The trend of increasing globalization and standardization of goods promoted on the world market was characteristic of international marketing in the late 20th century. The standardization strategy is a single global strategy applied in various foreign markets. It is possible to say that it represents the highest level of optimization of marketing activities on an international scale, its most economical type. The use of the strategy of globalization (standardization) implies that certain goods possess not only basic but also specific properties that are attractive to consumers regardless of their country of residence. Global marketing strategies imply that a single product range is sold according to a single standard marketing program. For example, the president of Coca-Cola calls this strategy "One look, one sound, one sale."
What Is Global Marketing
Global marketing is one of the most popular terms of multinational business. It is believed that the first time it was used by Theodore Levitt of Harvard University. As the name implies, a company can develop worldwide advertising and marketing strategies for its products. The concept is based on the assumption that the needs of consumers around the world are essentially the same. Consequently, buyers will respond to the same calls regardless of cultural differences. Like most other marketing concepts, global marketing must take into account the unique situation around and within each particular company. Despite the different aspects of global marketing, its main task of international marketing is to build an organization that maintains a sense of corporate identity in the company and its brands, allowing some autonomy in taking into account the characteristics of different countries.
It is possible to underline the following benefits of global marketing.
Cutting costs as one of the benefits of global marketing include:
- significant savings due to the absence of the need to expand the commodity, parametric series;
- significant cost savings due to the scale of production and marketing, including all elements of the marketing mix (product, sales, pricing and promotion policies);
- savings on the use of a single marketing program.
Other benefits include:
- Improving the quality of products and marketing programs;
- The ability to conduct a single advertising campaign on a global, global scale;
- The advantages of standardized logistics (in the case of insufficient quantities of goods in one country are moving stocks from another region);
- Enhancing the international image of the company and its products;
- Strengthening consumer preferences;
- Enhancing competitive pressures;
- Win in international competition.
However, full standardization in international marketing is difficult to achieve even with a global marketing plan consistent, which is determined by the following limitations associated with the development of standardized trademarks.
- Cultural and consumer stereotypes. In different cultural conditions, there is a different demand for the same type of goods. So, butter in some countries is used for cooking and, as a rule, consumers prefer a salted variant, and in other countries, it is spread on bread.
- Language. Quite often, the branded name of the product and advertising has to be changed in connection with language differences. There are situations when an inadequate translation of the name of the trademark causes the same inadequate reactions or bad associations of users.
- Rules and technical norms. In the world, much work has been done to standardize technical and technological norms and rules (within the UN and other international organizations), but there are some differences. An example is the permissible standards of food additives and colorants in products in different countries, the norms of genetically modified products, etc.
- Availability of the media and local preferences regarding the ways of promoting goods. These methods can vary considerably in different countries.
Global Marketing Strategies
The global marketing strategy is developed on the basis of the similarity of the parameters characterizing the markets of different countries. Thanks to this, standardization of the marketing complex is possible, which contributes to a significant reduction in costs.
It is possible to distinguish five global marketing strategies that determine the principal decisions on the choice of the direction of development of the firm:
- the strategy of internationalization involves the development of new markets;
- the strategy of diversification is the mastery of the production of new goods (including those not related to core activities);
- the segmentation strategy is the production of a wide range of products for different groups of consumers;
- the strategy of globalization is the standardization of products based on the definition of common characteristics of markets that do not depend on the characteristics of countries;
- the strategy of cooperation is mutually beneficial cooperation with other firms (the creation of purchasing, research, advertising societies, joint brands).
Examples of Global Marketing
Non-alcoholic beverages and fast food are illustrative examples of the effectiveness of the global strategy. So, the soft drink of Coca-Cola not only quenches thirst but also corresponds to the taste preferences of the population of almost all countries of the globe that have their own national soft drinks. Global strategy and global recognition strengthen consumer preferences and increase customer loyalty to this product, its image and turn the product into a global brand.
A bright example of standardized global brands and a standardized strategy for promoting the company on the world market are such products as the Coca-Cola or Red Bull soft drink, Colgate toothpaste, Marlboro cigarettes, McDonald's burgers, Levi Strauss jeans, Black & Decker power tools, and other products, leading in the world. Elements of marketing of these companies are identical with insignificant differences across countries. Coca-Cola is the same, whether you buy it in Moscow, in Seoul or in New York. This is a drink that enjoys worldwide recognition. Such level of recognition t is the ultimate goal of global marketing.