Advocates of marketing have been differentiating domestic and international marketing over the past centuries. With the concept of multi cultural marketing, the need to differentiate these two concepts may no longer be of deep emphasis. The world where we live in is diverse. It is full of different peoples coming from different cultures with different perceptions and buying preferences. Reaching out to theses consumers may pose obstacles and challenges to companies who wish to introduce their products and services in the world market.
Marketing plays a big role in this endeavor. It is a crucial aspect in every business organization because it addresses the way products are introduced and sold in the market. Peter Drucker (1974) defined marketing as a central dimension of the entire business seen from the point of its final result, which is from the customers’ point of view. Concern and responsibility for marketing must permeate all areas of the enterprise. Whether business organizations market their products and services in the domestic market or internationally, the basic concept of marketing will still be applicable.
Strategically, the business must be centered on the customers more than the products. While products are also crucial, the buying public still has their personal preferences. If you target more of the customers’ needs and wants, they will come back time and again and even bring along new potential customers. If companies push more on the products and ignore their wants and the benefits they can get, these organizations will lose customers in no time. The sad thing is that getting these customers back is the most difficult part (Exforsys Incorporated, 2010).
Differing views of marketing based on different perspectives “A good product will sell itself “– production perspective “Creative advertising and selling will overcome consumer resistance” – sales perspective “The consumer is king, find a need and fulfill it” – marketing perspective Domestic Marketing According to investor world, domestic marketing is the part of a nations market that represents the systems of trading securities of entities located within that nation. Domestic marketing means selling within one’s own country.
Generally, this is the first area where business organizations seek to market their products or services. The domestic market is often the easiest place for companies to launch their products because the market, geography, demographics, customer needs, tastes, and distribution methods are common. The four P’s of marketing – product, price, place, and promotion – are often easier for companies to determine within the domestic market (LoveToKnow Corp. , 2009). International Marketing International marketing means to offer one’s goods or services worldwide.
The flow of goods or services to consumers or users are planned, priced, directed, and promoted in more than one nation for profit. Most companies begin marketing their goods or services within their country, and expand to the international market to capture greater market share and open up new avenues for sales (LoveToKnow Corp. , 2009). The scope of marketing is broadened when the organization decides to sell across international boundaries, this being primarily due to the numerous other dimensions which the organization has to account for.
Most marketing organizations that are now operating globally advanced from a fairly small export base. Some companies never get any further than the exporting stage. In international marketing the method is very different. Organizations begin to develop and run operations in the targeted country or countries outside of the domestic one (FAO Agriculture & Consumer Protection, 2010). Stages of International Marketing Involvement 1. No direct foreign marketing Company does not actively pursue customers in foreign markets, but receives them thru unintended channels.
Products are brought abroad through domestic, wholesalers/ distributors, and websites via the internet. 2. Infrequent Foreign Marketing Selling is done to foreign markets only when a temporary surplus exists. If the surplus is gone, selling is temporarily gone. Only few companies apply this model because of the difficulty in establishing long term relationships with foreign counterparts. 3. Regular Foreign marketing Company produces products and services to primarily sell in the domestic market and eventually to the international market. The process is done through the presence of domestic and foreign middlemen.
There is sales force in foreign countries. 4. International Marketing Company is fully engaged in international marketing strategies. Companies are now considered international or multi national. 5. Global Marketing There is a change from company’s activities to all activities focused in a global perspective. The company starts to treat the world as one market. The market segment is no longer focused on national borders. Income levels, usage patterns and other factors are looked across borders (Chowdhury, 2009). Strategic Approaches to Marketing Internationally
• Domestic Market Extension Orientation – International Markets are secondary to its domestic markets • Multi domestic international orientation – Each nation has a separate and specific marketing plan to adjust to differences • Global Marketing Orientation – Marketing activities are global – Strives to efficiencies of scale through standardization Domestic marketing vs. international marketing Domestic marketing is focused on a particular market. International marketing is involved in more than just exporting and needs to coordinate with the local environment of another country.
The main difference is that in international marketing, all the environments have to be considered when developing and executing the marketing plan. These may include the legal environment, government control, buyer behavior, and cultural beliefs. The Multicultural Marketing Approach Multinational marketing refers to a number of very large companies whose business interests, manufacturing plant and offices are spread throughout the world. Although their strategic headquarters might be based in the original parent country, they tend to operate autonomously in individual countries.
Multinational companies can also be exporters and importers, but the main point is that they actually produce and market goods within the countries they have chosen to develop (Lancaster, 2010). This approach is somewhat contentious as it basically disregards the diversities among nations. Advocates of this approach claim that while this may incur losses in some remote areas, the chance of reaping better results is higher. This perception is due to the advocates’ belief that consumers worldwide are moving towards the global environment and they measure these products based on global standards.
The way in which people think is not only contained to local standards. Consumers around the globe are opening up to the possibilities of using the products that are used and developed somewhere other than their country for as long as it meets their needs and wants. A globally standardized product coupled with the right marketing can reap favorable results. Constant changes in the packaging, advertisement, and distribution will not be of major concern anymore. With the potential customers coming from diverse backgrounds, business organizations need to tackle the implications of such changes.
