Does the Firm's Technology and Marketing Profile Affect Foreign Market Entry?

Abstract

The authors examine the influence of the firm's technology and marketing profile on foreign market entry mode by testing hypotheses based on data from 105 firms in four European countries. Four technology and marketing variables were the most important: (1) the firm's generic marketing strategy—market concentration versus diversification, (2) demand uncertainty—the position in the life cycle of the firm's principal product, (3) transaction costs—transaction uncertainty and research and development, and (4) value added—product patents. The authors suggest ways managers may be assisted in their foreign market entry decisions on the basis of their firms’ technology and marketing profile.