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 page i

International Marketing
page ii
 page iii

International Marketing
Fifth edition

Pervez N. Ghauri
Philip Cateora

Bogota Mexico City Toronto London Madrid Milan Dubai

New Delhi Sydney
Seoul Singapore Taipei City Shanghai Beijing Hong
Kong Kuala Lumpur Bangkok
New York Chicago Dubuque Los Angeles Columbus
 page iv

International Marketing, Fifth edition

Pervez N. Ghauri and Philip Cateora

ISBN-13 9781526848598
ISBN-10 1526848597

Published by McGraw Hill

338 Euston Road
London
NW1 3BH
Telephone: 44 (0) 203 429 3400
Website: www.mheducation.co.uk

British Library Cataloging in Publication Data

A catalogue record for this book is available from the British Library

Library of Congress Cataloging in Publication Data

The Library of Congress data for this book has been applied for from the Library of
Congress

Portfolio Managers: Sabrina Farrugia and Lucy Wheeler

Content Developers: Hannah Cooper and Maggie du Randt
Marketing Manager: Vee Suchak
Content Product Manager: Adam Hughes

Cover design by Adam Renvoize

Text design by Kamae Design

Published by McGraw Hill (UK) Limited, an imprint of McGraw Hill, 1221 Avenue of
the Americas, New York, NY 10020. Copyright © 2022 by McGraw Hill Education
(UK) Limited. All rights reserved. No part of this publication may be reproduced or
distributed in any form or by any means, or stored in a database or retrieval
system, without the prior written consent of McGraw Hill Education, including, but
not limited to, in any network or other electronic storage or transmission, or
broadcast for distance learning.

Fictitious names of companies, products, people, characters and/or data that may
be used herein (in case studies or in examples) are not intended to represent any
real individual, company, product or event.

ISBN-13 9781526848598
ISBN-10 1526848597
eISBN-13 9781526848604
eISBN-10 1526848600
© 2022. Exclusive rights by McGraw Hill for manufacture and export. This book
cannot be re-exported from the country to which it is sold by McGraw Hill.
 page v

Dedication

For Saad P. Ghauri

page vi
 page vii

Brief Contents
Preface xvi
About the Authors xxi

Acknowledgements xxii

Guided Tour xxiv

Create & Custom Publishing xxix

Improve your Study, Research & Writing Skills xxx

Part 1 An Overview
Chapter 1 The Scope and Challenge of International Marketing 2
Chapter 2 The Dynamics of International Markets 22

Part 2 The Impact of Culture and Political Systems

on International Marketing
Chapter 3 The Foundations of Cultural Understanding 46
Chapter 4 Cultural Dynamics in International Marketing 62
Chapter 5 The International Political and Legal Environment 87

Part 3 Assessing International Market

Opportunities
Chapter 6 Researching International Markets 112
Chapter 7 Emerging and Regional Markets 135
Chapter 8 Exporting and Logistics 162

Part 4 Developing International Marketing

Strategies
Chapter 9 International Marketing Strategies 182
Chapter 10 International Market Entry Strategies 206
Chapter 11 Segmentation and Positioning in International Markets 227
Chapter 12 International Branding Strategies 245
Chapter 13 Digital and Social Media Marketing 267
Chapter 14 Ethics and Social Responsibility in International Marketing 287

page viii

Part 5 Developing International Marketing

Strategies
Chapter 15 Product Decisions for International Markets 308
Chapter 16 Marketing Industrial Products and Services 327
Chapter 17 International Distribution and Retailing 349
Chapter 18 Pricing for International Markets 375
Chapter 19 International Promotion and Advertising 403
Chapter 20 Personal Selling and Negotiations 427

Part 6 Supplementary Resources

The Country Notebook: A Guide for Developing a Marketing Plan 448
Case Studies to Accompany Parts 1–5 455

Glossary 584
Index 590
 page ix

Detailed Table of Contents

Preface xvi
About the Authors xxi
Acknowledgements xxii
Guided Tour xxiv
Create & Custom Publishing xxix
Improve your Study, Research & Writing Skills xxx

PART 1 An Overview

Chapter 1 The Scope and Challenge of International Marketing 2

Chapter outline 2
Chapter learning objectives 2
The internationalisation of business 4
International marketing defined 6
The international marketing task 7
Marketing controllables 8
Domestic uncontrollables 8
Foreign uncontrollables 8
Environmental adaptations 10
Self-reference criterion: an obstacle 11
Different marketing orientations 12
Domestic market extension orientation 12
Multi-domestic market orientation 12
Global marketing orientation 14
Globalisation of markets 16
Developing a global awareness 17
International marketing orientation 19
Summary 19
 Questions 20
Further reading 20
Notes 21

