Global Marketing Concept

Global Marketing Concept

Chapter 1

The concept of global marketing is used in different contexts, and has multiple meanings. It has been applied to mean so many different things. According to Johansson (2000), "global marketing is the integration that can involve standardized products, uniform packaging, identical brand names, synchronized product introductions, similar advertising messages, or coordinated sales campaigns across markets in several countries". At the global marketing level, the most profound change is the orientation of the company toward markets and associated planning activities. At this stage, companies treat the world, including their home market, as one market (Cateora, Gilly & Graham, 2009, p.20). A company is said to cross from international to global marketing when more than half of its sales revenue comes from abroad. The global marketing concept views an entire set of country markets as a unit, identifying groups of prospective buyers with similar needs as a global market segment and developing a marketing plan that strives for standardization wherever it cost and culturally effective. When a company is involved in global marketing it has to adapt its products to meet the different cultures in the different countries it operates in. Countries have different cultures and expect companies to respect it. Respecting cultural differences is a necessary recipe for success. Keegan (1989) mentions two motives for the globalization of marketing activities. One is to take advantage of opportunities for growth and expansion, and the other is survival. Companies that fail to pursue global opportunities will eventually lose their domestic markets, since they may be pushed aside by stronger and more competitive global competitors. With the trend of globalization, Levitt (1983) states that companies must learn to operate as if the world were one large market - ignoring superficial regional and national differences. In addition, he argues that the companies that do not adapt to the new global realities will become the victims of those that do. Global marketing involves awareness and tolerance of cultural difference and knowledge of cultures, history, world market potential and global economic, social and political trends (Cateora et al., 2009). As an organization develops from each level of marketing to become global in scope, there are four key marketing mixes that should be considered: product, price, place, and promotion. A global business is able to manufacture a single product or offer the same service to the global market with minimal adjustments of certain elements. Coca-Cola, for example, has uniform packaging in various countries, but differentiates in certain other countries using their native language on the bottle. In the different markets, price is not constant and uniform. Price changes are dependent on factors such as cost of product development, cost of materials, delivery, and other overhead factors. The aspect of marketing that entails adequate budget is promotion or product and service advertising. Global marketing can be both advantageous and disadvantageous to the global companies. Beneficially, the expansion of the market worldwide is a huge plus. Because it is global, a business maintains consistency in brand image and name for global brand recognition. Also, marketing practices are uniform which contribute to a lower cost and expenses in advertising. Business relationships are also established on a global level. Lastly, a company is able to benefit from the economies of scale in both production and distribution. On the other hand, there are disadvantages with global marketing, too. These are more related to the differences of various aspects considering that the business is now global. Differences in procedures and product placement can occur, as customers have different and changeable preferences that lead to diversity in customer responses. However, these differences may be addressed by the many ways and techniques a company can integrate

Chapter 2

The world population is growing at an explosive rate. It now totals 5.9 billion and will exceed 7.9 billion by the year 2025. According to Cateora et al. (2009) International Labor Organization estimates that 1.2 billion jobs must be created worldwide by 2025 to accommodate these new entrants. The explosive world population growth has major implications for business. It is significant in appraising potential consumer markets. A growing population means growing human needs to satisfy. Depending on purchasing power, it may also mean growing market opportunities. The world's large and highly diverse population poses both opportunities challenges. Thus, marketers keep close track of demographic trends in their markets, both at home and abroad. The world growth projections today are at 0 per cent, with developed countries posting a negative