How Markets Become Global

Topics: Globalization, Corporation, Multinational corporation Pages: 3 (944 words) Published: November 15, 2010
‘Globalization’ is a simple word which has achieved great success. “Globalization of markets” (Levitt 1983) is an expression which related first to demand: taste, preferences and price-mindedness are becoming increasingly universal. Second, it relates to the supply side; products and services tend to become more standardized and competition within industries reaches a world-wide scale. Third, it relates to the way firms, mainly multinational companies, try to design their marketing policies and control systems appropriately so as to remain winners in the global competition of global products for global consumers. Globalization means homogenizing on a world-wide scale. The implicit assumption behind the globalization process is that all the elements will globalize simultaneously. Much of controversy around marketing dates back to Prof. Theodore Levitt’s 1983 seminar article in Harvard Business Review “The Globalization of Markets”. Prof. Levitt argues that marketers were confronted with a “homogenous global village”. He advised organisations to develop standardised, high quality world products and market them around the globe using standardised advertising, pricing and distribution. Some well publicized failures by Parker pen and other companies seeking to follow Levitt’s advice brought his proposals into question. But with the passage of time and years of research, a different flavour of globalization has come into the limelight. Companies have begun to realize that to become truly global they have to “Think globally, Act locally”. Organizations have discovered that consumers from different cultures have different attitudes, perceptions, tastes, preferences and values and remain reluctant to purchase foreign products. Hence, it can be posited that cultural differences remain an important aspect of global marketing because cultural forms and beliefs are powerful forces shaping people’s perceptions, dispositions and behaviours. (Markus and Kitayama, 1991;...
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