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Prof. Ashulekha Gupta Abhinav Agarwal




I extend my sincere thanks to all those who helped me in the completion of this
report. Without their undying help and guidance, this project would not be what it is. I
specially extend my heartfelt thanks to my Faculty Guide Prof. Ashulekha Gupta for
helping me at every step, and guiding me in every way possible. This project would not
have been successful without his help and continuous guidance throughout. A special note
of thanks also goes out to the people from various fields for giving me their precious time
and helping me with this project. I also extend my appreciation towards my family who
encouraged me and were by my side whenever I needed them.

Abhinav Agrawal

MIB 0901

I have the pleasure in certifying that Mr. Abhinav Agrawal is a bonafide student of
2nd year of the Master’s Degree in International Business (Batch 2009-2011), of
Institute of Management Studies, Dehradun under H.N.B. Garhwal University Roll No.
………..……. .

He has completed his report work entitled “Globalization and its impact on Marketing
Strategies” under my guidance.

I certify that this is his original effort & has not been copied from any other source. This report
has also not been submitted in any other Institute / University for the purpose of award of any

This project fulfils the requirement of the curriculum prescribed by this Institute for the said
course. I recommend this project work for evaluation & consideration for the award of Degree to
the student.

Signature : ……………………………………
Name of the Guide : Prof. Ashulekha Gupta
Designation : HOD - MIB
Date : ……………………………………

Building on international business, strategic management and marketing literature, this

project advances prior knowledge on globalization and business by analyzing different effects of
globalization on firms. Globalization—the process of increasing social, cultural, political, and
economic interdependence—has resulted in several changes in business environment. Global
market opportunities and threats are major effects of globalization.

While the former refers to the increases in market potential, trade and investment
potential, and resource accessibility, the latter refers to the increases in number and level of
competition, and the level of uncertainty. Two empirical studies included in this project explore
how these effects influence firms’ international marketing activities and performance.

Thus, central contributions of this project include: first, it classifies the effects of globalization
on firms into global market opportunities and global competitive threats; second, it

integrates literature on international business, strategic management, and marketing to address

the effects of globalization on firms’ marketing conduct and outcomes; third, it demonstrates the
generalizing of the transaction cost economics, the market power perspectives, and the literature
on environment-organization interfaces in the domain of globalization; fourth, it confirms that
globalization acts as a two-edged sword and that alliance cooperation presents a viable
alternative for firms to navigate successfully in this new competitive landscape.

TITLE PAGE………………………………………………………………..I
EXECUTIVE SUMMARY…………………………………………………01
OBJECTIVE OF THE STUDY……………………………………………..03
RESEARCH & METHODOLOGY……………………………………….
FINDINGS & ANALYSIS……………………………………………

The primary objective of this research is to gain a better understanding of the effects of
globalization on firms’ international marketing cooperation and performance of firms, both in
developed and emerging economies (i.e., the India, and the other countries).

The first two questions of this project are:

1) Does globalization affect firm performance?

2) Is the relationship between global market opportunities and its performance stronger
than the relationship between global market threats and its performance?

By answering these questions, the study indicates the extent to which firms in two different
economic contexts are affected by globalization. It also shows which dimension of globalization
effects tends to have stronger impact on the performance of firms that are located in very
different market environments.

Some Questions arises while studying this topic:-

• Up to what extent Globalization is affecting different aspects of our life including culture,
environment and business or marketing.

• To study the different strategies used by the companies in this environment.

• To study the change in consumer behavior

• To study the threats and opportunities globalization is creating.

• What steps companies may take to go for globalization?

• To study “Is globalization useful for business.”


The emphasis of this project is on how the degree of cooperation in co marketing alliances
enables firms to manage globalization effects and stay competitive in international markets. As
suggested in past literature, globalization makes alliances an essential part of a firm’s strategy in
order to stay competitive and to achieve superior performance. To better capture global
opportunities, firms tend to cooperate with other firms to capitalize on and leverage their limited
resources since it is impossible for one firm to “do it all and go it alone. Similarly, in order to
cope with increasing global competitive threats, firms are likely to form alliances .Based on the
classical industrial organization perspective—the market power, firms form alliances to reduce
competition and uncertainty. Through such cooperation, companies gain market power that helps
alleviate competition and improve its competitive position.

Therefore, the next two research questions of this project are:

1) Does globalization affect the degree of cooperation in co-marketing alliances?

2) Do co-marketing alliances influence firms’ international performance?

Guided by these two broad research questions, a more specific emphasis of this paper is on the
degree of cooperation in international marketing activities of the co-marketing alliances among

Past literature also suggests that firms from emerging economies usually possess characteristics
which distinguish them from those of developed economies. Therefore, empirical investigations
on the relationships among globalization effects, degree of co-marketing alliances, and
performance of firms from India and other countries, which possess different backgrounds and
characteristics, are undertaken by secondary data approach.

An Overview
Globalization has caused dramatic changes to business practices around the world. Companies

such as IBM, Intel, Microsoft, and Philips have started to outsource specialists from various parts

of the world, causing job shifts and changes in companies’ structures. Alliances among

automakers (e.g., GM-Ford- DaimlerChrysler, Ford-Mazda, and GM-Honda), petroleum

manufacturers (e.g., BP-Mobil, NUPI-Chevron Texaco), and airlines(e.g., star alliances) are

other examples of changes driven by this phenomenon. Therefore, this dissertation investigates

the effects of globalization on business firms with a particular interest on how it affects firms

from both emerging economies (i.e., China, Thailand), and developed economies, (i.e..India and

the U.S).

In this study, “globalization” refers to the process of increasing social and cultural inter-

connectedness, political interdependence, and economic, financial and market integrations that

are driven by advances in communication and transportation technologies, and trade


Globalization (or globalization) describes an ongoing process by which regional economies,
societies, and cultures have become integrated through a globe-spanning network of
communication and trade. The term is sometimes used to refer specifically to the integration of
national economies into the international economy through trade, foreign direct investment,
capital flows, migration, and the spread of technology. However, globalization is usually
recognized as being driven by a combination of economic, technological, socio-cultural,
political, and biological factors. The term can also refer to the transnational circulation of ideas,
languages, or popular culture through acculturation.

People around the globe are more connected to each other than ever before. Information and
money flow more quickly than ever. Goods and services produced in one part of the world are
increasingly available in all parts of the world. International travel is more frequent. International
communication is commonplace. This phenomenon has been titled "globalization."

"The Era of Globalization" is fast becoming the preferred term for describing the current times.
Just as the Depression, the Cold War Era, the Space Age, and the Roaring 20's are used to
describe particular periods of history; globalization describes the political, economic, and
cultural atmosphere of today.

While some people think of globalization as primarily a synonym for global business and trade,
it is much more than that. The same forces that allow businesses to operate as if national borders
did not exist also allow social activists, labor organizers, journalists, academics, and many others
to work on a global stage.

In terms of economics, businesses participate in globalization to increase the international flow

on capital, including foreign investments. This would lead to the economic stability of the nation
and means providing more development such as infrastructures and establishments. Furthermore,
it could create international agreements among different nations, and may lead to more job
opportunities in the nation. This also affects the political aspect, as more projects will be
produced, nationally and locally, and will practically help the nation or country in their stability
and leadership. More opportunities may also mean the boosting of confidence of each individual
to become more productive and effective. Culturally, there will be an increase in the exchange of
information, and multiculturalism will be achieved; having no inferior or superior races. This
will lead to a boom in travel and tourism, which would totally help locals to promote their
products and profit from their small businesses.
No one doubts that the world’s economy is truly global. Whether it’s a Fortune 100 company
that sells on six continents or a local concern whose bottom line is affected by the cost of raw
materials that originate across the ocean, every business is tied to the global economy. And
ambitious companies look to become more global by the day.

Nestlé has reported massive double-digit growth in its China business. Procter & Gamble has
acknowledged that emerging markets will account for 25 percent more business in a few short
years. India will be a top-five consumer-packaged-goods market by 2010. The average salary in
that country is growing by more than 10 percent a year. Global means growth potential. And the
potential is staggering. By 2030, the world population will have gained nearly 50 percent over
2002, and developing nations will represent 90 percent of the world’s population, up five
percentage points.


Globalization is an interesting phenomenon since it is obvious that the world has been going
through this process of change towards increasing economic, financial, social, cultural, political,
market, and environmental interdependence among nations. Virtually, everyone is affected by
this process. Given these changes, globalization brings about a borderless world. Globalization
drives people to change their ways of living, prompts firms to change their ways of conducting
business, and, spurs nations to establish new national policies. Events transpiring in different
parts of the world now have dramatic consequences to other parts of the world at a faster pace
than anyone could imagine in the past. For example, the Asian financial crisis in 1997 has
severely affected businesses around the world and the outbreak of SARS (Severe Acute
Respiratory Syndrome) in 2003 has shown how globalization permits the rapid spread of the
disease, which affects many airlines, the hospitality industry, and other businesses around the
On the positive side, globalization enables firms to outsource and find customers around the
world, e.g., the auto and electronics industries. The globalization of production and operations
benefits firms through the realization of economies of scales and scope. Hence, no one can deny
that globalization has changed the way we conduct business.

Although globalization is a worldwide phenomenon, the extent to which each country is

globalized is not identical. To measure the degree of globalization of each nation, a globalization
index was recently developed by cooperation between Foreign Policy Magazine, AT Kearney
and EDS Company. The index indicates that some small developing countries in emerging
economies such as Singapore and Malaysia were among the top twenty most globalized nations
from 2001 to 2004 with Singapore being ranked as the most globalized nation. Thus, it is clear
that globalization is an important phenomenon, one that cannot be simply ignored, because every
nation—regardless of size or level of development—is globalized and affected by globalization.
With the prevalence of this worldwide phenomenon, it is not surprising that businesses are
inevitably affected.

Throughout this dissertation, the effects of globalization are classified into two broad categories:
1) Global market opportunities
2) Global market threats.

These two major effects are chosen to be investigated here because they are frequently cited in
the past literature as the most apparent and immediate effects of globalization. Global market
opportunities refer to the increases in market potential, trade and investment potential and
resource accessibility. Global market threats refer to the increases in the number and level of
competition and the level of uncertainty.


