Global Marketing Flashcards
Glocalization:
products/services developed and sold globally but is adapted to the needs and wants of customers in a local market.
Ethnocentric
- Firm not adapting or tailoring products to the different local markets of the country.
- Won’t engage in any local customisation of its product.
- Has 1 standard products in its product range.
- reduces r&d costs.
- EOS
- Products may not meet the needs of the local market.
Polycentric:
- Firms changing/adapting their products to more closely meet the needs/wants of consumers in that nation.
- Customers in a new country may have their own unique needs that differ to other countries, so firms adapt what they sell to create something more customized.
- meet customer needs more specifically.
- potential for greater sales.
- potential to charge higher prices.
- higher cost – due to conducting market research, r&d costs to tailor needs of customers
Geocentric:
- Consolidate/ create one global identity for the organisation.
- May consider to tweak/adapt/customise products that they sell to the bespoke needs of customers in different countries.
- Won’t create a whole different product – may invest in researching the needs of customers in that specific country – mild adaptation to their product range – in order to make it more suitable for the customers in that country.
Global: low pressure of local responsiveness and high pressure of global integration
- Highly centralised
- focus on efficiency (EOS)
- Little sharing of expertise locally
- Standardized product
Transnational: high pressure of local responsiveness and high pressure of global integration
- Complex to achieve
- Aim is to maximise local responsiveness but also gain benefits from global integration
- Wide sharing of expertise (technology, staff etc)
International: low pressure of local responsiveness and low pressure of global integration
- Aims to achieve efficiency by focusing on domestic activities
-International operations are largely managed centrally - Relatively little adaptation of product to local needs
Multi- domestic: high pressure of local responsiveness and low pressure of global integration
- Aims to maximise benefits of meeting local market needs through extensive customisation
- Decision making decentralised
- Local business treated as a separate business
- There’s strategies for each country
Global Niche Markets:
- Markets where customers in many countries have specific needs and wants that are not satisfied by mass markets products (e.g: ridesharing and messaging apps)
- minimal competition – due to high customer loyalty
- price inelastic – firms can charge a higher price – maximises profits.
- low sales volume – don’t have much chance of gaining EOS – face high unit cost of production
- high profit – attract competition – reduces firms market share and revenue
Develop because:
- high profit – attract competition – reduces firms market share and revenue
- cultural differences
- Specialist expertise developed.
- Different adoption of technology
- Premium/luxury demand
- Distinctive branding
- Specialist distribution
Marketing Mix:
Product – the firm might need to adapt a product for different markets
Promotion – different culture may require different promotional methods
Price – production and distribution costs, taxes, income and competition will vary between countries and will affect how much a business can sell its products for
Place – firms need to know how and where consumers will but the product. (e.g: supermarket or online)
e.g: Starbucks expanding to China – developed new foods and drink items, and promoted itself as a premium brand with higher prices than in other countries and stores in luxury shopping malls.
Ansoff Matrix:
- Risk will increase when firm enters a new market overseas because managers know less about consumers, competition and economy – making market development difficult
- Polycentric approach – riskier than ethnocentric – firm may develop new products for a new market which will have more uncertainty than entering a new market with an existing product
