The Main Selling Point of Globalization and E-Commerce - Research Paper Example

Introduction Globalization has effectively changed business with new realities and therefore new challenges. Businesses are challenged not only to excel in their trade but now must be able to bring that trade to fresh waters and beyond their comfort zones (Perner, 2004). Coupled with the developments in technology, specifically the internet and aviation, and the liberalization of international commerce, globalization is now becoming a reality to many people. Craig and Douglas (2005) describe today's market that has to be dealt with proactively with businesses taking initiative from developments instead of simply going with their flow. For business to establish themselves in today's markets they have to be able to understand and accept their position in the market and that of their competitors carefully (Levy & Weitz, 2004). Globalization allows great opportunities but increase competition just as much. The challenge is not in holding on who you are or what your company is, the challenge will becoming what you can be (Varley & Rafiq, 2003). Retailing Revolution Among all the developments today in globalization, it is the explosion of retail channels that is fueling the most excitement. The idea of being able to sell to the whole world is the main selling point of globalization and e-commerce however retailers are now realizing the constraints of these expanded channels. With the deluge of buyers and the stress on company's selling infrastructure, there is a need to evaluate and redevelop retail management policies (Berman & Evans, 2006). Fashion retailing whether online or not and whether selling globally or not are among the industries that needs to asses its position and strategies. Since the industry usually entails actual perusal of the product, sellers need to communicate on a personal level with its buyers. Since the selling strategy targets this level of appeal, companies need to realize that they need to understand better who they are selling to culturally and psychologically stay competitive (Johansson, 2001). According to Perner (2004), "A learned, shared, compelling, interrelated set of orientations for members of society". Culture influences goals, beliefs, attitudes and values and ultimately buying behaviour. This is growing concept is growing in significance because of the focus on multinational expansion and at the same time the growing immigration trends in society (Aaker, 1990). In the development of the essential strategies for competing effectively in today's globalized retail markets, it can be concluded that several factors are essential to succeed. Among them are extensive and relevant market research, responsive and sensitive marketing strategies, focus and creativity to execute plans and strategies, attentiveness changes in society and the social and political environment, flexibility to cope with critical situation effectively and efficiently. The mentioned component for strategies develops from the core of the company towards the consideration of buyers and strategically positioning products (Stern & Ander, 2004). The central theme is that to be able to compete and establish fashion retail products, the company must be first able to establish its core product and strategic principles (Torella, 2003b). This is the cornerstone of its brand and product identity that in turn established and projects its personality to consumers. Considering Muji Aaker in 1990 pointed out that Japanese retailers faced a challenge in terms of being able to compete globally citing its traditional practices and production methods need to be updated to keep pace with multinational brands. Japanese retailers and manufactures answered the challenge by modernizing and increasing technology inputs but did not change its traditional product ideologies. The tenacity has worked well for most companies and has even secured significant sectors of markets for Japanese products not only in term of brand but more importantly because of the philosophy behind the products. Muji or Ryohin Keikaku Co., Ltd. is one of the most successful fashion brands today in its segment. The company is characterized by its no brand or logo policy and its focus on recycling. It also is characterized by a Zen style in product design emphasizing minimalism and the environment. Though these features were designed to be simply unique product features, they have since become the brand's main selling point establishing its niches in the market. Considering that the were marketing very specific products, the company has had to conduct extensive and relevant market research not only with regards to their product but also with regard to the philosophy of their products. In some ways, the products can be considered a counter cultural movement in the fashion industry which traditionally centred on branding merchandise. Though the market is still overwhelmingly still brand focused, Muji provides an alternative and philosophical statement in contrast to the trend. The products are supported by a significant number in the market that demands quality over brand (Cox & Brittain, 1996). At the same time, the number of suppliers that it ahs been able to gather that support its product ideology have been developed to meet the growing demand and popularity of the products which have even become a preference of characters in fiction and literature (Gibson, 2001). Thus, Muji has also been able to show that it is responsive and sensitive marketing strategies. In an international environment, a company's concerns will have to consider more external factors. International trade laws, liberalization and globalization are the obvious concerns that emerging brands and products should be able to handle (Hasty & Reardon, 1997). Consideration of social