MARKETING IN GLOBAL BUSINESS STRATEGY

MARKETING IN GLOBAL BUSINESS STRATEGY

International marketing strategy is significant in formulating global business strategy in three diferent ways;

First, what should be the global configuration of marketing activities? That is, where should such activities as new product development advertising, sales promotion, cannel selection, marketing research, etc., be performed?.

Second, how should global marketing activities performed in different countries be coordinate?.

Third, how should marketing activities be linked with other activities of the firm? Each of these aspects is examined below.

Marketing activities, unlike those in other functional areas  of a business, must be dispersed in each host country to make an adequate response to local environments. Although this configuration is valuable in being customer oriented, not all marketing activities need to be performed on a dispersed basis.  In many cases, competitive advantage is gained in the form of lower cost or enhanced differentiation if selected activities are performed centrally as a result of technological changes, buyer shifts, and evolution of marketing media.  These activities comprise production of promotional materials, sales force, service support organization, training, and advertising.

Although cultural differences between nations require advertising to be tailored to each country, in many ways global advertising is gaining acceptance.

First, a Company may select one ad agency to handle its global campaign, economizing in campaign development, seeking better coordination between the parent and subsidiaries, and facilitating a consistent advertising approach worldwide.

Centralization of advertising makes sense.  Yet government rules and regulations relative to advertising, distinct national habits, language differences, and lack of media outlets may require dispersión of advertising to different countries.

International Marketing Coordination;  International marketing activities dispersed in different countries should be properly coordinated to gain competitive advantage. Such coordination can be achieved the fallowing ways;

·         Performing marketing activities using similar methods across countries -  This form of coordination implies standardizing activities across nations.  Some strategies, including Brand name, product positioning, service standards, warranties, and advertising theme, are easier to coordinate than are other marketing strategies.  On the other hand, distribution, personal selling, sales training, pricing and media selection are difficult to coordinate across nations.

·         Transferring marketing konw-how and skills from country to country – For example,

A market entry strategy successfully tried in one country can be transferred and applied in another country.  Likewise, customer and market information can be transferred for use by other subsidiaries.  Such information may relate to shifts in buyer purchasing patterns, recent trends in technology, lifestyle chances, successful new producto r feature introductions, new promotion ideas, and early market signals by competitors.

·         Secuencing of marketing programs across countries -  For example, new products or new marketing practices may be introduced in various countries in a planned sequence.  In this way, programs developed by one subsidiary can be shared by others to their mutual advantage and, thus, should result in substantial cost savings.  To reap the benefits of sequencing a Company must create organizacional mechanisms to manage the product line from a worldwide perspective and to overcome manager resistance to chance in all participating countries.

·         Integrating the efforts of various marketing groups in different countries.  Perhaps the most common form of such integration is managing relationships with important multinational customers, often called international account management.   International account management systems are commonly used in service firms.  For example, Citibank handles some accounts on a worldwide basis.  It has account officers responsable for coordinating services to its large corporate customers anywhere in the world.

·         Marketing´s linkage to Nonmarketing Activities;   A global view of international marketing permits linking marketing functions to upstream and support activities of the firm, wich can lead to advantage in various way.  For example, marketing can unlock economies of scale and learning in production and/or research and development by a) supporting the development of universal products by providing the information necessary to develop a physical product design that can be sold worldwide;  b) creating demand for more universal products even if historical demand has been for more varied products in different countries; c) identifying and penetrating segments in many countries to allow the sale of universal products;  and d) providing services and/or local accessories that effectively tailor the standard physical product.