Introduction This article first talk about the standardization of products in the international market place and the issues associated with not customizing products. The report demonstrates the necessity of shaping the product value proposition according to the needs of each market place by investigating on two real case studies; Starbucks and EuroDisney. Secondly this article discusses in regards to the opening of foreign investments in India and the on how companies compete in the Indian market place with the help of Coke & Pepsi case study and the Fair and Lovely case study. The case studies are analyzed and compared by applying elements of the international marketing task diagram (Cateora et. al, 2012). Case 1 and 2: Starbucks and EuroDisney. ‘As current markets become saturated, new ones must be found. With globalization, companies would require to provide standardized goods to all countries rather than customized products for individual countries.’ as stated by Theodore Levitt (1983). In the case of Starbucks, the domestic market in the USA and Canada were reaching its saturation point in the mid 1990s, where they began to cannibalize the sales of existing cafes with the introduction of new ones. The company operated more than 10,000 cafes across USA and Canada, which along with coffee offered high-speed internet access at 1200 of their cafes. Starbucks had successfully turned coffee into premium commodity (Vishwanath & Harding, 2000) with its $3 lattes. With regards to the down turn in economy, people started to cut back. With saturated markets and the slow economy, the company wanted to increase their revenues by expanding into the European markets. As in the case of EuroDisney, they already had theme parks running suc... ... middle of paper ... ...nd's Dreamlike Success", Japan Quarterly, vol. 35, no. 1, pp. 58. Holt, D, Quelch, J, & Taylor, E 2004, 'How Global Brands Compete', Harvard Business Review, 82, 9, pp. 68-75, Business Source Complete, EBSCOhost, viewed 17 May 2014. Levitt, T 1983, 'The globalization of markets', Harvard Business Review, 61, 3, pp. 92-102, Business Source Complete, EBSCOhost, viewed 15 May 2014. Ratnam, C 1998, 'Multinational companies in India', International Journal Of Human Resource Management, 9, 4, pp. 567-589, Business Source Complete, EBSCOhost, viewed 17 May 2014. Vishwanath, V, & Harding, D 2000, 'The Starbucks Effect', Harvard Business Review, 78, 2, pp. 17-18, Business Source Complete, EBSCOhost, viewed 10 May 2014. Wetlaufer, S 2000, 'Common Sense and Conflict', Harvard Business Review, 78, 1, pp. 114-124, Business Source Complete, EBSCOhost, viewed 17 May 2014.
Kotabe, M., & Helsen, K. (1998). Global marketing management. Temple University. New York: John Wiley & Sons.
In 2002, unexpected findings of a market research showed problems regarding customer satisfaction and brand meaning for Starbucks customers. The situation was unacceptable for a company whose overall objective is to build the most recognized and respected brand in the world. Starbucks was supposed to represent a new and different place where any man would relax and enjoy quality time, alone or with others. But the market research showed that in the mind of the consumers, Starbucks brand is viewed as corporative, trying to expand endlessly and looking to make lots of money. This huge gap between customers' perception and Starbucks' values and goals called for immediate action.
Cravens, D. W., & Piercy, N. F. (2009). Strategic marketing (9th ed.). New York, NY: McGraw-Hill Company.
Global marketing refers to the worldwide ‘the firm’s commitment to coordinate its marketing activities across national boundaries in order to find and satisfy global customer needs better then competition’ (Hollensen, 2014). Satisfying those customers needs was previously seen a a ‘global dilemma’ (Mukoyama, 1996) between standardisation and adaptation. Yet, a third option has emerged: the glocalisation approach. Glocalisation emphasises the need to adapt to country-specific characteristics as well as the standardisation of parts of a firm’s activities to sustain global competitive advantage (Hollensen, 2011; Sharma, 2009). The sources used for this essay comprise academic articles, case studies and the use of global marketing textbooks.
We propose a branding strategy which takes into account the brands capabilities and competencies, strategies of competition brands and the outlook of consumers experience in their respective societies. As an international brand there is the challenge of staying connected with local customers. We will overcome this by adapting marketing strategy to local needs using a variance of standardized marketing mix and an adapted marketing mix.
For example, Henry Ford had developed the automobiles that was affordable to the middle class by using the assembly line. Even though he did not invent the automobile or assembly line, he was the one create the affordable cars to the America middle class by manufacturing the exact same cars. By manufacturing the same product, he was able to lower the price for each unit and lower the unit product cost of automobile as well. Hence, price is an essential factor that drives the consumers’ purchasing decision. Therefore, standardized product is an effective way to attract more consumers because the price is
Etzel, Michael J., Stanton, Bruce J., Stanton, William J. (2004). Marketing. (13th ed.). Boston: McGraw-Hill.
Starbucks is currently the industry leader in specialty coffee. They purchased more high quality coffee beans than anyone else in the world and keep in good standings with the producers to ensure they get the best beans. Getting the best beans is only the first part, Starbucks also has a “closed loop system” that protects the beans from oxygen immediately after roasting to the time of packaging. They did this through their invention of a one-way valve which let the natural gasses escape but keeping oxygen out. This gave them the unique ability to ensure freshness and extended the shelf life to 26 weeks. Starbucks isn’t only about the coffee, it’s also about a place where people can escape to enjoy music, reflect, read, or just chat. It is a total coffee experience. The retail outlet has been responsible for much of Starbucks growth and has contributed substantially to their brand equity.
The proponents of standardization approach in international marketing views the globalization trends as a facilitation of technological uniformity, greater level of similarity, and higher convergence of consumer preference, taste, and needs. The growth of international communication channels also facilitate the standardization including th...
If a company has set its objectives there is need to look into the following. Which countries are their target market and who are the consumers and how or which marketing strategy should they use to reach the consumers. The company needs to know what products are best for their chosen customers and if there may arise a need to adjust the company should be ready for it. The other thing they should consider are the import regulations in their country, market and the global rules also should focus on the competition involved looking...
Along with increasingly liberalised trade policies, economic integration, higher stability of monetary transaction and development in transportation as well as communication, international business has experienced a dramatic rise (Czinkota and Ronkainen, 2001). This rise is also accompanied with enormous challenges that generate from differences between multinational companies’ home countries and foreign markets. Therefore, international marketing strategy that aims to achieve business success in competitive overseas markets has become a focus of studies especially in terms of standardization and adaptation. Years of fierce debates generate three basic perspectives. From a standardization perspective, reasons for standardizing strategy can be growing market similarity, economies of scale, homogenized customers, technological advance and consistent corporate brand (Levitt, 1983; Theodosiou and Leonidou, 2003). By
In today’s society nothing is confined to just one country, everything is global. With everything being global, were seeing companies that have attained global recognition, and are known on every corner of the globe. It is no accident that companies, like McDonalds, Apple, and Coca-Cola, are known everywhere. These companies have mastered the most important aspect of reaching global markets, and that is global marketing. Global Markets are not all the same, they vary from one country to the next. And while a marketing campaign maybe successful, in for instance the United States, it could be a disaster in another
Globalization encourages worldwide business. Globalization is an efficient process by which all the nations of world will commonly try to set regular universal standards & regulations (both created & recommended) which will encourage business around different nations. Business around nations or elements crosswise over different fringes is called universal business.
Cravens, D. W., & Piercy, N. F. (2009). Strategic marketing (9th ed.). New York, NY: McGraw-Hill.
Stonehouse, G., Campbell, D., Hamill, J. & Purdie, T. (2004). Global and Transnational Business (2nd ed.). Chichester: John Wiley & Sons.