International Marketing Research

“International Marketing” today increasingly, and rightly, forms part of the curriculum across business schools the world over as we face new regional trading blocs created by the need to respond to an ever-growing developing nations with its own currency and trading rules. As academics we should not be limited to the costs of bringing products to market and the speed with which this needs to be done, but the need for us to educate our students to become effective competitors. While competition becomes increasingly dynamic, focused and professionalized, marketing practice appears still to follow one of the following orientations: market focus; competitor focus; product focus or customer focus. There is need for low cost excellence in today’s markets where quality is expected alongside low cost. If we believe this to be true, we have not been passing this on to our students. International Marketing today is a necessity. (Paliwoda, S. J., 1999)

International Marketing is marketing of products (goods and services) across the borders of the nation (Walsh, 1978). Multinational companies perform international marketing for their products to penetrate in to foreign markets.

International Marketing Research


Businesses preparing to compete in the twenty-first century are increasingly confronted with the task of crafting strategies that anticipate and respond to the rapid pace of change in global markets. As a result, their information needs are changing and becoming ever more complex and diverse. Timely, relevant information is essential to provide an adequate basis for day-to-day decision making as well as to chart the firm’s path in an increasingly fast paced, turbulent and competitive environment


Information needs are changing in both developed and developing countries. The established markets in industrialized countries are becoming more geographically integrated, as direct vertical links and information flows are established between customers, retailers and suppliers. As a result, there is a growing need to conduct research spanning country boundaries, in order to identify regional or global market segments, or to examine opportunities for integrating and better co-ordinating strategies across national boundaries. At the same time, speed in collection and interpretation of results from multiple and geographically diverse sources becomes imperative in order to anticipate market changes and devise an effective response strategy.
Advances in technology both facilitate and at the same time render more complex the collection of data on a global basis. The growth and increasing technological sophistication of the communication infrastructure enable data collection on a much broader and diverse geographic scale and with rapidity previously unthinkable. Yet, at the same time, management has to master these tools and understand their inherent limitations and implicit biases (Craig C. S. and Douglas S.P., 19).


Evolution of international marketing research


To understand the research needs of the twenty-first century it is important to consider how they have changed over the past four decades. In the 1960s and 1970s, many US firms, faced by slackening rates of growth in their domestic markets, began to venture into international markets. Japanese and European firms with smaller domestic markets also expanded internationally in order to broaden the geographic scope of their operations and take advantage of potential economies of scale or to respond to foreign competition entering their domestic markets (Douglas and Craig, 1989). In this initial phase of international market entry, firms were mostly concerned with collecting information to identify and assess market opportunities in other countries to determine which markets to enter, how to position products in these markets and how far to adapt different elements of the marketing mix to local market conditions.
At this phase of the firm’s expansion, the country was typically used as the unit of analysis for the research design, for developing the sampling frame, as well as for data collection. Owing to economic, political, linguistic and cultural barriers, the country was the focal point of entry decisions. Equally, the firm’s international operations were often organized on a country-by-country basis. Marketing research agencies were also typically national organizations, with relatively few having the capability to conduct research on a multi-country basis. Most secondary data as well as sampling lists were available on a national basis.
As, however, firms have expanded internationally and product markets are becoming increasingly integrated worldwide, the key decision issues facing the firm in the 1990s have changed dramatically. As a result, research and information needs have changed and broadened. In industrialized nations such as North America, Europe and Japan, regional market integration and the removal of barriers between countries, the growth of a regional and global market infrastructure as well as increased mobility of consumers have created pressures to consolidate and integrate marketing strategy across countries. Consequently, increased attention is focused on conducting studies which cover multiple countries, examining differences and similarities in behavior and response patterns across countries.


At the same time, as growth in these markets slows, future market potential lies in emerging market economies, with countries such as China and India accounting for over one-third of the world’s population. The explosive population growth in these countries, together with the opening, up of markets in the former Soviet Union, makes entry into these markets mandatory for firms aspiring to be global leaders in the future. In entering these markets, as in initially entering international markets, firms need to collect information to assess potential opportunities, to determine how to position, price, promote and distribute their products and brands, whether to develop local variants, etc.

Key progress areas


As businesses expand further and further in international markets, the role of timely and accurate marketing research to guide decision-making becomes increasingly critical. Research to support international marketing decisions has evolved over the past four decades and must change even more to support firms in the 21st century. There are four key areas where progress must be made.

