Unit 1: International marketing fundamentals

International marketing is the performance of marketing activities to plan, price, promote and direct goods and services to consumers in more than one country for a profit.

• Challenges: cultural and language differences, varied laws and standards, currency and political risk, distance and logistics, competition from global and local firms, limited market information, tariffs and non-tariff barriers.

• Macro (country) segmentation: grouping countries by economic development, culture, region, language, trade blocs or market size.
• Micro segmentation: consumer segments that cut across countries — global teens, affluent professionals, business travellers (inter-market segments).
• Screening process: preliminary screening (macro indicators) → in-depth screening (industry potential, competition) → final selection (company sales potential, risk, fit).

• Choice depends on: market size and growth, risk, control desired, resources, speed, legal restrictions on foreign ownership, nature of product.
• Trade-off: higher control comes with higher investment and risk — exporting is low risk and low control; wholly owned subsidiaries give full control at the highest risk.

• Self-reference criterion (Lee): the unconscious tendency to judge foreign markets by one's own cultural values — a major cause of international marketing failures.

• Country risk: possibility that political, economic or social events in a country harm a firm's operations or returns.
• Types: political (expropriation, war, instability), economic (recession, inflation, currency crisis), transfer (restrictions on remitting funds), legal and regulatory, social unrest.
• Assessment tools: country risk ratings (sovereign credit ratings, Euler Hermes, PRS Group), checklists and weighted scoring, Delphi technique, scenario analysis.
• Managing risk: joint ventures with local partners, local sourcing, insurance (ECGC, MIGA), phased entry, diversification across countries.

The World Trade Organization (1995) replaced GATT. It sets rules for international trade, settles trade disputes and works to reduce trade barriers.

Consequences for India: lower tariffs and wider market access, stronger patent laws (product patents from 2005), competition for domestic industry, and debates over agricultural subsidies and food security.

International Monetary Fund (IMF, 1945): promotes international monetary cooperation and exchange-rate stability, provides short-term loans to countries with balance-of-payments problems, and offers policy advice and surveillance. India borrowed from the IMF during the 1991 crisis.

• Levels of economic integration: free trade area → customs union → common market → economic union → political union.
• India's agreements: SAFTA, India–ASEAN FTA, CEPAs with UAE (2022), Japan and Korea, ECTA with Australia (2022), India–EFTA TEPA (2024), India–UK CETA (2025).