Learning Objectives :

i) To understand different Market entry strategies adopted by International

marketers
ii) To develop and in depth knowledge in the market selection process in
International marketing;
iii) To familiarize with product related decisions, pricing decisions etc.
iv) To know the supply chain management and physical distribution process in
International market;
v) To become familiar with the promotion strategies including a marketing in
International business.
Introduction to International Marketing :

Due to globalization, exports have become vital for economic development. No

country can afford to remain isolated from the rest of the world. The world in fact,
has become a global village. International Marketing is growing day by day, Since
no country can claim to be self sufficient, it has to depend upon some other
countries to reach its needs and requirements. International Marketing calls for
Identifying needs and requirements of overseas buyers and meeting them. Since
there is competition even from smaller countries for exports, there is a need to
bench work the practices and performances against best of companies from other
part of globe. International Marketing calls for management of various activities
from the receipt of copies export orders till it is executed. International Marketing
is defined as :
According to Hesi and Cateora "International Marketing is the performance of
business activities that direct the flow of goods and services to consumers or uses
in more than one nation".

According to Walsh "International Marketing is the marketing of goods and

services across national frontiers".
Product life cycle theory divides the marketing of a product into four stages:
introduction, growth, maturity and decline. When product life cycle is based on
sales volume, introduction and growth often become one stage. For internationally
available products, these three remaining stages include the effects of outsourcing
and foreign production. When a product grows rapidly in a home market, it
experiences saturation when low-wage countries imitate it and flood the
international markets. Afterward, a product declines as new, better products or
products with new features repeat the cycle.

General Theory
When a product is first introduced in a particular country, it sees rapid growth in
sales volume because market demand is unsatisfied. As more people who want the
product buy it, demand and sales level off. When demand has been satisfied,
product sales decline to the level required for product replacement. In
international markets, the product life cycle accelerates due to the presence of
"follower" economies that rarely introduce new innovations but quickly imitate
the successes of others. They introduce low-cost versions of the new product and
precipitate a faster market saturation and decline.
Growth
An effectively marketed product meets a need in its target market. The supplier of
the product has conducted market surveys and has established estimates for
market size and composition. He introduces the product, and the identified need
creates immediate demand that the supplier is ready to satisfy. Competition is low.
Sales volume grows rapidly. This initial stage of the product life cycle is
characterized by high prices, high profits and wide promotion of the product.
International followers have not had time to develop imitations. The supplier of
the product may export it, even into follower economies.
Maturity
In the maturity phase of the product life cycle, demand levels off and sales volume
increases at a slower rate. Imitations appear in foreign markets and export sales
decline. The original supplier may reduce prices to maintain market share and
support sales. Profit margins decrease, but the business remains attractive because
volume is high and costs, such as those related to development and promotion, are
also lower.
Decline
In the final phase of the product life cycle, sales volume decreases and many such
products are eventually phased out and discontinued. The follower economies
have developed imitations as good as the original product and are able to export
them to the original supplier's home market, further depressing sales and prices.
The original supplier can no longer produce the product competitively but can
generate some return by cleaning out inventory and selling the remaining products
at discontinued-items prices.
Coca-Cola is a great example of a product that has had a very long product life
cycle. Since being introduced in 1886, it has spent the majority of its life in the
maturity stage. However, its sales over recent times lead to the question of
whether it is has now entered the decline stage.
Publicly available information about individual brands that the Coca-Cola
company sell is difficult to come by but information about the soft drink industry
as a whole can be used to make some assumptions about Coca-Cola sales.
1) Falling soda sales in the USA.
This Fortune.com story reveals how overall sales of carbonated soft drinks fell for
the 11thconsecutive year in the USA, with 2015s decline of 1.2% a bigger fall
than 2014s 0.9%. The article states that the decline in demand for diet soda drinks
is even more significant.
Of course, just because sales are declining in one market does not mean that
overall sales are falling. Coca-Cola is a global soft drink and perhaps it is growing
strongly in emerging markets?
2) Falling global sales for Coca-Cola.
The Reuters article (and accompanying video) states that the first quarter of 2016
has followed recent trends and global sales have now fallen four quarters in a row.
Part of that reason was attributed to a stronger US$ but sales revenue fell in nearly
all markets, including China.
So perhaps Coca-Cola has entered the decline stage although again this stage is
likely to be relatively far longer than other goods and services. And no doubt the
marketing department at Coca-Cola will be hard at work on extension strategies.
The 2014 Share a Coke campaign was successful at giving a jolt to sales figures
although it appears to have only been temporary.
But money invested into a clever marketing campaign can pay dividends,
especially in the short-term. Industry research by Beverage Insider shows the
change in sales in the US by the big soft drink brands in 2015.

As can be seen, the only brand with a significant increase was Sprite. I was
puzzled by this as I was unaware of any particular marketing campaign. But in the
US, Sprite has included quotes from hip-hop stars on their cans and this seems to
be resonating with their target market.
It remains to be seen how temporary this sales increase is and whether the
carbonated soft drink market continues to decline. Perhaps it is worth doing some
"market research" with your classes who after all will be the consumers of the
future. You might also consider doing a "Business Time Capsule" and make some
predictions about the future of this industry (and others).
CONCLUSION
Transcript of The Product Life Cycle of Coca-Cola
The Introduction Stage The first stage of the Product Life Cycle
Identical to commercialization or the last stage of the new product development
process.
Profits are often low in this stage
Length of introduction stage varies
The Decline Stage Sales decrease and continue to drop to lower levels.
Companies decide whether to harvest the product or divesting the product. By:
Azzeza Mussa The Product Life Cycle of Coca-Cola The Growth Stage The
Maturity Stage Number of potential new customers decline and the sales of a
product typically begins the level off.
Competition causes profits to fall until the strongest competitor is standing.
Longest stage in the PLC
Companies look for marketing strategies to market their product.

Increasing sales, more competitors, and higher profits.

Competitors are beginning to enter the market more rapidly.
Number of distribution outlets begin to increase.
The Introduction Stage Created during the spring of 1886 by Dr. John S.
Pemberton
Was first introduced as a soda fountain drink
Placed on sale for 5 cents a glass
Pemberton's partner and bookkeeper, Frank M. Robinson suggested 'c's would
look good in advertising, which led to the name "Coca-Cola"
In 1888, Pemberton sold Coca-Cola to Asa Chandler
Chandler formed the Coca-Cola Company in 1892 and by 1895 Coca-Cola was
being drunk in every state across America
As demand grew, production increased and Coca-Cola was made available in
bottles rather than just through soda fountains
The Growth Stage Coca-Cola is currently in this stage.
To extend it's mature stage coca-cola has developed the following marketing
strategies: product improvement, new models were developed, it entered new
market segments, and enlarged its distribution channels