Chapter 2 The Dynamics of International Markets 22

Chapter outline 22
Chapter learning objectives 22
The twentieth century 24
World trade and the emergence of multinational corporations 24
The twenty-first century and beyond 26
Balance of payments 29
Protectionism 30
Protection logic and illogic 30
Trade barriers 33
Easing trade restrictions 38
General Agreement on Tariffs and Trade (GATT) 38
World Trade Organization (WTO) 40
International Monetary Fund (IMF) 42
Summary 43
Questions 43
Further reading 44
Notes 44

PART 2 The Impact of Culture and Political Systems on

International Marketing

Chapter 3 The Foundations of Cultural Understanding 46

Chapter outline 46
Chapter learning objectives 46
Natural features of different international markets 47
Climate and topography 47
Nature environment and international trade 49
Social responsibility and environmental management 50
Resources 51
World population trends 53
World trade routes 56
 Trade routes 57
Historical perspective in international trade 58
History and contemporary behaviour 58
History is subjective 59
Summary 60
Questions 60
Further reading 61
Notes 61

Chapter 4 Cultural Dynamics in International Marketing 62

Chapter outline 62
Chapter learning objectives 62
Cultural knowledge 64
Factual knowledge 64
Interpretive knowledge 65
Cultural sensitivity and tolerance 65
Culture and its elements 65
Elements of culture 66
Analysis of elements 71

page x

Can cultural differences be measured? 72

Cultural change 75
Cultural borrowing 76
Similarities: an illusion 77
Resistance to change 77
Planned cultural change 78
Required adaptation 78
Degree of adaptation 78
Imperatives, adiaphora and exclusives 79
Communications emphasis 80
Summary 84
Questions 84
Further reading 85
Notes 85
Chapter 5 The International Political and Legal Environment 87
Chapter outline 87
Chapter learning objectives 87
Political environments 88
Stability of government policies 88
Nationalism 88
Political risks 90
Economic risks 92
Encouraging foreign investment 92
Assessing political vulnerability 94
Politically sensitive products 95
Forecasting political risk 96
Reducing political vulnerability 97
Good corporate citizenship 97
Strategies to lessen political risk 97
Legal environments 98
Bases for legal systems 99
Legal recourse in resolving international disputes 102
Conciliation 102
Arbitration 102
Litigation 103
Protection of intellectual property rights: a special problem 103
Prior use versus registration 105
International conventions 105
Commercial law within countries 105
Legal environment of the EU 106
The decision-making process 107
Competition policy 107
Summary 109
Questions 109
Further reading 109
Notes 110

PART 3 Assessing International Market Opportunities

Chapter 6 Researching International Markets 112

 Chapter outline 112
Chapter learning objectives 112
Breadth and scope of international marketing research 113
The marketing research process 115
Defining the problem and establishing research objectives 116
Developing a research plan 117
Quantitative and qualitative research 117
Gathering secondary data 119
Gathering primary data 121
Multicultural research: a special problem 125
Analysing and interpreting research information 125
Presenting the findings and results 125
How to organise marketing research 126
Estimating market demand 127
Analogy 128
Income elasticity 129
Multinational marketing information systems 129
Summary 130
Appendix: Sources of secondary data 130
International organisations 131
Chambers of commerce 131
Trade, business and service organisations 131
US government 131
Other sources: abstracts, bibliographies and indexes 132
Questions 132
Further reading 133
Notes 133

Chapter 7 Emerging and Regional Markets 135

Chapter outline 135
Chapter learning objectives 135
What are emerging markets? 136
Demand and consumption in emerging markets 138
Marketing in emerging markets 139

page xi
 Regional market groups 143
Why economic union? 144
Economic factors 144
Political factors 144
Geographic proximity 145
Cultural factors 145
Patterns of regional cooperation 145
Regional cooperation groups 146
Free trade area 146
Customs union 147
Common market 147
Political union 148
Regional market groups in Europe 148
Europe 148
EU structure 153
EU authority 153
The Maastricht Treaty and European union 155
European Economic Area (EEA) 155
Regional market groups around the globe 156
The Commonwealth of Independent States (CIS) 156
The Americas 156
Asia 157
Africa 157
Middle East 158
Strategic implications for marketing 158
Opportunities 158
Market barriers 158
Ensuring EU market entry 159
Summary 159
Questions 160
Further reading 160
Notes 161

