Adapting the Marketing Mix for International Markets (AQA A Level Business): Revision Note

Adapting the product

• When a business enters a new international market, it faces a fundamental choice: should it use the same marketing mix it uses at home, or adapt it for local customers?

• In practice, most businesses take a mixed approach - standardising some elements to save cost and maintain a consistent brand identity, while adapting others where cultural, economic or legal differences make this necessary

How the product may be adapted for international markets

• The product itself often needs to change when entering international markets, either to suit local tastes and preferences, to comply with local regulations, or simply to make it affordable

Taste and cultural preferences

• McDonald's is perhaps the most well-known example of product adaptation

  • Without these adaptations, McDonald's would struggle to attract customers in markets with very different culinary traditions

In India, where a large proportion of the population does not eat beef or pork for religious reasons, the menu features the McAloo Tikki (a spiced potato burger) and the McVeggie In Japan, the Teriyaki burger and seasonal flavours such as sakura (cherry blossom) appeal to local tastes

• KFC in China goes even further

  • Alongside its core chicken products, it serves congee (rice porridge), egg tarts and other items drawn from Chinese breakfast culture, making it a destination for morning meals rather than just a fast food stop

• Cadbury adapts the sweetness and texture of its chocolate for different markets - the formula sold in Australia, for example, differs from the UK version to match local taste preferences

Packaging and format

• Unilever recognised that millions of consumers in lower-income markets in South Asia and Africa could not afford standard-sized bottles of shampoo, washing powder, or conditioner

• The solution was single-use sachets, sold for a few pence each, that made Unilever's brands accessible to an enormous new customer base

Regulatory compliance

• Products may need to be reformulated or redesigned to meet local safety, ingredient, or labelling regulations

  • Food businesses must often reformulate products to comply with different rules about permitted additives, allergen labelling or nutritional information standards in each market

Adapting the price

• Pricing for international markets is rarely straightforward

  • Income levels, purchasing power, local competition, import tariffs and currency fluctuations all mean that the same price point cannot simply be applied globally

How the price may be adapted for international markets

Local purchasing power

• Netflix charges significantly different subscription prices in different countries

  • A monthly subscription in India costs a fraction of the equivalent in the UK or US, reflecting the very different income levels and the intense local competition from cheaper alternatives

  • This allows Netflix to make its service accessible to a much larger global audience.

• The Economist's Big Mac Index illustrates this clearly

• The same McDonald's burger costs the equivalent of around £5.75 in the UK but less than $2.50 in many developing markets

• This reflects how pricing is adapted to match what consumers can afford

Premium brands and consistent global pricing

• Some luxury brands deliberately resist adapting their prices downward in lower-income markets

  • Rolex, Louis Vuitton, and Chanel maintain broadly consistent global pricing (adjusted only for taxes and import duties)

• The high price is itself part of the product's appeal - it signals exclusivity and status

  • Lowering the price for some markets would undermine that positioning worldwide

Currency and tariff challenges

• Exchange rate movements can make a product suddenly more or less competitive in an international market, even if the business has done nothing to change its strategy

• Import tariffs can significantly raise the final price customers pay, making a previously affordable product uncompetitive

• Apple periodically adjusts iPhone prices in different countries to reflect movements in currency exchange rates

  • When the pound, euro or Japanese yen weakens against the US dollar - the currency in which Apple's costs are largely set - the company raises its prices in those markets to protect its profit margins

  • This can lead to consumer backlash and temporarily reduce demand

Adapting the place (distribution)

• The channels that work well in one country may be unavailable, underdeveloped, or simply not trusted by consumers in another

How place may be adapted for international markets

E-commerce platforms

• In China, consumers do not typically shop through individual brand websites

  • Instead, the dominant retail channels are platforms such as Alibaba's Tmall and JD.com, enormous online marketplaces that function like a combination of Amazon and eBay

• UK and Western businesses entering China must list their products on these platforms to reach Chinese consumers

  • They cannot expect customers to find and trust an unfamiliar, standalone website

Traditional retail infrastructure

• In India, modern supermarkets account for only a small share of grocery sales

  • The majority of everyday purchases still happen through millions of small, independent local shops known as kirana stores

  • Unilever, Nestlé and Hindustan Lever have built extensive distribution networks to reach these stores to avoid missing most of the market

Store formats

• IKEA has adapted its store format for markets where very large out-of-town retail parks are not practical

• In Japan and several Chinese cities, the business has opened smaller city-centre stores that fit the urban retail environment, rather than expecting customers to travel to a suburban warehouse format

Adapting the promotion

• Promotional strategies often require the most significant adaptation of all, because communication is so deeply tied to language, culture and media habits

How promotion may be adapted for international markets

Media channel differences

• A UK business cannot simply replicate its domestic social media strategy in some countries

  • Facebook, Instagram, Google and YouTube are all blocked in China

    • The equivalent platforms in China (WeChat, Weibo and Douyin) operate completely differently and require entirely separate strategies, content and local expertise

  • In Japan, LINE is the dominant messaging and social platform

  • In South Korea, KakaoTalk plays a similar role

• Businesses must understand which platforms their target audience actually uses in each market

Cultural sensitivity in messaging

• Humour, imagery, and emotional appeals that resonate strongly with consumers in one culture may fall flat or cause offence in another

  • Global brands often develop entirely different advertising campaigns for different markets rather than translating their home-country adverts

• Nike consistently uses local sports heroes in its promotional campaigns so that the emotional connection with sport feels locally relevant rather than imported

  • Cricketers in India

  • Footballers in Brazil

  • Basketball players in the USA

• Dove's 'Real Beauty' campaign, built around authentic, diverse representations of women, was adapted market by market

• It reflected local standards of beauty and cultural norms, ensuring the message landed appropriately in each country

Language

• Effective translation requires far more than converting words - meaning, tone, and cultural resonance all need to be considered

• Many businesses have been embarrassed by promotional materials that translated poorly, reinforcing the importance of working with native speakers and cultural experts rather than relying on direct translation