What are International Marketing Channels? (5 best)

If you have ever wanted to sell your product or services to international markets, you have come to the right place!

Today, we will review the most important international marketing channels and how you can choose the best one for your strategy.

International marketing channels are how you sell and distribute your product in different countries. Direct marketing channels include your main website, selling directly to a main supplier, social media channels, or gaining a government contract. Indirect marketing channels include hiring an export trading company, a 3rd party management company or an eCommerce platform.

Whether your international marketing channel is your main website or an ecommerce platform or a strategic alliance with an international partner, your channel is an important part of your international marketing mix.

Let’s now explore the main types of international marketing channels and walk through some helpful examples.

Two Main Types of International Marketing Channels: Direct and Indirect channels

As we get started, know that there are two main types of international marketing channels:

1. Direct marketing channels, and
2. Indirect marketing channels.

The main difference between direct and indirect marketing channels are the number of layers between your company and the customer. 

Example of a direct international marketing channel

For example, if your business is located in Thailand and a customer from Costa Rica purchased your product directly from your website, this is an example of a direct international marketing channel.

In fact, if your website is the marketing channel you choose as the main strategy for your international marketing plan, you could easily enter many international markets.

Combined with another direct international marketing channel by choosing the right  social media strategy, these may be the only two channels you need for a robust international marketing strategy. 

You simply receive the order from the customer and, just as you would ship in your domestic market, you ship the product using one of the primary companies that ship internationally, such as: 

1. FedEx  who may provide the fastest shipping options, 
2. UPS who probably has the widest network coverage,
3. USPS has some solid, simple options, and 
4. DHL has many helpful business solutions.

This is in fact, what many companies do in today's environment for setting and managing their international marketing channels.

Example of an indirect international marketing channel

On the other hand, if you hired an export trading company (ETC) to be your indirect marketing channel, this ETC would be responsible for finding international buyers, shipping the products, and ultimately being the in-between for transacting the sale.  

This is not to say you won’t have control of the process, this primarily means for this example that you are at least one step removed from the customer.

This can be concerning for many companies because it will more difficult to control your brand, your communication structure and customer onboarding procedures. This means that keeping your customers may be tougher, when they are being acquired by a 3rd party service.

The main take-away is this:

International marketing channels are how you make it possible for people outside of your home market—the "foreign" part of international—to see what you're selling, and ultimately learn how to buy and become a customer.

Let’s now go a little deeper into indirect vs direct marketing channels and help you develop your own strategy.

The best international marketing channels

There are many reasons for developing your international marketing strategy. But as a general rule, the core strategy behind your international marketing channel development is part of your market expansion strategy. 

After all, by devoting resources to gain sales and acquire customers in foreign countries, means you are expanding into additional markets.

Said another way, your international marketing channels are how you get your products and services in front of customers who aren't in your home market. 

This concept is very important to fully understand because it implies many things.

First, expanding into foreign markets implies that your home market is well-defined and you have thoroughly reviewed your strategies for market penetration and market expansion.

That is, by developing your international marketing channels, this basically implies that you have a handle on your market penetration strategy. And this means that you know who your domestic customers are to a degree that will let you define with enough confidence to be able to attract customers in international markets, thereby expanding into other markets. We will walk through some real world examples of how to do this in just a moment.

For more information about market expansion strategies, here is a very helpful article:

5 Market Expansion Strategies (+Examples)

If you would like more information on the relationship between your market penetration strategy (going deeper into your current market) and your market expansion strategy (going international is a market expansion strategy), here is another very helpful article:

Market penetration vs market expansion (the difference)

Ok, since you are developing your market expansion strategy this assumes a few things about your market penetration strategy:

1. Your market penetration strategy no/minimal room for growth, or 
2. Is currently growing satisfactorily according to your Key Performance Indicators (KPIs), andor
3. Strategically working in union with your market expansion strategy.

With that, if you would like additional information on getting more from your market penetration strategy, here is a very helpful article:

How to write a market penetration strategy (5 simple steps)

International marketing channels: Direct channels vs indirect channels

Let’s now dig deeper into your marketing expansion strategy by developing your best international marketing channels.

In other words, they're the vehicles you use to reach out to people who don't know about you yet.