Chapter 8 Exporting and Logistics 162

Chapter outline 162
Chapter learning objectives 162
Regulations and restrictions on exporting and importing 163
Export controls 163
 Import restrictions 164
Customs-privileged facilities 170
Foreign trade zones 171
Export documents 172
Export declaration 172
Bill of lading 172
Commercial invoice 172
Insurance policy or certificate 172
Licences 172
Other 173
Terms of sale 173
Letters of credit 174
Packing and marking 175
Export shipping 175
Logistics 177
The foreign-freight forwarder 177
Summary 178
Questions 178
Further reading 179
Notes 179

PART 4 Developing International Marketing Strategies

Chapter 9 International Marketing Strategies 182

Chapter outline 182
Chapter learning objectives 182
International marketing management 183
Global versus international marketing management 183
Standardisation versus adaptation 184
Market-driven versus market-driving strategies 185
Competition in the global marketplace 186
Quality and competitive marketing 187
Cost containment and international sourcing 189
Collaborative relationships 189
Relationship marketing 191
Formulating international marketing strategy 191
Positioning 194
 Product life cycle and international marketing strategy 195
Strategic planning 197
Company objectives and resources 199
International commitment 199
The planning process 199
Summary 203
Questions 203
Further reading 204
Notes 204

Chapter 10 International Market Entry Strategies 206

Chapter outline 206
Chapter learning objectives 206

page xii

Product portfolio, growth and internationalisation 207

Product portfolio and growth 207
Becoming international 208
Phases of international marketing involvement 208
Changes in international orientation 209
Market entry objectives 210
Market opportunity assessment 212
Market/country selection 213
Invest 214
Divest/license 214
Joint venture 214
Export 214
Selective strategy 215
Market entry strategies 217
Exporting 217
Licensing 218
Franchising 219
Strategic international alliances 220
Consortia 222
Manufacturing 222
Countertrade 223
 When to choose which strategy 223
Summary 224
Questions 225
Further reading 225
Notes 225

Chapter 11 Segmentation and Positioning in International

Markets 227
Chapter outline 227
Chapter learning objectives 227
Market segmentation, targeting and positioning 228
International market segmentation 229
International market segments 231
Geographic segmentation 231
Demographic segmentation 232
Psychographic segmentation 233
Behavioural segmentation 233
Market targeting 234
International target market strategies 235
Market positioning 237
Approaches to positioning 238
Product characteristics or attributes 238
Price–quality 238
Product users 238
Positioning in international marketing 239
International positioning strategies 240
Global consumer culture positioning 240
Local consumer culture positioning 242
Foreign consumer culture positioning 242
Summary 242
Questions 242
Further reading 243
Notes 243

Chapter 12 International Branding Strategies 245

Chapter outline 245
 Chapter learning objectives 245
Introduction to branding 246
The development of branding 247
Country-of-origin effect and global brands 250
Own brands 252
Brand elements 253
Functions of brands 253
Characteristics of brands 254
Brand management 256
Brand equity 256
Branding strategy 256
Brand strategy 259
Brand portfolio strategy 259
Brand architecture 260
Corporate branding 261
Branding versus advertising 261
Corporate identity 261
Corporate reputation 262
Summary 264
Questions 264
Further reading 265
Notes 265

Chapter 13 Digital and Social Media Marketing 267

Chapter outline 267
Chapter learning objectives 267
Digital marketing 268
Introduction 268
Digital marketing strategy 268
The benefits of digital marketing 270
Digital media channels 271
A framework for digital marketing 272
Social media marketing 274
Social media domains 276
Social media planning 278

page xiii
 Summary 285
Questions 286
Further reading 286
Notes 286

Chapter 14 Ethics and Social Responsibility in International

Marketing 287
Chapter outline 287
Chapter learning objectives 287
Ethical environment 288
Anti-trust: an evolving issue 291
What is social responsibility? 291
Analysing ethical issues and social responsibility 293
Business ethics 295
Ethics and international marketing 296
Green marketing 298
Ethical behaviour in international marketing 301
Summary 304
Questions 305
Further reading 305
Notes 305

PART 5 Developing International Marketing Strategies

Chapter 15 Product Decisions for International Markets 308

Chapter outline 308
Chapter learning objectives 308
International markets and product decisions 309
Products and brands 312
Products and culture 313
Innovative products and adaptation 315
Diffusion of innovations 315
Degree of newness 316
Physical or mandatory requirements and adaptation 317
The product life cycle 318
 The product life cycle and adaptation 319
Screening products for adaptation 320
Analysis of characteristics of innovations 320
Analysis of product components 321
Quality products 324
Summary 324
Questions 325
Further reading 325
Notes 325