Consumer researchers are increasingly exploring and comparing behavior and cognitions in
diverse national environments. New samples of the consumer behavior are formed by the fact
that it drastic changes within the political borders and in the spatial configuration of the sales
markets for consumer goods, which are connected with strong sociological-cultural forces.
Barriers between markets moved away through regional integration, and created larger unified
market entities. Consumers are increasingly exposed to a myriad of diverse influences from
beyond their national borders, because the advances in communications technology are shrinking
distances and forgetting links between markets worldwide. Traditional definitions of the unit of
analysis used in cross cultural research need to be critically re-examined in view of the changing
consumer landscape.

There are different changing dynamics of consumer behavior in the world. In the following a few
are introduced. The first changing dynamic are the massive waves of migration which are taking
place, as consumers from emerging market economies are moving to industrialized economies.
The second one is that consumers are becoming more mobile and travelling more both for
pleasure and business. One of the results of this changing dynamic is that the consumers are
becoming exposed to the products, lifestyles and behavior patterns of consumers in other
countries. There are some reasons, for example that barriers come down (European Union) and
consumers and goods move freely across national boundaries. Firms gradually alter traditional
patterns of behavior, by introducing new products, services and ideas into the global market
place. As a result countries or cultures can no longer be viewed in isolation as a set of separate
entities, characterized by their own distinctive value-systems, traits and customs.

In the 60s and 70s the first studies (cross-cultural consumer research) emerged, which examine
the consumer behavior in the different countries. Studies were primarily descriptive and lacked
any strong conceptual framework to interpret findings and make inferences about observed
similarities' or differences' in behavior in different countries. One wanted to examine whether
similar consumption samples and behavior in similar demographic and sociological-cultural
groups in the different national cultures exist. A number of studies have focused on examining
the universality of consumer models in different countries and cultural contexts. This is one of
the key themes in cross-cultural psychology. Another stream of research focuses on comparing
similarities and differences in various aspects of consumer attitudes and behaviors such as
values, cognitions and decision making etc., in different cultural contexts or countries.

The key theme of this is the study of cultural values or rather to compare values cross culturally.

Differences in time orientation and use of time across countries or cultures have been another
favorite topic of investigation. A number of studies have focused on identifying global market
segments based on demographic characteristics, such as, global teenagers, women worldwide,
elite consumers, and have compared their attitudes and behavior patterns in different countries.
The changing dynamics of consumption behavior and the increasing complexity of cultural
influences on behavior, together with the limited ability of traditional research designs to capture
this complexity suggest the need to reexamine the design of cross cultural consumer research.

It is necessary to define the unit of analysis. There are different aspects to be attended here. The
first priority is to define the relevant unit of analysis, or cultural group to be studied. Important
point in this context is a high degree of homogeneity in attitudes and behavior among members
of the group. There are two different key criteria to define the unit. First there is the language,
which may be a dialect or main language, and secondly the degree of social interaction and
communication. Modern means of communication enable members located at geographically
dispersed sites to communicate, interact, and establish a strong closely knit community of shared
interest and identity. Besides this it structures the research design in cross-cultural studies. Once
the unit of analysis has been determined along with its cultural context, the next step is to
structure the research design and identity, the nature of the cultural phenomena or influences to
be studied.

The first and most common type of study involves a static comparison of cultic-units located at
different geographic sites and within different macro or micro-cultures. Another type of study
involves examination of the impact of exposure to direct and indirect influences from other
cultures on behavior patterns of a given group. A third type of study examines how attitudes,
interest and behavior patterns change with movement from one macro-culture to another. In such
studies, the local point is to examine the ethnic core of the culture, and in some instances, its
variation across sites. Different aspects of the ethnic core and its relation to behavior as
consumers can be examined, including, for example, its core values and beliefs, the artifacts and
symbols of the culture, and their impact on consumption, and desired product benefits, or
ritualistic behavior.

While multi-site studies focus on the ethnic core of the cultic- unit, and its influence on attitudes,
preferences and consumption behavior, the second type of study focuses explicitly on examining
the impact of external cultural influences on the culti- unit or individual members. These are
influences which come from other macro-cultures or originate from a cultural context other than
the one in which their culti-unit is embedded. There are direct and indirect influences. Direct
influences will arise when an individual travels to or lives for a period of time in another cultural
context or macro-culture. Indirect influences, on the other hand, arise from passive exposure to
media, information, visual images, or other stimuli generated by organizations from other ma
cro-cultures. A third type of study deals with transition from one macro-culture to another. This
occurs when an individual moves from one macro-cultural context to another, as through
immigration to another country.

Consumer Behavior in Global markets

The focus is to provide a comprehensive view of consumer behavior in global markets,

especially in relation to the countries of Eastern Europe and the third world.

Consumer behavior is likely to be somewhat different in developing countries since it is largely

influenced by social, political and economic conditions. It provides a framework that can be used
to study consumer behavior in global markets, this framework is applied to examine and
understand consumer behavior in countries of the third World and Eastern Europe. Besides this it
offers generalizations and recommendations to those wishing to market their products/services in
the Third World and Eastern Europe.

Theories/models have played an important role by detailing how various factors influence
consumer behavior. The four stages are termed access, buying behavior, consumption
characteristics, and disposal. A thorough understanding of each stage is essential for the global
marketer since the overall effectiveness of the marketing function is contingent on all four stages
being facilitated within any culture. First there are short definitions of each stage:

(1) Access

The first step in global marketing is to provide access to the product/service for consumers
within a culture. Access pertains both to physical access as well as to economic access.

(2) Buying Behavior

This stage encompasses all factors impacting on decision making and choice within a culture.
Examples of these factors include perceptions, attitudes, and consumer responses such as brand

(3) Consumption characteristics

The specific products/services that are purchased and consumed may be different in each culture.
The cultural orientation (traditional versus modern) and social class distribution, among other
factors, will determine consumption patterns within a culture.

(4) Disposal

Most countries, including the developing countries, are becoming more environmentally
conscious and moving away from throw-away products. Hence marketers need to design systems
to facilitate the safe disposal, recycling, resale or manufacturing of products. They must also
meet their social responsibilities in other countries, especially in relation to public safety and
environmental pollution.

First, since the four stages are universally applicable, the paradigm offers a general framework to
understand consumer behaviour within any global market. Second, in order to understand the
broadest possible range of consumer behavior within any culture, the paradigm encompasses all
aspects of purchase and consumption within a simple framework. Third, the four stages of the
paradigm are arranged in a hierarchical fashion from the consumers' viewpoint. And fourth the
consistent with the concept of business process reengineering, which encourages business to
improve corporate performance by using a cross- functional perspective.

The practical application of consumer behavior findings in international markets has often posed
a problem for marketers for two reasons. First, most consumer research in international markets
has used a piecemeal approach. Second, there has been no comprehensive framework to integrate
the findings in a meaningful manner.



Brand strategy is aimed at influencing people perception of a brand in such a way that they are
persuaded to act in a certain manner, e.g. buy and use the products and services offered by the
brand, purchase these at higher price points, donate to a cause.

A global brand needs to provide relevant meaning and experience to people across multiple
societies. To do so, the brand strategy needs to be devised that takes account of the brand’s own
capabilities and competencies, the strategies of competing brands, and the outlook of consumers
(including business decision makers) which has been largely formed by experiences in their
respective societies. There are four broad brand strategy areas that can be employed.
(1) Brand Domain- Brand domain specialists are experts in one or more of the brand domain
aspects (products/services, media, distribution, solutions). A brand domain specialist tries to pre-
empt or even dictate particular domain developments. This requires an intimate knowledge, not
only of the technologies shaping the brand domain, but also of pertinent consumer behavior and
needs. The lifeblood of a brand domain specialist is innovation and creative use of its resources.
A brand domain specialist is like a cheetah in the Serengeti preying on impala and gazelle.

The cheetah is a specialist hunter with superior speed to chase, and the claws and teeth to kill
these animals. The cheetah is also very familiar with the habits of its prey.

(2) Brand Reputation- Brand reputation specialists use or develop specific traits of their brands to
support their authenticity, credibility or reliability over and above competitors. A brand
reputation specialist needs to have some kind of history, legacy or mythology. It also needs to be
able to narrate these in a convincing manner, and be able to live up to the resulting reputation. A
brand reputation specialist has to have a very good understanding of which stories will convince
consumers that the brand is in some way superior. A brand reputation specialist is like a horse.

(3) Brand Affinity- Brand affinity specialists bond with consumers based on one or more of a
range of affinity aspects. A brand affinity specialist needs to outperform competition in terms of
building relationships with consumers. This means that a brand affinity specialist needs to have a
distinct appeal to consumers, be able to communicate with them affectively, and provide an
experience that reinforces the bonding process. A brand affinity specialist is like a pet dog.

(4) Brand Recognition- Brand recognition specialists distinguish themselves from competition by
raising their profiles among consumers. The brand recognition specialist either convinces
consumers that it is somehow different from competition, as is the case for niche brands, or rises
above the melee by becoming more well known among consumers than competition. The latter is
particularly important in categories where brands have few distinguishing features in the minds
of consumers.

The factors discussed above each have their own specific impact on the four general brand
strategies and their strategy sub-types. Due to the limitations of its format, this paper focuses on
factors that influence the four general strategies only. We also limit the discussion to one global
branding issue that has attracted a lot of attention among practitioners in recent years, namely
brand harmonization or standardization. This is not say that the factors discussed above do not
also have a profound effect on other global branding issues such as global brand extensions,
rationalizing a global brand portfolio, global brand architecture and co-branding global brands.


Since at least 10 years you hear a lot about Globalization, about the shrinking physical and
mental distances between countries.

There are probably four different marketing constituents that need to be considered if one
analyzes the extent of the globalization of marketing: The Consumer, Brands, the community of
Marketers, and the academic field of marketing.

