International market research is more important than ever. Today’s economy is dynamic and driven by globalization. Therefore, due to globalization, more and more companies decide to operate internationally. Through operations that cross borders, companies want to achieve their growth goals and remain competitive. Succeeding in the foreign market requires a comprehensive understanding of the marketing environment. More information about foreign markets is needed to understand the market conditions and thus adapt the strategy.
In particular, exporters must decide whether to standardize or adapt their products when entering new markets. This product lineup is one important marketing tool of the 4 P’s (Product, Price, Place, Promotion). This article highlights the importance of market research as part of a marketing tool and explains what type of information to focus on during international market research.
International Market Research Information
- Geographical: Geographical conditions may affect the product you may launch in your target area. For example, the Nutella company changes the recipe in hotter regions to ensure a normal viscosity. But the demand for ice cream is also higher in regions with a warm climate.
- Economic: There are several factors that influence the adoption of a new product. Market purchasing power and income are an indication of whether or not consumers like complex and expensive products. As an example, we can see Nokia, which focuses on the sale of cheap and affordable mobile phones on the African continent.
- Cultural: Often underestimated, but very important in marketing decisions. Language and religious differences are things you should keep an eye on. A famous example of religious differences is how McDonald’s adapts its products in India. In Hinduism, people are not allowed to eat beef. That’s why McDonald’s offers more chicken products.
- Infrastructure: Road quality, communication system, stock availability affect the product. Coca Cola changed its marketing strategy due to poor access to infrastructure in Africa. This means they use manual distribution centers. Coca-Cola distributes its syrup to vendors.
- Competitors: Competitor analysis helps companies avoid mistakes and understand market dynamics. We can learn from competitors and see how they presented their products and how the market potential develops. But companies can compare their products to see how competitive they are.
The biggest mistake in marketing decisions is to believe that a product suitable for the home country is also suitable internationally! Of course, product standardization is less complex and offers advantages, but sometimes customization is necessary. It’s about meeting the needs of customers.
Advantages/Disadvantages of Standardization and Adaption
- Standardization offers customers economies of scale and access to the universe. However, companies cannot react to rapidly changing conditions with this strategy, and innovation is hindered.
- Adaptation is a tool to stand out from the competition, but modification always comes with higher costs.
Mainly Katrium specializes on international market research. They conduct market research in more than 64 countries. Their expertise will help you make the right marketing decisions. On request, Katrium can offer customized market research depending on the customer. Companies need to define their research problem and set goals to obtain useful market research.