- April 15, 2014
- Posted by: essay
- Category: Term paper writing
The topic of global marketing has become especially popular after the release of Ted Levitt’s book “The Globalization of Markets” in 1983, the main idea of which was to claim that the people living on our planet have more similarities than differences (Levitt, 2009). Modern communication technologies contribute to common and comprehensive universality; the world in front of us is turning into one big village. According to T. Levitt (2009), marketers can earn good money if they forget about national differences and focus on the similarity of tastes and preferences of consumers. Generally, globalization of business operations and global marketing strategies have been the favorite topics of theorists and practitioners of marketing for the past few decades. They are applied at the level of top management of transnational corporations and among academic guru of international business.
Global branding regards the world as a single market, the work with which requires a single marketing plan with universal programs and single coordination system for production and distribution. The main criterion for the location of production is the minimization of costs for delivery of goods to customers (Keegan and Green, 2008). Everything is subject to standardization, all decisions are centralized. Adherence to this principle leads to the fact that the company is forced to give up satisfaction of non-standard needs of customers, but the increase in production efficiency compensates for losses (Albaum and Duerr, 2011). Few companies fully comply with the definition of globality, but most of them strive to this. For example, Ford’s competitive strategy involves the production of world-class vehicles in different regions of the world (Jeannet and Hennessey, 2005). However, the question is whether in real life there is a factual global consumer with the need for a global product.
Finally, global marketing may be seen as managerial utopia. As Sinclair and Wilken (2009) mark, while global marketing strategies are implemented at the international level, an attempt of effective global and centralized management of marketing is doomed to failure because of the managerial near-sightedness. Indeed, beyond the high-tech economies, globalization is not widespread. Thus, Philip Kotler (cited in Ghauri and Cateora, 2010) insists that the essence of marketing is product differentiation, determining customer needs and the characteristics of the brand, and the revenue. The inevitable conclusion is that the underestimation of the differences leads to neglecting the very foundations of marketing. Companies need to orientate themselves on the map drawn in a multinational or, rather, multilocus scale; and while in the 1950’s, 60’s and 70’s the global marketing and global brand management dominated, since the 1980’s the leading approach changed into the following: “Think globally, act locally” (Ghauri and Cateora, 2010). This slogan has become the basis for the formation of a new concept of glocalization.
Basically, glocalization refers to the ability of culture to absorb external impact that smoothly suits the nation and enriches it. But at the same time, it rejects the outside influences hostile to the culture. The goal is to assimilate aspects of globalization in the local culture, helping the local growth and diversity, but avoiding total domination of globalization over national self-development (Wilken and Sinclair, 2011). Glocal marketing strategy applies the universal tactical and strategic techniques in many countries, but gives an opportunity to adapt to the unique markets. Glocal strategies acknowledge the potential need of adaptation, individual approach, diversity, diffusion, independence and flexibility in marketing activities (Sinclair and Wilken, 2009).
Anyway, there are no purely global strategies: global brands have to adapt to the local peculiarities of the country and to resort to the localization of both the product and the full range of marketing communications. In particular, companies competing globally should be able to determine how various factors may limit their standardized approach, as it is rationally noted in Rialp and Rialp (2007). For example, if a company plans to sell its cars in Canada, it should equip them with a special engine heater for easy starting in winter at temperatures below 40Â°C, while the heater is no longer needed in warm countries, but the presence of air conditioning become a must. In any case, errors in the creation of the standardized approach can be very expensive.