The Consumer – There is no doubt that today’s consumers are much more globally oriented
than ever before. The internet makes physical boundaries seem obsolete, the exchange of ideas
and communication appear more borderless. But, but most consumers, especially in the US, still
spend most of their discretionary income on US brands, on products and goods that are sold
(definitely not manufactured) in the United States. There is only a very limited global sourcing
and purchasing behavior of consumers. This is very different from businesses which are getting
used to buy goods and services from anywhere. Still, the US consumer is used to shop non US
brands, and thinks more and more beyond physical country boundaries but there are only a few
(very rich) truly global consumers.

Brands – The number of truly global brands (e.g. Apple, Nokia, Hugo Boss) have increased over
the last decade. One just needs to look at Toyota and their increasing leadership in the
automotive industry on a global level. One can imagine that the world of brands morph into two
extremes, of very global and very local brands. Brands will have to decide if they want to focus
primarily on their local or their local identity.

Marketers – It’s still pretty rare to find really global marketers in the CMO’s position of Fortune
2,000 Firms. It’s much more common for CEO’s to have the global work experience with stints
on multiple continents. CMOs still seem to follow the old rule of originating from a brand’s
motherland. While this is partly understandable (you first need to understand the consumer’s
mindset of the brand’s mother or fatherland), CMO’s need to become much more global players.
Unfortunately there does not seem to be a growing community of global marketers, not even
within the big marketing services firms, that actively promote the global CMO.

Academics – The biggest lack of globalization resides within the academic community. Most US
marketing academics are too busy enough in reinforcing their own US superiority while non US
academics don’t like to rely heavily on the US marketing leadership. Just recently I asked US
academics about their favorite non US marketing personality or stimulating book. I did the same
with some of their European counterparts and inquired about their favorite US marketing
academic or book. In both cases I only received blank stares and uncomfortable silence.

This brief assessment of the globalization degree along the key marketing constituents shows
that leading brands behave and think much more global than the practicing or the academic
oriented marketer. We Marketers have to be careful that we don’t fall further back but instead
keep up with the speed of globalization. Currently it’s more driven by brands and opinion
leading consumers instead of a community of global marketers.
Why Go Global?

The playing field is wide open for small business. Here’s why both men and

women should consider going global:

• Increase sales.
• Generate economies of scale in production.
• Raise profitability.
• Insulate seasonal domestic sales by finding new foreign markets.
• Create jobs, productivity growth and wealth.
• Encourage the exchange of views, ideas and information.

Small business in particular can take a mentoring role in educating other men and women in
going global. They can establish educational programs, conferences and other activities to
advance their colleagues, and in doing so, promote professional growth and leadership among all
small business owners. The best is truly yet to come.

What Does It Take To Go Global?

Any small business owner must be adaptable, strategic and willing to take calculated risks. But
becoming a successful global small business requires the following commitments:

• Be comfortable with change.

• Welcome new experiences; and learn as much as possible about the culture in which you
are interested in doing business.
• Be willing to take risks, even though it may create short term challenges.
• Push yourself to continuously innovate.


1. Exporting

Exporting, the most traditional mode of entering the foreign market is quite a common one even
now. International trade has been growing much faster than the world output resulting in greater
world economic integration. Exporting is the appropriate strategy when one of more of the
following conditions prevails.

1. The volume of foreign business is not large enough to justify production in the foreign market.

2. Cost of production in the foreign market is high.

3. The foreign market is characterized by production bottlenecks like infrastructural problems,

problems with materials supplies etc.

4. There are political or other risks of investment in the foreign country.

Exporting is more attractive than other modes particularly when underutilized capacity exists.
Even when there is no excess capacity, expansion of the existing facility may sometimes be
easier and less costly than setting up production facilities abroad. Further, many governments, as
in India, provide incentives for establishing facilities for export production. The alternatives to
making in foreign countries by the international marketer for marketing the goods in the foreign
countries are licensing and contract manufacturing. Although these have certain advantages,
there are also certain risks. Hence, if a company does not want to go in for licensing or contract
manufacturing, the only avenue open is exporting.

2. Licensing and Franchising

Licensing and Franchising, which involve minimal commitment of resources and effort on the
part of the International marketer, are easy ways of entering the foreign markets. Under
International licensing, a firm in one country (the licensor) permits a firm in another country (the
licensee) to use its intellectual property (such as patents, trademarks, copyrights, technology, and
technical know-how, marketing skill or some other specific skill). The monetary benefit to the
licensor is the royalty or fees which licensee pays. In many countries, such fees or royalties are
regulated by the government; it does not exceed five per cent of the sales in many developing

A licensing agreement may also be one of cross licensing, wherein there is a mutual exchange of
knowledge and/or patents. In cross licensing, a cash payment mayor may not be involved.

Franchising is “a form of licensing in which a parent company (the franchiser) grants another
independent entity (the franchisee) the right to do business in a prescribed manner. This right can
take the form of selling the Franchiser’s products, ‘using its name, production and marketing
techniques, or general business approach.” One of the common forms of franchising involves the
franchisor supplying an important ingredient (part, material etc.,) for the finished product, like
the Coca-Cola supplying the syrup to the bottlers.

3. Contract Manufacturing

Under contract manufacturing, a company doing international marketing contracts with firms in
foreign countries to manufacture or assemble the products while retaining the responsibility of
marketing the product. This is a common practice in international, business.

Contract manufacturing has the following advantages.

1. The company does not have to commit resource for setting up production facilities.
2. It frees the company from the risks of investing in foreign countries.

3. If idle production capacity is readily available in the foreign country, it enables the marketer to
get started immediately.

4. In many cases, the cost of the product obtained by contract manufacturing is lower than if it
were manufactured by their international firm.

4. Management Contracting

Under the management contract, the firm providing the management know-how may not have
any equity stake in the enterprise being managed. In short, in a management contract the supplier
brings together a package of skills that will provide an integrated service to the client without
incurring the risk and benefit of ownership Thus, as Sir Philip Kotler observes, management
contracting is a low-risk method of getting into a foreign market and it starts yielding income
right from the beginning.

The arrangement is especially attractive if the contracting firm is given an option to purchase,
some shares in the managed company within a stated period. Management contract could,
sometimes, bring in additional benefits for the managing company. It may obtain the business of
exporting or selling otherwise of the products of the managed company or supplying the inputs
required by the managed company.

Management contract enables a firm to commercialize existing know-how that has been built up
with significant investments and frequently the impact of fluctuations in business volumes can be
reduced by making use of experienced personnel who otherwise would have to be laid off.

5. Turnkey Contracts

Turnkey contracts are common in international business in the supply, erection and
commissioning of plants, as in the case of oil refineries, steel mills, cement and fertilizer plants
etc; construction projects and franchising agreements.
“A turnkey operation is an agreement by the seller to supply a buyer with a facility fully
equipped and ready to be operated by the buyer’s personnel, who will be trained by the seller.
The term is sometimes used in fast - food franchising when a franchiser agrees to select a store
site, build the store, equip it, train the franchisee and- employees and sometimes arrange for the

6. Wholly Owned Manufacturing Facilities

Companies with long term and substantial interest in the foreign market normally establish fully
owned manufacturing facilities there. As Drucker points out, “it is simply not possible to
maintain substantial market standing in an important area unless one has a physical presence as a
producer.” A number of factors like trade barriers, differences in the production and other costs,
government policies etc., encourage the establishment of production facilities in the foreign
markets Establishment of manufacturing facilities abroad has several advantages. It provides the
firm with complete control over production and quality. It does not have the risk of developing
potential competitors as in the case of licensing and contract manufacturing.

Wholly owned manufacturing facility has several disadvantages too. In some cases, the cost of
production is high in the foreign market. There may also be problems such as restrictions
regarding the types of technology, non-availability of skilled labor, production bottlenecks due to
infrastructural problems etc. If the market size is small, a separate production unit for the market
may be uneconomical. Foreign investment also entails political risks.

7. Assembly Operations

As Miracle and Albaum point out, a manufacturer who wants many of the advantages that are
associated with overseas manufacturing facilities and yet does not want to go that fat may find it
desirable to establish overseas assembly facilities in selected markets. In a sense the
establishment. of an assembly operation represents a cross between exporting and overseas
Having assembly facilities in foreign markets is very ideal when there are economies of scale in
he manufacture of parts and components and when assembly operations are labour intensive, and
labour is cheap in the foreign country. It may be noted that a number of U.S. manufacturers ship
the parts and components to the developing countries, get the product assembled there and bring
it back home. The U.S. tariff law also encourages this. Thus, even products meant to be marketed
domestically are assembled abroad.

8. Joint Ventures

Joint venture is a very common strategy of entering the foreign market. In the widest sense, any
form of association which implies collaboration for more than a transitory period is a joint
venture (pure trading operations are not included in this concept). Such a broad definition
encompasses many diverse types of joint overseas operations, viz,

1. Sharing of ownership and management in an enterprise.

2. Licensing/franchising agreements.

3. Contract manufacturing.

4. Management contracts.

Three of the above have already been discussed in the preceding sections. The following
paragraphs are confined to the first category referred to above, i.e. joint ownership ventures.
What is often meant by the term joint venture is joint ownership venture.

The essential feature of a joint ownership venture is that the ownership and management are
shared between a foreign firm and a local firm. In some cases there are more than two parties

A joint ownership venture may be brought about by a foreign investor buying an interest in a
local company, a local firm acquiring an interest in an existing foreign firm or by both the
foreign and local entrepreneurs jointly forming a new enterprise.
9. Third Country Location

Third country location is sometimes used as an entry strategy. When there are no commercial
transactions between two nations because of political reasons or when direct transactions
between two nations are difficult due to political reasons or the like, a firm in one of these
nations which wants to enter the other market will have to operate from a third country base. For
example, Taiwanese entrepreneurs found it easy to enter People’s Republic of China through
bases in Hong Kong. Third country location may also be helpful to take advantage of toe friendly
trade relations between the third country and the foreign market concerned. Thus, for example,
Rank Xerox found it convenient to enter the erstwhile USSR through its Indian joint venture
Modi Xerox. There are several cases of countries not having direct commercial transactions. For
example, it was true of Israel and Arab Countries. In the past, government of India did not permit
trade with South Africa and Mauritius.

