International Marketing Management: A Case Study of Rolls-Royce

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This report assesses the global expansion of Rolls-Royce, a British car manufacturing company, using various frameworks and models. It includes a critical evaluation of models such as PESTLE analysis, Porter's Five Forces analysis, CAGE model, OLI framework, and Hofstede's model of international culture.

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International Marketing
Management

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Table of Contents
Executive Summary.........................................................................................................................3
INTRODUCTION...........................................................................................................................4
Overview of the organisation...........................................................................................................4
Critical Evaluation of Models..........................................................................................................4
PESTLE Analysis.......................................................................................................................4
Porter's Five Forces Analysis......................................................................................................6
CAGE Model..............................................................................................................................6
OLI Framework- Market entry...................................................................................................7
Hofstede's model of international culture...................................................................................9
Justification of models to be used.............................................................................................10
PESTLE Analysis of Rolls Royce in Australia..............................................................................10
PESTEL Analysis of Rolls-Royce in Canada................................................................................12
Hofstede's Cultural dimension- A comparison..............................................................................13
Cage model....................................................................................................................................15
Marketing mix analysis- Country comparisons.............................................................................16
Justification of choice of country...................................................................................................17
Mode of entry strategies.................................................................................................................18
CONCLUSION..............................................................................................................................18
REFERENCES..............................................................................................................................19
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Executive Summary
The mentioned report was aimed at global expansion of respective business organisation
i.e., Rolls-Royce (A British Car manufacturing company). For instance, it was comprised of
various frameworks and models in order to accomplish the standards and goals of completion of
this particular report assessment. The entire assessment was basically aimed at international
expansion of company in Canada and Australia.
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INTRODUCTION
International Marketing Management is determined as process of carrying out
multinational marketing practices in different economic nations. For instance, it includes
development of strategic plan and further execution of plan including strategies for promotion,
pricing, and supplying products in order to fulfil consumer demands. There are various elements
involves in essential process of international marketing management including research, product
localisation, communication, inbound & outbound marketing, etc. Within this report, Rolls
Royce is a UK-based organisation that is taken into consideration for demonstrating different
aspects of this report (Akter and et.al., 2021). This report assessment will be comprised of
significant and insightful information and knowledge regarding International marketing with
context of Rolls Royce. Furthermore, it will further highlight risk factors as well as opportunities
associated with respective organisation in carrying out international marketing practices for
growth and expansion.
Overview of the organisation
Rolls Royce Motor Cars Limited is UK based auto-mobile manufacturer engaged in
manufacturing of luxury motor cars. Moreover, respective business organisation was established
in the year 1904, and has been headquartered in Westhampnett, United Kingdom. The company
operates worldwide by providing customers of richer section of society as motor cars offered by
respective organisation are quite costly as compared to other competitors in the market. The
respective organisation is functioning for the purpose of developing administrative as well as
production facilities that are opened in the year 2003 (Baack, Czarnecka and Baack, 2018). After
this year, the company has expanded its product range in order to involve two-door coupe,
extended wheelbase along with the convertible versions of Phantom Sedan and smaller ghost
four-door sedan, Dawn Convertible, Wraith two-door coupe as well as Cullian SUV.
Critical Evaluation of Models
PESTLE Analysis
It is a tool that is used to analyse the impact of macro-environmental factors that are
influencing the functioning of an industry. This tool helps the managers of Rolls-Royce in taking
strategic decisions and building remedies for the strategic management of the company. The
Pestle Analysis of Rolls-Royce is given as under:

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ď‚· Political factors: UK Union has strong stability and has less trade restrictions because of
this it provides opportunities for firm like Rolls Royce to trade freely at global level. It
brings positive impact on company as the organisation can expand it business throughout
the world. But impact of pandemic situation in the year 2019 has highly influenced the
performance of company as government of country has made various guidelines such as
social distancing, etc (Cantoni and et.al., 2019). This has resulted in declining the sales of
company as thereby its profitability and efficiency too.
ď‚· Economic factors: Economy of UK is globalised and market oriented which brings
positive impact on company such as Rolls Royce. It helps in encouraging business
worldwide which increases sales volume as well as profitability of the company.
