Global Marketing Assignment: Understanding The Concept Of International Marketing
Task: To complete the global marketing assignment, answer the given questions.
1. Discuss what “globalness” means for businesses and how global companies could leverage their “globalness.” Include all of the following points when forming your response.
a) Compare and contrast global marketing strategy with international marketing strategy within this global marketing assignment. Customers in any country where a firm does business might expect the same product or service offers, which is called global marketing. Banks, insurance businesses, and large retail enterprises like Wal-Mart are among examples. International marketing, on the other hand, caters to the distinct needs of each market by offering items that are specifically customised to the needs of the clients in that area. They have diverse abilities from each other which when coupled provide successful outcomes for the organisation and its worldwide outlook. A company's marketing budget is established and authorised at the corporate headquarters when it adopts a worldwide marketing strategy.
For example, Nike finalises a certain amount of budget at its headquarters which then drops down to local branch offices afterwards. However, in worldwide marketing, the money is divided up among the several subsidiary offices, each of which is able to come up with its own spending plan. Advertising for McDonald's, for example, uses regional dialects and customs that are unique to the location. From the company's headquarters, every worldwide marketing strategy is planned and implemented; in international marketing, the marketing activities originate from the home market. Consumer participation levels are more readily visible in cross-border business ventures. International marketing, on the other hand, appears to produce more engagement than global marketing.
b) What is glocalization What does it mean to pursue a glocal approach in global marketing
Globalisation is never a one-way path. Just as globalisation comes from someplace and is executed by specific, socially, and geographically placed actors, so too ‘global’ processes are vulnerable to specific types of localization. Glocalisation is a politics of the global and the local, not to be understood via distinct geographic scales but rather the intricacy of the relationality of links. The local is influenced by global factors, while the global is likewise influenced by local forces. That which is abstract from that which is tangible must be separated out for our benefit. The global production of the local and the localization of the global. But global consumer capitalism supports endless needs/wants wherein specialised markets, customisation and joys of ongoing identity modification give rise to a heterogeneity. Local issues are addressed as a result of the effects of global influences.
Capitalist marketing methods that target distinct "local markets" establish the concept of the local as part of and as a by-product of globalising discourses like these. Any focus of particularity and variety is already an increasingly global discourse. A glocal approach involves delivering global information within a local setting that respects human rights. It encapsulates the notion 'think globally, act locally'.
c) Discuss how using a glocal approach could help companies leverage their “globalness.” Illustrate your argument with a company/brand example.
With its powerful, widely recognised brand image, McDonald's can appeal to a wide range of cultures. With its worldwide standards and training processes, McDonald's has become a global brand, but it also has a local feel, partnering with local companies, sourcing its ingredients from the local area, and catering to the specific preferences of the local customer market. Mc Donald’s continues to develop internationally and the expansion of the corporation demands unique marketing techniques such as glocalization marketing plan. As recently as the previous decade, researchers have begun to hypothesise about the occurrence of "glocalization."
In addition to the creation of new integrating units, globalisation necessitates the dismantling of preexisting ones. In reality, globalisation brings about a great number of disintegrations, referred to as glocalization. While glocalization does not guarantee a conflict-free future, it provides a more historically-informed and realistic perspective of what the future may hold. In the case of international corporations like McDonald's, localization serves a specific purpose, allowing for greater efficiency in the implementation of the marketing mix and contributing to the brand's dominance on the market. Glocalization plays a significant role in Mc Donald's global marketing efforts.
2. Developing and managing a global pricing strategy is usually more complexthan establishing national pricing strategies. Discuss the relevance of pricingstrategy in global marketing by reflecting on all of the following points.
a. Describe the three broad key factors that are relevant for setting prices inthe global marketplace. Provide specific examples to explain how eachfactor could influence global pricing decisions.
Managing global pricing is more challenging than setting national price plans. There are three important aspects that determine pricing policy in an international market.
i. Cost Factors
The foundation of every successful pricing plan is a thorough knowledge of the different costs associated with worldwide marketing.
Amount Spent on Travel
- Shipping goods across large distances is a common part of international marketing.