Chapter 16 Marketing Industrial Products and Services 327

Chapter outline 327
Chapter learning objectives 327
The industrial product market 328
Technology and market demand 328
The volatility of demand in industrial markets 329
Attributes of product quality 330
Price–quality relationship 331
Product design–quality relationship 332
Service and replacement parts 332
Universal standards 334
ISO 9000 certification and Industry 4.0 standards: international standard
of quality 334
Relationship marketing 336
Promoting industrial products 337
Industrial trade shows 339
Marketing services globally 340
Characteristics of services 341
Entering international markets 342
Market environment for business services 342
Summary 346
Questions 346
Further reading 346
Notes 347

Chapter 17 International Distribution and Retailing 349

Chapter outline 349
Chapter learning objectives 349
Structure of distribution channels 350
Supplier-oriented distribution structure 350
European distribution structure 351
Distribution structure in the USA 352
Trends: from traditional to modern channel structures 353
The Internet 354
Factors influencing marketing through the Internet 357
Electronic advertising 357
Distribution patterns 359
General patterns 360
Retailing 362
Alternative middleman choices 363
Home-country middlemen 365
Foreign-country middlemen 367
Government-affiliated middlemen 368

page xiv

Factors affecting choice of channel 369

Cost 369
Capital requirement 370
Control 370
Coverage 370
Character 370
Continuity 370
Locating, selecting and motivating channel members 370
Locating middlemen 371
Selecting middlemen 371
Motivating middlemen 371
Terminating middlemen 372
Controlling middlemen 372
Summary 372
Questions 372
Further reading 373
Notes 373
Chapter 18 Pricing for International Markets 375
Chapter outline 375
Chapter learning objectives 375
Pricing policy 376
Volume and pricing 376
Parallel imports 377
Skimming versus penetration pricing 380
Leasing in international markets 380
Factors influencing international pricing 382
Pricing objectives 382
Price escalation 382
Approaches to lessening price escalation 387
Competition 389
Target customer 389
Pricing controls 390
Administered pricing 390
Price setting by industry groups 391
International agreements 393
Predatory pricing 394
The purpose of predatory pricing 394
Predatory pricing and price discrimination 394
Predatory pricing and cross-subsidisation 394
Disadvantages of predatory pricing 394
Transfer pricing 395
Dumping 397
Countertrade as a pricing tool 398
Types of countertrade 398
Western firms and countertrade 399
Proactive countertrade strategy 400
Summary 401
Questions 401
Further reading 402
Notes 402

Chapter 19 International Promotion and Advertising 403

Chapter outline 403
Chapter learning objectives 403
 Promotional mix 404
International advertising 406
Pattern advertising: plan globally, act locally 407
International advertising and world brands 408
Pan-European advertising 409
International market segmentation and promotional strategy 409
International advertising and the communication process 411
Challenges of international advertising 414
Legal and tax considerations 414
Language limitations 415
Cultural diversity 415
Production and cost limitations 417
Media planning and analysis 417
Tactical considerations 417
Specific media information 419
Sales promotion 421
The advertising agency 422
International control of advertising 423
Summary 424
Questions 425
Further reading 425
Notes 425

Chapter 20 Personal Selling and Negotiations 427

Chapter outline 427
Chapter learning objectives 427
Selling in international markets 428
The nature of the sales person–customer relationship 429
The international selling sequence 431
Understanding the nuances of cross-cultural communications 432
Recruitment of an international salesforce 433

page xv

Expatriates 434
Local nationals 434
 Third-country nationals 435
Host country restrictions 435
Selecting an international salesforce 435
Training and motivation 436
Cross-cultural negotiations 438
Atmosphere 438
Background factors 438
Pre-negotiation stage 440
Face-to-face negotiation stage 441
Post-negotiation stage 443
Summary 444
Questions 444
Further reading 445
Notes 445

PART 6: Supplementary Resources

The Country Notebook: A Guide for Developing a Marketing Plan 448

Case Studies to Accompany Parts 1–5 455

PART 1
Case 1.1 Strategy Formulation at Audi 456
Case 1.2 Market Entry Strategies of Hyundai, Toyota and Volkswagen in the Czech
Republic 460

PART 2
Case 2.1 Abercrombie & Fitch: Expanding into the European Market 465
Case 2.2 El-Sewedy Electrometers 469
Case 2.3 Aldi and Lidl: International Expansion of Two German Grocery Discounters 481

PART 3
Case 3.1 The Lost Brightness of Lladró 489
Case 3.2 Fiat 500: Bye Bye USA? 495
Case 3.3 Blacksocks.com: Bringing Sockscription to Feet 502
Case 3.4 Marimekko: Setting Ethical Standards for the Fashion Industry 508
Case 3.5 Competitive Positioning Through Collaboration in the Global Marketplace: The
Case of Tobii 512

