Standardization Versus Adaptation in International Marketing

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Standardization versus Adaptation in International Marketing Introduction The most challenging decision that a company may face in internationalization is the degree of standardization or adaptation in its operations. The question of standardization or adaptation affects all avenues of a business’ operations, such as R&D, finance, production, organizational structure, procurement, and the marketing mix. Whether a company chooses to standardize or adapt its operations depends on its attitudes toward different cultures. These attitudes are defined by three orientations toward foreign culture: ethnocentric, polycentric, and geocentric. Ethnocentric Model Ethnocentrism has a socio-psychological dynamic that is broadly used to…show more content…
Attitudes of geocentricism are biased toward marketing, human resource, production policies, and finance that try to synthesize local and global practices. Preeminence is given to accruing the right people and policies. For instance, a decision maker, who is geocentric, would endorse a global pricing policy that would be adapted to regional and local environments. These decision makers strive to ratify policies that fit both local differences and global commonalities. Furthermore, when one adopts a geocentric mindset, this in turn, leads to the evolution of a geocentric company. Comparison of Ethnographic, Geocentric, and Polycentric Models Each orientation utilizes standardization or adaptation, or both, in its DNA. Ethnocentrism uses standardization, polycentrism uses adaptation, and geocentricism exercises both standardization and adaptation. How does standardization and adaptation affect the marketing mix? A comparison of the dichotomies is illustrated. Marketing Mix Standardization Adaptation Product No changes are made to product/service Specific changes are made to the product/service to fit cultural characteristics Price Fixed pricing in all international markets Prices are determined by local competitive conditions Place Uniform channel structures Adjusting distribution Promotion Same promotion is used in all international markets, and no changes are
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