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Title: Explain what you understand by the term globalisation and discuss its impact on Marketing.

Student Name: Alma Cecilia Carrillo Amelio

Globalisation has become one of the most common topics for debates due to its level of influence in every field and country. This term does not have one standard definition or historical origin; many people claim that it has been part of our history since the Roman Empire but others consider it as the modern development over the decades. One simple definition is that it is a universal phenomenon which describes how the world has become connected economically, politically, socially, and culturally through the advances of technology, communication, and transportation. Opinions vary considerably over its positive and negative effects nevertheless all of them admit that globalisation is inevitably changing the way companies are managed to compete in a global economy. Therefore globalisation is a powerful economic phenomenon with profound implications for marketers in the fast-moving world of business. Marketing requires competent managers with the appropriate skills to ensure success in the globalised environment. First of all marketers need to understand the meaning of global marketing terminology which is in English. Terms such as brand, image, target market, SWOT analysis, POP material, share of market, jingle, publicity and slogan in order to benchmark the world of business. Global companies use these set of standards to be able to share and compare information in the same language. It is very useful for worldwide companies to analyse their results in every country and to identify opportunities and threats in specific countries. Moreover marketers need to refine the role of marketing according to the changes that are caused by a globalised world that is affecting the purchase decision making process. Generally speaking globalisation offers marketers the opportunity to reach a wider range of consumers nevertheless these consumers are changing their behaviour. Customers have become more sophisticated and demanding. They are less loyal and less willing to forgive companies whose products and services do not meet their high standards (OConnor and Galvin, 2001, p.3). In addition, consumers have the opportunity to gather easily all kinds of information quicker and at lower costs than the past. They have many sources of information and they are constantly bombarded and influenced by advertising and promotions. These elements lead them to evaluate, compare and select the best product or service.

There may be global brands and products but there are no global people to buy those brands. Marketers have the role to adapt global brands to local needs and motivations. There are many brands that have all the characteristics of a global brand however there are variations. Sometimes the brand identity is global but the names or symbols vary from one country to another. An example is Unilever which has different brand names for its category of ice creams according to the region such as Ola in the Netherlands, Walls in the United Kingdom, Frigo in Spain, Eskimo in Hungary, and Good Humor in the United Sates. Although Unilever has different brand names, it has the same logo and guidelines that make it recognizable worldwide (De Mooji, 2005). This is the challenge for marketers against globalisation, the formulation of international marketing strategies into the adaptation of those strategies to the particular country. In order to build relationship between consumers and brands, advertising must reflect peoples values. Consumers from various countries are significantly different due to varying culture, language, politics, income and level of economic development. Hence consumers may use the same product without having the same need or motive or may use different products to satisfy the same need.

Sony, a recognised worldwide company, created the term global localisation during a General Management Conference in 1988. Morita who was the chairman of Sony explained how Sony would focus its efforts to become a truly global company. He expressed as the following: Each of our regional headquarters in Japan, the United States, Europe, and Asia must set new goals to localize operations. I would thus like to introduce the principle of 'global localization' as our future guiding principle. This is a new way of life for Sony, whereby we meet local needs with local operations while developing common global concepts and technologies. This is an example of how worldwide companies use their innovation in technology and product design to satisfy or create a specific need of a region; they set local marketing techniques in order to reach the main global goal of the company.

As a result of globalisation, another challenge for marketing managers is to understand the possibilities and opportunities by using digital elements in their strategies. Companies are discovering a number of benefits with new technologies that give them the opportunity to get closer with their consumers and gain future

consumers of any part of the world. In 1998 an article from The Economist magazine described that Marketing has become a complex art. Technology and trade have increased the potential for global brands. The fragmentation of audiences and rising costs of television and print advertising are making other media attractive. Direct marketing and the Internet are rewriting all the marketing rules (OConnor and Galvin, 2001, p.3). The Internet is transforming the way business is conducted and communicated. Hence, firms should exploit this electronic method in the design of their promotions, advertising campaigns, distribution channels, marketing research techniques, customer relationship management and other factors that can be virtualised.

In summary globalisation is an evolutionary process in which companies, regardless of where they are located, are inevitably affected. Firms need to have a wider scope in the actual world of global business in order to be more competitive. They have learned that the quality and the price of their products are not longer the most important elements. Consumers are more emotional and they prefer brands that communicate their ideas, experiences and lifestyles based on their culture; they are looking for brands that are closer to them. Mass campaigns with homogenous messages are not longer the path for companies, they can sell the same product but they need to adapt the communication according local needs. Although we have global brands, technology is developing the segmentation rather than

standardisation. Therefore the most important challenges of marketing managers in the future will be the correct analysis of market information and the usage of new technologies. These will develop the creation of tactical strategies in a globalised world with consumers that are looking for brands that identify with them. (1,055 words)

References

De Mooij, M. (2005) The Global-Local paradox in Global Branding, (2nd ed) Global Marketing and Advertising: Understanding Cultural Paradoxes. Thousand Oaks: Sage, pp. 13-32.

OConnor, J and Galvin, E (2001) Marketings Challenge, (2nd ed) Marketing in the Digital Age. Harlow: Pearson Education Limited, pp.3-12.

Sony Corporation (2011) Global Localization [Online]. Available at: http://www.sony.net/SonyInfo/CorporateInfo/History/SonyHistory/2-18.html#block5 (Accessed 06 September 2011).

Park, D. White Paper: What is Globalisation? [Online]. Available at: http://www.b2binternational.com/publications/white-papers/globalisation-andmarketing/ (Accessed 30 August 2011).

(2009) Available

Effects of Globalisation to International Marketing Strategies [Online]. at: http://ivythesis.typepad.com/term_paper_topics/2009/10/effects-of-

globalisation-to-international-marketing-strategies.html (Accessed 30 August 2011).