issues can help companies have a better local feel for the markets. For example, Muji's store in London while undeniably minimalist in design and Japanese in design but many of the features and accommodations are decidedly modern. This responds to their promotion of their brand identity to their London market which emphasizes the culture and philosophy of the products (Gibson, 2001). One of Muji's creative methods to be able to execute plans and strategies has been to employ pubic relations in its European markets. These methods have become crucial in building brand and product awareness, purchase and loyalty (Peppers & Rogers, 1993). It also allows for the feasibility of introducing product extensions and even non-related ventures (McGoldrick, 2002). Its appeal and support to artists and writers who feature their products or their ideologies has also the effect of enhancing its presence in current culture. The company's attentiveness changes in society and the social and political environment is met by its maximization of existing trade and commerce laws. At the same time, it has responded by developing product lines that appeal to a general market while maintaining its niche branding. Take as an example one of its products, knitted socks. The first set of knitted socks colours only included neutral tones however today; the colours have been replaced with brighter coloured socks and varying styles while still being made from recycled yarn. In all of these, Muji has shown a degree of flexibility to cope with critical situation effectively and efficiently that promises. According to Freathy (2003), this is the trademark of any company that wishes to figure solidly in today's retailing. Because of an abundance of sources, buyers are given more options today. Fashion is intrinsically a personality based industry and therefore, Muji's actions of trying to appeal to individuals rather than modes go back to the core of the industry (Torella, 2003a). The environment of retailing has effectively changed from that of as early as ten years ago (De Kare-Silver, 2000). Though most of the same concerns remain similar in principle, the means of answering the challenges now involve more than ever society, technology and the perception of individual buyers (McGoldrick, 1994). Prospects for the Industry According to the United Nations Conference on Trade and Development (UNCTAD) (2004), the retail and consumer industry is one of the industries exhibiting one of the highest growths today. There is no denying importance of being able to respond to consumer behaviour particularly for the characterized market of one's products. The concepts involve hidden motivators, emotional gratification, perceived risks and opportunities, and cognitive dissonance can not be denied. This includes acceptance or tolerance and loyalty for one's products, services and ideas. Companies should maximize the internet and the channel it provides as marketplace unbound by geography and time zones. Regardless of business size, it can become the key for positioning in the industry since the internet reduces the costs of communication and promotion. Considering the extent of it in the UK, it becomes even more essential for the fashion industry. These are essential in building strong local marketing background for both existing and new brands and products. One should prescribe to Toralla's (2003a) view that "Defining a brand is one thing - building it into a world-class brand and keeping it there is another thing" (p. 5). It is essential for the brand to be able to sustain itself and this can only be accomplished by creating the brand to become a leader in its field characterizing "The new age of retail brands [that] starts with the concept they are ideas that people live by, need, want and enjoy" (p. 6). The ability to understand local culture, product or brand character and work with its context creates association should be an objective for fashion retailers who want to achieve the success that Muji has accomplished. References Aaker, D. A. (1990). How will the Japanese Compete in Retail Services California Management Review 33. pp 54-67 Berman, B and Evans, J. (2006) Retail Management: A Strategic Approach. New York: Prentice Hall. Cox, R. and Brittain, T. (1996). Retail Management Pittman, Second Edition. London: M&E Handbooks Craig, S. and Douglas, S. P. (2005). International Marketing Research. London: John Wiley & Sons De Kare-Silver, Michael (2000). E-Shock 2000. McMillan Business Freathy P (Ed) (2003). The Retailing Book. London: FT Prentice Hall Gibson, W. (2001). Modern boys and mobile girls. The Observer. Retrieved on February 1, 2007 from http://observer.guardian.co.uk/life/story/0,6903,466391,00.html Hasty R. and Reardon J. (1997). Retail Management. London: McGraw-Hill. Johansson, J. K. (2001). Global Marketing: Foreign Entry, Local Marketing and Global Marketing, International edition. Boston: McGraw-Hill Higher Education. Levy M & Weitz B (2004). Retailing Management. Irwin: McGraw-Hill McGoldrick P. (1994). Cases in Retail Management. London: Pitman McGoldrick P. (2002), Retail Marketing. London: McGraw-Hill. Peppers D & Rogers M (1993). The One to One Future. Piatkus Perner, L. (2004.). International Marketing: The Global Marketplace. [Online]. Available from: [1 February 2007] Stern N & Ander W (2004). Winning at Retail. New York: John Wiley Torella J. (2003a) Stop Talking, Start Doing. [Online]. Available from: [1 February 2007] Torella J. (2003b) Whole-Being Retail Branding. Toronto: J. C. Williams Group. United Nations Conference on Trade and Development (2004). United Nations Conference on Trade and Development 2004 Report. Geneva: United Nations Conference on Trade and Development Varley R & Rafiq M (2003). Principles of Retail Management. 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