Global Marketing Strategies
Paper Type: Assignment
Academic Subject: Marketing
Word Count: 2700
Submitted by: Student
Global marketing is defined as a process through which a company influences its existing and potential customers to purchase the goods and services offered by the company. According to De Mooij (2013), global marketing, in simple words, is the selling of products and services internationally and includes process of producing, planning, placing and promoting of company’s products to the markets overseas. The products which have universal demands have more importance in the intensely competitive business environment. The ability of global marketing is to catapult success for the company and to take it to the next level. Global marketing strategies are designed in order to understand the dimensions of the market where the company is about to introduce its products and services.
Global marketing is known as an advertising of products which in turn provides benefits to the business. The significance of global marketing for the company or business is defined below;
Global marketing, in organisational setting, enhances the company’s ability to expand its operations across the globe, while offering it with an opportunity to sell more of the offered products and services in most effective and efficient manner. The expansion of market includes advertisement of product and services to attain larger customer base (De Mooij, 2010). This gives an opportunity to the company to have potential profit margins. In the contemporary business environment, global marketing has played an influential role in enhancing the company’s marketing strategies.
Global marketing is essential for attaining a larger customer base and connecting with new markets and customers (Schmitt, 2010). Sometimes the cost of production in some countries becomes low because of cheaper workforce, lower taxation and cheaper modes of advertising. Global marketing with respect to organisational setting helps in establishing new connections for the business and open more doors of opportunities.
According to Grant (2016) global marketing strategy is defined as a strategy that encapsulates countries to coordinate at one platform by making marketing efforts. Coordination is the main element of global marketing strategy and it leads to a level where uniformity in branding, promotional appeal and packaging is required.
Direct import is defined as the imports of the products made directly in the country without an interference of the manufacturer (Fagiolo, 2010, p. 1). In this kind of import, the involvement of intermediaries is significantly lower than other form. It is one of the global marketing strategies, which is legal and the companies have to follow the global economy trends.
Indirect exports are the selling of the products through an intermediary (Ahn, Khandelwal and Wei, 2011, p. 73). With this strategy, the company introduces its products in foreign market. In this regards, it has been indicated that indirect import is relatively cheaper strategy to expand operations in global market. The agents and distributors are known to be intermediaries who take the task of targeting export markets and selling the products and services to the ultimate consumers.
Product positioning is an important marketing tool in a strategic marketing plan (Fuchs and Diamantopoulos, 2010, p. 1763). Product positioning can create brand image and can highlight the brand attributes in a way that differentiate the product from other products in a market. In other words, product positioning is the identification of points of differentiation and parity which enables the organisation to meet consumer’s needs, while adding value to the key elements of the products such as innovation, leadership, price, functionality and quality.
Global positioning is defined as a marketing tool in which the company positions its products on global or international level (Govindarajan and Ramamurti, 2011, p. 191). In other words when companies start out the expansion of their business, in the foreign markets, through the use of different attribute of their products is known as global positioning. For instance, Unilever entered in foreign markets by using its global strategy of “act global and think global”. This strategy had made the company to stand out in the global markets and gain presence worldwide. Moreover, to gain strong customer base in global market, Unilever has also selected the rival markets of the world by using cross-market subsidisation. This had helped Unilever to position itself in global market and attract buyers with their price strategy.
The competition strategy of product positioning requires a unique attributes and features of the product, which gives it superiority over the other products existing in the market (Teece, 2010, p. 172). For instance, Avis Rental Cars used a different tagline of “we try harder”. The unique tagline ultimately helped the company to differentiate its offering resulted in the development of a competitive advantage. There can be two ways of positioning the product in the market for example, either the company uses the same strategy used by the other competitors or use a new marketing strategy. For instance, Colgate and Pepsodent are two products using the same strategy such as Pepsodent brought 24 hours protection for kids and Colgate shifted from family protection strategy to kid’s protection strategy.
Product benefit strategy focuses upon the product attributes and its benefits to the customers (Aaker, 2012). According to this strategy, the attributes are being discussed on the part of producers and are added according to the customer’s demand. Sometimes the companies associate with the variety of product features such as reliability, economy and durability. All of the features are primarily for the attraction of consumers. For instance, Unilever has positioned itself by emphasising on reliability and economy of countries, where it has continually positioned its products.
Pricing approach is the most effective positioning strategy. In many products, there are categories which the company tries to offer in terms of features, performance and services. All of these features require the best pricing policy, which also gives competitive positioning to the product in the market (Peter and Donnelly, 2011). The effective pricing strategy leads towards the higher market reputation and prestige. The consumers are often attracted towards the products which give them high quality with low prices. The premium pricing strategy is often justified by offering the consumers and customers with superior quality products or by introducing a unique product. Here a balanced perspective is required, market reputation and price strategy go hand in hand and the product attributes must be displayed to the customers effectively. Only then the customers will make purchases even if the price is high.
Product positioning strategy offers a great deal of market orientation on the part of producers (Auger et al., 2010, p. 140). It is a dimension of broader market perspectives. It offers the identification of the product attributes and aligns them with consumer’s demands to gain more competitive advantage. This perspective gains market orientation for the entire organisation.