Part 4
Case 4.1 IKEA: Expanding in Russia 515
 Case 4.2 H&M: Sustainable Fashion or Greenwashing? 521
Case 4.3 Gillette and Toxic Masculinity: Is it Really the Best a Man Can Get? 527
Case 4.4 Amazon: From Online Bookstore to International Technology Giant 533
Case 4.5 Is Social Media Marketing the Lifeline for Small Firms? 541

Part 5
Case 5.1 WeRoad: Shaking the Travel Industry ‘All’Italiana’ 547
Case 5.2 Luigi Lavazza SpA 554
Case 5.3 Red Bull: A Truly Global Brand 567
Case 5.4 Netflix’s International Pricing Under Pressure 572
Case 5.5 Luxottica: Excellence in Eyewear Distribution 577

Glossary 584
Index 590
 page xvi

Preface
Since the last couple of years, we are living in a new world where
unpredictability is the new reality. The marketing function and
especially international marketing function has further evolved to
new levels and has taken the central position in most companies’
strategic design. Despite trade wars, interdependence of the world
economies has increased. This has also given way to new actors
leading to heightened competition and new challenges in the
marketplace. More recently, opinion has been raised that the
globalisation has gone too far and should be contained leading to
some protectionist and nationalistic regimes. Despite these
nationalistic regimes the volume of international trade has increased
and there is no slowdown to globalisation. The globalisation of the
marketplace is thus here to stay., The recent crisis of Covid 19 has in
fact, emphasized the need for further collaboration between
economies and markets.
The concept of the global market, or global marketing, has also
evolved. It generally views the world as one market and is based on
identifying and targeting cross-cultural similarities. In our opinion,
the global marketing concept should be based on the premise of
cultural differences and be guided by the belief that each foreign
market requires its own culturally adapted marketing strategies.
Although consumers dining at McDonald’s in New Delhi, Moscow and
Beijing is a reality, the idea of marketing a standardised product with
a uniform marketing plan remains ‘purely theoretical’. The global
marketing strategy is, therefore, different from the globalisation of
the market. One has to do with efficiency of operations,
competitiveness and orientation, the other with homogeneity of
demand across cultures. In this book we consider it important to
make this distinction and to see how it affects international
marketing planning and strategies.
In Europe, where home markets are smaller, companies like
Unilever, Ericsson, IKEA, HSBC, Akzo Nobel and Nestlé are deriving
up to 80 per cent of their revenues from abroad. The companies that
succeed in the twenty-first century are those capable of adapting to
constant change and responding to new realities. Companies coming
from larger markets such as USA and China, are also deriving major
part of their revenues from foreign markets, be it Microsoft and
Apple or Lenovo and Huawei. All these and other companies need to
market their products all over the world. They need to understand
that what does it take to be successful in many markets that are
diversified in size, culture and income levels.
The economic, political and social changes that have occurred
over the last decade have created new realities and have changed
the landscape of global business. Consider the present and future
impact of:
China as a credible player in the international market
the persistent economic crises due to Covid 19 and other
unpredictable events in the Western economies
emerging markets in Eastern Europe, Asia and Latin America where,
in spite of Covid 19 and economic crises, more than 75 per cent of
the growth in world trade over the next 20 years is expected to
occur
the job shifts in services from Western to emerging markets
the rapid move away from traditional distribution structures in
Europe, the USA and many emerging markets from in-store retailing
to online shopping
the growth of middle-income households the world over
an increasingly (in)effective World Trade Organization (WTO) and
increasing/decreasing restrictions on trade
the transformation of the Internet from a toy for ‘cybernerds’ to a
major international business tool for research, advertising,
communications, exporting and marketing, so called digitalisation of
the economies
the increased awareness of ethical issues, social responsibility and
climate change by customers and companies alike.

page xvii

As global economic growth occurs, understanding marketing

internationally is extremely important. Whether a company wants to
involve itself directly in international marketing or not, it cannot
escape increasing competition from international firms. This book
addresses global issues and describes concepts relevant to all
international marketers, regardless of the extent of their
international involvement, whether they sell products or services and
whether they are a big or a smaller company. Emphasis is on the
strategic implications of competition in the markets of different
countries. An environmental/cultural approach to international
marketing requires a truly global orientation. The reader’s
imagination is not limited to any specification or to a particular way
of doing business in a single country. Instead, we provide an
approach and framework for identifying and analysing the important
cultural and environmental uniqueness of any country or global
region.
The text is designed to stimulate curiosity about the marketing
practices of companies, large and small, seeking market
opportunities outside their home country and to raise the reader’s
consciousness about the importance of viewing international
marketing strategies from a global perspective.
Although this revised edition is infused throughout with an
international orientation, export marketing and operations of smaller
companies are not overlooked. Issues specific to exporting are
discussed where strategies applicable to exporting arise and
examples of marketing practices of smaller companies are examined
throughout the chapters.

