The Concepts Of Globalization And International Marketing Essay

Presents, the construct of globalisation has become one of the most of import constructs that affect the operations of many organisations and companies worldwide. The alterations go oning in the society, including alterations in footings of communicating and engineering have led to the alteration of concern and selling procedures and schemes, with the purpose of get bying with the mentioned alterations. Due to the bing fact that along with the alterations that happen in the society is the event of detecting planetary markets going more homogeneous. With this, companies and concern organisations, particularly transnational companies, continuously develop and better their selling plans and undertakings to run into the criterions of consumers and serve them across national boundaries. The development and betterment of such selling plans, schemes and undertakings lead many research workers and analysts to measure and measure the effects or impacts of globalisation. With this in head, this paper seeks to discourse the sensed impacts of globalisation on the international selling schemes of organisations, with mention to a major transnational company. In add-on to this is the treatment of the major forces that have led to turning globalisation of markets.

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Globalization and International Marketing

The constructs of globalisation and international selling are two of import constructs that must be addressed and discussed in relation to concern operations of big transnational companies. Globalization is defined as the integrating of the economic system at a planetary degree and involves two chief characteristics ( “ What is Globalization? … “ , 2003 ) . The first chief characteristic provinces that in globalisation, most trade takes topographic point among transnational corporations, while the 2nd chief characteristic emphasizes that the major activity in the planetary economic system is the flow of money in the signifier of derived functions, foreign investings and many others ( “ What is Globalization? … “ , 2003 ) . In simple footings, the construct of globalisation merely means the gap and cross relating of different economic systems in the universe, in line with the desire to hold a wider and diverse market. With this, since the purpose of globalisation is to spread out and diversify its market, the construct of international market so becomes relevant. International selling refers to marketing across national boundary lines, in which, the environment from where merchandises and services are offered differs from state to state, and services and installations are priced otherwise, with some merchandises or services non available at all in some states ( Benneth and Blythe, 2002 ) . From this definition, it can be observed that the constructs of globalisation and international selling are similar, with the purpose of market enlargement and variegation. However, the difference lies on the fact that globalisation may go the consequence of international selling.

A batch of concern organisations and companies engage in and concentrate on international selling, with the desire for more net incomes, gross revenues and acknowledgment from consumers. International selling besides allows concern organisations chances for farther development and betterment, in footings of their merchandises, services, schemes, systems, and operations. This is because international markets offer huge concern chances for houses with a merchandise or service in high demand, in line with newness, cultural version, attraction, and appropriate selling schemes that can help them peculiarly ( “ Global Marketing and Supply Chain ” , 2007 ) . In add-on, when houses focus on international selling, they are given the opportunity to derive more cognition and information in their industry, therefore, holding the chance to supply more advanced services and merchandises to their consumers.

With this, the schemes used in international selling can be discussed. The schemes or methods used in international selling are being used by transnational companies, with their purpose of spread outing and diversifying their markets. Chiefly, exporting is the initial scheme of houses in come ining a foreign market. Exporting means fabricating a merchandise in one state and selling it to another, and involves selling merchandises that have been made or assembled in a mark state ( Benneth and Blythe, 2002 ) . This is the initial measure of international concerns because exportation is a low hazard scheme, wherein few investings are made ( Perner, 2007 ) . Second scheme is through an constitution of an digesting presence in the foreign state through contract fabrication, which involves holding person else industry merchandises, while a specific house take on some of the selling attempts, therefore, salvaging investing ( Perner, 2007 ) . Third scheme is through licensing and franchising the merchandises of local concerns ( Benneth and Blythe, 2002 ) , which are low exposure methods of entry, as they allow other persons or groups of persons to utilize the house ‘s hallmarks and accrued expertness, therefore, bring forthing small control over the operation of the concern ( Perner, 2007 ) . In add-on, houses can besides set up their name and repute in a foreign market through sourcing constituents from foreign provinces ( Benneth and Blythe, 2002 ) , or importing natural stuffs and other equipments. This would somehow help the company in set uping its repute and name in the foreign state, therefore, giving it adequate chance to be known by its mark market. Last scheme or method of market entry is through direct entry schemes, where the house either acquires a house or construct operations that involve the highest exposure ( Perner, 2007 ) . With direct entry schemes, the house can garner more cognition sing the local market of its mark state, and sustains greater control over its resources and information ( Perner, 2007 ) .

