Linkage of Marketing to the Global Demand - Term Paper Example

 Global marketing management Linkage of marketing to the global demand Marketing is considered as a powerful tool in the business world in creating more and more demand for firm’s product, thus translating into profits. Therefore, marketing can be defined as a process that ensure a consumer gets the value for the product or service they have demanded. According to Cateora, P. (1983), value of the product can be expressed in three dimensions: possession, time, place, and form. Marketing ensures the consumer is satisfied along those dimensions with an aim of transforming them into loyal consumer. The global as become as global village; thus can be regarded as one community with diverse demand because of various reasons, for example, geographic location. Need for global marketing management has taken precedence to ensure the demands from the consumers are taken into consideration. Global marketing thus can be referred to as the management of available marketing infrastructure most efficiently and effectively to meet the demand national, regionally, and internationally. Global marketing aims to achieve the following objectives (Keegan, & Green, 2005) minimize duplication of efforts within the marketing process increase the market share of a product beyond a firm’s territorial boundary, and enhance the quality of the product and service to appeal and satisfy the diversity in demand exploit market niche In this paper, various internationally renowned firms will be analyzed assessed to determine the efficiency and effectiveness in the implementation of global marketing strategy. However, it should be noted that different firms have distinct approach towards exploring international market. Therefore, a firm will adopt a strategy that is in line with its objectives, vision and mission. The following functions are aimed to be achieved by any organization that intends to explore the international market: distribution function market research pricing product or service promotion, and Product and service management. The above functions will be analyzed using four multinational firms namely: Jumeirah group of hotels, Etihad airways, Dubai bank, and Aramex. Market research Demand for a product is not known until an analysis of the market I conducted. In some cases, the market would be present, but development of the product or service would not be economical due to low receptive level. According to (Cateora, 1983), market research is an essential element in the marketing field since it aims in identifying the specific demand of the consumers across the globe. Tapping this information is crucial in the product and service development; therefore, accurate data need to be gathered. In addition to that complains or suggestions from the consumer are vital and ought to be given the urgent attention during the product or service development. Jumeirah group of hotels is based in United Arab Emirates with other members of the group found in London and Shanghai. The performance of the Jumeirah group of hotel and resort is exceptional as reflected in the financial statements of the corporation. Different markets have different demand that is influenced by culture, socio-economic et cetera. It can be argued that Jumeirah hotels must have carried a market research before its inception in either London or Shanghai. The research revolved around the way of life of the people and purchasing power. Bearing in mind the Jumeirah hotel is based in an Islamic state; type of food prepared and how they are prepared matters a lot. Therefore, the production and preparation of food material should consider the values and beliefs of other persons that are non-Muslim. This can be the reason behind the success of Jumeirah hotel in England and China Etihad Airways is a renowned airline company ranked as the second best in the UAE, after Emirates. Airline firms need to carry out market research to identify which destinations that have high traffic. The essence of this is to avoid flying into regions where there is low aviation business is low either due to domestic competition or political violence. As a result of the beaches in UAE, tourists have been attracted, and therefore, this created an opportunity for airline companies. The demand for financial assistance across the globe grows day by day. This can be attributed to the high level of idea creation, thus requiring funding for implementation. Africa is believed to be a “sleeping lion” simply because it has the opportunity for growth, but it is cut short of resources specifically finances. Dubai Bank has opened its branches in various African countries e.g. Kenya. The aim is to provide financial assistance to those who possess business idea. Dubai Bank, market research aimed to identify the loan-uptake within a state before it set-up a branch. Aramex provides transportation and logistical services. Prior its inception there was high demand for such services, but the supply was limited. Currently, Aramex operates in fifty-four different states. Market research had to done before, Aramex ser up a branch in any of countries. Key questions that could have been used revolved around sending and receiving of parcels either within the nation or globally. It would be illogical setting up a business in regions where rate of logistical transactions are low, forcing the branch to close down. Product or service promotion function Product or service either developed or existing needs to be promoted which is conducted by the marketing. Promotion aims to create awareness of the product or service being offered by a given firm. Advertisement using billboards, posters, and media can be used to increase the market share for a firm’s product. However, recently the use of personal selling or use of missionary salesperson has been on the increase due to their efficiency. Missionary salesperson tends to dispense much information to the potential consumer, thus translating them to be loyal consumers (Cateora, 1983). Promotion packages should be able to address specific market segment, because consumer are diverse. Global market pose challenge on which platform can be used to reach out to the global consumers of a given product. Jumeirah hotel and resorts just like any business organization