Analyze the Opportunities and Challenges That Firms Practice Global Marketing

2129 WordsMar 26, 20119 Pages
Introduction Global marketing refers to marketing activities coordinated and integrated across multiple country markets. The concept of this involves the creation of a single or standardized strategy for a product, service or a company (Johansson, 2006). Those markets are not only defined within country boarders, but are also defined by buyer preferences that are similar across countries. Recently, going global becomes a trend. As Crespy (1986) indicated, firms should turn themselves into global corporations otherwise they will lose out to the new wave. Therefore, not only big sized business, even the smallest businesses have already extended their businesses to foreign markets. One of the best examples is Coca Cola which is the champion…show more content…
The firm can set up its R&D centers at those regions, even outsource to domestic R&D companies to gain professional knowledge and reduce resource wasting. Diversify and reduce the market risk To maintain a business, a firm needs to bear uncertain risks. The risks can come from economy, policies or demand fluctuation, etc. Those risks can decline the profits of a firm. However, the risks can be diversified by global marketing since the loss in a market can be covered from other profitable markets compared with only relying on a single market. Besides, there are certain country markets where a global firm wants to be present though competition is fierce and profitability is uncertain. These are called lead markets. The market situations of these markets are as similar as local market or other targeted markets but there are countries location-specific advantage, such as free from government regulation and technological know-how and labor skills (Mühlbacher, Leihs and Dahringer, 2006). The firm can explore the markets’ practices, learn from other competitors and customers and accumulate experience to improve other existing markets’ practices and to design marketing strategies elsewhere, which can help to reduce the market risks in existing and new markets. Challenges Internal In internal aspect, main challenge to a firm is lack of resources. The resources do not only financial and material resource, but also include global knowledge, experience
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