The concept of multi cultural marketing is often misunderstood because of the feared implications it will have on people’s cultural identity. The truth of the matter is that multi cultural marketing is applying the marketing principles, programs and strategies to segments of the market that possess more than one cultural identity. Multiculturism implies that many in a given society were able to preserve their different cultures or identities, even while sharing in a “unified culture” (Rosario). Marketers are slowly ditching out the traditional marketing practices and are now concentrating on multicultural strategies.
There are programs on American television that tries to address the concept of multi culture. It addresses the need to market to diverse cultures and presents techniques for the best way to reach these segmented multi cultural markets (The Ad Club of New York, 2010). The focus of multicultural marketing is on the development of business strategies that move away from the precise advertisements. The focal point will be on the linkages that may address local, national, and international levels (Global Acceptance: Widening the Company’s Acceptance, 2010). Strategic Approaches to Marketing 1. Domestic Market Extension Orientation
– International markets are secondary to its domestic markets 2. Multi domestic Market Orientation – Each country has specific and separate marketing plan to adjust to differences 3. Global Marketing Orientation – Marketing activities are global – Strives for efficiencies of scale through standardization The concept of globalization has opened the market on a global level. The decline in tariffs and trade barriers has encouraged companies to market their products globally. Standardization issues were brought out in the quest to level out the playing field. Standardization is important in addressing the concept of multi cultural marketing.
Factors Encouraging Standardization – Economies of scale – Spreading R;D cost over greater volumes – Reduced inventory cost – Component sourcing from cheapest or from multiple locations – Similar technology, regardless of level of economic development – Consumer mobility – Market homogeneity International Marketing in America In America, the current statistics show that there are more than 80 million Asian, African Americans, and Hipic that comprise a quarter of the nation’s population, and as consumers they spend an aggregate amount of more than $1. 2 trillion annually.
It’s estimated that within four decades, America’s non-Anglo population will be near 50 percent of the total. These stats suggest a cultural shift that’s now on the move. It impacts every business, government agency and organization (Garcia, 2004). With more than 30% of the U. S. population—the current or potential customers— coming from a diverse background, corporations must address the strategic implications of these changes. Globalization and cultural identities as factors in Multi cultural marketing The globalization of the production and distribution of goods and services is very much acceptable for many people.
It offers them access to products that they would not otherwise have. However, some are concerned that the changes brought about by globalization threaten the viability of local products and the people who manufacture them (Globalization 101. org). Globalization is driving ever increasing interactions among the world’s people. This world needs both greater respect for diversity and stronger commitment to unity. Individuals have to shed rigid identities if they are to become part of diverse societies (Cultural liberty in today’s diverse world, 2004).
Globalization can threaten national and local identities. The solution is not to retreat to conservatism and isolationist nationalism—it is to design multicultural policies to promote diversity and pluralism. Diversity in cultural goods has its own value because it increases consumer choice and enriches people’s cultural experience. But cultural goods also enjoy economies of scale. So the products of large producers tend to crowd out the products of smaller producers, particularly in poorer countries (Cultural liberty in today’s diverse world, 2004).
The business world is becoming more condensed and competition is rapidly increasing. Companies need to be conscious of the global possibilities and opportunities that come into existence. The multi cultural marketing concept is now becoming the current trend. Although some companies still find it contentious at the moment, in the long run this trend in marketing may prove to be more feasible and efficient than just distinguishing between using domestic or international marketing. The differentiation between domestic and international marketing need not be over emphasized these days.
With the concept of multi cultural marketing, business corporations can just focus on the ways and means on how they can promote their products and services using the multi marketing concept. Unlike in domestic marketing where the focus is just limited and in International Marketing where there is segmentation and consideration of other factors, Multi cultural Marketing is like shooting two birds with just one stone. It has combined the positive concepts of these two marketing strategies. Multicultural Marketing has replaced the need to differentiate between Domestic and International Marketing.
References: (2009). The Scope and Challenge of International Marketing. In I. A. Chowdhury, International Marketing. Slide Bloom. (2004). Cultural liberty in today’s diverse world. Human Development Report. Exforsys Incorporated. (2010). Importance of Marketing. Exforsys Inc. , Execution for System . FAO Agriculture ; Consumer Protection. (2010). Global Agricultural Marketing Management. Repository. Garcia, G. (2004). The New Mainstream: How the Multicultural Consumer Is Transforming American Business (1st ed. ).
New York: Harper Collins Inc. Global Acceptance: Widening the Company’s Acceptance. (2010). Allied Media Corporation . Globalization 101. org. (n. d. ). Culture and Globalization. The Levin Institute . Lancaster, G. (2010). Marketing Lectures. Durham Associates . LoveToKnow Corp. (2009, March 13). Global and Domestic Marketing. LoveToKnow . Rosario, L. (n. d. ). Multi cultural marketing: A misunderstood concept and an untapped business strategy. The Ad Club of New York. (2010, April 16). The Changing Face of Advertising Series.