has to promote its products, and services so as to maximize its sales. Jumeirah hotel and resorts in London and Shanghai are autonomous; therefore they are able to identify the best promotion channel that can achieve the set objectives. For instance, during summer, Jumeirah hotel and resorts in London can decide to adjust its product and service packages. The aim for this is to push sales to meet the set target for a given period. To capture the attention of the global market, mass advertisement is the best channel. According to (Mooij, 1998), the use of this means will not pass specific information to the target consumers. He argued that, mass advertisement is aimed to capture the global market while the demand for local market differs from each region. Online promotion has been used by McDonalds and it has transformed prospects consumers into loyal consumers. Etihad Airways has the obligation of ensuring its services are recognized beyond its territorial boundary. Besides, that it should keep in check her key competitors like Emirates. This can be achieved by it engaging n promotional services. Certain services can be developed to create a “push and pull”. Where the service pushes competitors and pulls passengers to book their airline. For instance, percentage discount for a couple will pull a couple to book a flight with Etihad even if Emirates is their flight of choice. Use of Billboards and magazine can create an illusion of high quality services, which will attract prospect customers globally. Worldcup 2022 will be held in Qatar, this is an opportunity for UAE airlines to exploit. With regards to Etihad Airways it has to promote its services across the globe, so that in 2022 it becomes flight of choice. Banks get returns from offering loans and, therefore, the higher the loan uptake the higher the return for the bank. Dubai Bank understands this concept, thus its team has to work tirelessly to come up with products (loan specification) that attract potential borrowers. Loans that are meant to finance businesses should be designed to attract investors. For instance, a flexible repayment is one of the attributes that can actually lure investors. Another concept that demands for promotion, is the basis that Dubai Bank is non-local bank, it has to promote its products as well as its brand in the foreign nation. It has been argued that consumers are influenced with graphics, and thus can influence their decision to purchase a product (Mooij, 1998). However, expenditure on promotion should be controlled to rationalize cash outflows. This is because promotion is costly and does not generate cash by itself. This is brilliant idea however; sales promotion through use of loan salesperson should be emphasized since it generates income as well as promoting the firm’s product Aramex was founded early 1980s but it has grown tremendously and competes with veteran players like DHL and Fedex. Its services has been appreciated across the globe, thus credit has to be awarded to the promotion element of marketing. Globalization has led to the increased demand for logistical services and therefore, Aramex has to find its market share by competing with other players. Creating awareness of the services being offered, sells a firm’s brand to potential client. It should be understood foreign market and domestic market are distinct due to political, economical and socio-cultural element. Therefore, a promotional service should consider these elements Distribution function Creation of a product is one thing and making it available to the consumer is another aspect. According to (Craven, 1979), distribution function ensures the consumer access the products they demand at their convenience, with regard to time and place. Multinational firms always face this challenge (distribution) when trying to meet the growing global demand for their products. To solve this problem, firms enter into an agreement with local distributor or agent who will sell their products on their behalf. Moving products from point of production to the point of consumption must ensure the following aspects taken care when selecting the distribution channel: The quality of the product or service Cost of distributing Geographic distribution of the target consumer Consumer characteristics Jumeirah Group of hotels and resorts has to ensure that it services and products are available to its loyal consumer at their convenience. For instance, Jumeirah Group of hotels in Dubai provides its services at different location e.g. Jumeirah Emirates Tower, Jumeirah Zabal Saray. The aim for this is to satisfy the consumers and create a good consumer-business relationship. This is achieved by offering the same level of service the consumer was offered at any of the hotel group. However, other subsidiary of the group should be set-up in Africa to serve its market segment in Africa. The distribution of Etihad airways is commendable. The distribution is measured in terms of the number of destination it serves across the globe. It can therefore be concluded that it makes an effort in satisfying the demand of its clients at their convenience. The management of Etihad Airways though it was prudent to have the airline serving at least the five continent and from there it can connect passengers to different destination Distribution of banks matters a lot when it comes to brand recognition for ease marketing of products. Dubai Bank has opened its subsidiary branches in most Africa states, which is a good move in the distribution of services or products. However, most of the bank’s branches are located in urban areas, therefore not serving the interest of rural dwellers in Africa. This does not mean he bank has failed; in fact the bank enjoys booming business transactions in the UAE. Aramex presence in fifty-four states signifies its ambition in ensuring it services can be accessed at different locations across the globe. Distribution function of marketing ensures that smooth operations of a firm are realized at different location. The concept of marketing through referral works best with logistical companies. Through referral distribution network can be enhanced to cover areas a firm had not set a subsidiary branch. Aramex goal of ensuring logistical processes in Africa are efficient has built its