These schemes are used by concern organisations and houses to guarantee their constitution in the market of their mark state. With the usage of such methods of schemes, concern organisations and houses are able to concentrate on their purposes and ends, therefore, doing them more focussed in taking advantage of unfastened chances that they can see as their border over other companies from the same industry. In add-on, with these schemes and methods, transnational companies or houses would be able to obtain equal and relevant information and cognition sing their mark market and state, therefore, would be utile in line with their merchandise or service development and betterment. The usage of such schemes, therefore, enabling them to take part in the procedure of and in heightening globalisation.

In relation to the schemes and methods used by houses to prosecute in international selling are the planetary schemes that besides aim for the same ends that international selling have. Most companies perceive globalisation as a affair of taking a superior concern theoretical account and widening it geographically, with necessary alterations, to maximise the company ‘s economic systems of sale. From this position, the cardinal strategic challenge is to merely find how much to accommodate the concern theoretical account – how much to standardise from state to state versus how much to place to react to local differences. However, the balance of localisation and standardisation does non ignore the fact that non all companies are similar from one another, including their differences in possible for development. Differences from state to state, in contrast, are viewed as obstructions that need to be overcome ( Ghemawat, 2003 ) .

The presence of differences is being recognized by companies as non merely as a disadvantage, but besides as an chance for concern and gross revenues. This is exhibited by the big transnational company Coca Cola. The Coca Cola Company is the universe ‘s prima maker, distributer and seller of non-alcoholic drinks, dressed ores, and sirups, and is present in about all parts of the universe ( “ Global Influence of Coca Cola ” , 2005 ) . It is considered a planetary company, one that mostly participates in the procedure of globalisation, for it is able to acknowledge and esteem the cultural differences among states and continents. Coca Cola was able to larn and educate itself to be able to go on functioning, satisfying, and run intoing the demand of its clients, through merchandise invention and development ( “ Global Influence of Coca Cola ” , 2005 ) . With this, the company was able to take part vastly in the procedure of globalisation, for the constitution of their name and repute in the planetary market does non merely intend the addition in the gross revenues and net income of the company, but besides the publicity and encouragement of instruction and acquisition, through the Coca Cola Foundation. The Coca Cola Foundation was formed and now operates in about 200 states, with the primary end of assisting those in demand, particularly those who lack instruction and cognition from academic establishments ( “ Global Influence of Coca Cola ” , 2005 ) . From this, it can be seen and proved that the Coca Cola Company has been able to go successful with its enterprises, and therefore, contributory to the procedure of globalisation.

Furthermore, in contrary to the planetary scheme of Coca Cola is the perceptual experience that traveling planetary does non intend that the company must needfully hold a presence around the universe, like Coca Cola. This merely means that the company must comprehend planetary competition and planetary markets and has determined the best scheme to thrive in that environment. The word “ planetary ” means the full universe, but is made up of smaller, more single geographic entities, get downing with the market in a peculiar province or state and widening beyond, therefore, does non restrict merely to the engagement of big makers ( Dossenbach, 2002 ) . There are several furniture makers who have carved a niche in the European market. One Northeastern company with 70 employees exports to England and presently dedicates about 20 % of its production to its market. Again, it is of import to understand that a planetary scheme does non hold to embrace every continent but can be regional, and giving big importance to program, above all else ( Dossenbach, 2002 ) .