These channels can be as simple as a website where potential consumers can learn about your business or as complex as a cross-border joint venture with another company that sells similar products or services in another country. 

1. The 5 best direct international marketing channels: 

Direct channels are the most common type of international marketing channels. 

But they're not always the best choice for reaching international markets. 

For example, direct distribution may be your only option if you have a product that needs to be shipped in bulk freight containers by boat or train. This would imply that you have a sales channel already developed, otherwise you’d have to pay a port to simply store a container! And of course, no one wants that.

From our experience, five of the best direct channels for international marketing include:

1. Enter into a contract a with a foreign government 
2. Do a contract with a large supplier
3. Franchise your business and enter a contract with a trusted franchisee, commonly a master franchise agreement in an international territory
4. Sell from your website in the international market
5. Sell using social media platforms

Here’s an example of one of our businesses that sells to our primary, domestic market but also has international direct marketing channels and sells to international markets.

One option here is if we decided to enter a new international market, we could start with our existing database.

For example, we might decide we wanted to grow our customer base in Singapore. To do this, we would first look at our database using many of the strategies such as these two articles:

• Recency, frequency, monetary (RFM) | Marketing analysis
• How ratios are used in business and marketing (+6 important formulas)

The first thing we would do is to get a list of all current customers who are from Singapore and review their buying behavior, such as:

• How many customers are there?
• What product did they purchase?
• At what price point?
• What's the average order value (AOV)?
• How many units did they purchase?
• What does the Law of 80 /20 tell us about these customers and these orders?

Next, we would develop a survey to get a little more information from them and see if we can get a competitive edge as we develop our sales and marketing strategy.

Some sample survey questions might look like this:

• Why did you choose to buy our product?
• How do you use our product?
• How would you make our product better?
• What local markets do you normally shop in?

Her are two excellent articles on exactly how to develop your own survey using Google Forms, and a helpful article on how to increase the participation:

• How to create an online survey using Google Forms (+example)
• How do I request survey participation in an email? (Free template)

By doing marketing research like this you will have a far better understanding of the market you want to enter. This will save you time, money and resources and help you gain a competitive edge in your international marketing channel.

2. Indirect international marketing channels:

Indirect channels are more likely to be used in larger scale international marketing strategies because they're less expensive and better at reaching the target market(s) (like small businesses).

Also from our experience, here are the best forms of indirect marketing channels for international marketing:

1. Find a management company to handle the marketing for you
2. Contract with an export trading company
3. Market your products and services through eCommerce platforms such as Amazon, eBay, Etsy, and Alibaba.

Let’s review two main strategies here.

First, is using an eCommerce platform such as Amazon or eBay, which are very effective strategies that will give your brand and your product international exposure. These platforms are fairly unique to each other in how you acquire the customer information, but both are tried and true methods for developing your international marketing channel. 

For a helpful article on developing your eCommerce marketing strategy, go here for a very useful article:

Best strategies for eCommerce marketing (Free template)

A second, proven strategy for developing your international marketing channel, both very helpful for a direct or indirect channel development is to visit international trade shows.

The International Trade Association (ITA) regularly posts international trade shows and events on their site. Here are the upcoming Singapore trade events:

Singapore may present some excellent opportunities for many US exporters because they are part of the world’s largest trade agreement called RCEP. Go here for an excellent article about RCEP and how you might get involved:

What is the RCEP trade agreement in simple terms? (15 nations, $26 tril)

Once you decide which is the best country for your international marketing strategy based on the customer in your ideal target market, developing your international marketing channel(s) should not only be fun, but will bring many new opportunities.

References

1. International Marketing Channels: https://onlinelibrary.wiley.com/doi/abs/10.1002/9781444316568.wiem06006
2. International Marketing Channels: https://globalmarketingprofessor.com/international-marketing-channels/
3. International distribution channels & global marketing strategy: https://www.allianceexperts.com/en/distribution-strategy/
4. https://www.trade.gov/sales-channels
5. https://www.trade.gov/negotiating-agreement-foreign-representative
6. https://www.trade.gov/choosing-foreign-representative 
7. https://www.trade.gov/feature-article/export-trading-company-act-1982