Business Explain: International Distribution and Retailing

What are the factors influencing marketing via the internet?

Culture

The website and the product must be culturally neutral or adapted to fit the uniqueness of a market.

Adaptation

Ideally, a website should be translated into the languages of the target markets.

Local contact

If fully committed to foreign markets, a company should create virtual offices abroad by buying server space and create mirror sites to enable voicemail and email contact specifically for the key markets.

Payment

Customers should be able to use a credit card number, an email or purchase by phone.

Delivery

Use different kinds of shipping companies such as Federal Express, UPS etc. Or the cheaper alternative, going for surface postal delivery of small parcels.

Promotion

In order to have visitors on the website, there needs to be marketing and advertising done that leads consumer to the online shop. Thus, search engine registrations, press releases, local newsgroups and forums, mutual links and banner advertising can help attract more visitors.

What are the six influencing factors in the choice of channel?

Cost

The costs arising from a) capital or investment of developing the channel and b) the continuing cost of maintaining it. The marketing cost is the cost of sales revenue less the production cost.

Capital Requirement

Maximum investment usually required when a firm establishes its own distribution channel, and less investment the more it hands over the work to middlemen

Control

More control if the firm has its own distribution channel, less if it hands activities out to middlemen.

Coverage

Market coverage in order to → gain the optimum volume of sales obtainable in each market, to secure a reasonable market share and to attain satisfactory market penetration.

Character

The chosen distribution system must fit the character of the company and the markets in which it is doing business. These relate to bulk of the product, complexity of sale, sales service required and value of the product. Also, patterns change.

Continuity

Most middlemen have little loyalty to their vendors, handling brands in good times when the line is making money but quickly reject them when they don't. Thus, channels of distribution often pose longevity problems.

What is the key variable that affects the marketer's choice of distribution channels?

The four main variables which affect the marketer's choice of distribution channels are;

1. The availability of middlemen

2. The cost of their services

3. The functions performed (and the effectiveness with which each is performed)

4. The extent of control which the manufacturers can exert over the middlemen's activities

How is distribution-channel structure affected by increasing emphasis on the government as a customer and by the existence of state trading agencies?

Marketers must deal with governments in every country of the world. Products, services and commodities for the government's own use are always procured through government purchasing offices at federal, regional and local levels. As more and more social services are undertaken by governments, the level of government purchasing activity escalates.

In what circumstances are trading companies likely to be used?

Trading companies accumulate transport and distribute goods from many countries. Large, established trading companies are generally located in developed countries, and they sell manufactured goods to developing countries, and buy raw materials and unprocessed goods.

In what circumstances is the use of an EMC logical?

When a firm has a relatively small international volume, or is unwilling to involve their own personnel in the international function.