Ø First, international marketing research efforts need to be more closely aligned with market growth opportunities outside the industrialized nations.
Ø Second, researchers must develop the capability to conduct and coordinate research that spans diverse research environments.
Ø Third, international marketing researchers need to develop new creative approaches to probe the cultural underpinnings of behavior.
Ø Finally, technological advances need to be incorporated into the research process in order to facilitate and expedite research conducted across the globe.

Implications for international marketing research in the twenty-first century


The dramatic changes in the global environment, coupled with technological advances in data collection, analysis and dissemination, imply that researchers will need to broaden their capabilities in order to design, implement and interpret research in the twenty-first century. As research efforts are aligned to match markets with the highest market potential, researchers will need to develop the capabilities and skills to conduct and design research in these environments (Barnard, 1997). New tools incorporating the latest technology will need to be mastered and creative approaches to understanding behavior in differing cultural contexts developed. Ability to interpret and integrate complex data from diverse sources and environments will also be critical in order to provide meaningful recommendations for the firm’s global marketing strategy.

Aligning research effort and capabilities with market growth potential


A first priority is to focus research effort and capabilities on markets with future growth potential. As indicated earlier, marketing research expenditures are heavily concentrated in the industrialized countries of North America, Europe and Japan. This reflects the current size and attractiveness of these markets. However, the countries with the highest growth potential are the emerging market economies in Asia, Latin America, Eastern Europe, and countries of the former Soviet Union. Firms who wish to succeed in the global markets of the twenty-first century will need to pay greater attention to examining markets in these regions of the world, and developing or acquiring the capabilities to conduct research in these markets.
Conducting research successfully in these regions requires both understanding and sensitivity to differences in the market environment as well as an ability to deal with the lack of a well-developed market research infrastructure. The accuracy of results hinges in part on the respondents’ ability to understand the questions being posed. Low levels of literacy in emerging markets as well as lack of familiarity with stimuli or response formats from industrialized markets create challenges. In designing research instruments, caution needs to be exercised in directly transposing stimuli or research formats commonly adopted in industrialized countries. Rather, researchers need to think creatively in designing instruments that are readily understood and unambiguously interpreted, and, as far as possible, devoid of cultural bias. In particular, design of instruments that employ visual as well as verbal stimuli and occur in a familiar and realistic setting rather than requiring abstract cognitive skills will be more effective.
Interpretation of results from emerging market countries may also pose some challenges especially for researchers from other socio-cultural backgrounds. Researchers need to be wary of interpreting results in terms of their own culture and experience, and, in particular, of generalizing from experience in industrialized markets to emerging markets. Indigenous researchers, on the other hand, trained in a different research paradigm, may interpret results in terms of the local context, and focus on the uniqueness of these patterns. Consequently teams of researchers from different backgrounds will be needed to provide a broad and balanced interpretation.

Conducting and co-ordinating research spanning diverse environments


The increasing diversity of the socio-cultural and economic environment, in which research is being conducted, implies that international marketing researchers will need to develop the capability to conduct and co-ordinate research spanning a broad range of environmental contexts and research questions. In essence, researchers will need to be able to tailor research questions, and adapt research instruments and administration procedures to different environments, as well as to interpret or generalize results at a pan-cultural or global level. This goes beyond geographic co-ordination of multi-country studies, translation and development of multilingual questionnaires or research instruments, and requires skills in designing multi-site studies that include a common core and purpose, while at the same time addressing country-specific issues (Douglas and Craig, 1997).


At a first level, skills in designing multi-site studies in diverse environments will increasingly be required. Here, although the key research questions are clearly identified and common across sites, attention needs to be paid to how constructs are operationalized, research instruments designed, and sampling and data collection conducted at each site. The definition of product categories may, for example, differ as well as brand availability, the nature of the retail environment, or, more insidiously, the socio-cultural context of consumption. Constructs or definitions used in one context are not necessarily appropriate in another. Research instruments, data collection or sampling procedures may incorporate bias, requiring reformulation or adaptation to ensure meaningful results (Craig and Douglas, 2000).


Use of a team incorporating members from different cultural backgrounds and sites helps to strike a balance between the need for local input and adaptation to local site conditions with the need for comparability and equivalence across sites. Researchers from each site should participate in the early stages of research design and in the interpretation of data and results, rather than merely acting as local implementers of a centrally designed study. They can then provide input in the formulation of research questions and the design of the research instrument as well as in sampling and data collection procedures. Equally, local researchers are best placed to interpret findings from their sites in terms of local contextual factors, and to explain local anomalies or differences.


