Global Marketing, Consumer Behavior, and Market Segmentation - Essay Example

?Global Marketing Global marketing can be defined as the process of conceptualizing and then conveying a final product or service worldwide with the hopes of reaching the international marketing community (Businessdictionary). Due to the popularity and spread of the globalization movement global marketing has become more important than ever. Many multinational corporations target customers from different parts of the world. It is imperative for marketers to customize their advertising efforts depending on the global market they are targeting. People from Europe have different taste than American customers. Global marketing has increased in popularity during the 21st century. Marketers today are using a wide variety of tools and techniques to reach the global masses. One of the most popular tools that global marketers are using to send messages to customers is the internet. The internet is a very effective marketing tool because marketers can run campaigns through the internet at lower costs in comparison with traditional media such as the television. Another advantage of the internet for global marketers is that anyone around the world can gain access to a website by typing in the URL. A lot of global marketers are taking advantage of the trend of internet surfers visiting a few times per day social media websites. The largest social media website, Facebook, is estimated to have one billion users by the end of 2012 (Purdueexponent). The users on Facebook account for one-seventh of the world population. Another popular method global marketers use to reach the masses is television commercials during major sporting or social events. During 2012 global marketers paid up to $4 million for a 30 second ad during the Super Bowl (Yglesias, 2012). An important factor that global marketers must take into consideration is the culture of the country the firm wants to penetrate. The over 200 countries around the world have different cultures, thus marketers have to adapt their marketing campaigns to meet the taste and preferences of the global customers. Consumer Behavior Consumer behavior studies how individuals, groups, and organizations select, buy, use, and dispose goods, services, ideas, or experiences to satisfy their needs and desires (Kotler). To understand consumer behavior markers have to spend time and resources doing market research. Consumer behavior varies depending on the age, race, and gender of the person among other factors. Companies from all industries must pay close attention to consumer behavior. Companies that are able learn about the consumer behavior of its target market are usually more successful. Understanding consumer behavior is a very challenging task. “Consumer may say one thing but do another.” (Kotler). Investing money to understand consumer behavior can be very beneficial because it can increase the total sales of a company. Time and experience are two factors that can positively influence in the efforts of companies to learn about consumer behavior. There are different stages of the buying process of customers. The six stages of customer behavior are: problem recognition, information search, evaluation of alternatives, purchase decision, purchase, and post purchase evaluation (Udel). Customers often change their purchasing behavior during their lifetime. The taste of teenagers, adults, and senior citizens are much different. The income capacity of a consumer influences their purchasing decisions. Many multinational corporations invest millions of dollars in marketing in order to attract customers. The fast food industry invested in 2010 $4.2 billion in advertising (Philpott). Advertising has the effect of creating interest of customers in goods and services. Many consumers are impulsive buyers. The use of discounts and specials is often used by the retail industry to attract customers. It is important for businesses to obtain customer retention. Based on Pareto’s rule 80% of a firm’s sales comes from 20% of its customers. Another way to increase customer retention is by providing excellent customer service. People like to shop at stores where they feel appreciated and are treated with respect. Market Segmentation “The purpose for segmenting a market is to allow your marketing/sales program to focus on the subset of prospects that are most likely to purchase your offering” (Businessplans). Companies often use market segmentation strategies in order to optimize their sales in a particular market. For instance the food company Goya segments its market based on areas where a lot of Latinos lived. Goya is a Latino based company whose corporate headquarters are located in Spain. Other companies that are larger and have a wider customer base utilize mass marketing as part of its market segmentation strategy. An example of a company that uses mass marketing is Coca Cola. Auto makers also use mass marketing, but these companies offer different car models depending on the market. The segmentation strategies in the auto industry are often impacted by regulations. The emissions laws in the U.S. are stricter than in China. Many companies segment their market based on social class or income bracket. For example the automaker Mercedes targets customers that make over $100,000 per year. Multinational corporations use a lot of segmentation strategies based on international locations. Wal-Mart in South America uses a different name for its stores. The product offering of companies varies by country. It is important to learn about the culture of company prior to penetrating a market. The burger giant McDonalds would not have success in India with its traditional American menu because the cow is considered a sacred animal in India. “The marketer does not create the segments; the marketer’s task is to identify the segments and decide which one(s) to target” (Kotler). Small companies are better off targeting small segments within a community. A company that achieved tremendous levels of success by targeting the youth is the clothes store Urban Outfitters. The use of market segmentation can help companies optimize their price structure. Companies that sell luxury items often used market segmentation to reach their target customers. Efficient market segmentation strategies have good coordination in the distribution and communication channels of a company. Many firms today are using flexible product offering in order to attend to the needs and desires of a wide variety of customers. Work Cited Page Businessdictionary.com. 2012. “Global marketing.” 25 July 2012. Businessplans.org. 2012. “Market Segmentation.” 25 July 2012. < http://www.businessplans.org/segment.html> Kotler, Phillip. Marketing Management. New Jersey: Prentice Hall. 2003. Philott, T. 10 November 2010. “The fast-food industry’s $4.2 billion marketing blitz.” 25 July 2012. Purdueexponent.org. 23 January 2012. “Number of Facebook users could reach 1 billion by 2012.” 25 July 2012. Udel.edu. “Chapter 6 Class Notes.” 25 July 2012. < http://www.udel.edu/alex/chapt6.html> Yglesias, M. 2 February 2012 “I Paid $4 Million for This?” 25 July 2012. Read More