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International Marketing

International marketing through franchising and entrepreneurship
The past twenty years has seen an unprecedented internationalisation of business and growth of multinational organisations.  Some analysts credit these large multinational firms with more economic impact than many nation states.  This has greatly changed the way marketing is done.  Global markets are extremely difficult to define, and variables significantly more complex and diverse.  The decision to take a company outside the UK involves careful analysis of risk and benefit factors, consideration and selection of potential markets, planned market entry, and development of market penetration over time.  While this can be done through a number of strategies, franchising is a growing means of achieving international presence.  In particular, McDonald’s and The United Colors of Benetton represent two distinct yet successful examples of effective international marketing in globally franchising firms.

DECIDING TO FRANCHISE INTERNATIONALLY

With the increase in international franchising and its impact on marketing, a number of studies have been conducted on various related aspects.  One first consideration in literature is what leads to the decision to go international, and how this stimulates marketing within the firm.  It is first helpful to consider the relationship between parent companies and their subsidiaries, whether franchises, partnerships, or company-owned outlets.  Structurally, large multinationals such as McDonald’s and Benetton are “better viewed as inter-organisational networks than monolithic hierarchies,” because each subsidiary can take actions that affect the company as a whole (Birkinshaw 2000, 2).  Corporate structure is determined by interplay between parent and subsidiary, with both responding to and driving needed changes in the business environment (Birkinshaw 2000, 4).  Sometimes it will be the subsidiary that pursues markets, making a “proactive and deliberate pursuit of a...