Major Factors that Influence Globalization

The primary thrust of companies and houses to globalise is their purpose or desire to spread out and widen their mark markets. The enlargement and broadening of the mark markets of international houses indicates that the house has adequate resources to prolong and keep its operations and production. Expansion of the company besides indicates that the company has acquired plenty cognition in keeping the operation of the company, therefore, more erudite and experienced in its ain industry. This is a major factor to acknowledge, for with the desire to spread out, the company aims for more net income and gross revenues, which would enable to company to go more constituted in its industry. Second major factor to acknowledge and stress is the function of variegation, which is related to the presence of different civilizations and races in the company. Several positive effects are attributed to variegation, and includes efficient resource allotment through internal capital markets, the addition in the ability of houses to internalise market failures, and increase in productiveness ( as cited in Li and Jin, 2006 ) . In add-on, variegation can besides increase the coevals of thoughts, for more persons become involved in the procedures of the house. Employees are besides exposed to more civilizations, patterns and cognition, therefore, developing its organisational civilization. Third major influence is the unfastened chances for houses to prosecute in new concern ventures, which would supply them with opportunities for more net income and prestigiousness. New concern ventures involve the production of new merchandises or the invention of a specific merchandise or service. Fourth major influence or thrust is the fact that houses may accomplish celebrity or prestigiousness if it globalize. The constitution of name, product/service, and repute in specific states and continents gives the concern organisation a opportunity to be regarded as one of the most successful concern organisations in the whole universe, therefore, going more established in its ain industry. Last major influence is the possibility of pulling new and more endowments and accomplishments in the company, which would give the organisation the border of executing good over other companies.

Impacts of Globalization

One of the sensed impacts or effects of globalisation are the constitution of international confederations or alliances, which link houses of the same industry based in different states ( Agnihotri and Santhanam, 2003 ) . With international confederations, international policies and understandings will be established and reinforced, therefore, set uping an addition in the constitution of harmonious relationships among companies. In add-on, international confederations strengthens the industry where specific companies belong to, therefore, reenforcing their bond that would enable them to come up with schemes for farther betterment and development. Second impact of globalisation is the development and betterment of the whole organisation in order to turn to challenges or jobs, for in line with the engagement in globalisation is the addition in the figure of jobs to be encountered. The demand to configure and organize globally in complex ways creates some obvious organisational challenges, such as organisational construction, describing hierarchies, communicating linkages, and wages mechanisms ( Agnihotri and Santhanam, 2003 ) . With this, it can be understood that along globalisation is the demand to develop, better, innovate, and follow new schemes and methods in relation to systems alteration to enable accommodation to the alterations and challenges being encountered by the organisation. Modification and restructuring in the organisation is needed because along with the company ‘s purpose to spread out and widen its mark market is the demand for extra work force and direction procedures and manners that would enable the company suit the addition in alterations. Restructuring and remodeling of the company, therefore, serves to be a good manner of accommodation.

Third impact of globalisation is the constitution of authorities dealingss. In the globalized epoch, the choice of foreign market to come in and the manner of entry will mostly depend on the dialogues with the foreign authoritiess concerned ( Agnihotri and Santhanam, 2003 ) . This is because the international concern must be able to do dialogues and understandings with the authorities concerned, in order to follow with necessary demands and promote harmonious relationships. In add-on, the ‘muscle power ‘ of the planetary house can be critical in make up one’s minding the displacement of power equilibrium, such that it must pull off its relationship with the foreign authorities to its advantage ( Agnihotri and Santhanam, 2003 ) . Establishing a good and manageable relationship with the authorities concerned ensures a permanent relationship with the house, therefore, widening its operations in the foreign state. Last major impact of globalisation is the addition in competition among other houses in the same industry. A planetary house may be in a better place to vie with its planetary challenger, as it can heighten its resources globally ( Agnihotri and Santhanam, 2003 ) . Bing able to take part in its foreign mark market makes the planetary house more advanced and more developed compared to its challengers in the same industry, for it is able to run into the criterions and demands of its foreign clients. From this perceptual experience, major providers and stakeholders would prefer the planetary house to other houses.


From this treatment, it can be perceived that the constructs of globalisation and international selling affect one another, in footings of the operations of planetary concern houses. Coming up with international selling schemes enables a planetary house to take part in the procedure of globalisation, which enhances its abilities in turn toing all the jobs and challenges that come its manner. In add-on, the development of international selling schemes enables a planetary house gather relevant and extra cognition sing its mark market. The usage of such cognition would come in ready to hand in the existent procedure of developing a merchandise or service and in its operations. Several factors determine the thrust of organisations to take part in the procedure of globalisation, and include enlargement, variegation, new unfastened chances, celebrity or prestigiousness, and pulling new endowments and accomplishments in the organisation. The interaction of such factors enables a planetary house to invent utile and advanced ways on come ining a foreign market. These methods produce a figure of impacts, including international confederations, organisational challenges, authorities dealingss, and competition. These impacts enable planetary houses address issues in their organisation, which farther develop and better their direction and system.