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Global Marketing Management: Theoretical Concepts

Abstract

The paper introduces global marketing as the means of channelling resources in the world market then examines the theoretical concepts and extensions on global marketing management. It then discusses the various kinds of management orientations and their differences in relation to global marketing. Then it goes ahead to discuss the marketability of long range radios in developing countries. This addresses the issue on whether long range radio manufacturer can have a high chance of getting a large market for his products within developing countries owing to the nature of the product and the needs of the consumers within these countries. Finally, it discusses the many aspects of the United States business world and whether it is appropriate to label the United States as low context culture.

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Introduction

According to Keegan and Green (2002), Global marketing is defined as the process where a company focuses and strategizes on how to invest its resources in the world market. This is often faced by certain challenges and threats which either drives or restrains the processes that are involved. These challenges are due to the differences in marketing practices that varies from country to country. Owing to this, the marketers are required to think globally before making appropriate actions. However, there are distinctive orientations that underline how international organizations should be managed. Global marketing presents organizations with certain advantages such as experience, global strategy and how to utilize resources economically (Terpstra, 1987).

Difference between ethnocentric, polycentric, regiocentric and geocentric management orientations

Ethnocentric management approaches represent the style that requires the least degree of change; managers simply transfer the same practices from their home countries to countries of destinations. Usually, similar marketing, production and human resource strategies are adopted in any new branch set up by the respective company. Sometimes this can work well for a firm if the destination country and the home country have similar cultures, management values and corporate values. For instance, if a beauty products manufacturer were selling the same products in India and the US, management may lose a lot if it chooses to market the product in the same way as the US. In polycentric the managers are obtained from target countries. In this strategy, it is assumed that only the locals can fully understand themselves so they should be in charge. This strategy has been shown to be very effective because multinationals appear to have that local touch that makes their target markets relate to them. Nonetheless, this strategy may backfire if a target country lacks the appropriate management abilities to handle business (Scheider, 1996). This is especially common in poor nations. Companies must therefore be wise about where they choose to apply their styles because the success of the latter two management approaches depends on the degree of difference or similarity between a target nation and the country of origin.

In certain circumstances managers may choose to ignore cultural differences and affirm that any good manager can handle a problem regardless of where that individual comes from or where the target country is. The approach is founded on the belief that good managers all possess the ability to apply logic in situations and therefore can be successful irrespective of the environments they select. This often works well in technical or operationally based management positions as the latter rarely get defined by culture (Keegan & Green, 2002).

The last type of management approach is regiocentric. This combines a few elements from all the latter mentioned strategies. Here, head office positions are managed by members from the parent country. Nonetheless, host countries are granted autonomy over subsidiary and regional decision making. In such circumstances, locals as well as members of the headquarters can both contribute towards business strategies in their own ways. Geocentric involves world orientation and is the same as regiocentric based on the similarities in the markets. In both marketing opportunities are followed by extension and adaptation strategies that are used within the global markets.

Developing countries as markets for long range radios

The long range radio manufacturer will have a high chance of getting a large market for his products because the nature of the product fits in with the needs of developing countries. For instance, long range radio needs minimal operating costs while satellite ones or cell phones tend to be expensive. Also, the long range radio does not require too much infrastructure. This is ideal for developing nations that may possess questionable communication infrastructures. The deployment of the product is also quite easy hence it can be used even in remote locations. If one only considers the qualities of the long range radio then one would definitely encourage this manufacturer to consider developing nations. His product would offer them the appropriate qualities needed in order to enrich their lives.

On the other hand, if the manufacturer considers the business environment then there may be a need to be a bit more cautious. Some developing nations are bogged down by immense levels of bureaucracy so it becomes very difficult to start up a business as a foreign exporter. Furthermore, other governments are known for their involvement in the affairs of their host nations. Although some developing nations do possess high populations, most of them may live on less than a dollar a day and may think of the long range phone as a luxury (Daniels et al., 2004).

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At the end of it all, the manufacturer will need to consider his target markets very carefully. If the chosen countries are growing at a stable rate then they may be feasible (Kravis et al, 1975). The manufacturer should also move to these countries only if he is ready to invest in substantial marketing for his products because cellular communications have already crowded the market. He would need to demonstrate to his respective clients that the long range radio can fulfill certain functions that other competing products may not be able to fulfill.

Whether it is a mistake to label the US a low context culture

Labeling the United States as a low context culture is indeed a mistake because there are several situations when people can display elements of a high context culture. For example, a costly gourmet restaurant may be considered a high context environment because its customers probably have a long term relationship with management, more informal communication comes into place and knowledge concerning the restaurant largely depends on the relationships formed. Therefore, a person who would want to enter into such a business would need to display high context characteristics.

Furthermore, several businesses have established relationships with their suppliers, customers and other stakeholders. Consequently, their interactions have become personalized. For instance, if a supplier has been doing a job for a retail seller for over fifteen years then chances are that communications will be less task-oriented. Additionally, many businessmen in the US are known for the astute abilities to forge networks with other businesses and this is an important characteristic of high context cultures. Lastly, a low context culture is normally one that provides information easily to the respective individuals affected by it. This means that external businessmen should be able to fit in easily into such cultures. However, there are several policies and procedures that can take decades to learn in the US for instance dietary laws, language expressions and the like. This subconscious information may make it difficult for foreigners trying to establish themselves in such a country (Leroy, 2004).

Conclusion

Global marketing management is a success when good planning tools are incorporated within a company (Keegan & Green, 2002). There are variables exogenous and endogenous which are involved in the developmental process of global marketing that also needs to be clearly understood. There are a number of environmental factors that should be considered in the planning process and these must have unifying influence that can enable the marketer to develop standardized plans. The opportunities to expand to new markets and its success depend majorly on the organization’s resource base and the type of management it has.

References

Daniels, J. D., Radebaugh, L.H. and Sullivan, D. P. (2004). International Business. Reading MA: Addison-Wesley.

Keegan, M. & Green, K. (2002). Global marketing management, NY: Prentice hall.

Kravis, I. B., Kenessey, Z., Heston, A. and Summers, R. (1975). A System of International Comparisons of Gross Product and Purchasing Power. Baltimore MD: John Hopkins University Press.

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Leroy, G. P. (2004). Multinational Product Strategies: A Typology for Analysis of Worldwide Products Innovation Diffusion. New York, NY: Praeger.

Schneider, S. (1996). A manager’s guide to globalization. Chicago: Irwin publishers.

Terpstra, V.(1987). International Marketing. 4th ed. The Dryden Press.

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