at homes are more difficult to deal with; focus groups, shopping mail interviewing may over-come that problems.