Contents Page
Assessment 1
Domestic & International Marketing – the major differences 3 Promotion 3
Product 3
Price 4
Place 4
People
Product Life Cycle 5
Product Life Cycle at Astracast 5-6
Assessment 2
Unfair Trading Practices 7
Dumping & Subsidies 7-8
The Importance of Incoterms 8
What Incoterms means for exporters 8-11
Reference List 12
Domestic & international marketing differences
There are many interconnecting parts within the marketing process which make up the ‘marketing mix’. Specification, packaging and advertising material to name but a few are some of the key elements where marketing overseas may differ, even the colour of a product can be deemed offensive in some countries.
There are basic areas of the marketing mix in domestic and international markets that remain the same, however, once we break this down, we will begin to see the differences between selling in the UK and selling abroad.
The major components are referred to as the five P’s – Promotion, product, price, place, people, (Bennett & Blyth)
Promotion
Whilst within the domestic market promotion can be done by sales personnel on the road directly to the customer with literature in a single language, overseas this may be done either by a sales representative based in the overseas country or alternatively an agent may be used to promote the product. A good reason to use an agent or sales person based overseas is that they will have knowledge of the local market and the cultural & language differences, including regulations and legislation in the area. The overseas sales base can assist with translation of literature, market research and exhibiting in the target market, however, for some companies who have smaller markets or more widespread markets to cover they may wish to keep the sales force UK based and do the promotional aspects from there.
Product
Manufacturing product for the domestic market can be much simpler, one specification of each product can be sold to many different customers with little change other than price and rebranding in certain cases. Supplying manufactured product to the international market can mean changes in design and specification, conformity to certain regulations within the overseas market can mean even small changes, such as an indelible mark of origin, be a crucial part of the product manufacturing process. For example; when Astracast used to manufacture toilet pans and cisterns to Australian customers, they do not require overflows where as other countries do. Aftersales service & warranties can also differ, Aftersales may be done by the overseas salesperson, agent or even a distributor who make keep a stock of spare parts. Alternatively a dedicated export team such as the one in place at Astracast can handle overseas Aftersales.
Price
Price is one of the key factors in all marketing whether it be UK or overseas, however, there may be other factors in marketing internationally that may need to be considered when deciding on a price. Terms of delivery will undoubtedly be a factor that has to be considered and it is important for the seller to negotiate terms of delivery by using Incoterms 2010, if for instance DDP (Deliver Duty Paid) terms are negotiated as opposed to EXW (Ex works) the seller can factor the cost of the freight into the price offered to the customer in addition to any documentation and clearance costs they may occur. Incoterms 2010 is not generally used in the domestic market, but it could easily be utilised to ensure clarity of delivery terms with UK customers. Cost of manufacture will also influence the price, as outlined above, overseas customers may demand different specification and packaging amongst other things, all of which must be taken into consideration when deciding on a price.
Place
Although in the domestic market
