International and Global Marketing

International and Global Marketing

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International and Global Marketing

The world is becoming more competitive and concurrently global; therefore the need for corporations to venture into the global marketplace so as to grow business and increase profits (Ronkainen and Menezes, 1996). Most corporations considering or going to the realm of global market lack a monitoring mechanism to determine failure or success. Globalization has quickly developed into a system of complex circuits of interactive dynamics, exchange and structures that interact collectively at higher levels; leading to rapid change that affect various aspects of human life. Growing globalization acts to produce results that are not easy to foresee, but operate to influence various aspects of the system. Globalization and increasing competition have affected the traditional aspects of consumer attitudes and habits in almost every country. In marketing, the debate about globalization of consumption started as early as the late sixties (Buzzell, 1968).

Even though everybody is in agreement that globalization has resulted in certain changes in consumer habits and marketing practices, discussion has been based on how marketing should respond to this new phenomenon. In his article ‘The Globalization of Markets’ (1983), Levitt states that companies need to learn operate as if the world is one big market- ignoring existing national and regional differences. In the 1980s the Journal of Consumer Marketing provided a platform for well-known academicians to convey more subtle aspects to globalization of marketing (Sheth, 1986). Many examples have been used to prove that despite the increasing globalization of markets, the difference in consumer behaviors has not reduced thus the need for a differentiated approach in marketing (Demooij, 2000).

In economics, there are four major market structures: monopoly, oligopoly and monopolistic competition and perfect competition (McEachern, 1998). By evaluating the changes witnessed in the last part of the twentieth century, one can be able to see the drastic change in the globalized market. The impact of perfect competition is in the process of fading out because it is losing shares in the economy. There has also been a reduction on the importance of monopolies. In democratized societies there has been an increased pressure on governments to deregulate, abolish monopolies, and liberalize industries. Even though there has been a decreasing importance of monopolies and perfect competition, the other two forms of market structures have been gaining ground especially oligopoly. The world is moving towards a market structure of dominance also known as ‘global oligopoly’.

Globalization has resulted to markets that are dominated by large companies which are internationalized. For example, they organize their operations on a world-wide scale and disregarding national borders. In most cases, controlling the global market requires huge resources and this means only large firms can operate. The high cost of getting into the global market is a threat to new entrants. The companies that are already present to face the challenge of growing investment in innovation and marketing are trying to focus on their key competencies and acquisition of new competences through alliances, mergers or networking. This means that achieving market dominance can not only be realized through natural development of a company or acquisitions and mergers. It can also be achieved through less capital intensive ways like establishing partnerships, alliances and networking which have become mainstream activities in today’s world market.