10. Mergers and Acquisitions

Mergers and acquisitions (M & A) have been a very important market entry strategy as well as
expansion strategy. A number of Indian companies have also used this entry strategy. Mergers
and acquisitions have certain specific advantages: It provides instant access to markets and
distribution network. As one of the most difficult areas in international marketing is the
distribution, this is often a very important consideration for M & A. Another important objective
of M and A is to obtain access to new technology or a patent right. M and A also has the
advantage of reducing the competition. Mergers and acquisitions may also give rise to some
problems which arise mostly because of the deficiencies of the evaluation of the case for
acquisition. Sometimes the cost of acquisition may be unrealistically high. Further, when a
enterprise is taken over, air its problems are also acquired with it. The success of the enterprise
will naturally depend on the success in solving the problems.

11. Strategic Alliance

Strategic alliance has been becoming more and more popular ininternational business. Also
known by such names as entente and coalition, this strategy seeks to enhance the long term
competitive advantage of the firm by forming alliance with its competitors, existing or potential
in critical areas, ‘instead of competing with each other. “The goals are to leverage critical
capabilities, increase the flow of innovation and increase flexibility in responding to market and
technological changes.”

Strategic alliance is also sometimes used as a market entry strategy. For example, a firm may
enter a foreign market by forming an alliance with a firm in the foreign market for marketing or
distributing the former’s products. A U.S. pharmaceutical firm may use the sales promotion and
distribution infrastructure of a Japanese pharmaceutical firm to sell its products in Japan. In
return, the Japanese firm can use the same strategy for the sale of its products in the U.S. market.
Strategic alliance, more than an entry strategy, is a competitive strategy.

There are different types of alliances according to purpose or structure. Based on the description
of the generic forms of coalitions by Michael Porter ‘and Mark Fuller, Magsaysay classifies
alliances according to purpose as follows.

1. Technology development alliances like research consortia, simultaneous engineering

agreements, licensing or joint development agreements.

2. Marketing, sales and service alliances in which a company makes use of the marketing
infrastructure etc., of another company, in the foreign market, for its products. This may help
easy penetration of the foreign market and preemption of potential competitors.

3. Multiple activity alliance which involves the combining of two or more types of alliances.
While marketing alliances are often single country alliances, as international firms take on
different allies in each country, technology development and operations alliances are usually
multi-country since these kinds of activities can be employed over several countries.

4. Multiple activity alliance involves the combining of two or more types of alliances. While
marketing alliances are often single country alliances, as international firms take on different
allies in each country, technology development and operations alliances are usually multi-
country since these kinds of activities can be employed over several countries.

12. Countertrade
Although the major reason for the substantial growth of counter trade is its use as a strategy to
increase exports, particularly by the developing countries, countertrade has been successfully
used by a number of companies as an entry strategy.

For example, Pepsi Co, gained entry to the USSR by employing this strategy. Countertrade is a
form of international trade in which certain export and import transactions are directly linked
with each other and in which import of goods are paid for by export of goods, instead of money
payments. In the modern economies, most transactions involve monetary payments and receipts,
either immediate or deferred. As against this, “countertrade refers to a variety of unconventional
international trade practices which link exchange of goods - directly or indirectly - in an attempt
to dispense with currency transactions.”


As with any sound business plan, the first step is doing your homework. Here are ten action steps
for taking on the world:
1. Conduct market research to identify your prime target markets.
2. Search out the data you need to predict how your product will sell in a specific
geographic location.
3. Update your database rigorously with a view to focusing more closely on those products
or services which are in demand and dropping those which are not.
4. Articulate your business plan for accessing global markets.
5. Get companywide commitment.
6. Build a web site and implement your international plan sensibly.
7. Factor in a two year lead time for world market penetration.
8. Make personal contact with your new targets armed with culture specific information and
courtesies, professionalism and consistency.
9. Value the relationship more than the deal; the individual is more important than closing
the deal under discussion.
10. Welcome the unknown.

Global market opportunities can be defined as increases in market potential, trade and investment
potential and resource accessibility resulting from globalization. Developments in information
technology, removal of trade and investment barriers, privatization, and deregulation of trade and
investment policies have provided firms seeking international markets with tremendous
opportunities. Such changes in the business environment enable firms to not only access new
markets but also lower costs by relocating their operations and exploiting cheap resources around
the world. Firms can outsource their production in various locations to lower their costs. Market
transactions have also become more efficient due to globalization of technology. These new
market opportunities have eventually fostered rapid growth in various economic sectors in many
regions around the world (Graham, 1996). A large volume of cross-border flows of trade,
investment, and technology during the 1990s and early 2000s is excellent evidence of increasing
opportunities driven by globalization.

As discussed earlier, globalization increases market potential, trade and investment potential and
resource accessibility of firms. It has become easier for firms to outsource their production to
different locations to gain benefits from location advantage since less trade and investment
barriers are present in today’s global marketplace. Firms are able to reach out and serve many
new untapped markets around the globe. Liberal movements of financial and human capital also
facilitate their business transactions. Moreover, advances in communication technology and
information systems also lower search costs and improve efficiency.

Hence, it is clear that globalization makes resources necessary for a firm’s growth and success
more abundant. Given that these opportunities are likely to enhance the firm performance, the
first hypothesis of this study can be stated as:

Firm performance is positively influenced by global market opportunities.


Global market threats can be further categorized into 1) global competitive threats and 2) global
market uncertainty. Global competitive threats are defined as the intensified competition in
global markets resulting from larger numbers of competitors in the global marketplace. Along
with higher competition, another threat posed by globalization is global market uncertainty,
which refers to the increasing complexity and demand uncertainty in the market. These two types
of global market threats and their hypothesized relationships are discussed in detail in the
following sections.



Due to the emergence of global market opportunities and global market threats, firms have been
forced to respond quickly to these effects. Unlike other environmental changes, the effects of
globalization are far more pervasive—affecting every individual, business, industry, and country

The environment surrounding business today is characterized as a “hypercompetitive”

environment—a faster and more aggressive competitive environment. Major forms of business
restructuring in response to the dramatic changes brought by globalization include, for example,
investments in new technologies, downsizing and reengineering, the formation of strategic
alliances and networks, and a shift from international and multinational to global and
transnational strategies. Among these various forms of business restructuring designed to
manage globalization effects, alliance formation is considered the most remarkable business
trend of the past decades. Therefore, it is of interest to both academics and practitioners to
explore how alliances help firms achieve superior international marketing performance in the
globalization era.

Since globalization makes alliances an integral part of a firm’s strategy to better satisfy
customers and to achieve sustainable competitive advantage, the proliferation of alliances in
recent years is not surprising. It has become difficult for firms to stay competitive in this era
without allying with other firms. Moreover, to achieve superior marketing performance in the
present business environment, firms need to manage relationships with partners, customers, and
different parties in the value chain. As a result, there has been an increasing trend towards more
cooperation among firms, both vertically and horizontally. Such inter-firm cooperation is
especially important for firms to compete in the global marketplace. In order for firms to succeed
in international markets, they need cooperate with other firms and or governmental agencie.
Thus, the purpose of this paper is to explore whether globalization affects the degree of
international marketing cooperation of firms participating in co-marketing alliances, a type of
strategic alliance in which partners cooperate in one or more marketing activities. Specifically,
we propose to investigate the influence of globalization effects on the degree of firms’
cooperation in co-marketing alliances, and the relationship between such cooperation and the
firms’ international marketing performance.


Strategies adopted by Various Companies

How Johnson & Johnson is winning in this environment. Specifically, the shift in economic
activity to developing nations, along with the associated rise of the middle class, which is
projected to significantly increase levels of consumer spending. How Johnson & Johnson is
maintaining its competitive edge in a global environment, citing its recent acquisition of Pfizer
Consumer HealthCare and the geographic expansion of Splenda. The Pfizer acquisition
effectively doubled the size of Johnson & Johnson's OTC market, with 50% of this market
now located outside of the U.S. Furthermore, in only five years since its launch, Splenda is
now distributed in 33 countries worldwide. While the core brand footprint - the look and feel
of the product - is consistent from region to region, Johnson & Johnson tailors the approach
and positioning of Splenda to local markets. The company's global reach and focus on local
market dynamics has enabled it to successfully enter these new markets.

In addition to learning from keynote addresses, ranging from health and wellness to the evolution
of market research.

The "Branding Strategies: The Challenge of Going Global and Staying Local" panel explored
what marketers can do when expanding product lines globally to protect their brands and
improve the chances of successfully launching products.

Rob Warren, Senior Vice President of Global Tequila for Diageo, explains that in taking a brand
global, the core essence of the brand and what it stands for must remain consistent. However, the
way that Diageo brings a brand to life for consumers may be tailored to specific cultures.

Sylvia Lin, Associate Director of Global Oral Care Long Term Innovation for Colgate-
Palmolive, noted that companies should determine how to gain a competitive advantage in a new
market. For example, Colgate-Palmolive conducts extensive research to determine whether
Colgate toothpaste should be marketed in English or in local languages. "In some instances it
makes sense to leverage the American brand; in others, it simply does not," explains Lin. The
"Health and Wellness: Trends in a Global Marketplace" panel discussed how marketers can react
to and capitalize on health and wellness trends when developing competitive marketing strategy.
Sharon Fox, Director of Marketing of Beverages at Kraft Foods, discussed a holistic health and
wellness trend, explaining that customers "desire balance in mind, body and soul; it is not just
about what they eat, but about overall healthiness." Kraft has developed a Sensible Solution Flag
for over 500 products that meet specific health related criteria, like 100-calorie-packs and Crystal

Brian Graybill, Director of Marketing of Tostitos, describes how Frito Lay responded to
changing consumer preferences by launching its Flat Earth products, snacks that include half a
serving of fruits or veggies per ounce. He also stressed the importance of engaging children in
healthier food options. However, Mr. Gray noted that lifestyle is more of a challenge than calorie
intake with kids. This led Frito Lay to launch "America on the Move," a program dedicated to
educating children about active, healthy lifestyles.

