1.b Nature of International Business
Nature of International Business¶
Accurate Information¶
- International business requires not just accurate but also timely information.
- Accurate information is critical for making informed decisions in the global marketplace.
- Example: A company like Apple needs accurate data on local consumer preferences when launching new products in different countries.
Timely Information¶
- The value of information decreases if it is not provided on time.
- Timely information helps businesses to adapt to the fast-paced changes in international markets.
- Example: A fashion brand needs timely updates on trends in different regions to ensure their products align with current customer demands.
Market Potential¶
- International markets often present more potential for growth compared to domestic markets.
- Companies can expand their operations and increase profitability by tapping into global markets.
- Example: Coca-Cola generates a significant portion of its revenue from international markets, where demand for its products continues to grow.
Market Segmentation¶
- In international business, market segmentation is often based on geographic criteria.
- This allows businesses to tailor their strategies to specific regions or countries, considering local preferences and conditions.
- Example: McDonald’s offers region-specific menu items, like the McAloo Tikki in India, to cater to local tastes.
Cultural Sensitivity¶
- Understanding and respecting cultural differences is crucial in international business.
- Companies must adapt their products, marketing strategies, and business practices to fit the cultural norms and values of each market.
- Example: Starbucks modifies its store layouts and menu items to align with cultural preferences in different countries, such as offering tea-based drinks in Asia where tea is more popular than coffee.
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