New and expanded features in this

edition
As a result of extensive review work with the publishers and
comments from many reviewers, we evaluated the contents of this
book and for this new edition have reorganised them to better
reflect the way topics are taught on most international marketing
courses. In particular the chapter on ethics and social responsibility
and digital and social media marketing have been added in Part 4,
emphasising their importance for international marketing strategies
and to meet the new realities.

New content
As segmentation and positioning are the bases for marketing
strategy in any market, we have expanding that chapter with new
text and examples. This chapter explains and provides guidelines for
segmentation and targeting the right customers in international
markets.
The new and expanded topics in this edition reflect issues in
competition, changing marketing structures, the importance of
cultural issues, ethics and social responsibility, and negotiations. To
meet the challenges of new realities, a new chapter (Chapter 13) on
digital and social media marketing has been added. This is a period
of profound social, economic and political change not least due to
Covid 19 and climate change. To remain competitive globally,
companies must be aware of all aspects of the emerging global
economic order and the new realities.
Additionally, the evolution of digitalisation, big data and advances
in global communications and their impact on how products and
services can be marketed cannot be ignored. In the third millennium,
people in the ‘global village’ will grow closer than ever and will hear
and see each other as a matter of normality. Today an executive in
the UK is able to routinely have Zoom, Team or Skype meetings with
his or her counterpart in an Australian company or anywhere else in
the world. In many respects, distance is becoming irrelevant.
Information – and, in its wake, the flow of goods – is moving
around the globe at lightning speed. Increasingly powerful networks
spanning the globe enable the delivery of services that reach far
beyond national and continental boundaries, fuelling and fostering
international trade. The connections of global communications bring
people all around the world together in new and better forms of
dialogue and understanding.

New features
More than 80 per cent of the boxed Going International examples
are brand new to this edition. These up to date and current
examples are carefully chosen to illustrate the points made in the
text. For the fifth edition, most of these examples now act as
provocative mini cases that can be used as discussion points,
featuring questions aimed at initiating exercises and discussion in
the classroom. Relevant Exhibits and real-life stimulating pictures
have been added to enhance the visual understanding and bases for
discussion.

page xviii

The key terms feature, which we introduced in the previous

edition, has been kept and expanded following the reviewers’
comments. All key terms are emboldened in the text the first time
they are used, and definitions provided in the margin for quick
reference. A full Glossary of key terms is provided at the back of the
book and on the Online Learning Centre (OLC).
 At the end of each chapter, you’ll find an improved Further
Reading feature, where we present a selection of publications that
reflect the classic, most influential and most recent studies in the
area covered by the chapter. This feature has been updated
throughout to include the most interesting and provocative new
research to not only encourage students to go deeper into different
topics, but also to help teachers in preparing interesting more
informed and enriched lectures.

Structure of the text

The text is divided into six parts. In Part 1, ‘An Overview’, the two
chapters introduce the reader to international marketing and to
three international marketing management concepts: the domestic
market expansion concept, the multidomestic market concept and
the global marketing concept. As companies restructure for the
global competitive rigours of the new realities of the twenty-first
century, so too must tomorrow’s managers. The successful manager
must be globally aware and have a frame of reference that goes
beyond a country, or even a region, and encompasses the world.
What global awareness means and how it is acquired is discussed
early in the text; it is the foundation of international marketing.
Chapter 2 focuses on the dynamic environment of international
trade and the competitive challenges and opportunities confronting
today’s international marketer. The importance of the creation of the
World Trade Organization (WTO), as the successor to GATT, is fully
explored. The chapter is totally updated with new facts, examples
and realities.
The three chapters in Part 2 deal with the impact of culture and
the political environment on international marketing. A global
orientation requires the recognition of cultural and institutional
differences and the critical decision of whether or not it is necessary
to accommodate them. These two chapters are totally re-written and
streamlined. As a result, this edition has two chapters on culture
instead of the three in the previous edition.
The foundations for cultural understanding (Chapter 3) are
included as important dimensions in understanding cultural and
market differences between countries. Not to be overlooked is
concern for the deterioration of the global ecological environment
and the multinational company’s critical responsibility to protect it.
Chapter 4 presents a broad review of culture dynamics and its
impact on human behaviour as it relates to international marketing.
Specific attention is paid to Geert Hofstede’s study of cultural value
and behaviour. Knowledge of the business culture, management
attitudes and business methods existing in a country and a
willingness to accommodate the differences are important to success
in an international market. This new integrated chapter provides
several examples to deal with these different business practices and
customs.
The political conditions in a country is a critical concern for the
international marketer. In Chapter 5, we take a closer look at the
political and legal environment. We discuss the stability of
government policies, the political risks confronting a company, and
the assessment and reduction of political vulnerability of products.
Increasingly, interaction between business and politics is becoming
important and cannot be ignored. Legal problems common to most
international marketing transactions are also discussed in this
chapter.
In Part 3, Chapters 6, 7 and 8 are concerned with assessing
global marketing opportunities and managing exports and logistics.
As markets expand, segments grow within markets, and as market
segments across country markets evolve, marketers are forced to do
some marketing research and understand market behaviour within
and across different cultural contexts. Multicultural research and
qualitative and quantitative research are discussed in Chapter 6.
 page xix