At a higher or “supra-country” level, skills and capabilities in designing and managing a research program which spans multiple, diverse environments are likely to become increasingly critical. A research program might, for example, cover a product business or industry worldwide. If the product business is at different stages of the product life-cycle in different regions or market conditions differ substantially, as, for example, detergents, different types of research or information will need to be collected. Ability to define relevant research issues in each context, and to coordinate and manage the different studies, will be critical to provide meaningful input for the development of the firm’s long-run strategy in world markets.


Developing and using new tools


In addition to developing the capabilities to conduct research spanning diverse environments, international marketing researchers also need to create and make imaginative and thoughtful use of new approaches to understand the changing market-place. As qualitative research techniques advance and mature, they offer increasing promise as a means of understanding and interpreting trends in diverse cultural contexts. Qualitative research provides insights and understanding of the consumption and purchase context and the underlying determinants of behavior, as well as a means of interpreting the results of quantitative research and predicting future trends.


Qualitative research techniques offer a number of advantages in international marketing research as they are unstructured and do not entail the imposition of the researcher’s pre-specified conceptual model or terminology on the respondent. As a consequence, qualitative techniques are especially helpful in probing the contextual embedding of attitudes and behavior, providing deep understanding of situational and contextual factors, and providing inputs into interpreting observed differences between countries and cultures (Cooper, 1996). In addition, as qualitative techniques are often observational or unstructured, they require minimal cognitive skills, and are particularly suited to research in emerging markets. They can also provide insights into underlying or hidden motivations as well as probing future trends and scenarios.
Videotaping of consumers in purchase or consumption situations can provide a rich source of information relating to the role of contextual and situational factors on consumer behavior and response patterns in different cultures and contexts. Videotaping of consumers in an in-store environment provides a wealth of information about visual cues and their role in product evaluation not easily obtained from other forms of data collection (Restall and Auton, 1995). In some cases, in store videotaping can be used to prompt or elicit responses from consumers. In emerging markets, videotaping of consumer usage and consumption behavior often provides deeper understanding of how consumers use products and how these are embedded in the cultural fabric of society, as well as perceptions of and associations with foreign products and brands.


Projective and elicitation techniques such as collages, picture completion, analogies and metaphors, psycho-drawing and personalization can be used to encourage respondents to project their private and unconscious beliefs and personal and subjective associations. Collages were, for example, used in a study of teenagers, worldwide, to explore their feelings about the future. This revealed significant differences between countries especially in terms of the degree of pessimism and hedonism (Thiesse, 1996). Equally, brand perceptions can be explored through personalization, association techniques or analogies, to probe culturally embedded images and associations that vary across cultures.


Focus groups and extended creativity groups can also be used to explore underlying motivations, feelings and points of view. These techniques can be used to screen new product ideas and concepts or develop ideas for a new positioning or advertising theme or to examine future trends. Use of such techniques is likely to become increasingly critical in the twenty-first century, as managers seek to identify new products or ideas that will appeal to cross-national segments or consumers worldwide. Their unstructured character facilitates identification of ideas, concepts and trends, which are truly universal, rather than reflecting the influence of any specific culture or country.

Incorporating technological advances into research design and methodology


At the same time, international marketing researchers will need to incorporate the latest technological developments in data collection and dissemination into the research design. These enable researchers to dramatically reduce the time required to collect data across geographic distances as well as substantially enhancing and enriching the type of stimuli that can be used in collecting data from international markets. It is, however, important to recognize that use of sophisticated technological techniques is subject to certain limitations in international markets, due either to the development of the technological infrastructure or to the technological sophistication of respondents.


Advances in computer technology such as scanners, CATI (Computer Assisted Telephone Interviewing), and CAPI (Computer Assisted Personal Interviewing) are well established in the developed countries and are beginning to be used elsewhere. They provide faster, more accurate methods of data collection, providing direct input of response and facilitating steering of data collection based on response. Techniques such as CATI and CAPI can also be used to centrally administer and organize data collection from international samples, subject to telephone and computer penetration in different countries as well as use of a common language or availability of software to automatically translate questionnaires.


As these technologies evolve and advance, they also provide innovative ways to present stimuli and collect data particularly suited to international research issues. Multimedia CAPI makes possible the presentation of highly complex stimuli and facilitates obtaining consumer reactions to video and audio stimuli (Thomae, 1995). Developments in virtual reality CAPI will heighten the realism in stimulus portrayal and expand the range of topics on which marketing research can meaningfully be conducted (Needel, 1995).


