Emerging Issues Related to the Economic, the Political and Cultural Aspects in the World Market | Marketing

1MARKETING
Marketing
Name of the Student
Name of the University
Author Note

2MARKETING
Executive Summary
This report deals with the emerging issues related to the economic, the political and the cultural
aspects in the world market. The three issues are the unemployment rates, the trade war and the
cultural conflict in the companies Tesco(UK), Ford Motors (USA) and Woolworths (Australia)
respectively. The report further deals with the issues and analyses them with theories and
justified data. The conclusion sums up the whole report and recommends ways of dealing with
these issues.

3MARKETING
Table of Contents
Introduction......................................................................................................................................4
Discussion........................................................................................................................................4
Economic issue faced by Tesco (UK)-........................................................................................4
Political issue faced by Ford Motors (USA)-..............................................................................6
Cultural issue(conflict) faced by Woolworths (Australia)-.........................................................8
Conclusion.......................................................................................................................................9
Reference.......................................................................................................................................12

4MARKETING
Introduction
The creation of great business of any type is an extremely difficult task and one can be
quite fraught with the problems and challenges in the organization. The companies dealing in
different industries do face some significant problems and they need to cope up with the
challenges to stay relevant in the industry. The issues can be economic, cultural or political. The
report will choose one issue from each of the economic, the cultural and the political field and
present the companies and countries under research (Pwc.com 2020). One economic issue that is
identified is high unemployment rate in the UK based company Tesco. One political issue is the
US-China trade war and its impact on Ford Motors and the last issue is the communication issue
faced by Woolworths Group Limited of Australia. In the discussion part, the report will produce
2-3 paragraphs per issue that will be justified theoretically regarding the importance of the issue.
It will be related to a specific company along with its activity within the particular country. The
report will also present some factual data which will justify the impact of the issue on the
company’ activities. In the conclusion part, the report will make some conclusive statements
regarding the impact of the selected issues to the selected companies along with proposing the
way these companies can make the best out of the opportunities emerging or they will be quite
less influenced by threats connected to the issue.
Discussion
Economic issue faced by Tesco (UK)- Tesco is found to be the one of the largest food retail
stores across the entire globe. Apart from food, the store has expanded the line of the business to

5MARKETING
the household goods, the toiletries, the electrical items and the clothing too. The company has
become quite successful over the years of its operations and like any other business, it has also
faced some economic issue affecting its profitability.
It is found that in the United Kingdom, there is a considerable number of unemployment
since the past years. The economists have found out some general causes of the unemployment
in UK. The causes are the Recession, the Structural factors, the geographical unemployment, the
frictional unemployment and the youth unemployment. The recession has caused the cyclical and
the demand deficient unemployment. It is with the falling GDP that the firms are actually
producing less. Hence, there is not more demand for the workers. Again, in the recession, there
are some of the firms that are going out of the whole business leading people lose their jobs.
There are the structural factors too because of the nature of economy changing too fast. Taken
for example, the manufacturing jobs have been lost because of the economy being based on the
service sector most (Yasmeen and Viswanathan 2017).. There are some of the unemployment
workers finding difficulty in getting jobs in the high-tech industries. Also the frictional
unemployment is because of the frictional factors as the youth taking time in finding a new
suitable job. The youth unemployment is again found as the highest among the young workers
which is often due to the fact that they lack some skills. However, as per the reports of 2018,
there is an unemployment rate of 4.1 % and there are still 1,281,000 million people who are
unemployed (Pettinger 2020).

6MARKETING
SOURCE- (Statista.com 2020)
All of the economic elements are affecting Tesco in this context because it leaves impact
on the profits made from the price and the product/service costs. The unemployment rate is one
of those factors that affect the profitability of the company. The unemployment has decreased the
demand for the products and the services at the end and its profitability too. The unemployment
is further a major concern for Tesco since it is beyond the control. It leaves impact on the
marketing opportunities and the entire performance in international/ local markets. Although
Tesco is expanding the operations quite globally, the unemployment rates might restrict the
company in reaching higher profit margins (Kotabe and Helsen 2020). The income of the
company has increased through the past few years but the fact is that it is highly dependent on
the market of UK and the rates of unemployment will mean lower levels of profit for Tesco.