Chapter 7 and previously Chapter 8 have been merged to explore

the impact of the three important trends in global marketing: (1) the
growth and expansion of the world’s big emerging markets; (2) the
rapid growth of middle-income market segments; (3) the evolution
of regional market groups that include the European Union (EU) and
post-Brexit Britain, as well as other regional groups.
Chapter 8 deals with regulations and restrictions with exporting
and logistics. It deals with export terminology and contracts as well
as how to share responsibilities between exporting and importing
company. In this regard logistics become extremely important as the
terms of sales include these clauses. the special issues involved in
moving a product from one country market to another, and the
accompanying mechanics of exporting, are addressed. The exporting
mechanisms and documentation are explained. This chapter is
particularly relevant for smaller firms.
In Part 4, ‘Developing International Marketing Strategies’,
planning and organising for international marketing are discussed in
Chapter 9. Many multinational companies realise that to capitalise
fully on the opportunities offered by global markets, they must have
strengths that exceed their competitors’ capabilities. Chapter 10 has
been dedicated to entry strategies. Here we provide a model that
can be followed to analyse different markets while making decisions
on market selection and entry.
Chapter 11 an expanded chapter on international segmentation
and positioning. Once a company has decided on an overall strategy
and has decided which market to enter, it has to quickly analyse
whether there is a customer segment in that particular market that
is relevant and can be targeted for its product/service or not. A
company must understand the target group so that it can position its
product/service in the minds of that target group, in a way that is
consistent with its overall objectives and strategy.
 Chapter 12 is the chapter on international branding strategies
that we introduced in the previous edition. It examines the different
issues surrounding branding, in recognition of its growing
importance to international marketing. This chapter has been further
improved and updated with new examples and Going International
mini cases.
Chapter 13, a brand-new chapter on digital and social media
marketing and how it is influencing international marketing
strategies and activities. Here differences in digital and social media
marketing are explained and latest examples are provided for better
understanding. Students can use this chapter while preparing for a
social media marketing plan for a company.
Chapter 14 deals with an expanded discussion on ethical issues
in marketing. This chapter has been brought forward to emphasise
the strategic nature of these issues. It is imperative that before a
company decides on marketing strategies, it is fully aware of ethical
and social issues in general and for the particular market it is
entering/operating in.
Part 5 looks at developing international marketing strategies and
Chapters 15 and 16 focus on product management, reflecting the
differences in strategies between consumer and industrial products
and the growing importance in world markets for services.
Additionally, the discussion on the development of global products
stresses the importance of approaching the adaptation issue from
the viewpoint of building a standardised product platform that can
be adapted to reflect cultural differences. The discussion on the
impact of product life cycle on international marketing strategy has
been expanded. The competitive importance in today’s global market
of quality, innovation and technology as the keys to marketing
success is explored.
Chapter 17 takes the reader through the distribution process,
from home country to the consumer in the target country market.
The structural impediments to market entry imposed by a country’s
distribution system are examined within the framework of a detailed
presentation of the American and European distribution structure. In
addition, the rapid changes in channel structure that are occurring in
emerging and in other countries, and the emergence of e-commerce
and online shopping as a distribution channel, are presented.

