With the increase of globalization around the world, organizations in almost every country have deemed it necessary and important to start operating on an international scale in hopes of increasing profits and brand awareness. Although it has become easier for companies to tap into foreign markets (with the development of technology and other resources) they still have to make crucial marketing decisions when entering into these markets and international environments in general.
If your company is in the process of deciding whether or not it wants to push into an international marketing environment, it must first be aware of and address the various underlying factors that will affect its business in this new environment. Failure to do so can result in project or company failure. These factors within an international marketing environment include:
- The Political Environment ( How stable is the target country? Is there social unrest or active terrorism? What type of political framework does this country operate around? Will operating in this country affect trade? Etc. )
- The Social/Cultural Environment ( What language does the population speak? Is your company sure that its products or services do not mean something different in the country’s native language? **More on this below**… Do your products or services align with the values of the target population? Do you know how business deals operate in this particular country? How will the colors and images in your products and advertising resonate with the target population and will they have a negative reaction to them? Etc. )
- The Economic Environment ( What is the economic situation within the country and can consumers afford your products or services? Does the country impose tariffs and how will this affect your prices? Does the government directly support local business, as Japan does for local rice farmers, and will this make it difficult for you to compete? What is the exchange rate between your domestic currency and this foreign currency? Etc. )
- The Technological Environment ( How developed is the technological infrastructure in this country and can it support your business? Does the population have access to technology or even electricity? What are the costs associated with setting up your business’ infrastructure? Is transportation available? Is there opportunity for local workers to be trained to use your technology or will your company send domestic employees to work? Etc. )
Of course, this list is not all-inclusive, but it is enough to adequately stimulate the minds of top-level executives and potentially reduce their chances of failure when entering into an international marketing environment…
As previously mentioned, it is very important that your company’s products, services or brand do not mean something completely different in a foreign country/language, especially countries in which you hope to do business. This article does a great job of outlining the 20 “greatest fails” by companies in regards to this topic!
In conclusion, the international marketing environment can be tricky to navigate as there are many factors that can potentially affect the success of your business operations in a foreign market. However, if your company chooses to address the key points above and take initiative in answering those types of questions, then the sky is the limit!