Global marketing strategy
| Global marketing strategy |
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| See also |
Global marketing strategy is based on the assumption that on the international market there is so called global consumer with similar needs and preferences. Using this approach, on foreign markets companies apply identical marketing instruments and their combinations, there is no different instruments adapted for social and cultural environment in those countries,
Global marketing strategy has several positive effects for managers:
- increase of efficiency by coordinating marketing efforts over several countries on the globe
- reducing role of national and cultural differences in product design and customer service
- utilisation of global logistics and value chains
- ability to reach for smart and creative employees overseas
Some examples of global companies using global marketing strategy are: Google, Uber, AirBnB, Microsoft, etc.
Global marketing
"Global marketing is defined as the firm's commitment to coordinate its marketing activities across national boundaries in order to find and satisfy global customer needs better than the competition"[1]. Therefore, the company can:
- based on similarities and differences between markets, develop a global marketing strategy,
- exploit the knowledge of the headquarters through worldwide diffusion
- transfer knowledge and practices from any of its markets and use them in other international markets.
Tips useful in marketing strategy[2]:
- Coordinate its marketing activities: integrating and coordinating marketing strategies and implementing them across global markets. Involves also delegation, centralization, standardization and local responsiveness.
- Satisfy global customers: adapting elements of the marketing, services and products
- Get to know global customer needs: this involves analysing market segments, carrying out international marketing research, as well as seeking to understand similar
- Being better than the competition: monitoring, assessing and responding to global competition by offering low prices, better value.
Marketing strategy
A global marketing strategy is as selling identical products with the same promotional programs through similar channels at comparable prices in more than one country. Levitt's very popular statement of the strategy (1983) is "selling the same product the same way everywhere"[3]. Proponents of a global marketing strategy claim that, as the world evolves, people, nations, and markets become more similar. Arguments in favor of a global marketing strategy we can divide into a category:
- strategic
- economic
- competitive
The economic gains can get obtained through cither economies of scale or experience curve effects. Economies of scale appear when costs production, marketing, and administrative fall down as corporations become larger. Experience curve effects appear when a company entering its second foreign market should be more effective than when it entered its first market abroad. Whether a firm benefits through experience curve effects or economies of scale, standardizing products is can be lower operating costs. Standardized marketing tactics can result in sharing good ideas and economize on managerial overhead, across national markets. The marketing losses assumed from not adapting to differences in markets may compensate the reduced costs from standardization. " Lower prices, Increased reliability, and quality improvements made possible through a global strategy are argued to be sufficient to overcome difference: in national preferences, creating world preferences for a standardized product"[4].
Examples
A lot of other companies have successfully pursued global marketing by creating strong global brands. For example, Philip Morris has made that Marlboro is the number one cigarette brand in the world. In automobiles, Daimler-Benz has gained global recognition thanks Mercedes nameplate. Global marketing strategies can also be based on system design, product positioning, distribution, customer service and packaging. For example, company McDonald's has designed a restaurant system that can be set up virtually anywhere in the world. Similar like Coca-Cola[5].
References
- Hollensen S. (2007). Global Marketing: A decision-oriented approach. Person Education Limited
- Keegan W.J., Schlegelmilch B.B. (2001). Global Marketing Management: A European Perspective. Person Education Limited
- Verhage B.J., Dahringer L.D., Cundiff E.W. (1989). Will a Global Marketing Strategy Work? An Energy Conservation Perspective. Journal of the Academy of Marketing Science, nr 1
- Zou S., Cavusgil S.T. (2002). The GMS: A broad conceptualization of global marketing strategy and its effect on firm performance. Journal of Marketing, nr 4, s. 40-56.
Footnotes
Author: Agnieszka Pytel