- Shipping costs can have a significant role in price decisions. Example: ZARA
- Zara is noted for responding rapidly to fashion trends and for providing new items quickly to its global locations.
- Zara pricing in the US might be 65 percent more than they are in Spain
- When items are carried over national boundaries, tariffs may have to be paid.
- The ultimate cost of goods is also affected by a wide range of local taxes, and a variety of national taxes contribute to the wide range of prices that may be found in different national marketplaces.
Example: Sin Taxes
- These are taxes levied on things that are legal but are discouraged by the society
- Tobacco products and alcoholic beverages typically fall within this category.
Costs of Local Manufacturing
- Operating costs for materials, salaries, and energy may vary from nation to country, which is relevant in this context.
Because labour expenses in South Africa are lower than in the United States, KFC is able to charge lower pricing for its chicken. In addition, SA is a significant producer of grain used to feed birds, which helps keep prices low.
ii. Market Factors
The market's realities are reflected in a good pricing strategy.
The quantity and variety of products and services purchased are directly proportional to the level of income in a country. Culture and Consumer Behaviour
Culture may also effect customer behaviour which in turn affects price.
Local customs, for example, might have an influence in adverting pricing
In China the number eight is connected with wealth and good luck whereas number four is related with death. Marketers in China avoid pricing ending in four, although prices ending with 8 were marketed four times more often than prices ending with other digits.
Any market's pricing levels can be considerably affected by the degree of competition.
It's easier for a business to vary its prices when it's the sole provider of a product in a certain market.
Price levels are occasionally controlled through cartels pricing agreements between rivals
In many countries, cartel is illegal by law
iii. Environmental Factors
It is important for international marketers to consider several external considerations when making price selections. Volatility of the US Dollar
When the value of the dollar fluctuates, exporters are particularly hard hit.
Price reductions for importers are made possible by a weak native currency.
Historically inflation has been more of a concern in developing nations
For the most part, price controls are most frequent in developing nations, where they may be used to battle inflation throughout the whole economy as a whole.
Pharmaceutical items are typically subject to price regulations. In the Philippines where one third of the nation lives on $2 a day, the government put price limitations on five frequently used drugs.
b. Compare and contrast market skimming, market penetration, andcompanion pricing strategies in global marketing by providing examples.Describe what business and pricing objectives could be met with each ofthese pricing strategies.
ü Through market skimming, corporations are seeking to target a part of the market i.e., prepared to pay a premium price.
ü Marketers who use skimming strategies to reach the world's elite, such as LVHM and other high-end brands.
ü In order to get a foothold in the market, it is necessary to keep prices as low as possible.
ü Pricing is then employed as a tactic to win market share.
ü For example, a news website may give a free trial of a subscription service for the first month, or a bank would provide a six-month trial of a free checking account.
ü Consideration of the whole product line is critical for formulating pricing strategies for electronic devices such as video game consoles, DVD players, and mobile phones.
ü Sales of game software generate the majority of the video industry's revenue.
ü Sony and Microsoft may be losing money on each gadget, but the sales of successful video games bring in a lot of money for the connected firms.
c. Define what adaptation (polycentric) pricing strategy is for global marketingand refer to the glocalization debate in your response. In this section of global marketing assignment, reflect on thebenefits and challenges of using this strategy worldwide for globalcompanies. Provide examples to support your arguments.
A route that works well in one market may not work well in another. It is imperative that the company's global marketing plan incorporates a channel strategy to satisfy its competitive position and overall marketing goals in every foreign market. Global marketers need to comprehend how environmental impacts (internal, macro and micro variables) may alter distribution methods and possibilities in each worldwide market.The advantages of a price policy rest in its capacity to make your goods desirable to buyers, while also paying expenditures. As a result, pricing methods have drawbacks, especially when they are not effective in attracting new clients. It's difficult to create and sustain premium pricing techniques. The costs of production and branding will be considerable, but the number of units sold will be modest. Because of product's high price, one is doomed to be outsold by cheaper competitors. Prices are used to determine the profitability of the product, determine demand, sales volume, and market share, counter the competition, build product image, and serve as a sales promotion tool. When producing a product, pricing is a major factor in determining whether or not it will be sold.