lecture 3 p2- decision to internationalise Flashcards
standardization in international marketing
standardization
in marketing means using uniform marketing practices, strategies and marketing mix across different countires or regions without any modification
standadization ]key point, benefits, challenges
key points
- its a counter approach to adaptation, where companies modify their practices to fit the local market
benefits
- economies of scale
- uniform global image
- simplified decision making and faster time to market
challenges
- local resistance - products might not meet specefic or cultural nuances
- regulatory issues- diff countires verying regulations might not meet
- lack of flexibility - a one sie fits all approach might make it challegning to address market specefic crisis or opps
- potential backlash - perceived neglect of local traditions or needs
localization in international marketing
localization
customizing products and marketing strategies to fit local market conditions and consumer preferecnes
localization key elements
- product; adjusting features, design, and functions local needs and taste
- price; considering local purchasing power, competitors and market demand
- place; local distribution strategies, retail environments and supply chain
- promotion; tailored advertising and sales promotions that resonate with local culture
localization
benefits and challenges
benefits
- enhancd customerappeal and satisfaction
- competitiv adv in local markets
- reduced risks of cultural insensitivity
chall
- increased costs and complexities in desing and production
- need for extensive market research
- balancing global brand consistency with local relevance
glocalisation in international marketing
glocalisation
a combination of globalisation and localisation it refers to the adaption of internationally marketed products and services to fit the specificities of local culture
glocalisation
key principle
- global strategy; create universally resonante better with local consumers
- local adaption ; modifiy aspects to cater to local needs, preferences and cultural nuances
glocalisation
adv
challengees
adv
- relevance - locally adapted products reesonate better with local consumers
- effeicicny - maintains a global brand image while also being locally accepted
- competitive edge- sets the company apart from those who only implement either a global or local strategy
challenges
- complexity - balancing global strategies and local adjustments
- costs; local adaptions might increase production and costs
forces for standardisation
- worldwide markets
- global customers
- removal of trade barriers
cont’d
- standardised technology and communication
- managing relationships with local partners
- global cost drivers- economies of scale/scope
forces for stand
worldwide markets - universal aspirations
cultural convergence
the concept of a global village where shared culutral values and products become present
eg coca - cola, nike
forces for stand
global customers
-customers around the world expect consistent product/serivces delivery, features and pricing irrespective of the region
eg amazon
forces for stand
removal of trade barriers
deregulation allows for smoother, more consisteent international trade, facilittating standardised product service offering
forces for stand
standardised tech and communication
a globally connected world through tech - shared standards and platforms, simpliying global operations
forces for stand
managing relationships with local partners
ensuring consistent, high quality interactions with local subsidiaries, suppliers and partners to maintain a uniform brand opresence and operational efficacy
foprces for standar
global cost drivers - economies of scale/ scope
centralised production or operations can lead to cost saving when products/services are standardised
forces for localisation
- cultural difference
- regionalism/ protectionism
- de globalisation
forces for local
cultural differences
markets are people not products
‘there may be global products but not global people’
- lanuage, values, behaviours and customs vary across regions
- consumer preferences are influenced by local culture
forces for local
regionalism/ protectionism
regional clusters forming regional trading blocs, potentially hindering global expansion
eg european union
forces for local
de globalisation
resistance tto forign influences rooted in the beleif of native customes superirorty
‘everyone beleives their native customs are best’ Herodotus 2500 years ago
eg resistance to US culutral imperialism, mcdonalidastion, coco - colonisation
definition of mcdonaldisation
refers to the process by which principles of the fast food industry are dominating more sectors of society
4 key principles of mcdonaldisation
- efficiency - optimal method to accomplish a task
- calculability - focus on quantitative aspects eg big macs uniform size and big is better
- predictability - uniform services eg similar taste worldwide
- control - automation, replacement of human by non human technologies
mcdonaldisation extends beyond food
its principles ar seen in retail, healthcare, education etc
leading to homogenization of societal experinces
deglobalisation
- refers to the reduction of interdependence and connectivity between nations
- factors; economic shifts, politcal changes, cultural resistance and tech
how mcdonalisation contributes to de globalisation
- homogeenization of culture; over standardization can overshadow local tastes, cultures and practices
- economic dependencies; centralized control may lead to economic challenges for local producers
- resistance to culutral imperialism; backlash against perceived westernization oor americanization can spur movements to reclaim local indentity
- loss of authenticity; as local flavours are overshadowed,m theres a push for a return to local customs, traditions and cuisines
fundamental reasons for exporting for firms
is to make money
what initation of internationalisation driven by
proactive or reactive motives
proactive are usually related to internal and reactive to external triggers
internationalisation initiation and motives
proactive motives
related to need for strategic change, exploiting unique competences of a company or making use of market opps
internationalisation initiation and motives
reactive motives
are related to passive adjustments to treats from the global economic environment or external pressures
proactivee motives eg
- profit and growth goal; drive to increase organisational profitability and expand business operations
- managerial urge; intrinsic motivation of the motivation of the managment to internationalie driven by ambition and personal objectives eg vimto
- unique product/ competence; capitalize on distinct products or competeencies that have a compeititve adv in foreign markets eg k beauty
- foreign market opportuntis; proactivitly seeeking and capitalizing on opps in ovrseas markets to expand reacg eg yellow tail -US expansion to BRICS
- cost efficiency ; eco of scale acheive higher production levels to lower per unit costs
- taxation ; taking adv of tax incentives, reductions or breaks in forign markets
reactive motives eg
- competitive pressurses; racting to global rival defending market sharee or preempting competitors eg cola
- small/ saturated home market ; limited growth potential locally, seeking new growth aveneues abroad
- overproductive/ excess capacity; exploitating surplus production spreading fixed costs eg cars, white goods in US
- extending seasonal products sale - capitalizing on diff seasonal demands globally eg ipanema
- proximity of international consumers (physical/ psycholical); catering to nearby foriegn markets eg SAS
- orders from forieng markets; capitalizing on unexpected global opps eg yellow tail
barriers to initiatiom of internationalisation
lack of commitment (inward focus)
implication - avidance of global expansion
potential solutions- develop a global mindset and strategic international vision
barriers to initiatiom of internationalisation
insufficient knowledge and experinces
implications - limitd ability to gauge foriegn market potential
potential solutions - invest in market research and international training
barriers to initiatiom of internationalisation
insuffient finances and capital
implications - inability to bear international entry costs
solutions - explore joint ventures, partnerships and fincial support
barriers to initiatiom of internationalisation
insufficient capacity
implications - cant meet potential international demand
solutions - scale operations or partner with entities in target market
barriers to initiatiom of internationalisation
lack of forgien market connections
implications - dofficutlies in naivgating local networks
solutions - build alliances, attend trade fairs and network events
barriers to initiatiom of internationalisation
lack of foriegn market distribution channels
implications - trouble reaching customers effectively
solutions - collaborate with local distribution or establish own channels
