List and describe the restraining forces for globalization provide examples in your answer

  Product development is developing new products and placing them in existing markets. Starbucks created a brand of instant coffee, Via, to enable its customers to enjoy coffee at the office and other locations where brewed coffee is not available. After a successful launch in the US, Starbucks rolled out Via in Great Britain, Japan, South Korea and several other Asian countries.

  Diversification is developing new products for new markets. Starbucks has launched several new ventures, CD’s and movie production. Next: Revamping stores so they can serve as wine bars and attract new customers in the evening.

  Marketers may be able to reduce non-monetary costs by decreasing the time and effort customers expend to learn about or seek out the product.

  A market is defined as people and organizations that are both able and willing to buy. A successful product or brand must be of acceptable quality and consistent with buyer behavior, expectations, and preferences. If a company is able to offer a combination of superior product, distribution or promotion benefits, and lower price than competitors, it should enjoy a competitive advantage. Japanese auto makers made significant gains in the American market in the 1980s by creating a superior value proposition. They offered cars with higher quality and lower prices than those made by American car companies.

The photo shows:
BARCELONA - SEPTEMBER 4: Alexis Sanchez of Chile warms-up before the friendly match between Mexico and Chile, final score 1 - 0, on September 4, 2011, in Cornella stadium, Barcelona, Spain

Concentration of marketing activities is the extent to which marketing mix activities are performed in one or a few country locations.

  Coordination of marketing activities refers to the extent to which marketing mix activities are planned and executed interdependently around the globe.

  Integration of competitive moves is the extent to which a firm’s competitive marketing tactics are interdependent in different parts of the world.

  Manufacturing firms may view foreign markets as dumping grounds with little or no marketing research conducted, manufacturing modifications made or attention paid to customer needs and wants.

  In Nissan’s early days of exporting to the U.S., the company shipped cars for the mild Japanese winters. Executives assumed that when the weather turned cold, Americans would put a blanket over their cars just like Japanese would. Nissan’s spokesperson said, “We tried for a long time to design cars in Japan and shove them down the American consumer’s throat. That didn’t work very well.”

  Michael Mondavi, former CEO of the wine company said, “Robert Mondavi was a local winery that thought locally, grew locally, produced locally, and sold globally…To be a truly global company, I believe it’s imperative to grow and produce great wines in the world in the best wine-growing regions, regardless of the country or the borders.”

  James Bailey, Citicorp executive said, “We were like a medieval state. There was the king and his court and they were in charge, right? No. It was the land barons who were in charge. The king and his court might declare this or that, but the land barons went and did their thing.”

  Jack Welch at GE also sought to instill a geocentric approach.

  Market needs and wants and IT: There are cultural universals as well as differences. Common elements in human nature provide the opportunity to create and serve global markets, i.e. soft drinks. Companies must recognize that product adaptation is not always necessary and that competitors may be serving global customers. The information revolution which Thomas Friedman calls the democratization of information is one reason for the trend to convergence. CNN and MTV allow people in remote areas to compare their lifestyles to others. Advertising overlapping national boundaries like in Asia or Europe and the mobility of consumers in these markets has allowed for pan-regional positioning. The Internet is perhaps the strongest force that allows people everywhere to buy and sell.

  Transportation and communication: Jets allow around the world travel in less than 48 hours. 1970: 75 million international passengers. 2003: 540 million. Airlines sell each other’s seats thanks to modern technology. International phone calls are inexpensive and there are many other ways to communicate like fax, e-mail, video conferencing, wi-fi and broadband internet. Transportation costs have fallen. Due to specially designed ships, the cost of shipping autos from Japan to the U.S. is less than the cost to ship from Detroit to either U.S. coast. Intermodal transportation uses 20 to 40 foot containers that may be transferred from trucks to railroad cars to ships.

  Product Development Costs: New pharmaceutical cost in 1976 = $76 million; today = $400 million and up to 14 years to get a drug approved. Pharmaceutical companies go global to spread the costs. However, only seven countries account for 75% of sales.

  World Economic Trends: Economic growth in key developing countries = major market opportunities. Slowing growth in developed countries has compelled managers to look abroad. Rapid economic growth, in a country such as China, has caused policymakers to open markets to outsiders. Competition can strengthen domestic companies. Domestic companies seek more governmental protection if markets are not growing. Worldwide movement to free markets, deregulation, and privatization is another driving force. As independent private managers take over running businesses (steel, railroads, telephones, airlines, utilities, restaurants, nightclubs) from governments, they are are likely to seek the best deals, regardless of the nationality of the supplier.

  Leverage: A company enjoys some type of advantage by virtue of the fact that it has experience in more than one country. Experience transfers mean that a company can leverage its experience in any part of the world. It can use management practices, strategies, products, advertising appeals, or sales or promotional ideas that have been test-marketed in one country or region and apply them in comparable markets. Since Chevron has drilled for oil under all conditions and recorded them, managers with a problem know how it has been handled in the past. Scale economies can be gained in manufacturing and by centralizing functional activities. Resource utilization means that global companies can scan the entire world to identify people, money and raw material that will enable it to compete most effectively in world markets. Rising and falling “home country” currency is not an issue as the world is full of currencies and a global company seeks financial resources on the best available terms. It uses them where there is the best opportunity to serve a need at a profit. Global strategy is a design to create a winning offering on a global scale. A global strategy is built on an information system that scans the world business environment to identify opportunities, trends, threats, and resources. When opportunities are identified, the global company leverages its skills and focuses its resources to create superior value for customers and achieve competitive advantage.

  National controls: Every country tries to protect its home industries and services through tariff and non-tariff controls. Thanks to organizations like GATT, WTO, NAFTA, EU, and other economic agreements, tariffs have been largely removed in high-income countries. Non-tariff barriers to trade include “Buy Local” campaigns, food safety rules and other bureaucratic obstacles.

  Opposition to Globalization: Globophobia is the term used to describe an attitude of hostility toward trade agreements, global brands, or company policies that appear to result in hardship for some individuals or countries while benefiting others. Opponents to globalization include college or university students, NGOs and labor unions. Some Americans believe that globalization has sent American jobs—both blue-and white-collar—overseas and also depressed wages at home. In developing countries, many believe that free trade agreements benefit the world’s most advanced countries. An unemployed miner in Bolivia said, “Globalization is just another name for submission and domination. We’ve had to live with that here for 500 years and now we want to be our own masters.”