However, impact of pandemic situation of COVID-19 such as economic lockdown has
greatly influenced the business operations due to which, the company has suffered loss
and negatively impacted.
ď‚· Social factors: Social market of UK is well developed along with fair as well as strong
society. Rolls Royce is a status icon and a brand which is popular across the world by
making positive impact on society. The company is producing the cars by knowing and
understanding the perceptions of its market share. It positively impacts business
operations of company as the sales of organisation will get increase through capturing a
large number of customer-base.
ď‚· Technological factors: UK has upgraded technological sector which impacts positively
on ventures like Rolls Royce as the company is using latest technologies that facilitates it
in saving the cost and time of the overall business. It brings favourable influence on
organisation and enhance its productivity and profit margins within the business.
ď‚· Legal factors: UK authority has legislations like Health and Safety at Work Act, 1974,
Employment Rights Act 1996, Equality Act 2010 (Cateora and et.al., 2020). Rolls Royce
follows legislations to work ethically which ultimately brings good impact on it.
ď‚· Environmental factors: UK environment is pleasant and has temperate climate and
Rolls Royce introduced electric vehicles to reduce pollution level which positively
impacts company's performance as it will attract a large number of customers within the
market place.
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Porter's Five Forces Analysis
The model of Porter's Five Forces will help company in analysing the level of
competition within the industry through examining surplus potentiality of industry and therefore
its attractiveness. There are five forces within this model and all these forces are discussed as
below:
ď‚· Competition in existing market: This force helps the company in determining the level
of competition within the industry of automobiles. Therefore, there is a high threat for the
organisation as market share can switch to another competitors who is offering the same
products at lower cost in comparison to first company.
ď‚· Threats of new entrant: The political system of UK has made certain barriers and
regulations within automobile industry for new entrants. There is a requirement of license
in order to enter into the markets of respective industry. Hence, there is a low threat of
new entrants for company because a large amount is required to enter into the industry.
ď‚· Bargaining power of suppliers: There are a large number of suppliers in automobile
industry so if a supplier charge high prices then the respective company has an option of
switching to the another supplier who offers same raw material at lower cost than others.
So there is a low threat of bargaining power of suppliers for company.
ď‚· Bargaining power of buyers: Buyers are large in number who are demanding modified
and innovative cars having unique features at low rates. Though, the company has
maintained customer loyalty but its market share can switch to other competitors who are
offering identical products at less cost than respective company (Czinkota and et.al.,
2021). Hence, there is a moderate threat of bargaining power of buyers for company.
ď‚· Threats of substitutes: When the price of substitute car products is more than the
company, then the customers will not switch to other company as the organisation will
offer products at less cost with same benefits. Thus, there is a low threat of substitutes for
business.
CAGE Model
This is a model that helps an organisation in making comparison of a possible target
market to the home market of a company on the basis of certain dimensions such as culture,
administration, geography and economy (Farrell, 2020). Rolls-Royce use this model because it
gives insights to company in key differences between target and home markets and permit the
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organisation in assessing desirability of that market. The Cage Model of Rolls-Royce is given as
under:
Cultural distance Administrative
distance
Geographic distance Economic distance
Different languages Absence of colonial ties Physical remoteness Difference in income
of consumers.
Different ethnicities Absence of shared
political or monetary
association
Lack of a common
border
Differences in cost and
quality of natural
resources, financial
resources, human
resources, information
technology and many
more. A diverse
workforce will capture
a similar crowd into
Rolls Royce hence
process of recruiting
new people while
managing diversity
ratio will be much
easy.
Different religions Political hostility Lack of sea or river
access
Different social
norms
Government policies
will help Rolls Royce in
enhancing its business
into international
markets.
Size of country

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OLI Framework- Market entry
OLI stands for Ownership, Location as well as Internationalisation and as per the OLI
framework, Rolls-Royce is required all the three advantages of ownership, location and
internationalisation in order to get successfully engaged in the Foreign Direct Investment (FDI).
