Strategy development in international markets: a two tier approach

Abstract

PurposeThe purpose of this paper is to seek answers to the question of the impact of different classes of strategy (generic and international) on firm performance in international markets.Design/methodology/approachSurvey of 213 British SME exporters, using EQS.FindingsThe paper concludes that Porter's generic strategies have both a direct and an indirect impact through international marketing strategies on firm performance, and that the combined impact of the two levels yields better returns than either of them individually. Furthermore, it questions the wisdom of a stepwise approach to international markets and highlights the importance of a challenger strategy.Research limitations/implicationsThis research is limited to British SMEs and needs to be supplemented by research from other countries. Also, it explores the effect of only a limited number of confirmed international marketing strategies, excluding for instance the standardisation construct – a key construct in international marketing.Practical implicationsManagers may derive guidance in their planning by applying the model and the findings in their own deliberations.Originality/valueLittle agreement has been reached as to the impact of different international marketing strategies, let alone the classification of strategies themselves. This paper analyses firm strategy in two levels – generic strategies and five groups of international marketing strategies.