The Causes of Globalization in Marketing
Globalization refers to the breakdown in barriers that prevent the exchange and integration of finances, trade and ideas across the world. While debate remains about the precise features or importance of any given cause of globalization, some general agreement exists about the causes themselves. As an integral, but ultimately subordinate, feature of business, the causes of globalization in marketing reflect the causes of globalization in business.
Technological advancement at almost every level, from widespread Internet access to standardization of transport containers and rapid global transportation, serves as a key driver of globalization. Standardization of manufacturing processes allows businesses to harness the economies of scale that make it feasible to serve a global-sized market, and reliable, worldwide transportation provides the necessary element to build a supply chain to serve that market. The 24/7 nature of the Internet gives consumers easy access to products from across the world and, in turn, drives a need for globalization in marketing.
Global communication, aided in large part by online communication channels, such as social media, aid in the transmission not only of ideas, but of social norms and wants. In essence, global communication leads to more homogenized tastes in everything from tablet computers to music. This trend toward global-level interest in products, regardless of origin point, calls for marketing that deals with brands from a global perspective, rather than a local or even national level. Marketers must craft imagery and messages that transcend cultural particulars and reflect universally appealing core ideas.
Capital now moves across national borders with comparative ease, which makes it easier for companies to secure financing from a variety of sources. This ability to secure funding from abroad, should domestic sources prove unwilling, can facilitate domestic growth and foreign expansion. In order to secure foreign funding, a business’s marketing team must prove capable of demonstrating that, for example, a foreign market exists for the business’s products, and that it knows how to address both domestic and foreign markets to capture share in both.
Globalization presents a conundrum for small business owners. On the one hand, small businesses often find themselves competing with and marketing in competition with better funded global brands. On the other hand, these same businesses have access to a worldwide consumer base that can prove a substantial source of income. Choosing between offering service to a worldwide consumer base or focusing on capturing local and regional business means weighing a number of factors, including logistics, expense, and the difficulty inherent in developing global-friendly marketing materials. Although some businesses lend themselves to serving the global market, selling information products for example, many small businesses opt out of globalization.