The respective organisation should develop a different strategy of the market entry in case id one
or more these advantages are lacked (HĂĽttner, 2018). It is a three-tier evaluation model that can
be used by the managers of Rolls-Royce at the time of attempting to ascertain whether it is
beneficial to pursue FDI or not. The OLI framework of Rolls-Royce is given as below:
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ď‚· Ownership advantage: First of all, Rolls-Royce requires an ownership advantage to
overcome the responsibility of foreignness (Ä°pek, 2020). Ownership is defined to
possession of certain valuable, rare, hard-to-imitate as well as organisationally embedded
resources which permits respective company in having a competitive advantage over
competitors in foreign markets. In context of Rolls-Royce, the company is having
ownership advantage.
ď‚· Location advantage: Secondly, there should be some type of location advantage within
the market that a company like Rolls-Royce is trying to enter. Given the well-known
liability of foreignness, UK must offer compelling advantages to make it worthwhile in
order to undertake FDI (Jiménez-Asenjo and Filipescu, 2019). Such advantages can be
conveniently geographical or are exist due to the presence of low wages, cheap raw
materials, skilled workforce and other particular tariffs as well as taxes.
ď‚· Internationalisation advantage: In order to select between the FDI and licensing, the
management of Rolls-Royce must look at the last advantage. The administration of the
company is required to consider whether it would be more sensible in getting value chain
activity operated locally along with their own team or outsource it to the foreign country.
Advantages of outsourcing from various countries can involve better skills and low cost
in order to operate value chain activities or effective information or knowledge of
markets of home country.
Hofstede's model of international culture
The model of Hofstede's Cultural Dimensions is used by the organisation for
understanding the differences within the culture across the nations as well as to recognize the
approaches that business is operating across different cultures. The six different categories of this
model is described as under in context of Rolls-Royce:
ď‚· Power Distance Index: It refers to power index which is adopted by executives of Rolls-
Royce in order to reduce inequalities as well as managing alterations that empowered the
authority among members of team along with improving organisational performance.
ď‚· Individualism versus collectivism: In context to Rolls-Royce, the main focus in on
collectivism where all the human resources are invited to sacrifice their own comfort for
the greater good sake of other people (Kotler and et.al., 2019). The employees also take
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part in activities and adopt relevant cultures within the international country that are
advantageous for organisation and workers.
ď‚· Uncertainty avoidance index: It shows uncertainty or ambiguity and is used by
organisation for operating its business in international markets. In context of Rolls-
Royce, there is low index level of the employees that shows intense tolerance as well as
acceptance of uncertainty.
ď‚· Masculinity versus femininity: Such kind of culture is concerned with femininity as
well as masculinity and is used by Rolls-Royce for developing its performance (Lu,
Scholz and Nguyen, 2018). Within the company, masculinity is followed by managers of
the organisation that can help in enhancing the business performance and concentrates on
wealth-building and material achievements.
ď‚· Pragmatics versus normative: Within Rolls-Royce, pragmatic approach is preferred by
the management of the company in order to concentrate on future and includes delaying
success of short-term for meeting success of long-term. This puts focus on perseverance,
persistence as well as growth for lomg-term.
ď‚· Restraint versus indulgence: In context to Rolls-Royce, the culture of indulgence is
followed by the administrators of the company in which it indicates that the society
permits comparatively free satisfaction in relation to enjoy life as well as have fun.
Justification of models to be used
From above explanation of the different models, it is justified that the managers of Rolls-
Royce are required to develop and frame effective business strategies for improving the
performance of the organisation. The company should consider political, economic, social,
technological, legal as well as environmental factors at the time of operating its business for
understanding wider market in which it is operating. In relation to Porter's Five Forces model, it
is justified that the company can gain competitive advantages through analysing the level of
competition within the industry and making strategic decisions. From the CAGE model, it can be
justified that the managers of Rolls-Royce are required to analyse cultural, administrative,
geographical as well as economic factors for comparing its own market functions with the
marketing functions of foreign organisations (Mansour, 2021). In context to Hofstede's cultural
dimensions, it is also justified that the company can easily understand the differences in the
culture of different nations and their impact on the business performance. Overall, it can be

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justified that the company can effectively operate its business in international markets through
developing effective business strategies and working in an ethical environment.