The Industry believes that while flavor preferences may vary regionally, philosophies and
general trends in health and wellness are global in nature. Companies worldwide are addressing
widespread health problems like heart disease, diabetes, and obesity. Some People dedicated to
the media industry, "Ready to Sweep out Traditional Media?" focused on the impact of new
media such as user-generated media and mobile marketing on consumers' purchasing behaviors.
The panelists also addressed whether they believe new media will soon supplant traditional off
-line media.

Elizabeth Poon, Regional Brand Development Manager for Unilever, believes in the
effectiveness of new media in developing consumer interaction with a brand. Unilever
established consumer interaction with its Dove brand through an online contest for women to
create a 30-second Dove advertisement. The winning video from this popular contest was aired
during the 2007 Oscar broadcast and generated serious industry buzz. According to Ms. Poon,
"consumers always had power and intent to contribute; only now they have the tools."

Panelists agreed that while newer media has advantages in its accountability and in the
immediacy of results, traditional media still has its place. "It's not a matter of new versus old;
integration is the bottom line."

Some other Industry expert explored the changing landscape of market research. Panelists
discussed how technology, such as online and adaptive surveys, online focuses groups, consumer
auctions, and data mining have affected the field.

Dan Salzman, Global Vice President of Marketing Research in Consumer Healthcare for
Johnson & Johnson, believes that technology has made research faster, cheaper, and allows
companies to answer questions in non-intrusive ways. In addition, the targeted nature of new
technologies allows researchers to "no longer seek to get accurate averages, but tailored solutions
for customers."

Steve Nollau, Partner of Brado Cuneo Nollau, believes that a cost-saving advantage related to
technological advances in marketing research. New technology has enabled companies to test
product concepts at an early stage in the development process, "preventing lots of money from
being spent on bad ideas and promoting investment in viable ones."

Last, the effects of the Internet and globalization on consumers, as they are provided increasing
access to product information, purchase outlets, and overall purchase options. This evolving
landscape presents both challenges and opportunities in consumer loyalty and retention for the
retailer, manufacturer, and marketer.


Consumers in most countries had trouble relating to generic products, so executives instead
strove for global scale on backstage activities such as production while customizing product
features and selling techniques to local tastes. Such "global" strategies now rule marketing.
Global branding has lost more luster recently because transnational companies have been under
siege, with brands like Coca-Cola and Nike becoming lightning rods for anti globalization
protests. The instinctive reaction of most transnational companies has been to try to fly below the
radar. But global brands can't escape notice. In a research project involving 3,300 consumers in
41 countries, the authors found that most people choose one global brand over another because
of differences in the brands' global qualities. Rather than ignore the global characteristics of their
brands, it's critical for firms to manage those characteristics, because future growth for most
companies will likely come from foreign markets. Consumers base preferences on three
dimensions of global brands--quality (signaled by a company's global stature); the cultural myths
that brands author; and firms' efforts to address social problems. The authors also found that it
didn't matter to consumers whether the brands they bought were American--a remarkable finding
considering that the study was conducted when anti-American sentiment in many nations was on
the rise.


Day by day, global branding is becoming a bigger challenge. Why? Because it's no longer
possible to isolate a brand and its reputation. Companies might think you've created an excellent
strategy for your brand in one local market, only to realize that the rest of the world has access to
that same local communication. This exposure destroys any possibility of separating your local
branding strategy from your global branding strategy. This unavoidable exposure of company’s
local brand-building strategy in the international arena is part of the growing difficulties that
attend global brand building. Related to this complication are the internal issues that arise. For
example, how can corporations handle the local and global mix in their marketing departments?
Is every local marketing department now obsolete? Can local marketing be taken over by a
single department of centralized marketing functions?

Such issues are the result of the speed and spread of communications. The Internet has enabled
every consumer to access every piece of communication in the world. Good old concepts like
running test markets have been dramatically altered because of the increasing proximity among
markets. True separation among markets has disappeared.

When Coca-Cola selected Australia as the test market for the first non-Coca-Cola drink it had
launched in years, most of the world watched the experiment, and almost as many people
participated in the experiment from outside the test market. This might very well have been the
strategy's intention. However, if the objective was to test a new product in a local market, the
strategy clearly failed.

Global communication is more or less forcing brand builders around the world to adjust their
approaches. They're having to forego the strategy that provides local marketing teams with full
autonomy. So, how should we handle the brand challenge?

First of all, the local brand is not dead. But some of the activities that are used to promote it are
now obsolete. I would separate local brand-building activities from global brand-building
activities on the promotional side, as McDonald's has done. Ronald McDonald is the key in-store
promotional figure. Very seldom do you see him on television commercials and, when you do,
you see him publicizing in-store promotions.

Ronald, very cleverly, has become McDonald's point of differentiation in each market. He
celebrates Christmas in Northern Europe and the Chinese New Year in Hong Kong. He promotes
McDonald's wine in France and McDonald's Filet-o-Fish in Australia. But he never appears in
globally accessible media. McDonald's' global messages come through television commercials.
The corporation produces local adaptations of these, too. But you can see McDonald's local
twists are substantially stronger in the in-store promotions than on television.

The purpose of global brand management is to conceive of and control a brand's global direction,
and this is done by defining and communicating the brand's core values. The execution of this
communication lies in devising and consistently applying a specific style, tone, and image.

The role of local brand management is to refine the communication of the brand's core values by
adjusting their execution to communicate meaningfully with each local market. If a local event
like the Chinese New Year is taking place, it's the local brand-builder's task to ensure the brand
leveraging on it. Local brand building depends on an acute awareness of local trends; it's all
about leveraging knowledge that the international marketing department has no access to or
sympathy with.

The global marketing department is the strategic group. The local team is the tactical group. Both
need to work hand in hand.

Managing Brands in Global Markets: One Size Doesn't Fit All

Global companies need global brands to some extent. But global branding is not an all-or-
nothing proposition. There is a continuum along which firms can decide how global they wish
their brands to be -- with a single global brand at one extreme and an assortment of nothing but
local brands at the other. Global and local brands can be part of a successful marketing mix at
any spot along the continuum. Decisions to use a combination of local and global brands -- what
the Wharton professors call the "hybrid" approach -- depend on many factors, including
products, industry, local cultures and the nature of the competition.

There are "various levels of being truly global. It is not always achievable, nor desirable, to go
the full extent. Some form of local adaptation may be necessary, either in the product/service that
is offered or in the positioning relative to competition."

Big Brands, Big Money

Which global brands are most valuable? According to the 2004 Business Week/Interbrand
survey, Coca-Cola tops the list of the 10 most valuable global brands ($67.4 billion), followed by
Microsoft ($65 billion), IBM ($53.8 billion), General Electric ($44.1 billion), Intel ($33.5
billion), Disney ($27.1 billion), McDonald's ($25 billion), Nokia ($24 billion), Toyota ($22.7
billion) and Marlboro ($22.1 billion).

These brands and others share some common features: They have a consistent name that is easy
to pronounce; corporate sales are globally balanced with no dominant market; the essence and
positioning of the brand is the same the world over; they address the same customer needs, or the
same target segment, in every market; and there is great similarity in execution (pricing,
packaging, advertising) across cultures.

What kinds of products do not lend themselves to global brands? Food is one category where,
literally, differences in tastes from culture to culture compel global companies to adapt to local
conditions, according to Day. At the other end of the spectrum is a company like Intel, whose
products and markets make it easier for executives to establish a truly global brand with a
memorable catch-phrase: "Intel inside."

It's much easier for a company like Intel to establish a global brand, Intel has a smaller number
of buyers [than many other global companies] and all of those buyers are using computer chips
for the same purpose. And all of Intel's competitors are global. Intel is a global brand without
significant local adaptation. The same holds true for Disney, which stands for family
entertainment in all cultures.

Forces against Globalization

One such force is the inherent market differences that can exist from country to country. For
example, KFC, formerly Kentucky Fried Chicken, has 5,000 restaurants in the U.S. and 6,000 in
other countries. It has learned that it cannot open restaurants globally based on its U.S. model. In
Japan, KFC sells tempura crispy strips. In Holland, it features potato-and-onion croquettes. In
China, KFC's chicken gets spicier the farther inland one travels.

Another countervailing force is entrenched local brands. Conditions favoring local over global
brands include unique market needs; low frequency of purchase, so that brand loyalty passes
from one generation to another through family traditions; and the relative unimportance of
advertising, which makes it harder for global companies to change loyalty patterns.

A third force mitigating against global brands is the growing concentration of retail buying
power -- labeled "growing channel power" by the authors -- which can lead to heightened price
sensitivity on the part of the buyer. Wal-Mart's goal to offer low prices every day can constrain
companies wishing to sell their products through Wal-Mart stores.

Finally, criticism of global brands by activists opposed to globalization can also limit global
branding. A 1999 book titled No Logo, by Naomi Klein, alleged that global brands and excessive
corporate power were chief contributors to poverty around the world. Well-known logos of firms
such as Nike, Disney, Shell and McDonald's became symbols of a host of complaints about
globalization. Targeted companies responded by establishing codes of conduct and improving
labor practices, but the anti-globalization movement served notice that high-profile brands
carried risks.
1600 Brands

In a chapter titled "Managing Brands in Global Markets," the authors trace the paths of two
global brands, Unilever and Music Television Networks (MTV). Both companies exhibit the
various challenges faced by global firms to sell their products and services worldwide. The
experiences of these two firms also show that developing brands for global markets is more
complex and nuanced than Levitt's portrait of an inexorable march toward globalization would

In the 1990s, Unilever was struggling under the weight of some 1,600 brands in more than 50
countries. Revenues were lopsided -- 3% of the brands provided 63% of revenues -- and the
company was not growing. In 2002, Unilever launched a program to reduce its number of brands
to 400 "core" brands so that it could concentrate its resources on fewer products. The company
combined branding strategies by placing the 400 in three categories: international brands (such
as Dove and Lipton), regional brands (such as a spread called Flora in the United Kingdom and
Becel in Germany), and local brands with strong positions in single countries (including
Wishbone salad dressing in the United States and Persil detergent in England).

