Multinational Corporation: International Marketing Plan Essay

Multinational Corporation: International Marketing Plan Essay

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The marketing department of a multinational company wishes to expand
its product sales into a new overseas market. What factors do they
need to take into account?

Introduction - Multinational Company

Economists are not in agreement as to how multinational or
transnational corporations should be defined. Multinational
corporations have many dimensions and can be viewed from several
perspectives (ownership, management, strategy and structural).
According to Franklin Root (1994), an MNC is a parent company that:

1. engages in foreign production through its affiliates located in
several countries,

2. exercises direct control over the policies of its affiliates,

3. implements business strategies in production, marketing, finance
and staffing that transcend national boundaries (geocentric).

In other words, MNCs exhibit no loyalty to the country in which they
are incorporated.

Simply put, a multinational (sometime called a transnational) is a
company that has headquarters in one country, but has operation in
other countries (Wall et al 2001).

The Macro-Environment

It is very important that an organization considers the environment
before beginning the marketing process. This includes all factors that
can influence an organization, but that are out of their direct
control. There may be aggressive competition and rivalry in a market
and the threat of substitute products and new entrants through
globalisation. The wider environment is also ever changing, and the
marketer needs to compensate for changes in culture, politics,
economics and technology. To assess the external factors that
influence the organisation, the marketing department should execute a
PESLTLE analysis, which is the acronym for:

Ø Political
Ø Economic
Ø Social
Ø Technical
Ø Environmental
Ø Legal

Political Factors

The political arena has a huge influence upon the regulation of
businesses, and the spending power of consumers and other businesses.
Organisation seeking to internationalise typically investigates
factors in the county such as:

Ø The stability of the political environment.

Ø Influence of government policy on laws that regulate or tax the

Ø government's position on marketing ethics, policies on the economy
and their view on culture and religion.

Ø Governme...

... middle of paper ...

... Edition.
Pearson Education: Harlow.

Sloman, John (2000) Economics, Fourth Edition. Pearson Education:

Wright, Ray (2003) Marketing in Action, an Introduction. International
Thompson Business Press: London.

Mc Carthy, J (1996) Basic Marketing: A managerial Approach, 12th
edition. Irwin Homewood, IL,

Kotler, Phillip (2000) Marketing Management: Millennium Edition.
Prentice Hall, NJ

Doyle, Peter (2002) Marketing Management and Strategy: 3rd Edition.
Prentice Hall, UK

QMBA (2004) Strategic Management (online) Available from: [Assessed on October 21

Centre for Economic Policy, The effect of the Tax Break System of the
UK Economy online) Available from: [Assessed on
October 21 2004]

TSI (2003) What Are The Main Principles of the European Single Market?
(online) Available from:
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The World Factbook (2003) United Kingdom. (online) Available from: [Assessed on
October 21 2004]

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