page xx

The challenge of pricing faced by international marketers in

foreign markets are discussed and presented in Chapter 18. The
concepts of breakeven prices and other limitations on pricing
strategies have been introduced. Price escalations and ways in which
these can be lessened; countertrade practices and pricing strategies
under varying currency conditions are also discussed in this chapter.
The factors influencing pricing decisions in different markets are
thoroughly discussed.
Chapter 19 covers advertising and addresses the promotional
element of the international marketing mix. Included the discussion
of the changing nature of global marketing and promotion strategies,
including increasing challenges of digital advertising channels.
Chapter 20 discusses personal selling and sales management,
and the critical nature of training, evaluating and controlling sales
representatives. Here we also pay attention to negotiating with
customers, partners and other actors in our networks. This part of
the chapter has been totally revised and updated with new
examples. We discuss the factors influencing business negotiations,
and varying negotiation styles.
Finally, in Part 6, the Country Notebook presents an excellent
framework for assignments and for marketing research exercises.
This focuses on the new realities of international marketing and
factors that may influence entry and competitive strategies in
different markets are presented.
Also in Part 6, building on the success of the case section from
the previous edition, we have included a substantial section of
excellent case-study material that can be used by students and
lecturers to aid learning. You’ll find 20 cases in total, majority of
these cases are brand new written particularly for this edition. The
cases reflect all regions and by working through them you will
encounter all kinds of marketing scenarios in all kinds of companies
in all geographical territories. From supermarket chains in Germany
to footballers in China; from Fiat 500 to Abercrombie & Fitch’s global
success as a brand – each case study is lively, contemporary,
thought-provoking and expertly designed to bring out the real issues
in international marketing. The shorter cases focus on a single
problem, serving as the basis for discussion of a specific concept or
issue. The longer, more integrated cases are broader in scope and
focus on more than one international marketing problem.
Information is provided in a way that enables the cases to be studied
as complete works in themselves but, importantly, they also lend
themselves to more in-depth analysis that requires students to
engage in additional research and data collection.

Pedagogical features of the text

The text portion of the book provides a thorough coverage of its
subject, with specific emphasis on the planning and strategic
problems confronting companies that market across cultural
boundaries. The pedagogy we have developed for this textbook is
designed to complement the rest of the book perfectly and has been
constructed with the very real needs of students and lecturers in
mind.
Current, pithy, sometimes humorous and always relevant
examples are used throughout each chapter to stimulate interest
and increase understanding of the ideas, concepts and strategies
presented, emphasising the importance of understanding the cultural
uniqueness and relevant business practices and strategies.
The Going International boxes, an innovative feature since the
first edition of International Marketing, have always been popular
with students. This edition includes over 50 new boxes, now with
questions and all providing up-to-date and insightful examples of
cultural differences and international marketing at work, as well as
illustrating concepts presented in the text with illustrations and
pictures. They reflect contemporary and often controversial issues in
international marketing and real-life marketing scenarios, and can be
used as a basis for solo study and as mini-case studies for lectures,
as well as to stimulate class discussion. They are unique to this text,
lively to read, and will stimulate all who use this book.
‘The Country Notebook: a Guide for Developing a Marketing Plan’,
found in Part 6, is a detailed outline that provides both a format for a
complete cultural and economic analysis of a country and guidelines
for a marketing plan. This can be readily used by students and
teachers for extended assignments.
 page xxi

About the Authors

Professor Pervez N. Ghauri Pervez Ghauri completed his PhD
at Uppsala University (Sweden) where he also taught for several
years. Over the years he has worked as Associate Dean for Oslo
Business School in Norway, Professor of International Marketing &
international Business in Manchester Business School and King’s
College London in UK. Currently Pervez is Professor of International
Business at University of Birmingham (UK). Pervez is the founding
editor of the International Business Review (IBR) and Consulting
Editor for Journal of International Business Studies (JIBS). He is
Fellow of Academy of International Business (AIB) and Fellow of
European International Business Academy (EIBA). He served AIB as
Vice President during the period 2008-2010. Pervez has published
more than 30 books and more than 100 articles in top level journals
such as; Journal of International Business Studies (JIBS), Journal of
Organizational Behaviour (JOB), Journal of World Business (JWB),
international Business Review (IBR), International Marketing Review
(IMR), European Journal of Marketing, Industrial Marketing
Management and Journal of Business Research (JBR). He has also
been consulting with companies such as Airbus Industries, BP and
Ericsson.

Email: [email protected], Web: www.pervezghauri.com

 page xxii

Acknowledgements

Publisher’s acknowledgements
Our thanks go to the following reviewers for their comments at
various stages in the text’s development:

Gabriela Gliga, NUI Maynooth

Madeline Lundburg, Mälardalen University

Irene Garnelo-Gomez, Henley Business School/University of Reading

Astrid Moreno, Stockholm University

Shelley Chapman, University of Leicester

Alea Fairchild, KU Leuven

Terence Hermanus, Cape Penninsula University of Technology

We would also like to thank the following who have contributed case
studies to the new edition:

Sylvie Hetrich, Ecole de Management Strasbourg, University of

Strasbourg

Ulrike Mayrhofer, IAE Nice, Université Côte d’Azur

Hana Machkova, VSE University of Economics, Prague

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