Tranisition Into a Global Organization
What marketing considerations do you need to understand as you evolve from a domestic supplier or international distributor to a fully integrated global company? Is it an easy transition or does it demand restructuring of your market functions? There are many factors an organization must consider before and during the transition into a fully integrated global company. Although the transition may not be easy, evaluation of and planning for these considerations will enable an organization to evolve into a strong global organization.
During this process of transition from a domestic company to a true global organization, some restructuring of the market functions will have to occur. The traditional marketing model from the seller’s point of view, or the Four “Ps” of marketing, is based on Product, Price, Place, and Promotion. This model is based on the assumption that the marketplace is driven by manufacturers. According to Schultz and Kitchen (2000), manufactured-driven marketplace has “evolved” into a distribution-driven market place where major retailers or distributors like Wal-Mart control the marketplace.
Schultz and Kitchen (2000) go on to state that the marketplace is continuing to evolve into a newly emerging interactive marketplace brought about by the development of the internet and new e-commerce business applications.
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In this new interactive marketplace, the consumer interests rule and as a result, manufacturers, according to Schultz and Kitchen (2000) must adjust to consumer needs. This new trend has led to a new marketing model from the consumer’s point of view. This model, called the Four “Cs” is consumer oriented as opposed to the traditional seller oriented Four “Ps” model.
The Four “Cs” model of marketing are Customers, Company, Competitors, and Circumstances. The global marketplace, according to Schultz and Kitchen (2000) is a combination of the other three marketplace functions. If this is the case, an organization that wishes to evolve into a fully integrated global company must evaluate the global market based on the Four “Ps” and the Four “Cs” and develop a business plan accordingly to the specific marketplace of implementation. What works locally for a domestic organization may not work lobally.
Consider the example of the Starbucks Company failure in Australia. According to Patterson, Scott and Uncles (2010), a contributing factor to the failure of Starbucks in the Australian marketplace was that Starbucks tried to bring “what worked in the US and applying it here (Australia), without really understanding the local market. ” Starbucks had an unsustainable business model because the company failed to do the research that would have enabled the company to effectively market its product to the Australian consumer.
Patterson, P. , Scott, J. , & Uncles, M.. (2010). How the local competition defeated a global brand: The case of Starbucks. Australasian Marketing Journal, 18, 41-47. Retrieved from http://proquest. umi. com. ezproxy1. apus. edu/pqdweb? did=2097829591&sid=4&Fmt=3&clientId=62546&RQT=309&VName=PQD Schultz, D. & Kitchen, P.. (2000). Communicating Globally: An integrated marketing approach. Lincolnwood, IL: McGraw-Hill, Inc. Retrieved from http://site. ebrary. com/lib/apus/docDetail. action? docID=10153056