Product positioning strategies help an organisation to cope with market dynamics (Belleflamme and Peitz, 2015). The changes in market occur on day to day basis and the marketers are required to have a closer look to these changes. These developments lead to the higher expectation from the customers and product positioning is significant for fulfilling consumer demands.
If the right product is positioned in the market with the right strategy, the consumers will be more loyal to the products (Auger et al., 2010, p. 140). A systematic approach to product positioning makes the company’s name and its products more prominent in the market which ultimately leads towards strong customer relations. With respect to Unilever, the company has continually offered its customers with superior quality products and services, which has ultimately resulted in the development of goodwill and loyalty.
An effective product positioning helps an organisation to design effective promotional strategies (Belleflamme and Peitz, 2015). This can also be done by conducting extensive market research and when the advantages and benefits of the products are being communicated, the promotional strategy can be designed according to where the product is being positioned.
Product positioning strategy differ the product from other products in the market which attract customers to make more purchases (Auger et al., 2010, p. 140). All the consumers have specific demands of product features such as some want safety, some low price and some want specific features. Positioning the product will attract different sort of consumers.
Product positioning helps an organisation to face extensive market competition which ultimately leads towards high profit margin. With the dynamism in market and changing customer demands, product positioning can get a strong response from consumers and gain competitive strength on the part of producers and marketers.
Global market segmentation is defined as a process of choosing potential customers beyond the national borders of the country where the company exists and splitting them into groups or categories in order to gain sales (Wedel and Kamakura, 2012). Global market segmentation becomes important with the emerging markets in the last decade. The segmentation is usually done on the basis of customer’s needs and demands. In simple words, it is the division of world markets into different groups targeting the people or group of people who want similar products.
The segmentation of the potential customers on the basis of their income includes the people who can make high purchases (Cleveland, Papadopoulos and Laroche, 2011, p. 244). In this type of market segmentation the company chooses the people who are earning monthly income and can spent on the sales of the products. For instance, Lamborghini has continually targeted individuals from elite social class, and with higher income. This has allowed the company to differentiate its vehicles from others available in the marketplace.
Some product attributes are connected to certain age of people. For instance, Unilever introduces brands in the localities, where women of age 30 are more concerned with the skin issues. Offering products to the certain people can gain sales and customer influence in the market.
Global segmentation is also done by focusing on the particular gender (Cleveland, Papadopoulos and Laroche, 2011, p. 244). Some clothing companies have continually segmented their markets based on gender based on their manufacturing capabilities. For instance, Garnier makes products specifically for women and Ralph Lauren focuses on men clothing.
Psychographic segmentation is defined as the division of market based on personality traits, attitudes, values, lifestyles and interests of the consumers. This is more authentic and useful way of market segmentation because it includes engagement of product design according to consumer’s choices.
Global market segmentation plays an important role for the companies operating in developing and emerging markets (De Mooij, 2013). The right segmentation leads toward the higher sales of the products making the high profit margin. For instance, in the last few years Unilever has gained profit with its gender segmentation strategy.
The global market segmentation strategy also helps the business to grow in international markets. Targeting right customers for the right product ultimately helps in business expansion, irrespective of the intensity of competition in the industry. For instance, Unilever’s product Dove has targeted women who are inclined towards the skin care products especially in India so the actual brand has grown tremendously in the emerging market of India.
Effective global market segmentation strategy is beneficial for retaining customers (De Mooij, 2013). Customer retention is an important prospect because it does not only gain customer loyalty, but also customer’s association with the brand. Unilever has retained customers in global markets by focusing on people, who like spending on skin care products.
Along with the growth opportunities, global market segmentation also pursue higher market share. Segmentation proposes a competitive position in the market along with its relationship with customers, suppliers and channel partners. For instance, Unilever’s global market share in personal care s €20,074bn due to its effective market segmentation strategy.
In order to have a sound global marketing strategeies, companies like Unilever would have to follow global trends in the intensely competititve business environment. For that matter, following recommendations have been given:
According to Gao et al. (2010, p.377) direct exports are the trade transaction in which the company sells its goods and services directly to the ultimate consumers in another country. This type of transaction does not include a medium such as a retailer or any organization. Direcr export can have a huge impact on market because there would not be much expenses related to the retailer or any other middle man in the business transactions.
Niche marketing is defined as a specific segment in which inhibits the preferences and habits of the particular segment (Wilson and Gilligan, 2012). The maketers define their product by using niche marketing strategy. This can be beneficial for setting global strategy and also would help the company to survive market competition. Further niche marketing would assess the company to have highly specialised products for the particular market niche.
Industry trends have a tendency to change over time (Hirst, Thompson and Bromley, 2015). Any company which would want to expand its market on a global level must have a sound understanding of the industry trends. Industry trends include the products, prices, distribution mechanism and promitions. The company is required to adapt the industry trends in order to gain prominence in global market.
Global brand consistency is defined as a notion in which the organization maintains its brand image and attributes consistenly in the global market (Bengtsson, Bardhi and Venkatraman, 2010, p. 519). For having effective global marketing strategy the company must keep its brand image consistent. One more reason for having a global consistency is its effect on company’s revenues and its direct impact on company’s value as well.