Equally, as the Internet evolves, it offers the potential to dramatically change the way in which much international marketing research is conducted, both in providing ready access to secondary data, and in providing a new means of collecting primary data. Rather than visiting a traditional research library, the marketer can have virtually instant access to data from traditional sources as well as sources that are only available on the Internet. The Internet can also be used to collect primary data, either by tracking visitors to a Web site, or through administering electronic questionnaires over the Internet. To the extent that Web sites are increasingly likely to be accessed by users worldwide, information on an international sample can be gathered. Behavior at the site can be tracked, revealing interest relating to the products and services or information offered, as well as response to promotional material or offers.
The Internet can also be used to collect data in a more systematic fashion that is closer in character to more traditional marketing research practice. Subject to the availability of suitable Internet sampling frames, questionnaires can be administered directly over the Internet. Questionnaires are sent via e-mail to respondents and the responses are returned via e-mail. This represents a very quick and totally automated means to conduct a survey over a broad geographic scope. The results are available almost instantaneously, as the responses can be checked and analyzed in real time as they are received. Questionnaires administered via the World Wide Web also have the advantage that product details, picture of products, brands and the shopping environment can be portrayed with integrated graphics and sound.


This approach is most suited to surveys among respondent populations that are technology literate, and at present for certain types of products such as computers, computer software or business-to-business research (Frost, 1998). However, as use of the Internet becomes more commonplace, e-mail surveys will begin to replace mail and phone surveys. Progress will occur most rapidly in the USA and Europe and will spread more slowly in other parts of the world (Worldwide Internet Conference, 1999).


An important limiting factor is the extent to which Internet sampling frames correspond to respondent populations that are of interest to marketers. Versions of Web software available in different countries may not be compatible. Technical issues may daunt respondents, resulting in non-response bias. Factors such as overall response rate and item non-response will also continue to be important. Consequently, a large number of surveys need to be sent out to obtain a large enough sample to analyze. However, the fact that results will be obtained rapidly will allow additional sampling, with enhanced incentives, to compensate for short fall. While lower costs and rapidity of response make this mode attractive for international research, potential bias problems suggest that, at least in the short run, and particularly where part of the target market is likely to exist in countries with low Internet access, this approach will need to be used with some caution.


Marketing researchers in a global society must face the challenges of working with diverse cultures and varying levels of social and economic development. This optional module highlights specific demands and opportunities that arise from the international context. Learning Objectives:


1. Describe the environmental factors that affect international research and show how each may impact the steps in the research process.

2. Discuss the problems and various approaches involved in the management of international research projects, including the coordination of fieldwork.

3. Give examples of secondary data sources available for international research and what should be taken into account when using them.

4. Identify the issues that make sampling a challenge in international research.

5. Describe how persons of different socioeconomic types can be identified and classified for sampling and data-interpretation purposes and why different methods may be required in different countries.

6. Explain why qualitative research plays a crucial role in international research and give examples of differences among countries when using qualitative methods internationally.

7. Describe the use (including availability and appropriateness) of telephone, personal, mail, and electronic survey methods in different countries.

8. Discuss the special challenges of executing experimental (causal) research in an international setting.

9. Identify problems in designing questionnaires for international research and describe the best ways of translating a questionnaire into one or more foreign languages.

10. Identify the main problems that affect measurement and scaling in international research and how these may affect the choice of response scales. Discuss procedures for establishing equivalence of scales and measures.

11. Describe the variety of issues that affect interpretation of the results of international research and some of the tools to deal with them.

12. Explain the different ethical and legal issues that apply in different parts of the world and how these may affect research projects.

Conclusion


Change is occurring in virtually all aspects of business and personal life. These changes are being played out at different rates in different parts of the world. Against this backdrop, marketing researchers are being challenged to conduct research that is of the highest possible quality, as quickly as possible, in multiple diverse settings. The issues marketing researchers face are multifaceted and relate to where and how research will be conducted, who the respondents will be, and the tools and techniques that will be used.


Marketing researchers must find creative ways to harness the new technologies to facilitate the conduct of research and enhance its value to clients. At the same time, research organizations must begin to develop the capability to conduct marketing research simultaneously in the developed and the developing world. Increasingly, multinational marketers are designing and selling global brands and need research to guide their decision making across an increasingly diverse and disparate world. Sound and timely marketing research becomes even more critical for firms as they compete in the twenty-first century.






References

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