reputation on distribution network. Product or service management Transferring product to the consumer does not mean that the business has been closed. With this regard, a follow-up on the consumer is encouraged since the consumer will feel that they are being valued. It is role of marketing to ensure the existing and new consumers are maintained or “cultivated” (Chunawalla, 2009). Multinational firms have to adopt strategies that will facilitate its operation as far as product or service management is concerned. It can turn to be ugly if a consumer purchase a product, and it breaks down, and since the firm has no product management locally; the client has to ship it back. Jumeirah Group of hotels and resorts provide different services ranging from food to health activities such as massage. Consumers are at liberty to raise any query concerning the service offered to them. With numerous hotel subsidiaries, address to the public concerning an issue should be fast since this will build confidence with the consumers. It has been said on several occasions that whoever wears shoe knows exactly where it pinches. This is the case the consumer might suggest a change on how a service is being offered. Etihad Airways has agents in each destination it operates. The agents are responsible to handle the booking and passengers’ complaints. Complaints from consumer should not be considered as a bother because it identifies area of weakness that need to be adjusted. Responding to those complaints is a sign of responsive management that aims to manage it services. In addition t that feedback from the passengers regarding the flight or new service offered signify act of valuing clients. Challenges of global marketing Global marketing has it unique hurdles that are out of control of the respective firm. However, these challenges should not be considered as the reason for the downfall of a firm or failing to reach out a given market segment. Some of the challenges include Finding a reliable partner Culture and religion diversity Political and legislation Competition with the local companies Decision regarding distribution channel Partners who can market the products of another firm in a different country are essential for effective global marketing activities. Aramex can enter into an agreement with reliable partners who can assist in the opening new subsidiaries in new markets. In the event, the partner decides to engage into an unorthodox behavior, Aramex’s brand reputation becomes compromised. Therefore, it is brilliant to vet the business partner when doing global marketing. The presence of culture diversity needs to be appreciated even if it poses a challenge global marketing. Culture dictates the way of life for a given community and therefore, a business should factor the people’s culture during its inception. Jumeirah Group of hotels and resorts has opened several hotel subsidiaries in both Christian and Islamic states and its operations run smoothly. According to (Sinkovics, 2009), it can be difficult for an organization to run its operations effectively, that are against the way of life of the local people. He further suggested that when identifying potential market globally, marketers need to assess the culture and religious background of the potential market. Some products being produced cannot be marketed in a given country. For instance a pork firm cannot start its operation in Islamic faith states. Political influence has immense impact to the growth of an economy, which is enhanced by business transactions. For instance, the political instability experienced in African countries during elections frightens firms from setting up manufacturing plants in a given country even if the demand is high. For instance if Jumeirah Group of hotels and resorts had invested in Syria, definitely they would have faced enormous loss due to terrorism activities. Competing with the local companies has been a challenge for multinational firms. For instance, Dubai bank faces stiff competition from other local banks. This becomes a hurdle in exploiting new markets in the aim of marketing a company’s brand globally. Opening up subsidiary branches in different locations means new consumers of a given product have been identified. These consumers are diverse and the distribution channel adopted in the localized (mother) region may not be applicable anymore. Global marketers find it a challenge to change the normal distribution channel maybe because the new region has unreliable resources to support a company’s preferred distribution channel. For instance, Aramex a logistical company might prefer to use railway channel when distributing bulk products. However, in a country where the demand for it services is high and yet the railway network is underdeveloped, will force Aaramex to change its normal distribution channel to use road. This also has to do with a nation’s level of technology uptake to influence distribution and advertising of products. Conclusion The concept of global marketing needs close attention by a firm which expects to get high return by investing beyond its territorial boundaries. Strategic plan before exploring new market is a key element for successful market penetration. The functions played by marketing should be the guideline for the success of a firm that hopes to explore new market. Accomplishment of the functions is an indication of successful market penetration. Challenges that face global marketing demand for contingency plan to be in place to reduce intensity of the impacts. Last, but not least global marketing ought to meet the objectives of the firm by exploring new market. References Baker, J. (1975). Multinational marketing: Dimensions in strategy. Columbus, Ohio: Grid. Cateora, P. (1983). International marketing (5th ed.). Homewood, Ill.: R.D. Irwin. Chunawalla, S. (2009). Product management (Rev. ed.). Mumbai: Himalaya Pub. House. Craven, J. (1979). The distribution of the product. London: Allen & Unwin. Keegan, W., & Green, M. (2005). Global marketing (5th ed.). Upper Saddle River, N.J.: Pearson/Prentice Hall. Mooij, M. (1998). Global marketing and advertising: Understanding cultural paradoxes. Thousand Oaks, Calif.: Sage Publications. Sinkovics, R. (2009). New challenges to international marketing. Bingley: Emerald Jai. Read More