Difference between product adaptations and standardization! Export Management Product adaptations also called differentiation or localization or customization come in several forms. Marketing strategies in a country- by-country basis are tailored with the peculiarities of the local market.
According to De Wit and Meyerthe question facing managers is whether they should anticipate and encourage global convergence by emphasising global standardisation, centralisation and coordination or should managers acknowledge and exploit international diversity by emphasising local adaptation, decentralisation and autonomy.
Technology is driving converging commonality according to Levitt.
Firms benefit more from commonality i. I would suggest that globalisation has been good for the world consumer in both rich and poor countries.
This has largely been achieved through standardisation. In particular, corporations have benefited from this standardised approach through economies of scale in production, distribution, marketing and distribution. As a consequence, the consumer has greatly benefitted in the rich and poor countries as goods have reduced in cost.
It may be argued that this is purely for the consumption of goods but not necessarily for the communities that may have once manufactured these goods in either rich or poor countries. It can have devastating consequences once the manufacturer moves out of the local community.
Not at all if that community can become a world-class source of concepts, competence or connections. Standardisation is possible to apply to product offerings, value adding activities and resources employed. Consumers all over the world know what to expect.
Companies standardise not just for organisational convenience but it is a means of achieving cross-border synergies. Companies benefit from this strategy by leveraging resources, integrating activities and aligning product offerings across two or more countries.
Applying this standardised US centric approach enables Apple to achieve huge economies of scale and avoid the costly task of employing localisation companies such as Lionbridge Technologies, Sajan, welolocalize etc.
The reason companies adopt this approach rather than localising for every locale is because the return in investment would be utterly negligible, enables Apple to have a cost advantage and ultimately keep the cost of the product down for the consumer. Other corporations such as Proctor and Gamble take a multidomestic strategic approach which is in essence treating the world as a portfolio of national opportunities.
Getting cross border synergies on a large scale can be a way a firm gains competitive advantage over its rivals. This can be seen in the below figure as argued by De Wit and Meyer.
Cross Border Synergies Know your Market However, for the success of a firm operating in a global environment, they must remain aware of the specific demands of the local market and equally important be in a position to respond to these configurations in a timely manner.
A company must know the differences in market structure, differences in customer needs, differences in buying behaviour, differences in alternative products, government regulations etc. If a firm is not responsive to the nuances of the local market then there is a risk of failure despite taking a standardised approach.
Everything is becoming more similar or homogenised. This is where technology is coming to an increasing importance. Levitt argues that Standardisation decimates competitors that live in the old way of doing things.
Multinationals and Global Corporations operate differently. The Multinational Corporation operates in many different countries but adopts its products and practices to each locale.
Whereas a Global Corporation operates in a standardised approach which enables it to have lower operating costs and in essence treats the world as one overall market as oppose to multi-regional markets. Coca Cola it could be argued is the epitome of success. Its products is standardised in each market.
By adapting a multicultural approach with cultures throughout the world joining together o sing the hit song it showed how a standardised product such as a cola could be enjoyed on a global scale. This enabled Coca Cola to focus on efficiency in production, cheap location to manufacture the syrup, distribution, marketing and management which brought about a reduction in cost for both the manufacturer and consumer.
A so called win-win for everyone. Cultural impact of Globalisation Coca Cola sought to treat the world as one market. By making the product desirable on a global scale i.
Coke ensured this was possible by keeping the price low and thus ensuring local competition was eliminated or significantly reduced.Published: Mon, 5 Dec In this report, we have addressed three main themes of international/global marketing vis-à-vis standardization versus localization, cultural patterns and its influence on consumption and finally the research procedure to take when entering new international markets.
The essay is completed by drawing conclusions on standardisation vs. adaptation debate and its relevance to the modern marketplace. Standardisation as a cost saving strategy Standardisation involves using “the same range of products, the same pricing, promotional and location strategies” (Gupta and Randhawa, , p).
The Standardisation vs. Adaptation Debate Essay examples; The Standardisation vs. Adaptation Debate Essay examples. Standardisation versus Adaptation in a Globalisation context Challenge This is the challenge facing primarily multinational firms whether to standardise their local offering or adapt/localise it for the market they are selling.
Standardisation versus Adaptation in a Globalisation context US centric approach enables Apple to achieve huge economies of scale and avoid the costly task of employing localisation companies such as Lionbridge Technologies, Sajan, welolocalize etc.
to adapt the market for the locale it is intended for. Essay about Standardisation. Examples of localization include the translation of the cooking instructions or the ingredients of a food product or the dubbing or subtitling a foreign-language movie or series.
Localization can also result in changes to the contents of a product, to comply with the different regulations of a foreign country, such as the removal of gory scenes from a localized version of a video game. Standardization vs. Localization: A Disney Case Study Multi-national organizations are becoming more prevalent in the global economy.
The expansion into new countries requires companies to examine policies and products more closely.