Introduction to Global Market

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​INTRODUCTION

​to

Global

Market

Reporter: Lloyd Florenosos

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Global Market:

​the system that allows commercial, financial and labor exchange between different countries without any types of restriction

a fundamental tool for the financial growth of companies and nations

Definition:

For example, a business may be located in the United States. It may purchase components for one of its products from Japan, South Korea, Germany, and Mexico.

Elements of the Global Market

​There are elements involved in the global market. Some of them are: 

​1. Exports and imports of goods and services between countries.

Exporting refers to the selling of goods and services from the home country to a foreign nation. Whereas, importing refers to the purchase of foreign products and bringing them into one's home country.

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Elements of the Global Market

​There are elements involved in the global market. Some of them are: 

2. Flow of capital through credit and financing.

Japan

Japan

Credit: a method of paying for goods or services at a later time, usually paying interest as well as the original money

Financing Methods: equity financing, which is funding given in exchange for partial ownership and future profits; and debt financing, which is money that must be repaid, usually with interest

Elements of the Global Market

​There are elements involved in the global market. Some of them are: 

3. Transfer of human capital to another country.

human capital: the skills, knowledge, and qualifications of a person, group, or workforce considered as economic assets.

Elements of the Global Market

​There are elements involved in the global market. Some of them are: 

4. Remittance

a sum of money sent, especially by mail, in payment for goods or services or as a gift

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The best Global Marketing Strategies you can apply to your business

1. Use the language of each country.

​Saudi Arabia

Japan

China

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The best Global Marketing Strategies you can apply to your business

2. Consumption habits of each territory.

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The best Global Marketing Strategies you can apply to your business

3. Legal framework of the country.

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The best Global Marketing Strategies you can apply to your business

4. Strategies for each market.

Multiple Choice

Which one is NOT TRUE about global market?

• In a global market, only multinational corporations matter.

• In a global market, every country is affected by every other one.

• In a global market, exchange of human capital becomes possible.

• Global market has the ability to increase the wealth of nations and the standard of living of their citizens

Multiple Choice

These refer to goods and services that are produced in your home country and sell it to customers or other businesses in another country

• Imports

• Exports

• Shipments

• Freight

Multiple Choice

How does "the global market" ensure that trades are fair and without bias?

• Countries / Parties involved in the trade demands transparency in all transactions.

• Countries / Parties involved in the trade applies equity financing in its transactions.

• Countries / Parties involved in the trade seeks guidance from a business tycoon.

• Countries / Parties involved in the trade establish regulatory framework.

Multiple Choice

True or False: In developing countries remittances are the least important source of external funding.

• TRUE

• FALSE

Multiple Choice

Which one among the list is NOT one of the best marketing strategies in a global market?

• Researching about the consumption habits of each territory.

• Investing a large sum of money to make sure the business works

• Using the language of each country in promoting the products/services your company offers

• Studying the legal framework for each market

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​INTRODUCTION

​to

Global

MARKETING

Definition:

Global MarketING:

means marketing the company’s products and services, considering the global market as one.

Global marketing means adapting the company's marketing strategy to an international market.

It is different from international marketing, which tailors marketing activities to each region and country.

Definition:

Global MarketING:

Global marketing adopts a uniform marketing approach to all locations. The product design and variety are kept the same. Marketing activities are also concentrated in the headquarters instead of spreading out as in international marketing.

Why is

Global MarketING

Global marketing is best applied when the company’s product has a universal demand. Here are the key benefits of global marketing:

important?

1. Higher Profit Margin

-expand customer base; more profitable to to sell to an international market than a local one

In the past, only large corporations could afford to operate abroad. Nowadays, the Internet allows even small businesses to reach customers in any part of the world.

Why is

Global MarketING

Global marketing is best applied when the company’s product has a universal demand. Here are the key benefits of global marketing:

important?

2. Uniform marketing strategy

-maintain consistency in how it promotes its products and services

Two advantages:

1.there are fewer marketing costs as the company can use unanimous commercials for customers worldwide

2.standardized marketing practices can save time and effort, and allow the company to focus on core activities such as product development.

Why is

Global MarketING

Global marketing is best applied when the company’s product has a universal demand. Here are the key benefits of global marketing:

important?

3. Global brand recognition

Customers think more highly of a company that has a global presence.

The truth is a global reputation can cascade to local markets, making people more aware of your brand and start buying from it.

Why is

Global MarketING

Global marketing is best applied when the company’s product has a universal demand. Here are the key benefits of global marketing:

important?

4. Economies of scale

Economies of scale are the reduction of unit cost as a firm becomes bigger.

Global marketing also helps you achieve economies of scale. By growing bigger, your company grows in power, network, and technical skills. All of this can contribute to a faster, cheaper, and more efficient production process. In other words, your company can produce more with fewer costs.

Types of Global Marketing Strategy

Three Types of Global Marketing Strategy:

1. Global Marketing: Standardization

2. Global Marketing: International

3. Global Marketing: Multinational

Types of Global Marketing Strategy

Global marketing standardization means adopting the same product and marketing practices for all markets. In other words, to sell the same things everywhere.

Standardization

The company only needs to design the marketing campaign once and apply it to all markets. Global marketing standardization also gives the company more control over the market and reduces its reliance on local partners.

Standardization also quickens the production process as there's no need to develop new features. Companies also have an easy time when training their staff.