PESTLE Analysis of Rolls Royce in Australia
ď‚· Political Factors: The essential factor of political stability plays a crucial role in
influencing or affecting operations and activities carried out by business organisations.
For instance, Parliamentary democracy regulated in Australia facilitates in providing
respective economic nation with Political stability (Nes, 2018). In addition to that,
business organisations always look out for economic nations with political stability as it
facilitates in stable business environment as well as eliminating uncertainty in
environment.
ď‚· Economic Factors: The respective economic nation has been facing a downfall in
economic growth by 7% in the quarter of June 2020 (Reserve Bank of Australia, 2022).
For instance, arise of these situations have been resulted in a barrier to crossings of
international border. The recent rise of this conflict could contribute negative values
towards economy with degradation of existing scenario. Therefore, this factor or aspect
could lead to negative impact upon operations and activities carried out by respective
business organisation.
ď‚· Social Factors: As the luxury motor cars offered by respective organisation are very
expensive, target customer base of Rolls-Royce is richer and wealthy section of people in
society. For instance, preferences and behaviour of customers in society is inclining
towards fulfilment of social status with purchase of luxurious and expensive products and
services. Moreover, this factor of increasing preferences of people towards purchase of
expensive products will result beneficial for respective business organisation in attracting
their target customer base.
ď‚· Technological Factors: The technological environment within Australia is highly
upgraded and developed which will help the managers of Rolls-Royce in performing its
business operations within the country. As the company is already using latest
technologies and machines in order to conduct business transactions, it will bring positive
impact on the organisation.
ď‚· Legal Factors: Within Australia, the legislative system of the country has framed The
Competition and Consumer Act 2010 which is a national law that facilitates the
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businesses in regulating fair trading process within the country (Oyewole, 2018). Rolls-
Royce must have to consider and adhere this law in order to operate its business functions
in an ethical way. This will enhance the brand image of the company within the country
and will also increase its productivity and efficiency.
ď‚· Environmental Factors: The major environmental law that is framed by the government
of Australia is The Environment Protection and Biodiversity Conservation Act 1999.
When Rolls-Royce will operate its business in Australia then it has to follow this
environment law as it will help the company in protecting the environment of the country
through developing the electrical vehicles that emit less pollution to the environment.
PESTEL Analysis of Rolls-Royce in Canada
ď‚· Political Factors: The respective economic nation has been considered among least
corrupted economic nations in the world (Ozturkcan, 2019). For instance, according to a
survey of World population Canada has been ranked 12 for least corrupt countries which
is quite a higher rank among total of 180 countries. This positive aspect of respective
economic nation will facilitate respective organisation in carrying out their business
operations without any unethical practices due to corruption. Furthermore, with low
corruption rate in respective country, Rolls-Royce will be able to attain efficiency as well
as minimising cost incurred in carrying out operations and activities (Least Corrupt
Countries 2022, 2022).
ď‚· Economic Factors: In order to expand business units in another economic nation, it
incurs huge cost which is needed to be raised from that particular economic nation. For
instance, financial markets in Canada are highly efficient which results in a positive
aspect for respective organisation to look out for further expansion of business unit. In
addition to that, Financial market of respective country is determined one of the largest
contributor towards GDP of Canada (Sangra, 2020). Furthermore, efficient financial
market in respective country will facilitate Rolls-Royce in upright accumulation as well
as allocation of funds.
ď‚· Social Factors: The level of education among people in an economic nation is an
important factor of macro environment which impact upon operations and activities of a
business organisation. Referring to OECD, Canada is among most educated economic
nations with maximum educated population. In addition to that, this aspect will result in
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being a positive aspect for Rolls-Royce to expand in an economic nation with high
education level (Most Educated Countries 2022, 2022).
ď‚· Technological Factors: There is a huge significance of technology in an economic
nation. For instance, Technology has been considered as one of the fastest growing
sectors in Canada especially in the field of education, occupation and profession, leisure,
etc (Sapouna and et.al., 2018). In addition to that, occupation and professions engaged in
technology sector are facilitate with higher paid job opportunities. Business organisations
all around the world look out for Canada as most suitable economy in order to boost their
businesses. Therefore, this sector will result in being beneficial towards respective
organisation.
