Global Marketing: A Project Report
Global Marketing: A Project Report
Global Marketing: A Project Report
A PROJECT REPORT
ACKNOWLEDGEMENTS
Thanks to Almighty ALLAH the one and only who gave such
appreciable and worthy opportunity and enabled us to complete
our project and we are also in-debt to Holy Prophet (PBUH)
whose life is a living example for every Muslim.
Thanks to our loving families and our caring friends those helped
us a lot, encouraged us in every despair moment and enabled us
to face the challenges of this project.
TABLE OF CONTENTS
Page 2. INTRODUCTION
Page 2. MEANING OF MARKETING
Page 4. MEANING OF GLOBAL MARKETING
Page 4. EVOLUTION TO GLOBAL MARKETING
Page 7. GLOBAL MARKETING ADVANTAGES AND
DISADVANTAGES
Page 8. GLOBAL MARKETING ENVIRONMENT
Page 12. GLOBAL MARKETING: 5 STEPS TO SUCCESSION
Page 14. WHY GLOBAL MARKETING IS IMPERATIVE
Page 18. GLOBAL MARKETING PLANNING
Page 20. DOMESTIC vs INTERNATIONAL PLANNING
Page 21. CONCLUSION
Page 22. BIBLOGRAPHY
INTRODUCTION
Two decades ago, the term global marketing did not even exist. Today,
global marketing is essential not only for the realization of the full
success potential of a business, but even more critically for the survival
of a business. A company which fails to go global is in longer of losing
its domestic business to competitors with lower costs, greater
experience, better products and in a nutshell, more value for the
customer.
The importance of going global to ensure company survival is a more
powerful motive for many companies than the attract ion of
opportunity abroad. Industries that were entirely national in scope
only a few years ago are dominated today by a handful of global
companies.
MEANING OF MARKETING
Marketing is essentially a creative corporate activity involving the
planning and execution of the conception, pricing, promotion, and
distribution of ideas, products, and services in an exchange that not
only satisfies customers' current needs but also anticipates and creates
their future needs at a profit. Marketing is not only much broader than
selling, it also encompasses the entire company's market orientation
toward customer satisfaction in a competitive environment. In other
words, marketing strategy requires close attention to both customers
and competitors. The aim of marketing is to create value for
stakeholders, and the key stakeholder is the customer.
Advantages
Disadvantages
Differences in consumer needs, wants, and usage patterns for
products. Differences in consumer response to marketing mix
elements
Differences in brand and product development and the competitive
environment
Differences in the legal environment, some of which may conflict
with those of the home market.
Differences in the institutions available, some of which may call for
the creation of entirely new ones (e.g. infrastructure)
Differences in administrative procedures
Differences in product placement.
1. Demographic Environment
1. Demographic Environment Demography is the study of human
populations in terms of size, density, location, age, gender, race,
occupation, and other statistics. The demographic environment is of
major interest to marketers because it involves people, and people
make up markets.
The world population is growing at an explosive rate. It now totals
more than 5.9 billion and will exceed 7.9 billion by the year 2025. The
explosive world population growth has major implications for
business. A growing population means growing human needs to
satisfy. Depending on purchasing power, it may also mean growing
market opportunities.
The world's large and highly diverse population poses both
opportunities and challenges. Thus, marketers keep close track of
demographic trends and developments in their markets, both at home
and abroad. They track changing age and family structures, geographic
population shifts, educational characteristics, and population diversity.
2. Economic Environment
The economic environment consists of factors that affect consumer
purchasing power and spending patterns. Nat ions vary great ly in their
levels and distribution of income. Some countries have subsistence
economies they consume most of their own agricultural and industrial
output. These countries offer few market opportunities. At the other
extreme are industrial economies, which constitute rich markets for
many different kinds of goods. Marketers must pay close attention to
major trends and consumer spending patterns both across and within
their world markets.
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4. Technological Environment
The technological environment is perhaps the most dramatic force
now shaping our destiny. Technology has released such wonders as
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5. Political Environment
Marketing decisions are strongly affected by developments in the
political environment. The political environment consists of laws,
government agencies, and pressure groups that influence and limit
various organizations and individuals in a given society. Even the most
liberal advocates of free-market economies agree that the system
works best with at least some regulation. Well-conceived regulation
can encourage competition and ensure fair markets for goods and
services. Thus, governments develop public policy to guide commercesets of laws and regulations that limit business for the good of society
as a whole. Almost every marketing activity is subject to a wide range
of laws and regulations. Legislation affecting business around the
world has increased steadily over the years. The States has many laws
covering issues such as competition, fair trade practices,
environmental protect ion, product safety, truth in advertising,
packaging and labeling, pricing, and other important areas. The
European Commission has been active in establishing a new
framework of laws covering competitive behavior, product standards,
product liability, and commercial transact ions for the nations of the
European Union. Several countries have gone father than the United
States in passing strong consumerism legislation. For example, Norway
bans several forms of sales Promotion trading stamps, contests,
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6. Cultural Environment
The cultural environment is made up of institutions and other forces
that affect a society's basic values, percept ions, preferences, and
behaviors. People grow up in a particular society that shapes their
basic beliefs and values. They absorb a world view that defines their
relationships with others. People in a given society hold many beliefs
and values. Their core beliefs and values have a high degree of
persistence. For example, most Indians believe in working, getting
married, giving to charity, and being honest. These beliefs shape morespecific attitudes and behaviors found in everyday life. Core beliefs and
values are passed on from parents to children and are reinforced by
schools, churches, business, and government.
