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Marketing Basics - Kotler Philip

The decision on the feasibility of entering the foreign market

Firms are involved in international marketing activities in two ways: either someone asks to organize a sale abroad - say, another domestic exporter, a foreign importer or a foreign government - or the company itself begins to think about going abroad. Perhaps her production capacity exceeds the needs of the domestic market, or maybe she sees more favorable marketing opportunities abroad.

Prior to going abroad, a firm must clearly define the objectives and policies of its international marketing. First, she needs to decide what percentage of her total sales she will strive to carry out in foreign markets. Most foreign firms start small. Some adhere to this principle in the future, considering foreign operations as an insignificant part of their entrepreneurial activity. Others have more ambitious plans, considering foreign markets as tantamount to domestic, or even superior in value.

Secondly, the company must decide whether it will be engaged in marketing in just a few or at once in many countries. The watch company “Bulova” settled on the latest version and launched activities in more than a hundred countries. Spraying her efforts too much, she secured profit in only two countries and suffered losses of about $ 40 million.7

Third, the firm must decide what type of country it wants to work in. The attractiveness of the country will depend on the product offered, geographical factors, income level, composition and population, political climate and other features. The seller can simply favor certain groups of countries or certain regions of the world.