The Role of Marketing Audit in International Expansion

Running Head: BUSINESS ENVIRONMENT 0
Global marketing Management

BUSINESS ENVIRONMENT 1
Sol 1)
The marketing audit refers to the organised and compressive assessment of the business
marketing environment both externally and internally to explore various areas of problems,
goals and objectives and suggest a proactive plan to a business firm that will enhance the firm
performance.
While expanding internationally, marketing audit helps a firm to reintroduce its product into
the new market. It helps a firm to explore various different culture aspects prevailing in the
market, customer demographics and trends, and various other market determinants and
elements (Pimenta da Gama, 2011). With all this information, various plans and policies can
be formed prior to starting the operations in the new market.
Macros components of an audit include –
 Macro Environment audit – It comprises of various factors outside the boundary of
enterprise such as demographic, environmental, economic, political and cultural.
 Marketing Strategy audit – It includes checking the viability of marketing
objectives, business mission, marketing strategies and goals having significant impact
on the organisation marketing performance.
 Task Environment audit – These includes those people who are closely associated
to the firm such as customers, rivalries, public, that impact the efficiency of the
marketing programs (Stewart, 2009).
 Marketing Organization audit – Considering various level of hierarchy, measuring
the performance of staff.
 Marketing Productivity audit – Measuring the marketing practices performed in
relation to profitability and cost-effectiveness.
 Marketing Function audit – Focusing on business core capabilities like price,
product, marketing communication and sales force.
 Marketing Systems audit – Updating and maintaining several marketing systems
like MIS, marketing control system and new product development system.

BUSINESS ENVIRONMENT 2
Sol 2)
International marketing expansion requires a firm to think upon an entry strategy for the new
market that is viable and build capacity for creating economies of scale. Considering
beverage manufacturing based company, there will be various central choices in relation to
primary markets of focus, determination of target consumer, market channel strategy, brand
positioning and resource allocation.
However, the company should not consider joint venture as an entry strategy as the objective
of joint venture are not 100 per cent clear and infrequently communicated clearly to all
individuals involved (Girmscheid & Brockmann, 2009). In addition, joint venture is fragile as
clashes in corporate culture in relation to operational decisions are most common. For
instance, Daimler and Chrystler joint venture were formed in 1990s, however due to
differences in philosophy and culture, both the companies dispatched from each other. Joint
venture also restricts flexibility and soon the individual businesses suffer in the process.
Rather than joint venture, the beverage company can use franchising its brand, to break into
new markets. All they require is a successful business model and with the help of franchisor,
the business can be setup internationally efficiently (Teece, 2010). It also helps the company
in terms of their speed of growth and allows the company to gain financial leverage as well as
human resource too. The major benefit to the beverage company will be competing with
much larger businesses so they can saturate markets even before the response of any
enterprise.
The combination of these factors will substantially decrease the risks and restrict the
company to spend any of their own capital on unit expansion.
Sol 3)
Selecting and preparing the domestic product to the international markets requires significant
changes such as unique characteristics of each target market, key policies of that area and
most importantly the right strategy to enter the market.
The strength of this approach brings out various benefit for the company such as achieving
economy of scale, getting access to advance labour, gaining experience and knowledge from
the foreign market that can be applied into domestic market too (Luo, Sun & Wang, 2011).
With expanding its products internationally, the company can also gain a competitive edge

BUSINESS ENVIRONMENT 3
over its domestic competitors who are offering same segment of energy drinks. The company
can also utilize government incentives as many countries around the world offer certain
incentives for the organisations looking to expand their operations internationally. For
instance, U.S. businesses take the opportunity to expand overseas so as to lower their overall
incomes tax rates.
On the contradictory side, there are some weaknesses too as to expand internationally,
changing product composition and do slight amendments in labelling is not enough. It is
important for the company to explore the social and legal aspects of the respective country
they want to export (Scherer & Palazzo, 2011). For instance, if they want to do overseas
distribution in Asia Pacific region where there are certain differences in culture such as
people prefer more organic drinks such as juices instead of bottled energy drinks.
In response to the CEO request, I would suggest conducting an overall market audit of that
new overseas market as it will help the domestic company to gain various necessary and
relevant insights.
Sol 4)
It is vital that organisation take into account the culture and lifestyle of countries to which
they are considering exporting as some products and services might even be found culturally
unacceptable. Package colours, product function, size and style all require adaption as of
cultural requirements.
There are different cultural traits that can impact production adoption and consumption in the
overseas market. The first is material culture which includes technological goods consumed
by major part of the population like natural gas, electricity, internet and wireless
communication (Tellis, Yin & Bell, 2009).
The second is cultural preferences as every global market will be having a varying preference
for the foods, brands and even food quality levels. Next trait standouts on languages that are
differently spoken in a nation and have a significant impact on marketing, brand names,
collection of information with the help of interviews and surveys in respect with business
relationship. One of the major cultural influencers is religion that can impact various aspects
of life comprising the role of women in society, rules about consumption of food and
beverage, and various other activities (Steenkamp & De Jong, 2010). In addition, there are