MTV might appear to be the kind of company that could establish the type of uniform global
brand that Levitt envisioned. MTV entered Europe in 1987 with pan-regional programs in
English. Programming was provided to cable operators at no charge, and all revenue came from
advertising. Within a few years, however, things changed. Advertisers called on MTV to offer
local programs, either because they could not afford pan-European coverage, their products were
available only locally, or their products were not uniformly branded in all countries. At the same
time, strong local competitors emerged, such as VIVA in Germany and MCM in France. MTV
responded to the change in climate. Today, MTV Europe (MTVE) has a presence in 41 countries
with multiple languages and formats and nearly 50% local programming.

For one thing, MTV realized that the local advertising sales market was much bigger than the
pan-European market. Moreover, changes in technology allowed separate satellite feeds to each
country. Hence, MTV managed to address local content and advertising concerns, while
simultaneously leveraging its powerful global brand identity -- the anti-establishment voice of
young people.

Effects of Globalization on Indian Industry started when the government opened the country's
markets to foreign investments in the early 1990s. Globalization of the Indian Industry took
place in its various sectors such as steel, pharmaceutical, petroleum, chemical, textile, cement,
retail, and BPO.

Globalization means the dismantling of trade barriers between nations and the integration of the
nations economies through financial flow, trade in goods and services, and corporate investments
between nations. Globalization has increased across the world in recent years due to the fast
progress that has been made in the field of technology especially in communications and
transport. The government of India made changes in its economic policy in 1991 by which it
allowed direct foreign investments in the country. As a result of this, globalization of the Indian
Industry took place on a major scale.

The various beneficial effects of globalization in Indian Industry are that it brought in huge
amounts of foreign investments into the industry especially in the BPO, pharmaceutical,
petroleum, and manufacturing industries. As huge amounts of foreign direct investments were
coming to the Indian Industry, they boosted the Indian economy quite significantly. The benefits
of the effects of globalization in the Indian Industry are that many foreign companies set up
industries in India, especially in the pharmaceutical, BPO, petroleum, manufacturing, and
chemical sectors and this helped to provide employment to many people in the country. This
helped reduce the level of unemployment and poverty in the country. Also the benefit of the
Effects of Globalization on Indian Industry are that the foreign companies brought in highly
advanced technology with them and this helped to make the Indian Industry more
technologically advanced.

The various negative Effects of Globalization on Indian Industry are that it increased competition
in the Indian market between the foreign companies and domestic companies. With the foreign
goods being better than the Indian goods, the consumer preferred to buy the foreign goods. This
reduced the amount of profit of the Indian Industry companies. This happened mainly in the
pharmaceutical, manufacturing, chemical, and steel industries. The negative Effects of
Globalization on Indian Industry are that with the coming of technology the number of labor
required decreased and this resulted in many people being removed from their jobs. This
happened mainly in the pharmaceutical, chemical, manufacturing, and cement industries.

The effects of globalization on Indian Industry have proved to be positive as well as negative.
The government of India must try to make such economic policies with regard to Indian
Industry's Globalization that are beneficial and not harmful


Rural Agricultural Marketing - Impact of Globalization: Contract Marketing

The macro level changes due to the New Economic Policy have had a direct impact in the field
of agricultural marketing. So the impact of globalization has been highlighted here.

As a result of globalization substantial investments in new ventures are being made by national
as well as international corporations. A number of foreign companies are slated to enter the
Indian market through collaborations with the well known Indian companies like Eagle Agro-
farms, Maxworth Orchards, etc. It is clear that the wholesaler in the fresh products market as
well as the processor will prefer contract marketing tie-ups with the farmers for sourcing his
supply requirements.

The concept of contract farming is not new to India. Several years back, contract marketing was
successfully tried in respect of "Hima peas". 'MARKFED' of Punjab also operated a scheme of
contract marketing for green peas, Agrecotec proposes to setup country-wide retail network of
shops for fresh fruit vegetable marketing. ,Direct marketing to consumer is already being done
by the Mother Dairy through its outlets in Delhi.
The successful integration of production and marketing under Apni mandi' scheme in Punjab and
the marketing managements of 'FRESH' in Hyderabad are clear signs that contract marketing is
going to be increasingly resorted to in the years to come. “Pepsi Foods" also an another example
of contract farming of potatoes and tomatoes. Under this farming farmers will be producing
specific varieties or qualities tailored to meet the requirements of the processor or the fresh
produce market.

The potential benefits of the contract farming are:- producers can reduce the market risk, post
harvest losses can be reduced, technology can be transferred to the producers, contract serve as a
security for increased access to credit by both producers and processors, contract may create a
greater sense of common interest among the producers and induce greater involvement in group
activities etc.

Common problems may be volatility in market price, there is risk that the processors may
manipulate the quality standards, coordination problems may be there regarding delivery of
inputs or produce, processors may lack the competence or capacity to deliver the require
technical assistance, producers may become tied to a contract relationship by virtue of debt,
specialization, or the disappearance of other markets and may be unable to adjust their
production activities to changing conditions etc.

Many of these problems of contract farming will not arise where goodwill and credibility exist
between the farmers and the concerned company.

Major Areas of Concern in the Rural Marketing Sector

1. Government should assume a more dynamic role in the field of agricultural marketing that of a
strong buffer between global forces and local needs.

2. Emphasize value addition by giving a thrust to agro-processing industries at farm level so that
the benefit of value addition is transferred to the producer.

3. There is a need for professionalizing agricultural marketing as a subject of great practical

4. Creation of an effective market intelligence network, right from the importer in the global
market to the producer in the remote corner of the rural India.

5. Institutional linkages should be emphasized upon to integrate the markets, for easy movement
of goods and also to facilitate the inter-state trade.

6. Regular surveys and analytical studies on agricultural marketing should be conducted, so that
appropriate policy adjustments and refinements whenever necessary.

7. Decentralization in the marketing system.

8. To introduce social marketing for bringing about a change in the behaviour and attitude
through social advertising and social communication. Some fertilizer companies and commercial
banks are taking up Village Adoption Programme under the social marketing.

9. A design frame work for information technology based Agricultural Marketing Network is
essential. Computer installations at State as well as district marketing boards enhances the
availability of trade information.

10. Economic incentives should be offered to the farmers to encourage them during low
economic conditions.

Research in a common parlance refers to a search for knowledge. Research can also be

defined as scientific and systematic search for pertinent information on the specific topic. So

research means careful investigation on inquiry especially through search for new fact in branch

of knowledge. Research is an academic activity and as such as term should be used in a technical

sense. “Research comprises defining and redefining problem, formulation hypothesis or

suggested solution, collection, organizing and evaluating data, make deduction and research

conclusion and careful testing the conclusion to determine whether they fit or not ”. Research

purpose is to discover answer to question through the procedure of scientific procedure.

Research Design

The study is descriptive and empirical in nature with applied bias.

Descriptive Study:

Descriptive studies are utilized when the researcher attempts to describe the state of affairs

without controlling the variables causing change. This study includes the survey and fact finding

inquires of different kind. The major purpose of descriptive research was description of the state

of affairs that exists in Globalization and its marketing strategies.

Empirical Studies:

An empirical research relies on experience or observation alone often without due regard for

system and theory. It is the data research coming up with the conclusion which is capable being

verified by observation and experiment.

Analysis Pattern

The nature of the project is of the subjective nature so for the analysis of the available data, the

use various statistical and mathematical and graphical techniques was not required. There were

no additional statistical and technical tool were considered for suitability of the procedure &

problem in order to achieve the desire objective. The study was of the qualitative aspect not the

quantitative. All the data was collected through interviews a secondary data so not tool were used

It has been found that firms from emerging economies usually possess characteristics which
distinguish them from those of developed economies. Therefore, empirical investigations on the
relationships among globalization effects, degree of co-marketing alliances, and performance of
firms from India and other countries, which possess different backgrounds and characteristics,
are undertaken by secondary data approach.
In Secondary data, external research was done through Internet website & published books

were consulted.

Local success on a global scale


Much of the debate about global branding has centered on the question of whether global brands
should attempt to speak with one voice around the world, or whether they should adapt to local
cultures. A popular strategy for many brands has been to globalize logos, brand names and
trademarks, while introducing product variations at the local level. But a few global brands have
gone the extra mile and achieved what must be the best of all possible worlds—acceptance as
local brands nearly everywhere they do business. Most of the brands that have achieved
multilocal status have been around for awhile, although the tie-in is not completely obvious.

One modern American brand that has achieved widespread local acceptance overseas is
McDonald's. The American fast food chain has become such a routine part of the landscape in
parts of Asia, for example, that kids may not even be aware of the company's foreign origins. In
the book "Golden Arches East," Emiko Ohnuki-Tierney relates a story of Japanese Boy Scouts
who were surprised, when traveling abroad, to encounter a McDonald's in Chicago (edited by
James L. Watson, Stanford, 1997).

McDonald's began expanding internationally in 1967, twelve years after it began franchising in
the US. By 1996, the restaurant chain was operating restaurants in more than 25 foreign
countries. In contrast to Singer and Philips, however, McDonald's became multi-local in the
absence of trade barriers and at a time when global communications were not practically
instantaneous; nor have McDonald's overseas restaurants operated independently of the home

Although the restaurant chain has made numerous efforts to localize its menu (it offers, for
example, salads in the US, lamb burgers in India, vegetarian burgers in the Netherlands, teriyaki
burgers in Japan, salmon sandwiches in Norway, frankfurters in Germany, and poached egg
burgers in Uruguay), it did not gain local acceptance worldwide by marketing local specialties.

As Harvard's James L. Watson argues in Golden Arches East: McDonald's in East Asia, the secret to
the restaurant's global popularity has almost certainly been its French fries, which he writes are
"consumed with great gusto by Muslims, Jews, Christians, Buddhists, Hindus, vegetarians,
communists, Tories, marathoners, and armchair athletes." McDonald's fries have resonated with
local tastes in dozens of countries—a fact that is not surprising when one considers that potatoes,
consumed by over a billion people around the world, are one of the most recognized foods on

But there's even more to the potato story. According to the University of Western Ontario's
Dawar, McCain Foods of Canada is the largest international supplier of French fries to
McDonald's. Meanwhile McCain, which markets frozen potato specialties in 100 countries, has
itself achieved multi-local acceptance in many of the countries where it does business. The
company localizes its product by calling it chips in the UK for instance and developing local
advertising for markets and managers by region. In Australia, people think of McCain as an
Australian company. In England, people think of McCain as an English company. In Canada,
people think of McCain as a Canadian company... McCain is a very local brand in each of the
markets in which it operates.