7MARKETING
Political issue faced by Ford Motors (USA)- Ford Motors is one such multinational company
that has its operations in many of the countries. This is the reason behind political environment
of those countries being significant for the operations of the company. The current situation of
the political climate across the world signifies that globalization has led many businesses to form
the alliances. The political environment of America, that is the home country for Ford is quite
favourable for the business and the company can easily penetrate any of the growing markets
(Scmp.com 2020).
SOURCE- (Buchholz 2020).
One such political issue that is faced by Ford Motors is the increased international trade
agreements which is a great opportunity for the company. Ford can avail the opportunity of
expanding the operations founded on different trade agreements making it quite easier for the

8MARKETING
companies to penetrate the foreign markets. Hence, with the help of the Trade War, Ford is
looking at the making of cars in China for beating the tariffs. Ford is looking at the speeding up
of the plans for building more number of cars in the plants of China since the Trade war is
growing and the US is making the exports quite less fascinating (Steve Carter 2012). The
company is on the verge of increasing exchange of the tariffs making it quite difficult to plan and
there is no such business case for the exportation of the vehicles from the United States.
Cultural issue(conflict) faced by Woolworths (Australia)- The Woolworths Group Limited is
considered as one of the major Australian companies that operate in the retail sector. It is further
considered as the second largest company that operates in Australia based on the revenues. The
company headquarters are situated in the Bella Vista. The maj0r operations of the company
consist of the hotels the supermarkets, the liquor retailing, the hotels and the pubs in Australia
(Kotabe and Helsen 2020). The company has expanded too with the objectives of improving the
bottom-lines of the company. The growth of the globalisation has increased the need for
effective communication.
The work culture in Australia is different from other countries. It is quite laid –back but
people speak with an open mind. There is the freedom of speech and people get the freedom of
saying what they feel like. The government is the democratic government, there is respect for the
equal worth and the dignity of an individual (Yasmeen. and Viswanathan 2017). There is
equality of the opportunities irrespective of the gender, the religion, the marital status, the
disability, the sexual preference, nationality and others.
The company is facing certain cultural issues such as the adaptation of new culture in
new place other than Australia. The company from various perspectives should understand the
culture of the new country. Without understanding, a culture that is different from the Australian

9MARKETING
culture the company will not be able to recognize the needs and the expectations of the clients. In
its expansion to India, Woolworths should have understood the Indian culture having identified
the culture trends and the expectations of the customers to formulate the marketing strategies for
penetrating into the market of India. The company was quite stuck and restricted within the
culture of Australia since the work environment and the ethics of the home country is different
from the countries where the company is expanding.
Conclusion
On a concluding note it can be said that an organization faces many issues both the
external and the internal in its course of operation which leaves impact on the activities. In this
report, the economic issue has been chosen related to the unemployment rate and its impact on
the Tesco company, United Kingdom. There are other economic issues too such as the inflation
rate, GDP growth, the laws and the government regulations, but the rate of unemployment
appeared to be the most relevant. The economic factor of unemployment rate is not under the
control of Tesco but this issue is affecting the performance of the company and the result is that
the marketing mix can be extremely intense. Hence, Tesco is likely to be affected by the
economic slowdown of UK and the food market of UK. It is founded on the fact of the company’
being exposed to a list of concentration risks. The marketing mix below will show the way
Tesco should operate in the market to stay relevant and address the economic threats:
Product- In order to deal with the economic
issue, Tesco should enter properly in the
online marketing sector and offer some
grocery delivery service beside other product
lines exhibited by the company. It should
Price- Tesco as a company should maintain
the low prices without compromising the
quality of the products or running in the loss. It
should make use of the economies of scale for

