In today’s global world companies no longer sell their products only in one country. They want to reach people in many parts of the world to expand their business to make profit. But every country is different in terms of language, culture, income level and habits. Because of this companies must first understand the international market before simply enteringa country before launching their product to avoid huge losses.
What is International marketingresearch?
International marketing research is the process of collecting and studying information about customers, competitors and business environments in different countries. It helps companies to make better decisions in terms of when to launch a product and when they need to change any strategies.
Simply, it means :
“Learning about people in other countries so that a company not only launches a product but makes it successful by selling the product in the right way.”
Why is It Important?
- Understanding Culture
Culture shapes how people think and purchase things. Understanding culture avoids mistakes, helps to create relevant advertisements and makes products successful in other countries.
- Knowing Competitors
Every country has its own local brands. Research helps to understand whothe actualcompetitors are, what they offer and how they attract the customers.
- Different Customer Preference
What customers like in one country may not be liked by another country.
For example – food taste, colour choices and features in the product vary widely. The marketing research role is vital to understanding these things.
- Understanding the Rules and Regulations
Each country has its own laws. Without research a company may face legal restrictions from that country. So, it helps to avoid risks related to legal factors.
- Selecting the Right Market Entry Strategy
The company may enterother countries through exporting, partnerships and franchising. Research guides them to choose the best method.
Challenges in International Marketing Research
- Language Barriers
- Differences in Culture
- High cost of research
- Time-Consuming Process
- Lack of reliable data in some countries in underdeveloped countries.
- Political or economic instability (PESTEL Analysis)
Despite the challenges,International marketing research is very important because it reduces risk and increases the chances of success to reaching in foreign markets.
CASE STUDY – Honda’s Entry into India: Learning through Hero
A great example of international marketing research is Honda’s entry into the Indian market. When Honda wanted to enter India, they realised that the Indian two-wheeler market was very different from other countries markets (price-sensitive market).Indian customers preferred fuel-efficient bikes, low-maintenance and affordable bikes.
Instead of entering alone, Honda partnered with the Indians brand (Hero) to understand the Indian market. Together they formed Hero Honda in 1984.
Partnership helped Honda to understand the following things:
- Indian customer’s needs
- Local road conditions
- Pricing expectations
- Cultural Values
- Indian Business Environment
From Hero, Honda learnt deeply about the Indian market. That’s why Hero Honda became one of the most successful two-wheeler brands in India for many years.
This example shows how Honda formed astrategic partnership with the Indian brand to understand the Indian market by leveraging the brand name of Hero to reach the customers.
Author:
Mr. Ankit Yadav
Research Scholar
Co-Author:
Dr. Gaurav Petkar