The notion of various environmental forces to global company is
shown in figure.
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Borders.
In order to do this, a company needs to find the similarities among the
consumers in a certain segment. Such similarities like values, age, and
lifestyle choices which need to translate into similar purchasing
behaviors. Once these similarities are found, a company can then view
the global marketplace as a single entity and sell a standardized
product worldwide using their same basic marketing mix to help them
position and sell that product in a variety of national markets.
5. Decide if standardized advertising will work for your
company.
If a company's advertisements legally and ethically can be viewed in
their home land country but also in other countries, then standardized
advertising is a great idea. If the advertisements are not offensive and
abide by that country's laws, then most likely using the same ads
instead of developing new ones for different countries is going to be a
significant cost saver. Also, there is concern that creative talent is
limited and that one large marketing effort has better results than 40
or 50 smaller efforts. On the other hand, cultural diversity makes it
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United States. Burger King and Pillsbury (known for its Haagen-Dazs
ice cream brand) are two American institutions owned and managed
across the Atlantic Ocean by Diageo, a newly created company as a
result of the merger of Britain's Grand Metropolitan PLC and Guinness
PLC.
Third, another profound change in the last decade is the proliferation
of the Internet and electronic commerce, or e-commerce. The Internet
opened the gates for companies to sell direct-to-consumers easily
across national boundaries. Many argue that e-commerce is less
intimate than face-to-face retail, but it could actually provide more
targeted demographic and psychographic information. Manufacturers
that traditionally sell through the retail channel may benefit the most
from e-commerce. Furthermore, customer information no longer is
held hostage by the retail channel. Most important, the data allow for
the development of relevant marketing messages aimed at important
customers and loyal relationships on a global basis.
An examination of the top one hundred largest companies in the world
also vividly illustrates the profound changes in competitive milieu that
we have seen in the past thirty years (see Table 1.2). Of the top
hundred largest industrial companies in the world, sixty-four were
from the United States in 1970 in 1980 the number declined to fortyfive companies. The latest figure came down to twenty four in 1997
(not shown) and went back up to thirty-five in 1999. The number of
Japanese companies in the top hundred has increased from eight in
1970 to twenty-four in 1999, almost a threefold increase. A similar
increase has also been observed with French companies, from three in
1970 to ten in 1997. The relative decline in the number of U.S.
companies in the top is reflected in the banking, insurance, and other
services sectors, as well as in the manufacturing sectors. The current
world economy has changed drastically from what it was merely a
decade ago.
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The changes observed in the past thirty years simply reflect that
companies from other parts of the world have grown in size relative to
those of the United States. In other words, today's environment is
characterized by much more competition from around the world than
in the past. As a result, many U.S. executives are feeling much more
competitive urgency in product development, materials procurement,
manufacturing, and marketing around the world.
The competition is not the only force shaping global business today.
Particularly in the past several years, many political and economic
events have affected the nature of global business. The demise of the
Soviet Union, the establishment of the European Union and the North
American Free Trade Agreement, deregulation, and privatization of
state-owned industries has also changed the market environments
around the world. Furthermore, the emerging markets of Eastern
Europe and the rapidly re-emerging markets of Southeast Asia
contribute to an international climate.
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The fluid nature of global markets and competition makes the study of
global marketing not only interesting but also challenging and
rewarding. The term global epitomizes both the competitive pressure
and the expanding market opportunities all over the world.
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Standardized plans
These offer a number of advantages:
- Cost savings on limited product range and economies of scale both in
production and marketing, for example fertilizers.
- Uniformity of consumer choice across the world.
Decentralized plans
Decentralized plans take into account the subtleties of local
conditions; however, they are usually very costly and resource
consuming.
Interactive plans
In this approach headquarters devises branch policy and a strategic
framework, and subsidiaries interpret these under local conditions, for
example Nestle. Headquarters coordinates and rationalizes advertising,
pricing and distribution. Within any of the above approaches plans can
be either long or short term. Increasingly planning is becoming fairly
routine. Most companies operate "annual operating plans" although
these are often "rolled forward" to cover a few years hence.
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CONCLUSION
Global marketing is a proactive response to the intertwined nature of
business opportunities and competition that know no political
boundaries. Global marketing does not necessarily mean that
companies should market the same product in the same way around
the world as world markets are converging. Global marketing is a
companys willingness to adopt a global perspective instead of a
country-by-country or region-by-region perspective in developing a
marketing strategy for growth and profit. The six forces making up the
companys macro-global environment include demographic, economic,
natural, technological, political and cultural forces. These forces shape
opportunities and pose threats to the company. Global market
possesses great importance of less developed countries (LDCs) It
provides all urge to develop knowledge and experience that make
development possible in LDCs. The remarkable growth of the global
economy over the past 50 years has occurred because of many driving
forces contributing to the growth of international business, namely,
market needs, modern technology, minimum cost application, higher
quality, information revolution and leverage advantages. Several
restraining forces also occurred in international trade in the form of
tariff barriers and non-tariff barriers. There are four identifiable stages
in the evolution of marketing across national boundaries. These are
known as Ethnocentrism, poly centrism, egocentrism and egocentrism.
Companies have the plan of entry strategy choices to implement their
global expansion efforts. Each alternative has its pros and cons. Global
companies often adopt a phased entry strategy. They start off with a
minimal risk strategy. Once the perceived risk declines, they switch to
higher commitment mode. It is made clear that, a broad range of
variables impact the entry mode choice. The three major dimensions
include the resource commitment a firm is willing to make, the
amount of risk the firm is willing to take and the degree of control that
is desirable.
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