ď‚· Environmental Factors: Within Canada, the environmental policies have been set in
such a way that there is a reduction target in the carbon emission of 30% by the year
2030. Therefore, when Rolls-Royce will operate its business in the markets of Canada,
then it has to follow the environmental policies of the country which can enhance its
business performance.
ď‚· Legal Factors: The legislative system within Canada has framed various laws and
legislations such as Canadian Human Rights Act, Constitution Act 1867, employment
laws and many more. The managers of Rolls-Royce must adhere these laws within the
country while performing its business operations and work in an ethical environment that
will bring positive impact on the company (Shemyatikhina, Shipitsyna and Usheva,
2020).
Hofstede's Cultural dimension- A comparison

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Cultural dimensions Australia Canada
Power distance index The power distance index within
Australia is relatively low with
an index of 36 compared to the
world average of 55. It shows
higher equality between levels
of society such as government,
organisations and many more.
The power distance index of
Canada is 39 which is higher
than the power distance index
of Australia and shows that
there is high level of inequality
between the levels of society
in comparison to the power
distance index of Australia.
Individualism vs collectivism Australia with a score of 90 on
such type of cultural dimension
show highly individualism
which converts into a loosely-
knit society in which the
expectation is that the people
look after themselves.
On the basis of this cultural
dimension, Canada is
generally following the culture
of individualism yet it also
concentrates and value the
contribution of everyone to
their community.
Masculinity vs femininity Australia is following the
culture of masculinity as men
are expected to be competitive,
assertive as well as concentrated
on success of material. As per
this cultural dimension,
Australia has scored 61 on such
dimension .
Canada is following the
culture of feminism as it
believes that women as well as
girls are having the ability in
order to meet the real change
in respect of peace and
sustainable development.
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Uncertainty avoidance index The country has scored 27 on
the scale of Uncertainty
Avoidance and implies that the
people of Australia do not like
the concept of uncertainty and
want stability for members.
The country has scored 48
which is high in comparison to
Australia and implies that the
people of Canada are receptive
of the innovative and new
ideas.
Restraints vs Indulgence With an score of 71 on the basis
of this dimension, the culture of
Australia is indulgence in which
there is relatively weak control.
With an score of 68 on the
basis of this dimesion, the
culture of Canada is also
classified as indulgence.
Short-term orientation vs
Long-term orientation
The culture of Australia as per
this dimension is at 30% which
is just below half the level at
44% as compared to rest of the
world which depicts that long-
term orientation is at low level
within the country and leans
more towards the short-term
orientation in which
concentration is on near future
including achieving short-term
success and puts a stronger
focus on present than future and
on quick outcomes as well as
respect for tradition.
The culture of Canada as per
this dimension is at 23% which
is less than Australia and is
following long-term
orientation which shows
society's belief in the process
of achieving its objectives as
well as tends to reflect an
appreciation for the traditions
of the culture.
Cage model
Components
and country
Cultural Administrative Geographical Economic
Australia Primarily a The Australia is Economy of country
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western culture
which is
originally
derived from
Britain but also
influenced by
cultural input of
Aboriginal,
Torres Straight
Islander as well
as other people
of Australia.
There is no
official
language of
Australia but
the society of
Australia values
the English
language.
administration or
the government of
Australia is run
by the Head of
State as well as
Governor-
General. It is a
constitutional
monarchy with
The Queen as
Soverign.
considered as a
comparably flat
continent along
with low elevation
highlands that
involves the Great
Dividing Range
along its Eastern
Coast. The intrinsic
outback has
deficiency in
precipitation and
has a large number
of deserts.
is dominated by its
service sector. It is a
wealthy nation and
has market-based
economy having
relatively high GDP
as well as per capita
income.
Canada Mixture of
British, French
and American
influences with
two official
languages
English and
French (Canada
Cultural Life,
2022).
