International Marketing Research
International
Marketing Research Categories
International marketing research is the
systematic design, collection, recording, analysis, interpretation, and
reporting of information pertinent to a particular marketing decision facing a
company operating internationally. International marketing managers need to
constantly monitor the different forces affecting their international
operations.
There are three general categories of
research based on the type of information required.
1. Exploratory research
deals with discovering the general nature of the problem and the variables that
relate to it. Exploratory research is characterized by a high degree of
flexibility, and it tends to rely on secondary data, convenience or judgment
samples, small-scale surveys or simple experiments, case analyses, and
subjective evaluation of the results.
2. Descriptive research is
focused on the accurate description of the variables in the problem model.
Consumer profile studies, market-potential studies, product-usage studies,
attitude surveys, sales analyses, media research, and price surveys are
examples of descriptive research. Any source of information can be used in a
descriptive study, although most studies of this nature rely heavily on
secondary data sources and survey research.
3.
Causal research attempts to specify the
nature of the functional relationship between two or more variables in the
problem model. For example, studies on the effectiveness of advertising
generally attempt to discover the extent to which advertising causes sales or
attitude change.
Research topics usually include the following aspects:
1. Development of customer needs and
customer desires
2. Customer´s perception of the company,
compared to competitor companies
3. Performance and adequacy of marketing
tools such as product and services, branding, direct sales and distribution
channels, communications including internet marketing, pricing.
4. Marketing innovation: new business
models and billing schemes, new variations of marketing tools, new technology
applications.
5. Service quality of business relations
between customers and sales persons or service technicians, to be examined by
mystery shopping
6. Openness for and acceptance of new
technology applications
7. Evaluation and selection of target
markets – e.g. examining market potentials, market attractiveness, market
barriers, intensity of competition, sales channels, customer segments and
others more
8. Preparations for new sales market
entry – e.g. profiling and prioritising of prospective customers, providing
short lists of target customers, short lists of resellers, distributors,
intermediaries, and logistics or other service facilities
9. Procurement out of new vendors – e.g.
profiling, evaluation and selection of suppliers, clarification of detail
questions such as transportation, custom duties, payment procedures, and others
more
10. Shift of production – e.g. country
comparison, execution of feasibility studies, later research for manufacturers,
suppliers, manufacturing facilities, personnel and others more.
11. Identify new technology and applications abroad
12. Take-over of competitors in target
markets, again creation of long and short lists, profiling, contacting,
negotiating, due diligence and others more.
All
these examples mean that accurate, complete, and up-dated pieces of information
are delivered to come to sound decisions.
Usually,
there is a clear geographical focus on specific country markets.
Why is
International Market Research so important?
International
Market Research shall identify new business opportunities and help assure a
so-called area strategy which defines which geographical hemisphere needs to be
covered.
Generally,
market research intends to provide new ideas, comparisons, and control
information for marketing deciders. These deciders are found not only in
Marketing and Sales, Import and Export positions, but also in New Business
Development, in a Strategy staff, in Corporate Planning departments and of
course, within top management.
International
Market Research provides an information base for strategic decisions. Here,
competitive information needs to be available early, fast, and with the right filter.
What needs to
be considered when executing International Market Research?
Strategic
decision-making requires an outstandingly high-quality information base.
Therefore,
international market research projects have to consider the following:
1.
Globalization Experts are featured by product and
industry knowledge, industry-specific experiences, methodological know-how like
research methods, information access (e.g. to specializing commercial data
bases), reputation (e.g. experts with door-opener-quality) and international
experience, language skills, and others more
2.
Competitive Information needs the right focus, but also
needs to be provided fastly, and early enough in order to be effective.
3. information should be retrieved
exclusively for your company – if all the industry enjoys the information there
will not be any competitive gain procurement of information may be done by
internal staff (“make”, e.g. sales force, internal research department), but
also by such type of external market intelligence specialist who are working in
the international field.
Main factors which influence the marketing research in different countries are
1. Cultural differences.
Culture refers to widely shared norms or patterns of behavior of a large group
of people. It is the values, attitudes, beliefs, artifacts and other meaningful
symbols represented in the pattern of life adopted by people that help them
interpret, evaluate and communicate as members of society. A company which works on the international market is in need of cross-cultural
awareness. Cross cultural differences (language, non-verbal communication,
different norms and values) may cause cross cultural blunders. There are
examples of cultural blunders in the marketing mix.
Product. When a soft drink was launched in Arab
countries, it has a label with six-pointed stars. The sales were very low as
the stars were associated with Israel.
Price. An American firm was willing to set a
reasonable price for the product they intended to sell to the Japanese. A
detailed presentation was made to the Japanese businessmen, but it was followed
by a deep silence. The Americans thought that the Japanese were going to reject
the price and offered a lower price. The Japanese kept silence again. After
that the Americans lowered the price again saying that it was the lowest they
could sell at. After a brief silence the offer was accepted. Later the Japanese
confessed that the first offered price was quite acceptable, but they had a
tradition to think over the offer silently. An American company suffered great
losses in this case.
Place. A company wanted to enter the Spanish
market with two-liter drinks bottles and failed. Soon they found out that
Spaniards prefer small door fridges and they could not put large bottles into
them.
Promotion. Pepsico came to Taiwan with the ad ‘Come
Alive with Pepsi’. They could not imagine that is it translated ‘Pepsi will
bring your relatives back from the dead’ into Chinese.
2. Racial Differences.
This refers to the differences in physical features of people in different
countries. For example, types of haircut and cosmetic products differ greatly in
various countries.
3. Climatic Differences.
These are the meteorological conditions such as temperature range or degree of
rain. For example, Bosch-Siemens adapted their washing machines to the markets
they sell. In Scandinavia, where there are very few sunny days, they sell
washing machines with a minimum spin cycle of 1,000 rpm and a maximum of 1,600
rpm, whereas in Italy and Spain a spin cycle of 500 rpm is enough.
4. Economic Differences.
Economic development of various countries is different and when a company
introduces a new product it adapts it to that new market. There are factors
which show the level of economic development
Buying power and revenue of the market. In developed countries with higher income of revenue people prefer
complicated product with advanced functions, while in poor countries simple
product are preferable.
The infrastructure of the market. Such elements of the infrastructure of the country as transport,
communication system and others influence the product. When Suzuki entering the
Indian market the suspension was reinforced as the state of roads in India is
very poor.
5. Religious Differences.
Religion affects the product greatly and makes companies adapt their product to
religious norms. If a company exports grocery product to Islamic countries it
must have a special certificate indicating that the animal was slaughtered
according to ‘Halal’ methods.
6. Historical Differences.
Historical differences affect the consumer behavior. For instance, Scotch
whiskey is considered fashionable in Italy and not very trendy in Scotland.
7. Language Differences.
The correct translation and language adaptation is very important. For example,
when Proctor & Gamble entered the Polish markets it translated properly its
labels but failed. Later they found out that imperfect language must have been
used in order to show that the company fits in.
Besides the differences
mentioned above, there may be differences in the way that products or services
are used, differences in the criteria for assessing products or services across
various markets and differences in market research facilities and capabilities.
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