STANDARDIZATION

lOCALIZATION

Global Marketing

International marketing

-consistency in all aspects of the brand. For example, the company will use the same packaging, design, and staff uniform in every location.

-tailoring the product and marketing campaigns to match the expectations of local people. For example, the company can add or remove several menu items, adjust its logo and redesign the store to match the local culture.

-require fewer marketing campaigns; cheaper; makes the brand more memorable

-requires more marketing campaigns to promote new products or features. The company also needs to adjust the advertising content for different regions.

VS.

Types of Global Marketing Strategy

An example of standardization in global marketing is Red Bull. Red Bull uses the same packaging everywhere, 12-ounce cans with a global appeal. It also adopts a sponsorship marketing tactic in all markets it operates in. The consistency in packaging and marketing message has gained Red Bull tremendous success. Almost everyone can recognize the brand as an energy drink provider and a reputable sports events sponsor.

Standardization

Types of Global Marketing Strategy

International strategy in global marketing involves importing and exporting goods. This is a low-risk strategy with the least level of engagement in the target market. The company does not have to set up an office abroad and can keep all operations within the home market. While international strategy is less risky, it is not the most rewarding.

International Strategy

Types of Global Marketing Strategy

Multinational strategy in global marketing is a bit like international marketing. The products are tailored to each market, but the same procedure applies. The customization is based on the market demand and conditions. For example, more staff can be sent to populous and high-demand regions.

Multinational Strategy

Global Marketing

International Marketing

VS.

Global Marketing

International Marketing

VS.

Global Marketing STRATEGY EXAMPLE

AirBnb

Founded in 2008, the company has now become one of the world’s biggest vacation home rental sites, with over 7 million listings in more than 220 countries.

One key to Airbnb's success is its marketing strategy that focuses on building a strong global community.

Airbnb adopts a comprehensive digital marketing strategy with email marketing, SEO, and social media to market its service to a global audience.

Global Marketing STRATEGY EXAMPLE

AirBnb

• Through email marketing, Airbnb showcases itself as a memory-maker and shares experiences with users worldwide.

• The company's Instagram page is filled with highly visual images of properties worldwide. Guests can share experiences with hashtags (#airbnb) and even book accommodation directly from their feed.

• Twitter is another channel on that Airbnb establishes its presence. The company mainly uses short videos to promote listings and attract new users.

• Facebook ads also generate Airbnb a lot of leads each month.

• Airbnb's blog is a place for Airbnb to tell its stories. There’s a section for people for hosts and guests to share their unique stories.

Global Marketing STRATEGY EXAMPLE

AirBnb

Besides digital marketing, Airbnb partners with brands worldwide to broaden its network while offering its users memorable experiences.

• Some Airbnb partners over the years include:

  • New York Red Cross ; American Express ; KLM Airlines ; Fabrica ; Virgin Atlantic ; Sydney Opera House

  Another successful global marketing strategy Airbnb employs is referral marketing, where the company rewards its referrers with vacation credit when the new members complete their trip.

INTERNATIONAL Marketing STRATEGY EXAMPLE

Dunkin Donuts

Dunkin Donuts is a brand that successfully combines global and international marketing strategies.

The first franchise was opened in 1955. Nowadays, the company serves doughnuts and coffee in over 67 countries. As a global company, Dunkin Donuts focuses on innovating the variety and quality of its products. The company has a whole innovation team to design new menu items to refresh consumers' tastes. It also experiments with many innovations such as digital technology and fast-to-market product concepts. For example, to target digital-savvy and busy customers, Dunkin Donuts uses mobile marketing to reward customers and offer on-the-go services.

INTERNATIONAL Marketing STRATEGY EXAMPLE

Dunkin Donuts

Being locally relevant is another key to Dunkin' Donuts' success. Dunkin Donuts is a 100% franchise. This means all Dunkin operations are locally operated, giving the store a competitive advantage over foreign brands. Since the local owners are more aware of the regional culture, they can adapt the recipe to match local tastes.

In Korea, there are rice and charcoal doughnuts, as people in these regions enjoy savory food. In China, you can find fish flake doughnuts, and if you travel to Thailand, you can try the tropical taste of mango doughnuts.

The blend of standardization and localization in global marketing is key to Dunkin' Donuts' success.

key takeaways

• Global marketing is a marketing strategy that considers the global market as a whole.

• Global marketing adopts a uniform approach to developing and selling products and services.

• Implementing a global marketing strategy can lead to higher profit margins, economies of scale, global brand recognition, and uniform marketing practice.

• It is different from international marketing, which tailors the products to local environments.

• There are three types of global marketing: standardization, international, and multinational.

Multiple Choice

Global marketing is a marketing strategy that considers the whole world as a global market.

• TRUE

• FALSE

Multiple Choice

Global marketing is important because it customizes products according to the local environment.

• TRUE

• FALSE

Multiple Choice

Which one among the list is not the main benefit of an effective global marketing strategy?

• increase brand awareness

• improve profit margin

• establishing heavy presence in a certain country

• build strong relationship

Multiple Choice

It means adopting the same product and marketing practices for all markets. In other words, to seel the same things everywhere.

• Standardization

• Localization

• Adoptation

• Multinational Strategy

Multiple Choice

This marketing approach requires more marketing campaigns to promote new products or features.

• localization

• standardization