Problems faced by Global brands

Companies find it difficult to succeed in new markets that are culturally unfamiliar.
• They often underestimate differences in the patterns of daily life in the new markets.
• This makes it difficult to develop products and services that fit peoples’ lives,
• It is difficult to extend their brand, and manage culturally diverse teams.


Coca-cola : Global is Out, Local is In

• Initial setbacks in 80s the benefits of global integration are sought and the need to adapt
products to local markets is largely ignored.

• Coke is instituting a strategy of ‘think local, act local’ by putting increased decision making in
the hands of local managers.

• Make model citizen by reaching out to the local communities and getting involved in civic and
charitable activities.

Better understanding and appealing to local differences.



• Workers were required to speak English, even if most people in attendance were French.

• Liquor was not sold in the park; they have a drink with lunch or dinner.

• Many of the exhibits and rides did not have a local theme; they were the same as those in

Disneyland USA and thus did not appeal to Europeans.


• began creating European-specific attractions

• Started to serve alcoholic beverages

A series of changes, abandoning its global approach, and substituting one that appealed to local


Procter & Gamble (P&G) with annual sales of almost $40 billion has operations

in virtually every country of the world.


• The firm employs a strategy that combines high national responsiveness with high economic

• Strategies being developed and implemented locally and/or regionally. In particular, product
delivery and marketing are local.
• The ‘back office’ of payroll, financing, human resource management and other general services
and processes is coordinated on a more global basis, in order to achieve internal economies of


• Economic efficiency and localization.



No doubt that in the age of globalization and liberalizations, Export has became of the most
lucrative business in India. Government of India is also supporting exporters through various
incentives and schemes to promote Indian export for meeting the much needed requirements for
importing modern technology and adopting new technology from MNCs through Joint ventures
and collaboration.

Export Sector of Indian Economy has improved immensely over the years and has earned US
$ 125 billion in the current fiscal year. The goods exported from India mainly include wide
variety of agricultural products, chemicals, jewelry, garments, leather goods and so on.

India has developed business relations with a number of foreign countries like the member
countries of SAARC, some Eastern European countries as well as African countries, Members of
EU. The impressive list of countries includes:

• Russia



• Hong Kong

• UK

• Japan

• Germany

• Singapore

• Belgium
• Malaysia

• Netherlands

• Bangladesh

• Italy

• Thailand

• France

• Australia

• Belgium

The export sector of Indian economy has always delineated impressive growth in all the areas of
export, like the chemical industry in the financial year 2005-06 recorded US $ 12677.21million
from exports, whereas the export earnings from gems and jewelry was US $ 13705.44million in
the same fiscal. The engineering industry has been performing consistently over the years in the
arena of exports as it secured the second position in terms of the earnings from exports in 2004-
05, amounting to US $ 10516.45million, which increased to US $ 14587.37million in the next
fiscal. The performance of textile industry has fluctuated a little as the earning of the textile
industry from exports in the financial year 2004-05 was US $ 12204.71million which came down
to US $ 12017.46 million in 2005-06.

USA has turned out to be the most significant export partner of India and the export sector of
Indian economy earned approximately US $ 13265.60 million in 2006-07. UAE has stood
second only to USA as UAE contributed 9.7 out of the total Indian earnings from exports in
2006-07. UK and China has exchanged their positions in the current year as China's share among
the exports figure in India in 2006-07 has improved by 6.3 % in comparison to 2005-06. In 2004-
05 Belgium and Italy contributed substantially to the earnings from exports, with a contribution
of US $ 2442.09 million and US $ 2160.83 million respectively.

The major export products of India hail from the following divisions within the export sector
of Indian economy like:

• Engineering Goods
• Agricultural Products

• Chemicals

• Marine Products

• Petroleum products

• Leather Goods

• Textiles

• Plantations

Among the agricultural exports of India include Indian rice, raw cotton, cashew, sugar, tobacco,
spices, coffee, wheat and tea have become very popular in the international market on account of
their variety and excellent quality. The engineering industry serves to export electronic goods ,
transport equipments, iron and steel, and various machineries and the textile industry is engaged
in the export of readymade garments, jute, cotton yarn, carpets, woolen yarn, coir, artificial
fabrics and so on. Other significant export products include paints, rubber, iron ore, plastic,
pharmaceuticals etc.

The export barriers in India have been hampering Indian exports to a great extent and most of
such barriers have been announced by the European Union regarding certification requirements,
application of pesticides, dumping of waste products. But the most significant export barrier
faced by the Indian exporters is red tapism which is mostly accompanied by corruption.
However, the government of India has considered plans to liberate the Indian exporters from the
cumbersome paper works and simplify the required procedures.

The export sector of Indian economy made comprehensive progress over the last decade. The
exponential growth of the export sector of Indian economy can be attributed to the liberal
Government of India economic policy. Indian exports have an ambitious target of US 160 billion
in 2007-08. The achievement came to the Indian exports in the last fiscal despite the odds against
the exports, minimizing the gains. In the first two months of 2007-08 exports grew by 20.3%,
which was a little lower than the previous year over the same period a year ago.
The Government of India latest export policy for the exporters will help in stabilizing the export
growth levels attained in the 1st quarter of 2007-2008. Ores and minerals exports grew
moderately to 12.9% against 37.4% in 2005-06. Similar trend was also observed in the exports of
manufacturing sector. The exports of manufactured goods from India grew moderately by 15%
in the first quarter of 2007-2008 as compared to 21.2% in the last fiscal year. High value
commodities like engineering goods and rice registered very high growth rate in the 1st quarter
of this fiscal against the same period last year. The overall exports suggests that the Indian
exports grew considerably across all major exporting destinations. The Indian exports to
Pakistan, UAE and Italy showed remarkable growth in the first quarter of the current fiscal year.

The astronomical growth of the Indian export sector was led by the following industry -

• Information Technology

• Information Technology Enabled Services

• Telecommunications hardware

• Electronics and hardware

• Pharmaceutical and biotechnology products

• Consumer durables

• Textiles

• Construction machinery

• Power equipment

• Food grains

• Iron and steel

• Chemicals and fertilizers

The robust overall growth of export sector of Indian economy led to secondary growth of the
following economic parameters -
• India's economy grew at 9.3% in quarter April-June and it was driven by manufacturing,
construction and services sector and agriculture sector

• GDP factor for the first quarter of 2007-08 was at Rs 7,23,132 crore, registering a growth
rate of 9.3% over the corresponding quarter of previous year

• Exports grew by 18.11% during the 1st quarter of 2007-2008 and the imports shoot up by
34.30% during the same period

• India's FOREX reserves (excluding Gold and SDRs) stood at $219.75 billion at the end
of July ' 07

• The annual inflation rate was 4.45% for the week ended July 28, 2007

• India's Balance of Payments is expected to remain comfortable

• Merchandise Exports recorded strong growth

• According to reports, productivity growth rate of Indian economy is estimated to be

around 8% and above until 2020

At this stupendous growth of the export sector of Indian economy, it is expected that India will
become the second largest economy in the world after China.

Exporting items from India is as profitable as importing things to India. You can easily import
the traditional art and crafts of the country, of which you will find great variety and number.
These items are in great demand in the western countries and good quality products sell for really
high prices. You can also export natural products like silk, flax seeds and jute fiber. These are
products that are already exported by India in large quantities.

India is a large exporter of aluminum and aluminum ore. Since aluminum takes a lot of
electricity to extract, India mainly exports the ore to other countries where power is cheaper.
Power is not abundant in India and there is a definite deficit in that area.

As mentioned earlier, India is a large exporter of handicraft and some clothing items also fall
within this category. India is known for providing some of the best embroidery works in the
world. Indian embroidery has various styles that are unique to the country and cannot be found
anywhere else. That is why they are prized highly by fashion designers all over the world. There
are also other traditional textiles and clothing that India exports in large quantities.



➢ Food and Live Animals

1. Cereals and Cereal Preparations

a) Wheat

b) Rice

c) Others

2. Cashew Nuts Raw

3. Spices

4. Others

➢ Beverages and Tobacco

1. Tobacco, Unmanufactured

2. Others

➢ Crude Materials, Inedible, except Fuels

1. Crude Rubber Incl. Synthetic and Reclaimed

2. Cotton

3. Jute

4. Wool and Other Animal Hair excl. Wool Tops

5. Manmade Fibres and Waste thereof

6. Synthetic Fibres suitable for Spinning

7. Matalliferrous Ores and Metal Scrap

8. Crude Fertilisers and Crude Minerals

9. Others

➢ Mineral Fuels, Lubricants and Related

1. Petroleum Crude and Partly Refined

2. Petroleum Products

3. Others

➢ Animal and Vegetable Oils and Fats

1. Vegetable oils, fixed

2. Others

➢ Chemicals

1. Chemical elements and compounds

2. Dyeing, tanning and coloring materials

3. Medicinal and Pharmaceutical Products

4. Fertilizers, manufactured

5. Others

➢ Manufactured Goods Classified Chiefly by

1. Pearls, Precious and Semi-Precious Stones

2. Paper, Paperboard and manufactures thereof

a) Newsprint paper

b) Others

3. Textile Yarn, Fabrics, Made-up Articles and

Related Products

4. Iron and Steel

5. Non-Ferrous Metals

6. Manufactures of Metal, n.e.s.

7. Others

➢ Machinery and Transport Equipment

1. Machinery, other than Electric

2. Electrical Machinery, Apparatus and Appliances

3. Transport Equipment

a) Railway Vehicles

b) Others



➢ Primary Products

A. Agriculture and Allied Products 1. Tea

2. Coffee

3. Rice

4. Cotton Raw including Waste

5. Tobacco

6. Cashew including Cashew Nut Shell Liquid

7. Spices

8. Oil Meals
9. Fruits and Vegetables

10. Processed Fruits, Juices, misc. Processed Items

11. Marine Products

12. Sugar and Molasses

13. Meat and Meat Preparations

14. Others

B. Ores and Minerals 1. Iron Ore

2. Mica

3. Others

➢ Manufactures Goods

1. Leather and Manufactures

2. Chemicals and Allied Products

a) Drugs, Pharmaceutical and fine Chemicals

b) Others

3. Plastic and Linoleum Products

4. Rubber, Glass, Paints, Enamels and Products

5. Engineering Goods

6. Readymade Garments

7. Textile Yarn, Fabrics, Made-ups etc.

a) Cotton Yarn, Fabrics, Made-ups etc.

b) Natural Silk Yarn, Fabrics, Made-ups etc.

c) Others
8. Jute Manufactures

9. Coir and Manufactures

10. Handicrafts

a) Gems and Jewellery

b) Carpets (Handmade excluding Silk)

c) Works of Art (excluding Floor Coverings)

11. Sports Goods

12. Others

➢ Petroleum Products

➢ Others


Over the past decade, exports (measured in rupees) have grown by 21.7% on an average. Some
commodities have enjoyed much faster export growth than others. Given below is the export
performance, in Million US$, of some commodities during 1994-95 and its change in percentage
terms over levels in 1993-94.

