This chapter discusses the environment in which international marketing research is conducted, focusing on the marketing, government, legal, economic, structural, informational and technological, and environments.’ Whereas discussions of how the six steps of the marketing research process should be implemented in an international setting took place in earlier chapters, here we present additional details on survey methods, scaling techniques, and questionnaire translation. The relevant ethical issues in international marketing research are identified and the use of the Internet and computers is discussed.
IBM: Trekking on a Global Track
IBM with 2008 revenues of $103.63 billion, conducts an international tracking study twice a year in 14 different languages across 27 different countries in Europe, North and South America, and Asia. The basic purpose of the study is to capture trend data on mainframe computing. It samples one out of every six sites where an IBM Enterprise Server is in use. The respondents surveyed are those responsible for IBM acquisition decisions at their respective companies. They are asked about their installed computing equipment, their future plans for acquiring equipment, and their views on various vendors. The survey allows IBM to track how it is doing on an ongoing basis. The questions are kept broad and are not used to determine a deeper understanding of customer wants but instead only to track overall trends. The information collected via this tracking survey becomes part of IBM’s decision support system.
IBM utilizes the RONIN Corporation a New Jersey-based research firm, to handle the interviewing and data collection process r ,)NIN conducts all interviews by telephone for this study at its international
call center in London. Because the study is international, RONIN deals with such issues as accurate translations and receiving consistent results across countries and languages while rapidly turning results around. They must also communicate that results are representative only for specific countries, not for entire regions. The results of such a study allow IBM to see how successful it is in key industries and how IBM equipment is used in large and small businesses across nations. These results are passed to the IBM sales force in each of the countries, where they provide their interpretation of the results and incorporate these results with their own field experiences to develop lists of the top 10 issues that they are experiencing in the field
Best in the West-And Around the World
As of 2009. Best Western International Inc is the world’s largest hotel brand with more than 4,000 independently owned and operated hotels in more than 80 countries. As the following chart shows, business travelers make up 36 percent of the market, the largest single share. Best Western has found, through survey research, that business travelers often resist trying less expensive hotels and appreciate the security of a well-known brand. This information has helped the chain attract business travelers
Through secondary data analysis and surveys, Best Western has learned the sources of hotel business in different regions’ of the world and geared its marketing strategy accordingly (see the following table). For example, the chain emphasizes domestic business in North America, focuses on both domestic and international business in Europe, and emphasizes foreign business in the Far East, Australia, Africa, and the Middle East. The use of marketing research continues to prove successful for Best Western.
Both these examples point to the fact that marketing research can contribute significantly to the formulation of successful international marketing strategies. The term international marketing research is used very broadly. It denotes research for true international products (international research), research carried out in a country other than the country of the research-commissioning organization (foreign research), research conducted in all or all important countries where the company is represented (multinational research), and research conducted in/across different cultures (cross-cultural research).
A Framework for International Marketing Research
Conducting international marketing research is much more complex than domestic marketing research Although the six-step framework for domestic marketing research is applicable, the environment prevailing in the countries, cultural units, or international markets that are being researched influences the way the six steps of the marketing research process should be performed. Figure 24.1 presents a framework for conducting international marketing research.
The differences in the environments of countries, cultural units, or foreign markets should be considered when conducting international marketing research. These differences may arise in the marketing environment, government environment, legal environment, economic environment, structural environment, informational and technological environment, and environment, as shown in Figure 24.1
An additional relevant factor is the government environment. The type of government has a bearing on the emphasis on public policy, regulatory agencies. government incentives and penalties, and investment in government enterprises. Some governments, particularly in developing countries, do not encourage foreign competition. High tariff barriers create disincentives to the efficient use of marketing research approaches. Also, the role of government in setting market controls, developing infrastructure, and acting as an entrepreneur should be carefully assessed. The role ot government is also crucial in many advanced countries, such as Germany and Japan, where government has traditionally worked with industry toward a common national industrial policy. At the tactical level, the government determines tax structures, tariffs, and product safety rules and regulations and often imposes special rules and regulations on foreign multinationals and their marketing practices. In many countries, the government may be an important member of the distribution channel. The government purchases essential products on a large scale and then sells them to the consumers, perhaps on,a rationed basis.
The legal environment encompasses common law, cede law, foreign.law, international law, transaction law, antitrust, bribery, and taxes. From the standpoint of international marketing research, particularly salient are laws related to the elements of the marketing mix. Product laws include those dealing with product quality, packaging. warranty and after- sales service
patents, trademarks, and copyright. Laws on pricing deal with price fixing, price discrimination, variable pricing, price controls, and retail price maintenance. Distribution laws relate to exclusive territory engagements, type of channels, and cancellation of distributor or wholesaler agreements. Likewise, laws govern the type of promotional methods that can be employed. Although all countries have laws regulating marketing activities, some countries have only a few laws that are loosely enforced, whereas others have many complicated laws that are strictly enforced. In many countries, the legal channels are clogged and the settlement of court cases is prolonged. In addition, home-country laws may aP!o apply while conducting business or marketing research in foreign countries. For example, a U.S. citizen is subject to certain U.S. laws regardless of the country where business is being done. These laws re1ate to national security, antitrust, and ethical considerations