10MARKETING
extend the range of choice for the customers
and earn maximum sales.
surpassing all the expectations of the clients.
It should make use of the smaller stores rather
than the ‘extras’ along with the online forums.
Promotions- The low prices of Tesco is what
keeps it apart from the chain of the
supermarkets. The brand image can be
improved through the advertisements. It should
employ more people according to the needs
and contribute in the country’ economy.
The Ford Motors on the other hand can deal with the political issue and make the best of the
opportunities available.
Product- The company should make the best
use of the continuing trade war of China and
United States. It should participate in the new
tariffs on the Chinese goods. The vehicles of
Ford are some parts which are suited for the
firms such as Toyota. The Motorcraft brand of
Ford should include most of the vehicles of
Ford.
Place- For the selling of the products, the
Chinese plants should be targeted and the main
places should be the auto parts stores, the
dealership , the Ford Parts website and the
Ford Motor Credit company. This is the way
the marketing mix of the company should be
designed having utilized different facilities that
are company-owned and the third parties for
generating the sales.
Promotion- The promotion in the Chinese
market should be done through customized
Pricing- The pricing strategy of Ford Motors
in the new country should be involving the

11MARKETING
advertisements, the personal selling, the direct
selling, the sales promotion and the public
relations too with the help of the executives
who are over there.
strategies that are used for determining the
appropriate prices for produces founded on the
business conditions and the market.. Two of
the pricing strategies that should be applied by
the company, the premium pricing strategy,
and the market-oriented pricing strategy.
The Woolworths Group Limited should be focusing on the training of the employees in terms of
understanding the cultural aspects of other countries. The trainings should be given on the way
employees of Australia will be able to know and adopt having understood the behavioural and
the work ethics of this country. The Woolworths Group will be able to the deal with the cultural
conflicts that are created due to rapid globalisation and inter-cultural changes. In this manner ,
the three companies from three different countries will be able to make use of the opportunities
and address the threats that are emerging.

12MARKETING
Reference
Buchholz, K. (2020). Infographic: U.S.-Chinese Trade War Keeps on Escalating. [online]
Statista Infographics. Available at: https://www.statista.com/chart/15199/us-chinese-trade-war-
escalates/ [Accessed 18 Jan. 2020].
Kotabe, M. and Helsen, K., 2020. Global marketing management. Wiley.
Pettinger, T. (2020). UK Unemployment Stats and Graphs - Economics Help. [online]
Economicshelp.org. Available at:
https://www.economicshelp.org/blog/5695/alevel/unemployment-stats-and-graphs/ [Accessed 18
Jan. 2020].
Pwc.com (2020). [online] Pwc.com. Available at: https://www.pwc.com/gx/en/issues/the-
economy/assets/world-in-2050-february-2015.pdf [Accessed 18 Jan. 2020].
Scmp.com (2020). Trade war: Ford looks at making more cars in China to beat tariffs. [online]
South China Morning Post. Available at: https://www.scmp.com/news/article/2165628/trade-
war-ford-looks-making-more-cars-china-beat-tariffs [Accessed 18 Jan. 2020].
Statista.com (2020). UK: unemployment rate 2000-2018 | Statista. [online] Statista. Available at:
https://www.statista.com/statistics/279898/unemployment-rate-in-the-united-kingdom-uk/
[Accessed 18 Jan. 2020].

13MARKETING
Steve Carter, K. (2012). [online] Available at:
https://www.researchgate.net/publication/280179031_Global_Marketing_Management
[Accessed 18 Jan. 2020].
Yasmeen, K. and Viswanathan, K., 2017. Influence of Country Factors on Entry Mode Through
Knowledge and Transactional Cost Economics: Market Entry: Evidence from Construction
Firms. International Journal of Economics and Financial Issues, 7(3), pp.581-585.