Composition of India's exports

(Percentage shares)
Commodity Group Apr-Sept Apr-Sept
1994-07 2007-08 2008-09 2009-2010
I. Agriculture & allied 16.0 19.2 16.1 20.6
1. Tea 1.2 1.1 1.1 1.0
2. Coffee 1.3 1.4 1.6 1.6
3. Cereals 1.5 4.7 3.5 4.1
5. Spices 0.7 0.7 0.7 0.9
6. Cashew nuts 1.5 1.2 1.3 1.3
7. Oil meals 2.2 2.2 1.5 2.1
8. Fruits & vegetables 0.7 0.7 0.7 0.6
9. Marine products 4.3 3.2 2.8 3.0
II. Ores and minerals 3.8 3.7 4.0 3.7
11. Iron ore 1.6 1.6 1.8 1.4
13. Other ores and minerals 1.0 0.9 1.1 1.1
III. Manufactured goods 78.1 75.4 77.8 73.5
14. Leather & manufactures 4.0 3.6 3.8 3.1
15. Leather footwear 2.1 1.8 1.2 1.1
16. Gems & jewellery 17.1 16.6 16.9 14.0
17. Drugs, pharmaceuticals & fine 3.0 3.2 3.1 3.3
18. Dyes / intermediates & Coal tar 1.8 1.5 1.6 1.6
19. Manufactures of metals 2.7 2.6 2.6 3.0
22. Primary & semi-finished iron & 1.6 1.6 1.8 1.3
23. Electronic goods 1.6 2.1 2.0 2.4
24. Cotton yarn, fabrics, madeups etc 8.5 8.1 8.2 9.2
25. Ready made garments 12.5 11.6 12.0 11.3
26. Handicrafts 3.9 3.5 3.8 3.5
IV. Crude & petroleum products 1.6 1.4 1.6 1.6
V. Others & unclassified items 0.6 0.4 0.5 0.6
Grand Total 100.0 100.0 100.0 100.0


Sector Exports Exports Contribution

1994-95 2009-10 (1994-95 to 2009-

US $ US $
million million %

Leather & leather 1278.2 3433.38 2.45


Chemicals & related 1581.3 14944.95 15.20


Engineering goods 2256.57 36619.31 39.09

Textiles (excluding 2512.46 9528.17 7.98

readymade garments)
Readymade garments 2215.54 9496.69 8.28

Other manufactured goods 3401.17 27128.86 26.99

Manufactured goods 13245.25 101151.4 100.00



Product group Exports Exports CARG, 1994-95

to 2009-10 (%)
1994-95 2009-10

US $ US $
million million

Primary & semi-finished iron & 92.21 4157.51 26.88


Non-ferrous metals 105.38 3055.71 23.42

Iron & steel bar/rods 62.43 1293.04 20.85

Ferro alloys 72.53 1113.99 18.62

Machinery & instruments 585.76 8724.77 18.39

Manufactures of metals 487.81 7027.5 18.14

Transport equipment 500.11 7029.16 17.96

Inorganic/organic/agro 201.88 2733.95 17.69


Electronic goods 267.21 3230.73 16.86

Residual chemicals & allied 79.2 934.29 16.68


Drugs, pharmaceuticals & fine 633.46 7241.44 16.45


Dyes intermediates & coal tar 319.31 2699.12 14.27


Paints/enamels/varnishes 91 657.21 13.15

Project goods 18.85 128.34 12.74

Machine tools 47.79 300.14 12.17

Residual engineering items 16.49 89.34 11.14

Cosmetics/toiletries 256.45 678.93 6.27

Merchandise exports have been increasing quite rapidly in recent years .Between 2001-02 and
2007-08 manufactured exports have increased at the compound annual rate of growth (CARG) of
20%. But the share of manufactured goods in total exports has declined from 73.6% in 1994-95
to 63.6% in 2009-10.

The growth in exports has been interpreted as a success of the reforms process since 1994.
But as Table shows, more than 50% of the growth of exports during 1994-95 to 2009-10 has
been accounted for by engineering goods (39.1%) and chemicals and related products (15.2%).
Again within these two sectors, the products for which exports have been expanding rapidly are
primary & semi-finished iron & steel (CARG 26.88% between 1994-95 and 2009-10), Iron &
steel bar/rods (20.85%), Machinery & instruments (18.39%), Drugs, pharmaceuticals & fine
chemicals (16.45%) etc.

These are precisely the industries which were created and developed in the pre-reforms period
through active state intervention. Consider, for example drugs & pharmaceuticals. This industry
is considered to be one of the success stories of independent India. A conscious industrial policy
worked behind the development of the pharmaceutical industry in India. Among the instruments
used were regulation of foreign capital, promotion of indigenous enterprises, patent reforms,
public investments in manufacturing and R&D.


From the above chart it can be seen that india’s export has significantly grown from 2005-06 to
2009-10 and . the export sector in india has continuously grown from 2005-06 to 2009-10. In
2004-05 the export was 83.5 USD billion dollar, it increased to 103.4 in 2005-06 and then it
increased to126.3USD dollar in 2007-08. In the year 2008-09 and 2009-10 also the export sector
in india is growing. There was a sharp rise in export from the year 2008-09 to 2009-10.

The findings of this study indicate that globalization drives more collaboration among firms,
allowing them to better cope with higher global competitive threats and market uncertainty. Such
cooperation eventually increases international marketing effectiveness of firms engaging in co-
marketing alliances.

Whereas an increase in cooperation is influenced by higher global market threats (i.e., both
competitive threats and uncertainty), it is not affected by global market opportunities. The
absence of any effect of global market opportunities on alliance cooperation can be attributed to
the fact that ample opportunities in the markets may result in the lack of collaboration among
firms. Moreover, it is found that increased cooperation in co-marketing alliances helps firms
enhance international marketing effectiveness but not efficiency. Since higher expenses may
arise from such cooperative attempts, efficiency becomes difficult to realize. In sum, these
results validate globalization-alliance literature by showing that globalization actually drives
more cooperation among firms.

Managers should be prepared to cope with these diverse effects by capitalizing on global market
opportunities while carefully managing the inherent threats. Alliance participation and
cooperation presents a viable option for firms to navigate successfully in this new competitive
landscape. From both theoretical and practical perspectives, globalization is a complex

This study is among a very few empirical studies of globalization effects. Therefore, the results
of this study must be viewed with these limitations. The scales to measure globalization effects
were newly developed. The scope and domain of our formative measure for the degree of
cooperation in co-marketing alliances represents another measurement concern. Although these
scales were developed from a careful literature review, they are new, and thus need further
verifications and applications.

Several variables were not included in this study, but are worth incorporating in further studies.
The roles of trust and commitment in the co-marketing alliances should be investigated.

As stated in Dyer, the transaction costs of the firms vary based on the choice of safeguarding
mechanisms used. For instance, higher commitment between exchange partners, higher
economies of scale and scope of exchange relationships and higher inter-firm information
sharing can help lower transaction costs (Dyer, 1997). Since levels of trust and commitment may
affect the degree of cooperation and satisfaction of each partner, further studies could investigate
the relationships between the two and its effects on firms’ efficiency.

Other research avenues may include comparative studies of differences in the degree of co-
marketing alliances and their performance implications among firms from emerging economies
themselves. Although most emerging economies appear to possess similar characteristics, they
tend to differ in various ways (e.g., political regimes, levels of economic development, and
managerial styles). Moreover, empirical studies of firms in different emerging markets are
scarce. Thus, studies comparing firms from different emerging economies are worth exploring in
the future.


This project is related to the effects of globalization on firms. Firstly it represents the advances

prior knowledge on globalization and business by empirically investigating how this

phenomenon affects firm performance. Secondly it has been seen, during the research work, that

various companies which were fighting for their existence and also had the doubt of failing in the

international market due to exposure to various competitors but globalization itself became a

boom to them and help them in achieving their prominent positions. So according to this, yes it is

stronger market opportunities and its performance stronger than the market threats. Studying

further explores the role of firms’ cooperation in alliances in enhancing their performance amid

globalization by specifically focusing on co-marketing alliances and international marketing

performance of firms. A particular emphasis is paid to this type of alliance since superior

marketing is crucial for firms to build a sustainable source of unique competitive advantage.

Such advantage eventually enables firms to achieve long-run success in a hypercompetitive

terrain under globalization. While studying the objective it shows a conceptual framework

relating globalization effects to firm performance and tests the proposed relationships in

developed and emerging economies (i.e. India and the other countries).

1. www.globalpolicy.org

2. www.google.co.in

3. www.nytimes.com

4. www.fortune.com

5. www.hbr.org

6. www.weforum.com

7. Business without borders

8. Harvard Business Review

9. The Borderless World

10. Marketing Management by Sir Philip Kotler

11. www.wikipedia.com