The government
of Canada is run
by The Right
Honourable Prime
Minister. The
country is a
constitutional
monarchy and
involves
executive,
legislative, quasi-
Canada has the
longest coastline
within the world
and its features
include a large
number of rivers,
clack-blue lacks,
majestic western
mountains, forested
eastern valleys and
rolling central
The economy of
Canada consists of
mining, eal estate as
well as
manufacturing. The
country's economy is
considered as a
home to some of the
largest mining
organisations within
the universe. The

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judicial as well as
judicial functions
at all three levels
of the
administration of
Canada.
plains. great portion of its
GDP comes from
international trade
along with its largest
trading partners such
as China, U.K and
U.S (Global Trade
Guide Guide, 2022).
Marketing mix analysis- Country comparisons
Marketing mix is a set of tactics or activities that are carried out by a company in order to
promote its brand or product and service within the market place. The marketing mix analysis of
Rolls-Royce is given as below comparing two countries:
Marketing mix element Australia Canada
Product Within Australia, Rolls-Royce is
selling car products such as Silver
Ghost, Silver Seraph, Corniche,
Cullinan, Phantom, Silver Spur,
Ghost, Wraith and many more.
Within Canada, the company
is selling car products such as
Cullinan SUV, Lamborghini
Urus SUV and many others.
Price The company should consider the
pricing factors such as costs,
customers, competitors and profit.
The high-premium pricing
strategy is also followed by
Rolls-Royce in Canada too but
it is less expensive in this
country as comparison to
Australia.
Place Sydney is number one with 4000
and Melbourne is second with
3000 (Australia Top Choice for
Wealthy 2022).
Within Canada, the company
is employing over 1000 people
throughout the six provinces.
Promotion The company is using a wide The company is using word-
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number of promotional strategies
such as social media, websites,
online and offline advertising,
digital marketing, etc. in order to
promote its products to capture a
large number of customers.
of-mouth promotional sgrategy
as a primary strategy for
promoting its car products to
the people of the country
through describing its special
and unique features as well as
advantages to the public.
Justification of choice of country
From above discussion, it can be justified that Rolls-Royce can choose Canada as a
country in order to take entry into international markets so that it can enhance its business
operations. Canada as a country is selected because it is has highly upgraded technological
environment in comparison to Australia in which the company can enhance its profitability and
productivity level through saving the cost as well as time of the business (Zeneli, Czinkota and
Knight, 2018). Another main reason behind choosing this country is that it is considered as one
of the largest Automotive manufacturing within the industrial sector and is contributing 10% of
manufacturing GDP along with 23% of manufacturing trade (Australia's automotive industry,
2022). Canada is presently the thirteenth largest auto-producing nation within the world as well
as seventh largest auto exporter by value and is producing 1.4million vehicles and exports
$32billion worth of vehicles in the year 2020 (Canadian automotive industry, 2022). The
automobile industry is a vital to the economy of Canada and this industrial sector is a key driver
for the economy of Canada that is contributing crucially high values. Therefore, Canada is
chosen as a country to take entry into international markets.
Mode of entry strategies
ď‚· Exporting: It is marketing as well as direct sale of domestically produced products and
services within another country. It does not require that goods to be produced in target
country and no investment in foreign production facility is needed.
ď‚· Licensing: It is the fast way to enter into international markets through taking only
restricted legal and financial risks that might consider agreements of licensing with
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international companies. It allows an international company for selling its products of
licensor or to use its intellectual property in exchange for royalty fees.
ď‚· Foreign Direct Investment: It involves direct ownership of facilities in the target
country and hence transfer of resources consist of technology, capital as well as
personnel. Entry through FDI can either take form of acquisitions of existing
organisations or through establishing a new plant.
CONCLUSION
From above explanation of report, it has been concluded that primary and major
importance of International marketing lies in expansion of target market, boosting brand
reputation, building up connection with global business environment. In this report, pestle
analysis of UK, Australia and Canada has been conducted to analyse impact of macro-
environmental factors influencing business performance. Other models such as Porter's five
forces, Cage model, OLI model, etc. have also been performed. Foreign direct investment has
been considered as an effective entry mode that will help the company in enhancing its business
and its performance.

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